Two Los Angeles City Council members are calling for a measure to be put on the November 2022 ballot to create a tax on companies that extract oil and gas within Los Angeles.
Councilman Paul Krekorian and Councilwoman Nithya Raman introduced a motion Wednesday to initiate the ballot measure by instructing the City Administrative Officer to report on potential amounts and structures for the tax.
The motion notes that Los Angles charged an oil extraction tax for 60 years before it was repealed by voters in 1996.
“Many neighboring jurisdictions impose various per-barrel taxes on oil and extraction that help them pay for general city services, including offsetting the negative local impacts of extraction,” the motion stated.
Krekorian said that he wants the tax levied only while the city transitions out of the production of oil. City Council’s Energy Climate Change and Environmental Justice Committee has already declared all gas and oil production a “non-compliant use” in L.A. and called for all existing oil and gas wells to be shutdown over the next 20 years, Krekorian’s office said. That motion has not yet been taken up by the full council.
“The city must move expeditiously to shut down wells while also guaranteeing a just economic transition to avoid job loss impacts. As that transition takes place, oil companies need to pay their fair share of the cost of city services through an oil and gas extraction tax that benefits the people of Los Angeles,” Krekorian said.
Los Angeles County has 5,100 oil wells that are either active or idle, making it the largest urban oil field in the U.S., Krekorian’s office said.
The motion was one of the first introduced by newly elected councilwoman Nithya Raman, who made climate change a central part of her campaign last year.
“Our city’s current fiscal crisis has made it all the more urgent that we seek out new, stable and progressive sources of revenue,” Raman said. “Even as we’re working to phase out oil and gas extraction entirely, this tax has the potential to make it more expensive to extract oil from the ground in Los Angeles right now.”