Opinion ID: 1179409
Heading Depth: 1
Heading Rank: 6

Heading: whether the tax is fairly related to the services provided by the state.

Text: The fourth prong of the Complete Auto test is whether the activity is related to services provided by the state. The pipeline companies contend that the tax is not a severance tax, but rather a tax on the privilege of purchasing or taking gas in Oklahoma. Like the parties in Commonwealth Edison, the pipeline companies have miscomprehended the essence of the fourth prong of the test. The tax need not reimburse the state for the cost of specific services dispensed to the natural gas industry. The Legislature stated that its intention was to use the tax to provide funds for energy preservation or energy research programs, for unfunded debts of public retirement systems, and for the general government of the state. [15] The pipeline companies would severely limit this test by focusing solely on those services which Oklahoma provides to natural gas activity located within the state. However, the tax which may be imposed on a particular interstate transaction need not be confined to the cost of the services incurred by the state on account of that activity. On the contrary, both Commonwealth Edison and Goldberg acknowledge that interstate commerce may be required to contribute to the cost of providing all governmental services, including those services from which it arguably receives no direct benefit. [16] The fourth prong of the Complete Auto test thus focuses on the wide range of benefits provided to the taxpayer, not just the precise activity connected to the interstate activity at issue. A taxpayer's receipt of police and fire protection, the use of public roads, and the other advantages of civilized society satisfy the requirement that the tax be fairly related to benefits provided by the State to the taxpayer. [17] We hold that the conservation tax does not violate the Commerce Clause, Due Process Clause, or the Equal Protection Clause. It is fairly apportioned, it does not discriminate against interstate commerce, and it is fairly related to services which the state provides to the taxpayer.