(Sacramento) – Assemblymember Pedro Nava (D-Santa Barbara) announced today the introduction of The Oil Industry Fair Share Act, AB 6x1. 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 approximately $1.5 billion in additional revenue to the General Fund. 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. 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 potential revenue source by forcing Big Oil to pay its fair share,” said Nava. “California has been giving away public assets to Big Oil for far too long.”
Nava was joined earlier in the day by school employees, seniors, healthcare provders, organized labor, and environmentalists at a Capitol news conference announcing the introduction of the bill. California is experiencing unprecedented budget shortfalls. Schools, universities, health programs, public safety, state parks, and various other aspects of the government have faced severe cuts. While unemployment has skyrocketed, oil companies in California are anticipating increased profits from rising oil prices.
These budget cuts have affected the most vulnerable citizens.
- “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.”