Directs the legislative auditor to conduct annual audits of severance tax payments and directs the Department of Revenue to establish procedures to verify self-reported information regarding severance taxes
If implemented, HCR111 aims to ensure the state receives complete, accurate, and timely severance tax payments through rigorous auditing practices. The resolution underscores the importance of properly collecting severance taxes as a critical source of revenue for Louisiana, especially in light of budget cuts to essential public services. It also establishes that severance tax payments are distinct from the financial obligations that oil and gas companies have for coastal restoration and damages, reinforcing that taxpayers should not bear these costs.
House Concurrent Resolution 111 (HCR111) directs the Louisiana Legislative Auditor to conduct annual audits of severance tax payments related to oil and gas extraction. The resolution highlights significant concerns about the current inadequacies in the monitoring and verification of these taxes, which are legally owed to the state. Due to previous performance audits, it was found that the Department of Revenue's procedures for reviewing severance taxes were insufficient, leading to potentially uncollected tax revenue that could benefit state programs such as education and healthcare.
The general sentiment surrounding HCR111 appears to be supportive, as it seeks to enhance accountability and transparency in the administration of severance taxes. Proponents contend that thorough audits will lead to findings of previously uncollected revenues, which could greatly benefit state funds. However, there may be concerns from the oil and gas industry regarding increased scrutiny and the potential implications for their financial responsibilities in the state.
A notable point of contention within HCR111 is the relationship between severance taxes and the obligations of oil and gas companies for coastal restoration. The resolution makes it clear that while the collection of severance taxes is essential for state revenue, it should not absolve companies from their responsibilities regarding environmental restoration. This distinction aims to clarify the expectations placed on the industry while advocating for the state's financial interests.