California Voters Decide to Keep Democrats’ Gas Tax Increase

Gas-Pump-blue-generic+flippedAmong numerous measures that went before the state’s voters Tuesday, Californians rejected a proposal to repeal a gasoline tax increase that was passed by the Legislature to fund road and transportation projects. Proposition 6 failed Tuesday after Democrats campaigned to preserve $5 billion a year to fix roads and improve transit.

The state’s Republicans sought to repeal hikes in fuel taxes and vehicle fees that are expected to fund $52 billion in transportation projects over a decade. Their plan also would have required voter approval for future gas tax hikes.

GOP lawmakers argued that California has grown too expensive and tax dollars need to be spent more wisely. They hoped the measure would help drive Republican voter turnout in contested state and congressional races.

“It’s about whether working families will be given some breathing room and whether we can address the high cost of living in California,” Carl DeMaio, a former San Diego city councilman who led the effort, told the Mercury News. “That’s real money.”

Democrats and construction industry and union leaders maintained the revenues are vital to upgrade California’s crumbling roads and bridges. …

Click here to read the full article from Fox News

Why Gas Prices are Going Higher in California

Gas-Pump-blue-generic+flippedIt has become raison d’etre to blame President Trump for everything wrong with California; including higher gasoline prices plaguing our state and contributing to a slowing statewide GDP. But in today’s world that is connected via air, land, sea and increasingly cyberspace; globalization and policies knit countries and states together like never before. Many times rendering geography and borders on maps obsolete – consequently, events in one region or country – affect continents, countries and states. California’s decision to never allow pipelines into the state, drill for oil and natural gas off our coasts and certainly not explore the billions in untapped fossil fuel reserves trapped in the Monterrey Shale is rippling across our state in the form of higher gas prices.

The Monterrey Shale – though considered technically hard to recover – is 64% larger than all other shale plays in the lower 48 US states. To believe the Monterrey Shale can’t be unlocked is economically unwise when you consider that in September Kuwaiti oil exports to the US dropped to zero for the first time since the first Persian Gulf War over rising US production. Furthermore, “U.S. net imports of foreign oil have dropped to a 45-year low.”

If California voters and policymakers wanted to lower gasoline prices, unlock poverty-alleviating affordable energy and create millions of high paying jobs then begin working with our world class universities to unlock the Monterrey Shale. It would be like when Governor Pat Brown built universities, highways and water systems that California and the US are still prospering from today. Our high gasoline prices have nothing to do with Trump, Iranian sanctions tightening supply or OPEC. This is a California problem that historically has some of the highest gas prices in the US, a newly instituted 12-cent per gallon tax and, “the most stringent regulations for its gasoline in the nation(US).”

On the ground it means few refineries are willing to produce gasoline for California and the situation becomes more dire when it was announced in September that the South Coast Quality Air Quality Management District (SCAQMD):

“Proposed an option that would ban a critical refinery process technology at two Southern California refineries that is required for manufacturing cleaner-burning gasoline.”

Consider this – of the 5 largest US states – California is #1 in poverty and Texas is #1 for growth. Texas is also the #3 exploration and production (E&P) producer in the world. Former Texas Governor Rick Perry used fracking as a policy tool, which achieved scientific breakthroughs, and corporate investment unlocking Texas shale basins into tax revenue that now has Texas being the #1 wind power generator in the US as well. Texas figured out how to use wind to their advantage and California could do the same with the Monterrey Shale.

The greatest impact a society can have on poverty, homelessness, and inequality along with overall human flourishing is abundant energy. California is blessed with billions of barrels of oil within our state and coastal waters. Moreover, we have enough natural gas to clean our air and continue dramatically cutting emissions like no continent, country or state can imagine. When the US began converting coal-fired power plants to natural gas this caused America to be the only industrialized country in the world to meet the Kyoto Protocol by dramatically lowering its carbon output and emissions through natural gas.

