Not only are local oil and gas companies among the top taxpayers in Kern County, the industry contributed more than $197 million last year in property tax revenues — crucial funds used to support government services, special districts and schools in Kern County, according to a new study.

 

The study was released last week by an economic consultant from Yorba Linda-based The Natelson Dale Group, Inc. The study was initiated by the Kern County Board of Supervisors following a January 14 public meeting to discuss California’s new oil and gas initiatives and the economic importance of the industry. At the conclusion of the hearing attended by more than 1,000 local residents, the board of supervisors agreed to initiate a study to quantify the oil and gas industry’s contribution in tax revenues to the County.

 

The study shows the oil and gas industry contributed more than $197 million to the property tax base in Kern County during the fiscal year 2018-2019 – which includes property tax revenue, property tax in-lieu of vehicle license fees, and bond tax revenue. The 100-page study, titled “Kern County Oil and Gas Property Tax Revenue (2018-2019) Analysis: County, Cities, Schools and Special Districts,” outlines in detail where property tax revenues from the industry are used, and estimates the financial impact an incremental reduction of oil and gas assessed valuation would have on the county and its cities, schools and special districts.

 

“The evidence is clear, a healthy oil industry results in a fiscally secure Kern County. For years, this industry has played a very critical role in the growth and progression of our County” said Leticia Perez, Chairman of the Kern County Board of Supervisors. “This study demonstrates the industry’s integral contribution to funding vital governmental services, programs and even our schools in Kern. We need oil and gas operations to continue in our county – especially at a time when our county budgets are hurting, and the community is continuing to struggle with the impacts of COVID-19.” industry

 

As county residents continue to grapple with uncertainty, unemployment and lack of job security, the oil and gas industry has felt its impacts as well. The county’s current budget forecasts already anticipate a 40 percent reduction in oil-related assessed valuation between January 2020 and January 2021. These are funds that cannot be replaced by commercial-scale solar or new wind projects, as suggested by some anti-oil groups.

 

In a cover letter to the report, Lorelei Oviatt, Kern County Planning and Resources department director, noted that contrary to the representations of anti-oil advocacy groups, the oil and gas revenue could not be replaced by commercial scale solar because such projects have a legislative exemption from property tax reassessment based on the real value of the project. New wind projects are limited by military air space and the California condors.

 

The study also examines the impact of an incremental reduction of oil and gas assessed valuation – amounting to a 23 percent reduction in total property tax revenue, and more than seven percent reduction in revenue from all sources – posing a  significant financial impact to the county, cities, special districts, local colleges and school districts, according to the study.

 

“This study shows the impact the oil and gas industry has on Kern County and our state officials need to understand it,” said Ryan Alsop, Kern County Chief Administrative Officer. “The study highlights how decisions made in Sacramento can disproportionately affect our residents. It’s not just about the major financial hit to budgets – the oil industry provides thousands of local jobs – losing local jobs is the last thing our communities need right now.”

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