Oil and gas production taxes from the Permian Basin represented about 59% of total state severance taxes in fiscal 2019 and about 64% in fiscal 2020 and 2021 and 68% in fiscal year 2022, the Midland-Odessa Transportation Alliance detailed a press release.
The Permian Basin contributed about $979 million in royalties to the state through the Texas Permanent University Fund in fiscal 2021.
Last year, those severance taxes provided $3.6 billion in funding for the state highway fund alone, according to MOTRAN President James Beauchamp. “While recent increased funding for the Permian Basin is helpful, when you look at the amount of funding generated here, it is not unreasonable, in fact, I think it would be wise to raise the level of the state’s investment here.”
The Midland/Martin Metropolitan Statistical area accounted for just over 20% of those severance taxes and Reeves County was 9%, that’s 30% of those state funds or $3.1 billion in a single year.
Beauchamp noted that even smaller communities are making a huge difference. “Upton County generated over half a billion in fiscal year 2022. Loving and Howard Counties were also above half a billion. It is a huge return from a very small area. When you look at a map, you notice that these areas are grouped together. There is a lot of connections between them with workforce, regional retail and services, that means every additional dollar re-invested out here can have a huge impact.”