Tuesday, November 3, 2009
Offshore Drilling Risks to Economy and Proposed Oil Severance Tax in California
Last week, Environment America published an expertly written report using dollar signs to elucidate the risks to our coastal economies from any increase in offshore drilling. According to "Oceans Under the Gun," a new report written by Environment America, our clean beaches and oceans support a vibrant coastal tourism and fishing economy that generates $55 billion per year in California. "Our oceans are truly 'under the gun,' threatened by Big Oil and their allies in Congress who want to expand offshore drilling," said Gina Goodhill, Ocean Advocate with Environment California.
"Offshore drilling severely threatens our national treasures: the beautiful oceans, waves and beaches that provide irreplaceable recreational, economic and ecological resources," states Surfrider Foundation's Legal Manager, Angela Howe. "Now more than ever, we need our California State Legislature and the U.S. Congress to stand strong against any new offshore drilling and incentivize a shift to a more environmentally sustainable energy plan."
The California Legislature has an opportunity to do just that by enacting the Oil Industry Fair Share Act AB 6X (Nava) to charge an oil severance tax on oil companies to pay their fair share. California is the third largest oil producing state in the nation and the only major oil producing state that does not charge this oil severance tax.
This bill would establish a 10% severance tax on the gross value of every barrel of oil produced in the state and prohibit oil companies from passing on the tax to the consumers in the form of higher gas prices. The deposits revenues from the oil severance tax would go into the state's General Fund.
Labels: coastal economy, offshore drilling, oil, severance tax
