LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 23 HLS 243ES 59
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: November 25, 2024 11:35 AM Author: GEYMANN
Dept./Agy.: Energy and Natural Resources
Subject: Oilfield Site Restoration Fund Analyst: Richie Anderson
MINERALS EN INCREASE SD RV See Note Page 1 of 2
Provides for the administration of the Oilfield Site Restoration Fund (Item #16)
Present law establishes the Oilfield Site Restoration Fund (Fund) to collect fees from oil and gas production and authorizes the Department
of Energy and Natural Resources (DENR) to use the Fund for site restoration programs. Proposed law allows the Natural Resources Trust
Authority (NRTA) to pledge revenue under the direction of the secretary of DENR, with oversight provided by the State Mineral and Energy
Board. Under the proposed law, NRTA would manage the Fund, security instruments, and site-specific trust accounts, and execute
agreements instead of the Oilfield Site Restoration Commission (Commission). Present law authorizes the secretary and assistant
secretary to direct Fund disbursements, with the Commission approving allocations up to $500,000 annually. Proposed law would allow the
NRTA to direct disbursements and approve allocations, removing the Commission’s authority to approve such disbursements. NRTA would
assume authority over the special custodial trust fund within the Fund in which federal funds are designated. Finally, the proposed law
increases existing site restoration fees that are imposed on wells that produce oil or natural gas. Proposed law removes the average New
York Mercantile Exchange as the benchmark used to determine the price of oil and natural gas. Effective July 1, 2025.
EXPENDITURES 2024-25 2025-26 2026-27 2027-28 2028-29 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $25,200 $0 $0 $0 $0 $25,200
Ded./Other $0 INCREASE INCREASE INCREASE INCREASE $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $25,200 $25,200
REVENUES 2024-25 2025-26 2026-27 2027-28 2028-29 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other $0 INCREASE INCREASE INCREASE INCREASE $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $0 $0
EXPENDITURE EXPLANATION
To the extent significant revenues are generated from the increase in fees, a subsequent increase in Statutory Dedications expenditures
can be expected; however, the LFO cannot anticipate the timing or amount of these expenditures. The Louisiana Department of Revenue
(LDR) anticipates one-time expenditures in FY 25 totaling $25,200 SGR for minor system design and specification updates, testing, and
system development in support of tax return modifications and processing system modification. Any expenditure increases would be
financed via SGR out of current collections, ultimately reducing SGF revenue mechanically.
REVENUE EXPLANATION
Proposed law will increase Statutory Dedication revenues into the Oilfield Site Restoration Fund due to the increase in the fee
assessment per barrel of oil and per thousand cubic foot (MCF) of natural gas.
Proposed law increases the Oilfield Site Restoration (OSR) fees on full-rate production crude oil and condensate as follows,
based on the oil price per barrel: below $60, the fee will increase from 1.5 cents to 2 cents; between $60 and $90, the fee
will increase from 3 cents to 4 cents; above $90, the fee will increase from 4.5 cents to 6 cents. Proposed law shifts the
existing OSR natural gas fee from a single flat amount to a tiered fee system based on the price of natural gas per MCF:
below $2.50 will remain at 3/10 of one cent; between $2.50 and $4.50, the fee will increase to 4/10 of one cent; above
$4.50, the fee will increase to 5/10 of one cent. The changes are summarized below:
Proposed Fee Changes (in cents):
Oil-Price per Barrel Current Fee New Fee % Increase
less than $60 1.5¢ 2¢ 33.3%
$60 to $90 3¢ 4¢ 33.3%
greater than $90 4.5¢ 6¢ 33.3%
Gas-Price per MCF Current Fee New Fee % Increase
less than or equal to $2.50 3¢ 3¢ 0%
$2.50 to $4.50 3¢ 4¢ 33.3%
greater than or equal to $4.50 3¢ 5¢ 66.7%
Continued on Page 2
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Patrice Thomas
x 13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} Deputy Fiscal Officer
or a Net Fee Decrease {S}
 LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 23 HLS 243ES 59
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: November 25, 2024 11:35 AM Author: GEYMANN
Dept./Agy.: Energy and Natural Resources
Subject: Oilfield Site Restoration Fund Analyst: Richie Anderson
CONTINUED EXPLANATION from page one: Page 2 of 2
Continued Revenue Explanation
For illustrative purposes, in FY 24, the Department of Energy and Natural Resources (DENR) collected $901,326 from oil fees
and $12.7 M from gas fees. Based on the proposed fee increases, the total collections in that FY would have risen to $1.2 M
from oil fees and $14.8 M from gas fees; an increase of $2.4 M combined. Assuming that oil and gas production remains at a
similar level, DENR can anticipate similar collections in future fiscal years; however, due to uncertainty surrounding oil and
gas prices and production, the LFO is unable to estimate the precise amount of these collections in future fiscal years.
Current law requires LDR to stop collecting OSR fees once the balance in the Fund reaches $14 M and resume once it falls
below $10 M. Proposed law repeals this provision in R.S. 30:86(C), which would allow the increased collections proposed in
this measure to be deposited into the fund.
The proposed law would shift the existing OSR gas fee from a single flat amount to a tiered fee system based on the price
per MCF. For illustrative purposes, looking at monthly price data obtained from the U.S Energy Information Administration
(EIA) over the past five years (60 months), this change would have resulted in the fee remaining at 3¢ for eight months
(average prices below $2.50); 4¢ for 37 months (average prices between $2.50-$4.50); and 5¢ for 15 months (average
prices above $4.50).
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Patrice Thomas
x 13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} Deputy Fiscal Officer
or a Net Fee Decrease {S}


Statutes affected:
HB23 Original: 30:81(B), 30:83(F)(2), 30:1(B)(3), 30:86(A)(2), 30:87(A)
HB23 Engrossed: 30:82(3), 30:83(B)
HB23 Reengrossed: 30:82(3), 30:83(C)
HB23 Enrolled: 30:82(3), 30:83(C), 30:86(C)
HB23 Act 16: 30:82(3), 30:83(C), 30:86(C)