Louisiana Senate Bill SR32

Louisiana 2018 2nd Special Session

• Introduced: 6/4/18

Caption

Requests the Louisiana State University Center for Energy Studies, the Louisiana State University Public Administration Institute, and the Louisiana Tax Institute to analyze mineral revenues, taxes, and exemptions and to submit a written report of its findings to the Senate.

Impact

SR32 aims to provide a comprehensive review of Louisiana's current mineral tax framework with specific goals in mind: to maintain or enhance the competitiveness of the state's oil and gas extraction sector, create uniform severance tax exemptions across well types, and stabilize or grow the state's mineral revenue. By requesting actionable recommendations, the resolution seeks to ensure that the legislative body is equipped with well-researched insights that can address economic concerns related to mineral taxation and encourage equitable treatment across different types of wells.

Summary

Senate Resolution 32 (SR32) urges the Louisiana State University Center for Energy Studies (LSU CES), the Louisiana State University Public Administration Institute (LSU PAI), and the Louisiana Tax Institute to conduct an analysis of mineral revenues, taxes, and exemptions in Louisiana. The resolution seeks to address existing disparities in tax rates for oil and gas, particularly the differing treatment of horizontal versus conventional wells, and to ensure that Louisiana's mineral tax laws remain competitive within the industry. The findings from this analysis will be presented to the Senate to inform future legislative actions.

Sentiment

The sentiment surrounding SR32 is largely supportive among stakeholders in the oil and gas industry who believe that a thorough analysis can lead to beneficial changes in tax policy. However, there could also be apprehension from local communities affected by increased extraction activities or changes in revenue allocation. The resolution reflects a proactive approach to improving state tax laws, eliciting a range of opinions among legislators and industry leaders about the best path forward for sustainable economic growth.

Contention

While SR32 does not directly create laws, it lays the groundwork for substantial revisions to the Louisiana mineral tax system. Points of contention may arise around the potential implications of recommended changes, particularly if they favor oil and gas producers at the expense of local government revenues or environmental standards. The recommendations generated from this study will need to carefully balance the interests of various stakeholders to avoid exacerbating existing tensions between economic development and community welfare.