Foster Campbell

Louisiana Public Service Commissioner

Cutting the Umbilical Cord

Posted on by Editor


L O U I S I A N A  P U B L I C  S E R V I C E  C O M M I S S I O N E R

27 May 2015

Letters to the Editor

The Baton Rouge Advocate


Louisiana will suffer chronic financial problems until we break the grip of the major oil

companies on the Legislature and Governor.

An umbilical cord connects our legislators and Governor to Big Oil. That cord may feed the

politicians, but Louisiana continues to rank poorly in educational, environmental and economic


Facing a $1.6-billion deficit next year, the Legislature taxed its weakest constituents and

largely left the companies untouched. College students and parents face higher tuition, motorists

more gas taxes, and smokers higher tobacco taxes.

Working-class and elderly Louisiana residents will endure cutbacks in health care. State

employees will see their paychecks and benefits squeezed.

This ugly picture plays out as Louisiana approaches the 100th anniversary of its Oil and Gas

Severance Tax. This antique from 1921 taxes in-state production but ignores the enormous

quantities of oil and gas brought to Louisiana for processing.

See how the obsolete Severance Tax works at the giant ExxonMobil refinery in Baton

Rouge: The plant processes 98 percent foreign oil and 2 percent Louisiana oil, and we tax the 2


A constitutional amendment by Senator Ben Nevers of Bogalusa would let voters modernize

Louisiana oil and gas taxes. It proposes a tax on hydrocarbon “processing” to support education,

health care, state employee and teacher retirement, and highways.

The bill has yet to receive a hearing.

As a senator I offered a tax on hydrocarbon processing at least 10 times, but the Legislature

refused to put the issue before voters.

Industry lobbyists must kill the Processing Tax in the Legislature because they know the

voters would approve it. Louisiana floats on a sea of foreign oil. We have thousands of miles of

pipeline, refineries no other states want, the Mississippi River to transport tankers, and politicians

friendly to Big Oil.

Not to mention the enormous oilfields off our coast.

Importing and processing oil is part of our culture. We have done it for decades. As a

result, we have tendencies similar to “petro-states” like Venezuela and Nigeria. The companies

dominate our politics. We defend them when they pollute our waters or damage our coast. We cut

their taxes.

The ExxonMobil refinery in Baton Rouge has received $119 million in subsidies since 2011.

The Governor and Legislature stooped to a new low last year when they worked to kill the

lawsuit blaming Big Oil for eroding our coastline, despite damage shown by the industry’s own


Voters who want their state back should ask the candidates for Governor and Legislature:

Who will you represent? How will you solve our fiscal problems? Will you tax foreign oil and cut

taxes on people?

Will you cut the umbilical cord and give us back our independence?


Foster Campbell