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Wilson County News November 14, 2012 2,594 views 1 comment
FLORESVILLE -- While entities, such as cities, located in the Eagle Ford shale exploration area are receiving increased sales-tax revenue as well as increased traffic, this area is also seeing the erosion of infrastructure.
Members of the Wilson County Farm Bureau approved a resolution Oct. 18 that could offer some relief as to how to pay for infrastructure damage caused by heavy loads traveling the highways en route to and from drilling sites. Their resolution is to redistribute the percentage of a severance tax already collected by the state on every barrel of oil produced or sold in Texas by three ways, not two.
According to the Farm Bureau, 25 percent of the severance tax collected on every barrel of oil or condensate produced and sold in Texas goes toward the Permanent School Fund and the other 75 percent to the Economic Stabilization Fund, also known as the “Rainy Day Fund.”
The resolution approved by the county Farm Bureau members would continue the current percentage designated for the Permanent School Fund, but would reduce the Rainy Day funding to 50 percent. The remaining 25 percent “would be divided between the Texas Department of Transportation (TxDOT) districts and the counties from where the severance tax was derived,” according to the resolution.
In the Farm Bureau’s explanation, this “would provide timely funds for TxDOT and petroleum-producing counties to repair the roads being destroyed by the drilling and production activity.”
Texas Farm Bureau Pres-ident Kenneth Dierschke, who delivered the keynote address during the convention, also addressed funding to alleviate the infrastructure damage within the Eagle Ford shale area.
Dierschke highlighted the gas tax, of which 94 percent is sent to Washington, D.C. In Texas, the total local, state, and federal tax rate for gasoline is 38.4 cents per gallon. Dierschke suggested the state needs to receive a higher rate of return, due to the increased heavy truckloads on highways related to the oil and gas exploration activity.
“We need to put the heat on D.C. and get more of that money back,” Dierschke said, and suggested money should be received from other states, since “they are using the oil and gas like we are ... and we are holding the sack.”
Dierschke also discussed the state budget, education, and water shortage during his Oct. 18 remarks. For more, see related article, 1D.