Assemblyman Pedro Nava has essentially the same remedy for every problem facing California. Indeed, regardless of the question, the Santa Barbara Democrat’s answer is the same: create a new tax, hike an existing tax, or make a temporary tax wider, deeper and permanent. Nava’s advice for every fiscal ill that we face is to ask all of us to pay more taxes and call him in the morning … at which point he will probably be well on his way to his next political office.

Joe Armendariz

Joe Armendariz

In his latest attempt to right what he thinks is wrong about oil development in California, Nava is calling for … you got it, a new tax. A severance tax on all of the oil produced here in California. This is Nava’s latest political tonic to help grow his chances at becoming our next state attorney general. A severance tax is “fair,” according to Nava, because oil companies are getting a “free ride” and that is, well, unfair. But are oil companies in California really getting a free ride as Nava suggests? Hardly. In fact, not only is this suggestion laughable, but the next thing we know Nava will suggest the Balloon Boy’s dad deserves the Nobel Prize for science.

Leaving aside — for a minute — the fallacy of Nava’s statement, it would seem that Nava has never been to a coastal city in his own district where the city council has been waging an expensive taxpayer-funded war against a local, independent oil company called Venoco. When members of the city council aren’t sliming and slandering the company, they’re busy suing them. Yes, I am sure Venoco’s management would be amused to learn that the company has been getting a free ride.

And perhaps Nava has not heard of another independent oil producer operating here in California called PXP. This company has already spent more than 10 years and untold millions of dollars trying to expand oil production from its existing offshore platform off the coast of Santa Barbara County. PXP not only agreed to shut down all production from its offshore platforms a full 10 to 12 years early, as part of a deal with some environmental organizations, but the company has also agreed to pay our bankrupt state $100 million before a single drop of new oil is recovered or refined. And if that weren’t enough, the company’s employees have now agreed to stop watching Fox News. OK, I’m kidding about the Fox News part — some things probably aren’t negotiable.

By the way, if you think after all of their concessions that PXP has been granted a permit to drill for oil … you probably also think Al Gore invented the Internet.

What is especially disturbing about Nava’s war on California’s energy producers, however, is not only his casual disregard for the facts, but also his apparent lack of understanding about how his politically motivated attempt to punish California’s energy producers will hurt the people who can least afford it: the working poor. Today, with an unemployment rate in California at 12.2 percent and climbing, and an under-employment rate at 24 percet and climbing, why any politician would wage war on working families struggling to make ends meet makes no sense to me. And make no mistake about it, if we make energy more expensive in California … everything we buy will become more expensive.

Compounding my frustration is Nava’s estranged relationship with the truth as it relates to how other states impose severance taxes, including and especially Alaska’s severance tax. Nava’s argument is that if Alaska has a 25 percent severance tax and he is only proposing is a 10 percent severance tax, then California’s energy producers are getting a fair deal. Upon closer examination, you will find that Alaska’s severance tax is a much different animal than what Nava is proposing here in California.

What Nava fails to mention is that in Alaska, the 25 percent severance tax is a “net revenue tax,” meaning it only taxes oil company profits. Nava’s severance tax, on the other hand, is a 10 percent tax on gross revenue — a huge difference as anyone in business understands. Moreover, Alaska’s severance tax allows companies to deduct the first $12 million of net revenues, resulting in very few companies actually paying the tax. Nava’s tax has no such exemption, which means it wouldn’t just hit “Big Oil” but our state’s smaller independent oil companies. This would drive many of these producers out of California, and the good-paying jobs they provide would leave right along with them.

The bottom line is oil companies get a lot of things for the right to do business in California, but a free ride isn’t one of them. Oil companies in California are taxed, regulated, re-taxed and re-regulated while trying to do business in one of the most difficult places on the planet. It could be true that the only thing faster and easier than securing a permit to drill for oil in California is to reach a lasting peace agreement between Israelis and the Palestinians. Not an impossibility, in other words, but a free ride it ain’t.

— Joe Armendariz is a Carpinteria city councilman and co-founder of Armendariz Partners, a public affairs consulting firm.