Why LOFT is LOST: The Case for Reforming Oklahoma’s Fiscal Watchdog

Unveiling the Conflict: Reforming LOFT to Restore Oklahoma’s Fiscal Trust

By Marven Goodman, July 2, 2025, The Sooner Sentinel

In Oklahoma’s state government, where fiscal responsibility and transparency should reign supreme, a troubling conflict of interest festers within the Legislative Office of Fiscal Transparency (LOFT). Established in 2019 to serve as an independent watchdog over the state’s budgetary processes, LOFT was intended to provide Oklahomans with unfiltered, non-partisan insights into how their tax dollars are spent. Yet, its very structure, specifically, its leadership under the co-chairmanship of the House and Senate Appropriations Committee chairs, creates a glaring contradiction that undermines its mission. As the 2026 legislative session looms, it’s time for Oklahoma’s lawmakers to confront this issue head-on and restore true independence to LOFT, or, failing that, dismantle it entirely to prevent further erosion of public trust.

A Compromised Watchdog

At the core of LOFT’s dysfunction lies its leadership. The office is co-chaired by Representative Trey Caldwell (R-Lawton) and Senator Chuck Hall (R-Perry), who also serve as chairs of the House and Senate Appropriations Committees, respectively. These roles make them the chief architects of Oklahoma’s state budget, wielding immense influence over fiscal policy decisions. Their dual positions create a conflict of interest, as LOFT’s reluctance to advocate for significant reductions in state income or sales taxes, fearing the loss of "golden revenue" funneled into the general fund for special projects and discretionary spending, undermines its mandate to provide objective scrutiny. For example, the Legislature’s 2025 passage of HB 2764, cutting the income tax rate to 4.5% with a high-bar trigger for future 0.25% reductions, is a tepid step that falls far short of the transformative relief working Oklahomans and retirees deserve. This structural flaw stifles meaningful tax relief, a cornerstone of fiscal conservatism, and hampers LOFT’s ability to ensure long-term fiscal responsibility for Oklahoma taxpayers.

However, placing the very legislators who craft the budget in charge of an agency tasked with critiquing it creates an inherent conflict of interest. LOFT’s 2022 Report 22-000-02, which highlighted the risks of revenue volatility from tax cuts and centralized taxation, serves as a case study. The report’s warnings were critical but measured, raising questions about whether political pressures softened its tone. Caldwell and Hall, as key figures in shaping Oklahoma’s fiscal landscape, face an impossible balancing act: oversee objective analyses that might criticize their own budgetary priorities or risk political backlash from colleagues eager to advance their agendas. This structural flaw ties LOFT’s oversight to the legislature’s political hierarchy, rendering it less a watchdog and more a lapdog beholden to the very powers it was meant to scrutinize.

This arrangement mirrors broader systemic issues in unchecked state power. When those entrusted with safeguarding taxpayer dollars are also the ones spending them, the result is a system ripe for self-preservation over accountability. Oklahomans deserve better. A government that prides itself on fiscal conservatism must ensure its oversight mechanisms are free from the taint of political influence. The Sooner Sentinel has long advocated for limited government and responsible stewardship of public funds, and LOFT’s compromised independence stands as a direct affront to those principles.

The Stakes for Oklahoma

The consequences of LOFT’s conflicted structure are not abstract. In a state where fiscal decisions, like the grocery tax cut, can ripple through communities, affecting everything from local services to economic stability, objective oversight is non-negotiable. LOFT’s 2022 report underscored the volatility of tax cut-driven budgets, a concern that resonates with fiscally conservative Oklahomans who value predictability and prudence in public finance. Yet, when the office tasked with delivering such analyses is led by legislators with a vested interest in defending those budgets, the public’s trust in government accountability erodes.

Consider the broader context: Oklahoma’s budget for FY 2025 stands at approximately $13.2 billion, with significant allocations for education, infrastructure, and public safety. These are taxpayer dollars, hard-earned by Oklahomans who expect their government to spend wisely and transparently. LOFT’s role is to ensure that spending aligns with the state’s long-term interests, not short-term political wins. When its leadership is entangled in the legislative machine, however, the office risks producing reports that are either overly cautious or skewed to favor the status quo. This is not transparency, it’s theater.

Legislative Solutions
Restoring Independence or Starting Anew

The conflict of interest plaguing LOFT demands urgent reform. The 2026 legislative session presents a critical opportunity for Oklahoma’s lawmakers to address this issue and reaffirm their commitment to fiscal responsibility. Below, we propose several legislative solutions to restore LOFT’s independence, or, if necessary, replace it with a more effective mechanism.

