SACRAMENTO /California Newswire/ — On the eve of Governor Arnold Schwarzenegger’s State of the State Address, and the release of his 2010-11 Budget Proposal, Assemblymember Pedro Nava (D-Santa Barbara) introduced today The Oil Industry Fair Share Act. The legislation will establish an oil severance tax of 10% on the gross value of each barrel of crude oil pumped by companies in California. This tax will provide more than $1.5 billion in revenue to the General Fund annually. These desperately needed dollars could be used for public safety, education, health programs for children, human services, and other vital programs.
“California oil companies are getting a free ride. Right now, California is the only major oil producing state that does not charge a severance tax on oil extraction. It is time for California to catch up with Alaska, Texas, Alabama, and Arkansas. We need to collect the people’s share of this revenue source by forcing Big Oil to pay its fair share,” said Nava.
The Governor is advocating for a proposal to allow a single oil company to bypass existing environmental review processes and begin the first new drilling in Santa Barbara in California Coastal Sanctuary waters in more than 40 years, since the 1969 Santa Barbara oil spill. This will raise less than $100 million annually.
Said Nava,”The Governor is placing at risk coastal recreation and tourism industries by advocating for new offshore oil drilling in the Coastal Sanctuary. This is just plain wrong and wrong headed. New drilling is not the answer and is not worth the risk. My proposal will generate more than 15 times the Governor’s proposal annually without any new drilling or jeopardizing California’s coastal environment and economy.”
Nava’s Oil Industry Fair Share Act has received broad support from many different organizations throughout the state:
“With $18 billion in cuts to education, this could be an important source of revenue to save important services for our students,” said Jai Sookprasert, the tax policy analyst for the California School Employees Association.
“Seniors have borne the brunt of these draconian budget cuts; we have seen a reduction in adult day health care programs that allow seniors to stay in their homes, the elimination of Alzheimer’s research, and aid to low-income seniors has been slashed,” said Gary Passmore of the Congress of California Seniors. “The Fair Share Act will bring much needed revenues to support these essential programs.”
“Recent budget cuts are harming nurses’ ability to provide for the critical health needs of people in our state,” said Elizabeth Pataki, RN, of the California Nurses Association. “An oil severance tax could provide much needed revenue to help pay for Californians’ healthcare needs.”
“The last round of budget cuts has affected every Californian,” said Willie Pelote of the American Federation of State, County, and Municipal Employees. “We are dismantling programs and need to ensure that sufficient revenue is available to mitigate the State’s fiscal crisis.”
“Oil companies have been making enormous profits while depleting finite natural resources and polluting the environment,” said Gina Goodhill of Environment California. “It is time they pay their fair share.”