California should be the leader in natural gas E&P instead of legislating through Senate Bill 100 (SB 100) that our advanced society can only be powered by renewable energy (wind & solar). Imagine what gas prices will be like when renewable energy tries to replace the 6,000 modern-day products that originate from crude oil. Moreover, the 2015 US Department of Energy Quadrennial Energy Review (QER) unveils the biggest reason renewable energy will cause gas prices to continue rising in California when it states:

“Energy storage is a key functionality that can provide flexibility, but there is little information on benefits and costs of storage deployment at the state and regional levels, and there is not broadly accepted framework.”

If California fully deploys SB 100 and there isn’t available energy storage – and currently there isn’t according to the Los Angeles Times – then energy from electricity and gasoline prices will naturally rise. Supply will not be able to keep up with demand based upon storage capacity alone.

Back to no interstate pipelines – if California doesn’t alleviate that problem – then gasoline refined outside the state will increase and this will cause intensifying the carbon-intensive use of trucking and shipping petroleum for economic continuity. Domestic and foreign refineries that have less environmental regulations will lead to increased global emissions; and ironically trucking and shipping crude oil, petroleum and gasoline have higher carbon footprints. California will then continue increasing gasoline prices, its carbon footprint and endangering environmental safety since pipelines are the safest method to import oil over ships, trucks or railways. The wise environmental policy choice would be to build pipelines.

Our policymakers should begin understanding that unweaving the intricacies of fossil fuel from our economy is like undoing globalization for trade and commerce. Everything is now interlinked whether we like it or not. Oil and natural gas can power our future or increasing our use of renewable energy and demonizing anyone who doesn’t share the belief that the environment takes precedence over California economic activity can be our downfall.

But with gas prices rising and foolishly slashing fossil fuel use instead of taking Texas’ approach to energy (the all of the above approach: fossil fuels and renewables working together) California voters, citizens and policymakers only have ourselves to blame when gas prices rocket into the $5 per gallon range. With the US shale revolution taking place there is no reason why our prices shouldn’t be in the $2.50-$3 range. Environmental taxes and regulations are choking our economy, increasing our poverty and a big reason business is leaving California.

Todd Royal is an independent public policy consultant focusing on the geopolitical implications of energy based in Los Angeles, California.

This article was originally published by Fox and Hounds Daily

Legislatures Kill Transparency Pricing at the Pump

gas prices 2Californians now pay as much as $1.00 more per gallon of fuel than the rest of the country. Shouldn’t the motoring public know why?

A bill in the California Legislature to do just that was Senate Bill 1074, by state Sen. John Moorlach, R-Costa Mesa. Called “Disclosure of government-imposed costs,” it would have required gas stations to post near each gas pump a list of cost factors, such as federal, state and local taxes, costs associated with environmental rules and regulations including the cap-and-trade tax.

Numerous folks and organizations spoke in support of the bill at an April 23 hearing before the Senate Committee on Business, Professions and Economic Development. I testified myself. Absolutely no one from the public spoke in opposition.

But the Democratic-controlled committee didn’t want the public to know why we’re paying so much, and voted to kill the bill from future consideration.

I watched closely the action on the Senate floor. The senator who spoke most against the bill was Sen. Josh Newman, D-Fullerton. But when the time of the vote came and it became clear the bill would fail, he voted Aye, which could help him in his close recall election bid this June.

Newman already had enough problems on the issue because he provided the key vote last year to pass Senate Bill 1, which jacked up gas taxes $5.5 billion a year. An initiative to repeal that gouging at the gouging at the pump just submitted more than 1 million signatures and also should go before voters this November.

It’s strange that almost every other product we buy comes with the price listed on the tag, with the taxes then clearly added to the receipt: clothes, computers, cars, furniture, office supplies, books, etc.

By contrast, the price at the pump is not broken down by tax or other cost, but actually includes a multitude of taxes, as well as costs from numerous environmental regulations.