Remove Legislative Leadership from LOFT’s Oversight

The most straightforward solution is to sever the tie between LOFT’s leadership and the Appropriations Committees. Instead of being co-chaired by the House and Senate Appropriations chairs, LOFT should be overseen by a non-partisan board of independent fiscal experts, appointed through a process insulated from legislative influence. These appointees could include economists, auditors, and policy analysts with no direct ties to the Oklahoma Legislature. To ensure accountability, the board’s appointments could require confirmation by a supermajority of a joint legislative committee, reducing the risk of partisan capture.

This approach aligns with the principles of small government by minimizing political interference and maximizing objective oversight. By removing legislators like Caldwell and Hall from LOFT’s leadership, the office can deliver unfiltered analyses without fear of reprisal. Such a structure would also enhance public trust, signaling to Oklahomans that their government prioritizes transparency over self-preservation.

Empower the State Auditor or OSBI with Oversight Authority

Another promising solution is to transfer LOFT’s oversight functions to an existing independent entity, such as the Oklahoma State Bureau of Investigation (OSBI) or the State Auditor’s Office. Both agencies have established track records of independence and expertise, making them well-suited to take on LOFT’s mission.

• State Auditor’s Office: The State Auditor and Inspector, currently Cindy Byrd, already conducts financial audits and performance reviews of state agencies. Expanding the Auditor’s mandate to include LOFT’s fiscal transparency role would streamline oversight and leverage existing expertise. A dedicated division within the Auditor’s Office could produce reports like LOFT’s, with findings and recommendations presented directly to joint sessions of the Oklahoma Legislature. This would ensure that lawmakers receive unvarnished insights without the filter of political leadership.

• Oklahoma State Bureau of Investigation (OSBI): Alternatively, a special fiscal transparency unit within the OSBI could be tasked with investigating budgetary practices and issuing reports. The OSBI’s independence from legislative control and its experience in conducting impartial investigations make it a viable candidate. Like the Auditor’s Office, this unit could present its findings to joint legislative sessions, ensuring broad visibility and accountability.

Both options would require legislative action to redefine LOFT’s role or dissolve it entirely, redirecting its budget and resources to the chosen agency. While this may seem like an expansion of government, it’s a pragmatic step toward consolidating oversight under entities already designed to operate independently, reducing redundancy and enhancing efficiency, core tenets of fiscal conservatism.

Establish a Citizen Oversight Commission

A more innovative approach would be to create a Citizen Oversight Commission to replace or supplement LOFT. This commission, composed of Oklahoma taxpayers from diverse backgrounds, would be tasked with reviewing LOFT’s reports and providing recommendations to the legislature. Members could be selected through a randomized, transparent process, similar to jury selection, to ensure impartiality. The commission would operate independently of legislative leadership, with its findings presented directly to joint sessions of the House and Senate.

This solution appeals to the small-government ethos by empowering citizens rather than career politicians to hold the government accountable. It also fosters greater public engagement, giving Oklahomans a direct stake in ensuring their tax dollars are spent wisely. To prevent bureaucratic bloat, the commission’s scope would be narrowly defined, focusing solely on fiscal transparency and leveraging existing LOFT staff for analytical support.

Sunset LOFT and Reassess Its Necessity

If reforming LOFT proves too complex or politically contentious, the legislature should consider sunsetting the office entirely. Created in 2019, LOFT is still a relatively new entity, and its compromised structure raises questions about its long-term viability. Dissolving LOFT and reallocating its $1.2 million annual budget to existing oversight bodies, like the State Auditor’s Office, could achieve the same goals without the baggage of conflicted leadership.

This approach aligns with the fiscally conservative principle of eliminating redundant or ineffective programs. If LOFT cannot be reformed to deliver truly independent oversight, its continued existence risks wasting taxpayer dollars on a flawed institution. A sunset provision, effective at the end of FY 2026, would give lawmakers time to evaluate alternatives while signaling a commitment to accountability.

A Call to Action for 2026

The conflict of interest at the heart of LOFT’s structure is more than a bureaucratic quirk, it’s a betrayal of the trust Oklahomans place in their government to manage public funds responsibly. As fiscal conservatives, we believe in a government that operates efficiently, transparently, and with minimal interference in the lives of its citizens. LOFT, as it currently exists, falls short of that standard.

The 2026 legislative session offers a chance to right this wrong. Lawmakers must act decisively to reform LOFT’s leadership, transfer its functions to an independent entity like the State Auditor or OSBI, or explore bold alternatives like a Citizen Oversight Commission. If these reforms prove unfeasible, sunsetting LOFT entirely is a better option than allowing a compromised institution to limp along.

Oklahoma’s taxpayers deserve a fiscal watchdog that barks without fear or favor. By addressing LOFT’s conflict of interest, the legislature can restore public trust, strengthen fiscal responsibility, and reaffirm the principles of limited government that define the Sooner State. The time for action is now, before LOFT’s promise of transparency is lost for good.

Sooner Sentinel is committed to advocating for small government, fiscal responsibility, and transparency in Oklahoma. Join us in calling for reform in 2026.