Anti-oil scaremongering fails
The battle for energy independence produced a big victory in the small city of La Habra Heights and serves as an example for what many local governments across the state may soon face.
In a record high turnout for the city, a resounding 57 percent of voters struck down a far-reaching ban on oil production.
Activists have been using hydraulic fracturing as a stalking horse, but their end goal is to stop all oil production in the state. Instead of celebrating the fact that California has the nation’s toughest standards for hydraulic fracturing, they’re attempting to pass bans at the local level to set the stage for a statewide ban.
These activists have had moderate success – passing bans in communities such as Santa Cruz and Mendocino counties. Since there is no oil production in those areas, these hydraulic fracturing bans are symbolic, and just as effective as if Kern County were to outlaw surfing.
However, voters in communities – most recently in La Habra Heights and last fall in Santa Barbara County – where oil production has occurred for decades, are striking down these misguided energy bans.
There are compelling arguments against these deceptive ballot measures, and voters are looking beyond the rhetoric and weighing the facts.
In La Habra Heights, there could have been many devastating impacts such as cuts in services, expensive legal challenges paid for by taxpayers, and the threat of higher taxes.
According to an independent analysis of the Measure A energy ban, if it were to pass, the city would have lost about $370,000 annually – amounting to 13 percent of the city’s general fund. City services that could have been at risk included eliminating paramedic programs and cutting back police patrols.
The loss of this tax revenue from oil companies would be compounded by the loss of future funding from prospective oil development. Measure A would have resulted in fewer resources to make roadway and infrastructure improvements. This could make the city more likely to consider tax hikes for residents to bear the costs of these expenditures.
Measure A would have weakened the city’s financial footing while putting taxpayers on the hook to pay for any legal challenges to this ban. The city’s independent analysis found the poorly drafted measure to have vulnerabilities in pre-emption and vested rights which would have undoubtedly resulted in years of expensive litigation. In fact, San Benito County is facing a $1.2 billion legal challenge for an energy ban that passed in November’s elections.
These types of bans hurt our economy and jeopardize tax revenue and jobs. According to a 2012 study by the Los Angeles County Economic Development Corporation, in Orange County alone, oil production generated $1.4 billion in state and local tax revenues and supported more than 22,000 jobs.
Less domestic oil production would mean a greater reliance on imported fuels, which is costly from both an economic and environmental standpoint. Imported oil can be more expensive and it is not produced with the same strict safeguards that we have in place in California.
In addition to federal regulations, California has the strictest and most transparent oil production standards. The state passed sweeping legislation two years ago requiring landowner notification, public disclosure of chemicals used and well integrity testing.
The facts about domestic oil production may not be as juicy as the tall-tales from anti-oil activists. But, as La Habra Heights and Santa Barbara County voters have demonstrated, the truth can prevail.
By Carolyn Cavecche, President & CEO of Orange County Taxpayers Association
OC Register, April 5, 2015