In addition to the federal tax on fuels that applies to all states, California’s state taxes are among the highest in the country. Beginning last November, SB 1 alone added 12 cents to a gallon of gasoline and 20 cents to diesel.

SB 1074 specified the multiple taxes and regulatory costs that would have to be listed: a) The federal fuel tax per gallon; b) the state fuel tax per gallon; c) the state sales tax per gallon; d) refinery reformatting costs per gallon; e) cap and trade program compliance costs per gallon; f) low-carbon fuel standard program compliance costs per gallon; and g) renewable fuels standard program compliance costs per gallon.

That’s a lot of taxes and costs.

The cap and trade costs, by the way, now are the major funding source for outgoing Gov. Jerry Brown’s favorite boondoggle, the Choo Choo train project.

The high fuel taxes impact not just drivers, but almost everything in our economy, such as the food carried to grocery stores, materials to housing construction and clothing to children’s stores. Even Amazon.com and other online retailers will charge more for shipping as their costs rise.

Especially hurt by the high cost of fuel are the working poor, who often must commute an hour or more inland because coastal housing is so expensive. Aren’t such people supposed to be a key constituency of the Democratic Party?

No wonder we now have a better understanding of why California suffers the highest percentage of people in poverty and a homeless crisis so acute it shocks the world.

SB 1074 would have given motorists information on what’s really going on. But for the Democratic supermajority in the Legislature, bliss is keeping Californians ignorant.

ounder of PTS Staffing Solutions, a technical staffing agency headquartered in Irvine

This article was originally published by Fox and Hounds Daily

The Public Deserves Transparency of Pricing at the Pump

Gas TaxFuel prices in California are among the highest in the country, as a result of some of the highest taxes in the country, plus the costs associated with compliance with various State environmental laws, which trickle down to the consumer, resulting in Californian’s paying as much as $1 more per gallon than most folks in the country. A bill currently working its way through Sacramento is SB 1074 (Moorlach) “Transparency in fuel taxes”.

Most everything that is bought, from clothes, computers, vehicles, etc., are based on price plus tax, except one item – transportation fuels, as the posted price includes everything.

Case in point was SB1 for Transportation Infrastructure funding that is targeted to raise $52 billion for infrastructure projects, added 12 cents to gasoline and 20 cents to diesel on November 1, 2016. With California already having some of the highest fuel taxes in the nation, the cost of those fuels did not change last November, but the posted price at the pump did change, but was not transparent to the public as to why fuel prices went up.

Low Carbon Fuel Standard (LCFS) compliance is getting tougher to meet each year as well as more costly each year. Today, the California Energy Commission (CEC) shows that the LCFS adds 10.1 cents per gallon for gasoline, and 6.8 cents for diesel. Those costs trickle down to the consumer and are hidden within the posted price of fuel at the pump.

The CEC also shows that Fuels Under the Cap (FUTC) i.e., the “boutique” fuel standards for gasoline and diesel required by the Federal Clean Air Act and the California Air Resources Board (CARB) to meet the state’s fuel blending requirements for reformulated gasoline standards accounts for 11.9 cents per gallon for gasoline, and 14.5 cents for diesel. Again, those costs trickle down to the consumer and are hidden within the posted price of fuel at the pump.

Cap & Trade revenues are funding the High Speed Bullet train as well as many other “green” projects. Within numerous state government agencies, there is a feeding frenzy on getting a piece of those lucrative cap and trade “fee” revenues for their projects. Again, those costs trickle down to the consumer and are hidden within the posted price of fuel at the pump.

The CEC shows that California fuel consumption is at the highest level since 2007. Fuels consumption for California’s 35 million registered vehicles in 2016, of which more than 90% were not EV’s, was 52 million gallons per DAY of gasoline and diesel. Sounds like a lot of fuel, but it’s only about 1 plus gallons per day per vehicle, resulting in refueling requirements every week or two.

