AUSTIN – Todd Staples, president of the Texas Oil & Gas Association, issued the following statement regarding Comptroller Hegar’s announcement that he revised the Certification Revenue Estimate upward, increasing his November estimate of General Revenue-related funds available for certification by $13.75 billion:
“Comptroller Hegar’s increased revenue forecast means good news for Texans, and the oil and natural gas industry is a big factor in producing resources that are positively impacting our state. This fiscal year the oil production tax is estimated to have grown by 91.8 percent, while the natural gas production tax is estimated to have grown by an eye-popping 266.8 percent. Further, Texas oil and natural gas activity has been a significant factor in the 23.6 percent increase in sales tax collections.
Not only is oil and natural gas a large amount of the increased general revenue estimate, but the indicated contribution of $3.58 billion to the Economic Stabilization Fund (also known as the “Rainy Day Fund”), which is funded almost exclusively by oil and natural gas severance taxes is more than double the amount this fund normally grows. Heading into the upcoming legislative session, Texas lawmakers will have a whopping $13.6 billion in their savings account. Additionally, another $3.58 billion is estimated to be paid through oil and natural gas production taxes to the State Highway Fund in FY 2023, bringing the total increase to these two critical state funds to about $7.7 billion, funding that comes directly from severance taxes that will be paid by the Texas oil and natural gas industry. Oil and natural gas severance taxes (also referred to as production taxes) paid to the state that exceed $1.1 billion during the biennium are equally split between each fund.
Every single Texan should celebrate our state’s strong oil and natural gas industry for its contributions to our schools, roads, universities and first responders. We hope all members of the legislature will work next session to ensure this vibrant, job-creating and essential service-funding sector of our state’s economy continues to thrive and prosper because of all the important contributions it makes to our state and our local communities. At a time when European nations are struggling to meet basic energy needs, Texas oil and natural gas needs to grow to meet our domestic needs and those of our allies. Oil and natural gas is the only industry that pays severance taxes to the state – this industry and these funding streams are truly irreplaceable. TXOGA members are committed to continuing both economic and environmental progress as we provide the indispensable fuel that powers modern life.”
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Founded in 1919, TXOGA is the oldest and largest oil and gas trade association in Texas representing every facet of the industry.