Environmental activist Tom Steyer announced Friday a proposal to place an oil-extraction tax on the 2016 California ballot — a measure with the potential to pump up funding for the University of California and other public higher education institutions in the state.
Steyer, the founder of NextGen Climate, an organization focused on climate change, made the announcement at the California Democratic Party convention in Anaheim, California. If passed, his proposed measure could bring in up to $2 billion, although the precise allocation of the tax revenue is not yet set in stone.
“It’s got to be several hundred millions of dollars for the UC system,” said Lenny Goldberg, executive director of the California Tax Reform Association. “It’s very popular and very effective that (the funds) would go to higher ed.”
In a 2014 poll by NextGen Climate, two-thirds of California respondents supported an oil-extraction tax, which Jack Tibbetts, a UC Berkeley alumnus and proponent of Steyer’s proposed measure, said would likely fund public higher education or lower tuition. He said NextGen Climate, however, is still exploring other sources to allocate the funding to, such as environmental and infrastructure projects in the state.
Steyer’s announcement comes after several failed efforts to pass a similar tax, most recently in 2014. Senate Bill 1017, introduced by then-state senator Noreen Evans, D-Santa Rosa, would have imposed an extraction tax on oil and natural gas in the state. Half of the tax revenue would have been disbursed to the UC, California State University and state community college systems in equal shares. SB 1017, however, was suspended in the Senate Appropriations Committee and has not since been revisited.
In the past, organizations such as the Western States Petroleum Association have advocated against an oil-extraction tax on the grounds that it would raise gas prices in California. Evans, however, said the price of oil is set by the global market and that the tax, therefore, would not affect the price of gas in California.
Sabrina Lockhart — a spokesperson for Californians for Energy Independence, a coalition that opposes state oil taxes — said Steyer’s proposal “will increase energy costs for consumers, and that will result in higher costs for not only what they pay at the pump but also for goods and services.”
Out of 22 major oil-producing states, only California has not implemented an oil-extraction tax. Since the 1978 passage of Proposition 13, which requires a two-thirds vote in each house of the state Legislature in order to impose new taxes, oil companies have been able to persuade Republicans not to vote for the tax, Goldberg said.
According to Suzanne Henkels, spokesperson for NextGen Climate, Steyer will be working with citizens to build a coalition to work out exact details of the measure.