With numerous incentives, 50% of the EVs in the nation are in one state-California, but they only represent about 7% of the 35 million registered vehicles. With the other 49 states accounting for the other 50%, it appears that nationwide, they are not endeavored by the EVs.

On a go forward basis, internal combustion engines appears to be the choice of citizens. The California economy is heavily driven by affordable transportation. Yet, Californians pay more per gallon of gasoline and diesel due to costs that are not transparent to the public.

A Yes vote on SB 1074 would expand transparency at the pump by creating a Quick Read (QR) Code that directly links the consumer with updated costs of taxes and regulated costs associated with the production of each gallon of fuel purchased would demonstrate that our elected representatives favor transparency of the costs that are included on the posted prices for fuel at the pumps to show the public why Californians are paying as much as $1 more per gallon than the rest of the nation.

On the contrary, a No vote on SB 1074 would demonstrate that our elected officials do not want the public to know why our fuel costs are among the most expensive in the country.

ounder of PTS Staffing Solutions, a technical staffing agency headquartered in Irvine.

This article was originally published by Fox and Hounds Daily

When’s the last time California started a year with gas prices this high?

California and the rest of the nation are starting 2018 with the highest gasoline prices to begin a new year since 2014, both AAA and GasBuddy have reported.

The average price for a gallon of regular unleaded in Modesto on Thursday morning was $2.92, compared to $2.60 a year ago, according to www.modestogasprices.com, which is part of GasBuddy.

The city is well above the national average price, which was $2.50 Thursday and $2.36 this day last year. But we’re well below the state average, which was $3.12 on Thursday.

In the greater Modesto area Thursday morning, the lowest price was $2.53, offered at Costco in Turlock and the Arco station at 3936 Mitchell Road in Ceres. Modesto’s lowest price was $2.55 at Costco.

Costco warehouse stores sell their gas only to members. Modesto’s next-lowest price, available to the general public, was $2.59, at Arco stations on West Orangeburg Avenue, Yosemite Boulevard, Crows Landing Road and North Carpenter Road. …

Click here to read the full article from the Modesto Bee

 

Politicians try to mask pain of gas tax hike

Gas-Pump-blue-generic+flippedHave you ever had a tooth extracted without Novocain or some other pain killer? When facing something painful, it’s always helpful to apply a numbing agent and, when administered by competent medical personnel, anesthesia provides effective relief. But when politicians try to mask pain, be skeptical.

The 12 cent increase in California’s gas tax which took effect this week has garnered a great deal of media attention, much of it negative. That explains why California Democrats have tried to mask the pain of the tax hike.

In perhaps their most deceptive move ever, California Democrats chose the same day that gas prices traditionally go down by 12 cents to increase them by 12 cents. Nov. 1 was the first day California’s cheaper “winter blend” gas can be sold which costs about 12 cents less a gallon. Nov. 1 was also the day that the 12 cent per gallon tax goes into effect statewide.

But this is just phase one of a yearly $5 billion tax hike on California families.

The largest gas tax hike in state history means drivers will pay a total of 50 cents a gallon in taxes to the state when they fill up. By 2019 it will have risen to 57 cents a gallon. Diesel truck drivers are getting hit too. Their price per gallon will jump 20 cents a gallon and will also include a 4 percent sales tax increase. Note that these figures do not include the excise tax from the federal government, another 18 cents per gallon.

Phase two will hit when you re-register your vehicle next year. The average driver will pay $50 more than last year due to a brand new “transportation improvement fee,” though some could pay up to $175. Electric car owners aren’t off the hook either. They’ll pay $100 more a year to register starting in 2020. …

Click here to read the full article from the Orange County Register

Legislators continue to drive up the cost of fuels

gas prices 2The concept of reducing our emissions is correct, but show me some progress!

