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The High Cost of Assembly Bill 2716 is a Step Backward for California

Assembly Bill 2716 has significant implications for California's economy, environmental integrity, and increasing co-dependency on foreign countries. 

Sponsored by Assembly Member Isaac Bryan of Los Angeles, AB 2716 seeks to impose a daily fine of $10,000 on average oil-producing wells within the state. An operator that operates a single well that produces less than 15 barrels a day within 3,200 feet of a sensitive receptor will be fined $10,000 a day. This punitive legislation perpetuates a false narrative that a well that produces less than 15 barrels a day is a danger to California, when in fact over 80% of California oil wells are under that daily production, constituting 41% of the state’s production.

California is facing a $73 billion state budget deficit. The conflicts in the Middle East, the Russian/Ukraine war, supply chain disruptions in the Red Sea, shut-downs in oil production by Middle Eastern oil-producing countries and those in Latin America, and continued legislation like AB 2716 all lead to higher oil prices, making the timing of AB 2716 even more complicated. 

The more we reduce and eliminate domestic oil production, the more oil we import to meet demand. All that oil that we import from countries across the globe comes with a price—a price we all pay at the grocery store, when we shop for goods, and at the pump. 

AB 2716 also undermines the state's labor market and economic contributions from the oil sector. Currently, the oil industry employs 55,000 Californians and provides significant revenue to local communities. With state government cutting programs, who will fund our fire stations, libraries, and other essential local services? AB 2716 also contains no provisions for the 55,000 California energy workers who make an average income of $123,000 a year + benefits. 

Oil is more than just the fuel in our vehicles. There are more than 6,000 products made with petroleum. AB 2716 doesn't say how we are going to replace the tires on our cars, the asphalt, paint, shower curtains, umbrellas, sporting equipment, and countless other items without oil. 

So what is the plan? How is AB 2716 going to meet the energy demand of today, tomorrow, and for the foreseeable future? And if the solution is electricity, how will you make a football or prosthetic limb from electricity? 

The stakes are high and the outcomes are far-reaching. Legislators must closely examine what AB 2716 does beyond its talking points and fancy rhetoric. Looking under the hood, you will find that AB 2716 is silent about the severe economic and environmental repercussions it brings. 

If you want to cause more pain at the pump, lose revenue for local communities, and put 55,000 Californians on the unemployment line, then AB 2716 is for you. 

For more information, contact Sean Wallentine.


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