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A Resolution of the County of Allegheny urging the United States Congress to evaluate the desirability of enacting a tax on a portion of oil companies' total net income, defined as income after accounting for all corporate actions, in order to pay for public transportation and necessary infrastructure improvements and maintenance.
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Whereas, the price of gasoline and other petroleum products continues to rise at a rate that greatly exceeds the rate of inflation, and these rising prices cause escalations in the costs of other goods and services available in the private sector as freight costs increase; and
Whereas, rising prices of gasoline and other petroleum products also affect the ability of local governments to provide for the needs of their residents, as the costs of gasoline for fleet vehicles, asphalt for roads, and diesel fuel for buses used for public transportation, among other necessary items, have increased; and
Whereas, even as the population of the United States and local governments attempt to come to grips with these rapid increases in costs occasioned by petroleum product cost increases, oil companies realize tremendous profits; and
Whereas, according to Hoover's reporting service, the oil industry's average net profit margin is 9.3%, while the average for the S&P 500 is 8.5% and the average for all other U.S. industries is a mere 6.8%; and
Whereas, Also according to Hoover's, since 2002, Exxon Mobil's total net income (defined as income after all corporate actions have been accounted for) has risen from $11.2 billion to $40.6 billion (and increase of 362%), while BP's has risen from $6.9 billion to $21.6 billion (+ 313%), Royal Dutch Shell's have risen from $9.5 billion to $31.3 billion (+ 329%), Chevron's have risen from $1.1 billion to $18.6 billion (+1,690%), and Conoco Phillips' have risen from $762 million to $11.9 billion (+ 1,562%); and
Whereas, the total net income increase of just these five companies from 2002-2007 is a staggering $94 billion, representing a 417% increase in net income in five years; and
Whereas, from 2002-2007, the average annual rate of inflation in the United States fluctuated between 1.59% and 3.39%; and
Whereas, even as the rapid escalation of petroleum products' costs adversely affects residents and local governments, executives at major oil companies enjoy unprecedented compensation; when he retired in 2006, Exxon Mobil's Chairman Lee Raymond received a retirement package that approached $400 million in value to supplement his $51.1 million pay rate in 2005, his last full year of employment with Exxon; and
Whereas, despite the national oil crisis and accompanying cost increases for the nation's population, in 2007, Exxon Mobil's new Chairman was paid $21.8 million, while Chevron's Chairman made $15.7 million, and Conoco Phillips' Chairman was paid $15.1 million; these three individuals' total earnings ($52.6 million) represent combined compensation at a rate of just over $25,000 per hour;
Whereas, given the extreme growth in oil company profits since 2002, the imposition of a tax on a portion of oil companies' profits in order to fund public transit and infrastructure seems entirely reasonable; and
Whereas, such a tax, if imposed at a rate of 20% on all oil companies' total net income increases of 20% or more from the prior year from 2002 through 2007, would have generated approximately $4.2 billion in revenue for public transit and infrastructure from Exxon Mobil alone; and
Whereas, the purpose of the proposed tax is also to alleviate the tax burden on the people of Allegheny County and other local municipalities throughout the country;
The Council of the County of Allegheny hereby resolves as follows:
Section 1.
The Council of Allegheny County, Pennsylvania, hereby urges the United States Congress to evaluate the desirability of enacting a tax on a portion of oil companies' total net income, defined as income after accounting for all corporate actions, in order to pay for public transportation and necessary infrastructure improvements and maintenance, with all deliberate speed.
Section 2.
Copies of this Resolution shall be transmitted to Allegheny County's elected representatives in the United States Senate and House of Representatives.
Section 3. If any provision of this Resolution shall be determined to be unlawful, invalid, void or unenforceable, then that provision shall be considered severable from the remaining provisions of this Resolution which shall be in full force and effect.
Section 4. Any Resolution or Ordinance or part thereof conflicting with the provisions of this Resolution is hereby repealed so far as the same affects this Resolution.
SUMMARY OF LEGISLATION
This Resolution authorizes the acceptance of a distribution from the Pennsylvania Gaming and Economic Development and Tourism Fund for the restricted purpose of distribution to a community infrastructure development fund of a county of the second class to fund construction, development, improvement and maintenance of infrastructure projects through the Economic Development, Community Infrastructure and Tourism Fund established by the Redevelopment Authority of Allegheny County.