Cap and trade has been a revenue generator for the state since 2006. It has raised over $7 billion for the state, but after 10 years since AB32 was signed into law in 2006, according to the California Energy Commission, has yet to lower our 1 percent contribution to the world’s greenhouse gases. It has however been very effective in hitting citizens’ pocketbooks to fund a multitude of governmental pet projects.

We could shut down the entire state that represents only 0.5 percent of the world’s population, close all the airports, get rid of the 35 million vehicles, turn off all the generators, and shoot all the cows, and it would have absolutely no effect whatsoever on the global climate.

Fuel costs for the entire world, EXCEPT California, are primarily driven by the cost of crude oil to manufacture the fuels and by-products from crude oil that drives every industry sector and supports our current quality of life. With crude oil hovering around the $45 range vs. the $100 range a few years ago, we’re enjoying more affordable fuels than in previous years.

However, in California, it’s our legislators and their appointees that are directly responsible for California having higher costs for our fuels and energy than the other 49 states.

California already has five reasons for their cost of fuels being higher the rest of the country:

  1. California fuel taxes are among the highest in the country.
  2. To date, according to the Legislative Analyst’s Office, cap and trade has already added eleven cents to the price of gasoline.
  3. California has boutique fuel brands that no one else in the country currently makes. If other states chose to manufacture the California boutique fuels, the only way to get it to the California energy island is to ship it thru the Panama Canal to California ports.
  4. California’s Low Carbon Fuel Standard increases the cost of the gasoline and diesel fuels produced from crude oil.
  5. To meet current demand, 10 million gallons of aviation fuels, and 40 million gallons of transportation fuels for our 35 million vehicles are manufactured DAILY in California which is the most environmentally regulated location on earth.

Our Legislators crusade to maintain the cap and trade “revenue generator” through 2030 provides the public with a dim forecast in the coming years as the burden of additional fuel costs will be falling completely on motorists and businesses. More cost increases that are coming are:

  • Starting in November 2017, SB1 will add significant tax increases to gasoline and diesel fuels, as well as higher registration fees to finance transportation infrastructure,
  • 4 years from now, according to estimates from the LAO, cap and trade could raise gas prices by another 63 cents per gallon in 2021, increasing to 73 cents per gallon in 2031.
  • California’s LCFS is expected to grow and overtake the cap and trade costs.

In the last 40 years, the California population has almost doubled to 38 million, but our air is cleaner today than it was in the 1970s. In the decade from 2006, California’s population has grown 1.077 percent to 38.8 million and we have less manufacturing jobs today than we had in 2006.

The inconvenient truth about AB32, as well as cap and trade, is that we now have higher gasoline prices and higher electricity costs. The coastal elites who support “going green” at all costs just don’t care that the working poor and struggling middle class living away from California’s coast are bearing the brunt of higher energy costs. Tellingly, our state has the worst poverty rate in the nation where 1 out of 5 California families are barely hanging on. Thus, it’s hard to understand the time and effort being extended on the subject of the emissions crusade that is obviously negatively impacting our poverty and homeless populations.

It’s our legislators that are causing the price of California fuels to increase, not the oil companies. With the approval to extend the cap and trade system to 2030, California’s top politicians will have immense effects on what consumers spend for gasoline and a myriad of other products and services.

Ronald Stein is founder of PTS Staffing Solutions, a technical staffing agency headquartered in Irvine.

This article was originally published by Fox and Hounds Daily

 

Fossil Fuels Witchhunt is a Quest for Cash

natural gas1The oil and gas industry was born in Pennsylvania on Aug. 27, 1859, when Edwin L. Drake drilled the world’s first commercial oil well. A critic said Drake should leave the oil underground because it was needed to fuel the fires of hell, and to pump it out would protect the wicked from their eternal punishment.

That’s how long some people have believed oil companies are in league with the devil.

Today’s anti-petroleum alarmists warn of the hellish climate that someday will result from civilization’s reliance on fossil fuels. Fortunately they’ve hit on a solution: cash payments. 

