The original instrument and the following digest, which constitutes no part of the
legislative instrument, were prepared by Riley Boudreaux.
DIGEST
Gallot (SB 236)
Present constitution, since July 1, 2007, requires 1/5th of the severance tax on all natural
resources other than sulphur, lignite, or timber ("oil and gas severance tax") to be remitted to the
governing authority of the parish in which severance or production occurs, not to exceed
$850,000, increased each July 1
st
thereafter by an amount equal to the average annual increase in
the CPI for all urban consumers for the previous calendar year, as calculated and adopted by the
Revenue Estimating Conference. The cap for FY 12-13 was $951,475. The cap for FY13-14 is
$971,266.
Present constitution provides for an increase of such maximum to $1,850,000 in the first fiscal
year after the contingency described below occurs (the "trigger"), and to $2,850,000 for each
fiscal year thereafter. The maximum is also to be increased each fiscal year thereafter by an
amount equal to the average annual increase in the CPI for all urban consumers for the previous
calendar year, as calculated and adopted by the Revenue Estimating Conference. Requires at least
50% of the "excess severance tax" received by a parish governing authority in a fiscal year to be
expended within the parish in the same manner and for the same purposes as monies received by
the parish from the Parish Transportation Fund. "Excess severance tax" is defined as any portion
of severance tax received by a parish which is in excess of the amount of such tax revenues
remitted to that parish in FY2011-2012.
Present constitution also contains a provision requiring an amount equal to 50% of the revenues
received from severance taxes and royalties on state lands in the Atchafalaya Basin, but not to
exceed $10 million each fiscal year to be deposited into the Atchafalaya Basin Conservation
Fund. Subject to the approval of the appropriate subject matter committees of the legislature, the
money is to be expended exclusively for projects contained in the state or federal Basin master
plans or an annual Basin plan developed and approved by the advisory or approval board created
by law specifically for that purpose, or to provide match for the Atchafalaya Basin Floodway
System, Louisiana Project. In addition, 85% of the money appropriated in any fiscal year, must
be used for water management, water quality, or access projects, and the remaining 15% to
complete ongoing projects and for projects that are in accordance with the mission statement of
the state master plan. However, no more than 5% in any fiscal year may be used for the
operational costs of the program or the department.
Present constitution has a trigger on the increases and distributions described above, that is, a
provision which provides that the increases and distributions cannot be implemented until a fiscal
year in which the last official forecast of revenues adopted for a fiscal year, before the start of
that fiscal year, contains an estimate of oil and gas severance tax revenues in an amount which
exceeds the actual oil and gas severance tax revenues collected in FY2008-2009. Proposed constitutional amendment removes the trigger described above for both the increased
maximums provided for parishes in which oil and gas severance and production occurs and for
the Atchafalaya Basin Conservation Fund distribution, and requires the increases and
distributions to begin in FY2015-2016.
Specifies submission of the amendment to the voters at the statewide election to be held on
November 4, 2014.
(Amends Const. Art. VII, Sec. 4(D)(4)(intro para), Sec. 4(D)(4)(a), and Sec.4(D)(4)(b)(intro
para))