Los Angeles City Councilmembers Paul Krekorian and Nithya Raman today introduced a motion to initiate a measure for the November 2022 ballot to tax oil companies that are extracting oil and gas within the city. The motion builds on action taken late last year by the Energy, Climate Change, and Environmental Justice Committee, upon Krekorians request, to declare all gas and oil production a non-compliant use across Los Angeles. The Committees action, which will be considered soon by the full council, would immediately halt any new development or expansion of existing oil infrastructure and require the complete shutdown of all existing oil and gas wells over the next 20 years.
Los Angeles County has some 5100 active or idle oil wells, the largest urban oil field in the United States.
Los Angeles has led the nation in reducing its reliance on fossil fuels and reducing its carbon footprint, Krekorian said. We are well on the way toward achieving a carbon-free electrical grid, and we have taken significant steps toward reducing tailpipe emissions in the transportation sector. Still, too many residents in Los Angeles are impacted by oil and gas drilling in their neighborhoods. 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Krekorian noted that for 60 years the City of Los Angeles imposed an oil extraction tax, which was repealed by the voters in 1996.
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 were 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.