Big Oil v. Hollywood in California oil tax vote - Yahoo! News

LOS ANGELES (Reuters) - Hollywood is battling Big Oil over a California ballot initiative to fund alternative energy with a tax on the state's oil production.
The advertising battle over Proposition 87 has drawn a record amount of cash for a ballot question -- more than double that spent on the higher-profile governor's race. Californians vote November 7 on whether to adopt a tax similar to those levied by other oil-producing states.
"It's a staggering amount of money," said John Matsusaka, University of Southern California business and law professor and president of the USC-based and nonpartisan Initiative and Referendum Institute. "We're talking $107 million on a single measure in one state and we're not even done."
Stephen L. Bing, a movie producer and real estate scion, has pitched in more than $40 million in support of the proposal to tax oil output, which has been bolstered by the likes of Julia Roberts,
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On the other side, California-based Chevron Corp. alone has spent about $22 million to undermine the initiative.
Opponents warn that taxing domestic oil production could raise consumer energy prices, increase dependence on foreign oil, and spawn a wasteful state bureaucracy.
Supporters say the initiative will reduce the need for crude oil imports because tax money would bolster use and development of alternative energy sources.
California imports about 42 percent of its oil from foreign countries, with the rest coming state producers and Alaska, according to government figures.
The vote Yes campaign this week convened cameras to see Oscar-winner Julia Roberts visiting children suffering from asthma to highlight the ravages of air pollution. Former President Bill Clinton last week wagged a bent knuckle at a UCLA audience -- the backdrop for a Vote Yes commercial -- saying the oil tax won't raise gasoline prices at all.
Clinton and his former vice-president Al Gore are the main politicians in the vote Yes corner, with Gore adding environmentalist heft from his movie about global warming, "An Inconvenient Truth."
If the initiative passes, the California government will get $200 million to $380 million a year in new revenue from a tax of between 1.5 percent to 6 percent on oil production, according to the state's nonpartisan Legislative Analyst. The sliding scale of tax rate would go up and down with the price of oil.
Oil companies have not fled other states that have an oil extraction tax, and they won't flee California either, Clinton told fans at UCLA.
Among the top oil-producing U.S. states, California is the only one with no tax for extracting oil. Similar taxes include Alaska, at 15 percent, Texas at 4.6 percent and Louisiana at 12.5 percent.