LEGISLATIVE COUNSEL'S DIGEST


AB 656, as amended, Torrico. State Board of Equalization:
annual report: oil and gas severance tax revenue estimates.
California Higher Education Endowment Corporation: oil
and gas severance tax.
(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.
This bill would establish the California Higher Education
Endowment Corporation (CHEEC) in state government . 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 , except as provided, 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.

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Comments/questions on AB 656 (Torrico): California Higher Education Endowment Corporation: oil and gas severance tax.