Bulletin: Oklahoma's State, Local Credit Ratings Unlikely To Be Affected In The Near Term By The SCOTUS Decision On Reservations

NEW YORK (S&P Global Ratings) July 13, 2020--S&P Global Ratings believes the U.S. Supreme Court's recent decision ("McGirt v. Oklahoma") upholding a large swath of land (approximately 19 million acres that is home to roughly 48% of the state's population) in eastern Oklahoma (AA/Negative) as tribal reservation land for purposes of federal criminal law does not have immediate credit implications for our rating on the state. We expect the effects of this decision to unfold relatively slowly, potentially over multiple years, but we will continue to monitor for any significant changes in the state's government framework and financial performance, particularly if the state's fundamental sovereignty over the management of its resources is weakened, which contributes to credit deterioration. The ruling

...While a broad-reaching interpretation of the U.S. Supreme Court's ruling could intersect with pre-existing laws, procedures, and regulations within Oklahoma, we have generally viewed the changes relating to the shared state-tribal jurisdiction of reservation land as incremental and believe they have not weakened the state's economic activities or fiscal capacity. Within its government framework, Oklahoma law establishes the authority and a structure for the state and local governments to enter into agreements with the five tribal nations (Cherokee, Chickasaw, Choctaw, Muscogee [Creek], and Seminole) under its Interlocal Cooperation Act and the State-Tribal Relations Act. Under these acts, we believe that the state and local governments possess relatively strong legal flexibility to resolve jurisdictional issues with the tribes, and to make necessary and timely changes in a practical sense. Based on a review of the state's financial statements and continuing disclosures, there is currently...

Bulletin