Audits leave parish pockets lighter
VIDALIA — Oil companies in Louisiana recently decided to audit many wells in Concordia Parish, and the results of their audit have left the parish’s pocketbook lighter for the using.
Police Juror Randy Temple said the oil companies audited wells all over the state, and because of this they have exempted many of the wells from having a severance tax.
“There is a provision in the statutes that says if a well produces less than a certain amount of oil, it is exempt from the severance tax,” he said. “This is reducing royalties and dramatically decreasing the amount of money we would get in severance.”
Temple said the oil companies got a refund from the state from all of the oil wells they audited.
“They are entitled to it and they are well within the law for asking for a refund for all of the money from the wells,” Temple said.
Concordia Parish Police Jury president Melvin Ferrington said something needs to be done about the difference between money made from the severance in 2008 to now.
“We went from having $914,000 in 2008 to $122,000 so far in 2010,” Ferrington said. “Concordia is affected by oil and severance taxes, and parishes depend on this money.”
Ferrington said the jury based this year’s budget with last year’s severance tax in it.
“This was a major source of revenue for the parish,” he said. “It’s very unfair that all of our wells are not receiving a severance tax.”
Temple said the loss of the money has made it harder for the parish to budget for the year.
“It has created a real hardship for us since we have already budgeted with numbers we were comfortable with,” he said. “Now those numbers are different.”
Ferrington said the jury passed a resolution at Monday’s meeting to help get the severance tax back the way it was.
“We are going to introduce our plan and try and get it into the legislature by 2011,” he said. “We are going to a police jury convention this month, and we are going to bring it up there.”
Ferrington said jurors hope to see requirements that oil companies have to pay severance taxes for every operating well that is in the parish.
“They should pay a severance to the well whether they produce one or 100 barrels,” Ferrington said.
Temple said this process would be helped if the police jury could expand the legislature’s appeal to a larger group.
“There is strength in numbers,” Temple said. “We need to make it a state wide effort to show that strength.”