Tom Steyer, a Bay Area hedge fund billionaire with two ballot-measure victories under his belt, is throwing his weight behind a new cause: an oil-extraction tax.
NextGen Climate Action, a political advocacy group Steyer founded, announced Monday it's launching a public awareness campaign and messaging blitz urging the Legislature to tax oil as it's taken from the Golden State's ground.
"We can't afford to disadvantage California to the tune of $1 billion to $2 billion per year," Steyer said in a telephone interview Monday. "We don't have the luxury of not having the fees that every other oil-producing state charges."
As much money and gravitas as he brings to this fight, he's taking on a Goliath. The oil industry, which claims such taxes would make California less hospitable to business and increase reliance on foreign oil, put up $95 million to defeat a ballot measure in 2006, and lawmakers have balked at taking the plunge ever since.
This "Reclaim Our Resources" campaign will host public round-table discussions, share research, conduct polling, run advertising blitzes via social and traditional media, and provide policy and media support for like-minded lawmakers.
Voters in 2006 rejected Proposition 87, an oil-extraction tax plan, after real estate heir and movie mogul Steve Bing spent about $49.6 million to support it, only to be outshouted by the industry.
Lawmakers since then have introduced five unsuccessful bills seeking such a tax. The most recent -- this year's SB241 by state Sen. Noreen Evans, D-Santa Rosa -- never made it out of the Senate Appropriations Committee, and a student-led effort to put a measure on 2014's ballot foundered for lack of petition signatures.
Steyer, 56, of San Francisco, said Democrats' two-thirds majority in the Legislature, new talk of expanded fracking to harness about 15 billion barrels in the Monterey Shale formation, and the state's continuing budget needs mean this is the right time to try again.
"We think our logic is compelling, but I think it's unrealistic to think that we're not going to learn a lot while going through this process," he said, adding he's not yet sure if he would pursue a ballot measure in 2016 if the Legislature fails to act.
That wouldn't be an idle threat, coming from someone who has shelled out $37.3 million for his other political causes in the past four years.
In 2010, Steyer faced down the oil industry by co-chairing and giving $5 million to the campaign against Proposition 23, oil companies' effort to roll back California's landmark greenhouse-gas emissions law. In 2012, he chaired and gave $32.3 million to almost single-handedly bankroll Proposition 39, forcing out-of-state business to pay taxes on their California sales with proceeds funding energy efficiency and green-energy projects in public buildings and schools.
Tupper Hull, vice president of the Western States Petroleum Association, said "raising taxes on a commodity like oil will have the effect of shifting production away from the state of California" along with jobs and the income and corporate tax revenue it produces.
Energy companies already generate a great deal of revenue for California -- as much as $6 billion by the industry's estimate, Hull said. And "policies designed to discourage petroleum energy production are clearly going to have the effect of increasing our dependence on foreign oil."
Steyer's group notes California's 200 million barrels a year puts it in fourth place among oil-producing states -- behind Texas, North Dakota, and Alaska -- but it's the only such state with no extraction tax for oil from private lands.
Oil companies have said California's more-stringent environmental regulations and other, higher taxes make up for that. But Steyer said that a 14-cent-per-barrel fee that California now charges, plus all applicable property, income and corporate taxes, adds up to about $4.22 per barrel.
Meanwhile, Texas -- the nation's top oil producer, and run by Republicans -- charges oil producers a 4.6 percent tax rate and royalties of 28 percent, Steyer said; Alaska, Louisiana, Montana and North Dakota also tax oil at similar levels or higher.