The strategy was hatched in 2012 at a two-day meeting in La Jolla organized by the Union of Concerned Scientists and the Climate Accountability Institute. It brought together 23 experts on law, science and public opinion for a workshop titled, “Establishing Accountability for Climate Change Damages.”

The idea was to compare “public attitudes and legal strategies related to tobacco control” to those related to climate change, according to a report of the meeting.

The group found a few problems with the comparison to tobacco. For one thing, they couldn’t identify a specific harm from climate change that had damaged anybody.

“What is the ‘cancer’ of climate change that we need to focus on?” asked one attendee.

And there was a bigger problem. “The fact is, we do need some form of energy,” one participant said. Another lamented, “The activities that contribute to climate change are highly beneficial to us.”

Oh, that.

Originally published in the Los Angeles Daily News. For the remainder of the column please go here.

CA gas prices expected to jump 30 cents by weekend

As reported by the San Diego Union Tribune:

The slide in California’s gasoline prices could abruptly end Friday, with prices possibly jumping 30 cents a gallon due to seasonal changes in the state’s refinery operations, a consumer group predicted Thursday.

Prices often climb in California this time of year because refineries switch from the winter blend of fuel to the more expensive state-mandated summer blend, which evaporates less quickly during warm weather.

But this year’s switch to summer gasoline has triggered a jump of 52 cents a gallon on the gasoline wholesale market in Los Angeles this week, which will lead to the higher pump prices predicted by advocacy group Consumer Watchdog.

“The summer blend should not be responsible for more than a few pennies, maybe a dime,” Consumer Watchdog President Jamie Court said at a news conference. …

Click here to read the full article

50% Petroleum Cut Dropped From SB350

Gas-Pump-blue-generic+flippedAfter the governor and legislative leaders announced pulling the 50-percent petroleum cut mandate from Senate Bill 350, the controversial climate change bill, fallout whirled about the capitol from finger pointing to relative silence from a main supporter to a defiant stand from the state’s chief executive.

As argued here previously, the economic consequences of passing the measure in tact would certainly affect lower income and middle class Californians. It was an argument that moved some Democrats who stood up for their constituents against pressure brought by legislative leaders and even movie stars.

Still, Senator Kevin de León yesterday was dismissing the argument that electric costs would increase when a Univision reporter asked him on camera about costs. De León’s answer was to suggest the information was a mistake put out by oil companies. However, a study issued by the Manhattan Institute reports that California’s green energy policies have driven up energy costs.

Meanwhile, one of the most noticeable proponents of SB350, billionaire environmental activist Tom Steyer, was mostly invisible after the measure was amended. Steyer, who stood with Sen. de Leon when the bill was introduced seven months ago, simply put out a short release praising the pieces of the measure that remained in SB 350 and said more work must be done.

On this site yesterday, Loren Kaye, president of the California Foundation for Commerce and Education associated with the state Chamber of Commerce urged legislators to wait and see if what has already been passed to confront climate change works before rushing ahead with new plans that could put the economy at risk.

But perhaps the most significant message delivered in the aftermath of the intense battle over this one bill came from a frustrated Governor Jerry Brown. He told a press conference that; “I am more determined than ever to make our regulatory regime work for the people of California.” He added, “We don’t have a declaration in statue but we have absolutely the same authority. We’re going forward.”

This Admiral Farragut declaration (“Damn the torpedoes, full speed ahead!”) hints at bypassing the people’s representatives and making changes through executive regulatory action, this time through the authority of the California Air Resources Board.

CARB’s authority to implement the provisions of SB 350 with no legislative oversight was a major sticking point in discussions about the legislation. The governor declared he would not diminish CARB’s power. From his statement, it appears he intends to use it.

Yet, a full-blown public debate over an important issue affecting all Californians should not be disregarded because it did not come out the way proponents wished. Any major change on climate legislation should be accomplished only after the people’s representatives or the people themselves vote.

Originally published by Fox and Hounds Daily