LEGISLATIVE COUNSEL'S DIGEST


AB 656, as amended, Torrico. State Board of Equalization: annual
report: oil and gas severance tax revenue estimates.
Existing
(1) Existing law establishes the
University of California, under the administration of the Regents of
the University of California, the California State University, under
the administration of the Trustees of the California State
University, and the California Community Colleges, under the
administration of the Board of Governors of the California Community
Colleges, as the 3 segments of public postsecondary education in this
state.
Existing law requires the State Board of Equalization to
administer and collect sales and use taxes, motor vehicle fuel and
diesel taxes, alcohol taxes, cigarette and tobacco products taxes,
and other taxes and fees.
This bill would require the board, on or before November 1 of each
year, to report to the Legislature, the Regents of the University of
California, the Trustees of the California State University, and the
Board of Governors of the California Community Colleges the
estimated amount of revenue that would be raised if an oil and
natural gas severance tax were imposed upon any producer for the
privilege of severing oil or gas from the earth or water in the state
at the rate of 12.5% per barrel. The report shall include a summary
of the estimated amount of revenues that would be distributed to
specified institutions of higher education, as provided.

This bill would establish the California Higher Education
Endowment Corporation (CHEEC). The bill would establish an oversight
board to govern the CHEEC and would require that board to appoint the
chief executive officer of the CHEEC. The bill would require the
CHEEC to annually allocate the moneys in the continuously
appropriated California Higher Education Fund, which would be created
by the bill, to the California Community Colleges, the California
State University, and the University of California, as specified. The
bill also would authorize the board to invest the moneys in the fund
in accordance with prescribed procedures.
(2) Existing law imposes various taxes, including taxes on the
privilege of engaging in certain activities. The Fee Collection
Procedures Law, the violation of which is a crime, provides
procedures for the collection of certain fees and surcharges.

This bill would impose an oil and gas severance tax upon any
producer for the privilege of severing oil or gas from the earth or
water in this state for sale, transport, consumption, storage,
profit, or use, as provided, at a rate of 12.5% of the gross value of
the product. The tax would be administered by the State Board of
Equalization and would be collected pursuant to the procedures set
forth in the Fee Collection Procedures Law. The bill would require
the board to deposit all taxes, penalties, and interest collected
pursuant to these provisions in the California Higher Education Fund,
as provided.
Because this bill would expand application of the Fee Collection
Procedures Law, the violation of which is a crime, it would impose a
state-mandated local program.
(3) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
(4) This bill would declare that it is to take effect immediately
as an urgency statute.