LOGA Industry Report - Fall 2008 - (Page 27)

2008 Legislative Recap The 2008 Legislative Season has come to a close. It’s called a season this year because the Legislature has more or less been in session since February. Armed with two special sessions under their belt, the largely new Legislature convened on March 30, 2008, and finally adjourned on June 23, 2008. In total there were 1,389 House Bills, 813 Senate Bills and 877 total resolutions. By comparison, in previous years more 3000 bills have been filed. HB 1128 – Non-consent penalty increase. This bill increases the non-consent penalty from 100 percent to 200 percent assessed on non-operating interest owners in a unit well. Grant Black with Samson Resources and Don Briggs testiﬁed in committee. The bill passed unanimously and is effective August 15, 2008. HB 1220 – Provides for operating agreements of underground storage caverns. This will allow the state of Louisiana to enter into operating agreements for the production and operation of underground storage caverns. It requires majority vote of the State Mineral Board to enter into the agreement. Effective August 15, 2008. SB 194 – Prohibits the development, expansion or conversion of certain storage caverns in the Jefferson Island Salt Dome. This bill was created as a local bill to stop the expansion of two more AGL salt dome storage caverns in Lake Peigneur. Don Briggs testiﬁed in committee and the bill failed to pass Senate Natural Resources by a vote of 4-3. SB 442 – Prohibits exploring or drilling for oil and gas within 1000 feet of an interstate highway. Matt Ellard with Winchester, Dean Deslatte with A. Wilbert Sons, and Don Briggs all testiﬁed in committee. This bill was defeated. SB 754 – Another bill aimed at stopping AGL from expanding their salt dome storage caverns, this bill provides for certain permits concerning groundwater. It was LOGA’s only defeat this session. The bill passed out of the House Committee by two votes and passed the House ﬂoor only after Commissioner of Agriculture Mike Strain gave his full support for the bill. Other bills that are of interest, but do not directly relate to our industry: HB 1104 & SB 612 – Restructures Louisiana’s workforce development programs. The Department of Labor becomes the Louisiana Workforce Commission. The commission will oversee 18 Workforce Investment Boards across the state. The WIBs will serve as the liaison between the workforce and the commission and will have the authority and resources to respond to workforce issues facing their area. Effective August 15, 2008. HB 313 & SB 148 – Mandates that health insurance will cover prosthetic devices and services for up to $50,000 per limb per year. Effective June 21, 2008 HB 958 – Autism Mandate. Expands current insurance coverage to include the treatment of autism spectrum disorders. The coverage will include applied behavioral analysis treatments. Effective August 15, 2008. HB 435 & SB 288 – Tax Commission Attorney Fees. These bills accomplished two objectives. The ﬁrst was that the Tax Commission will determine who it audits based upon a set of objective standards rather than a list made up by the Louisiana Assessor’s Association. Second, the commission will be compensated for its actual costs for audits, not 10 percent of determined taxes. HB 747 & SB 289 – Contingency Fee Contracts. Prohibits local tax collectors and auditors from being paid on a per hour basis or a contingency fee system. HB 420 – Severance Tax Allocation. This bill increases the severance tax allocation to parishes from $850,000 to $2,850,000. This bill will go into effect over the next two years, with the ﬁrst increase to $1,850,000 on July 1, 2009. Overall, we had a very successful year from a legislative perspective. This was the ﬁrst run for our new legislators, and now that they have their feet under them, we can expect that they will be much more active in the future. www.loga.la | by Gifford Briggs Here are a few of the bills that LOGA supported and opposed that directly relate to the oil and gas industry. HB 55 – Prohibits the use of counter letters. We worked closely with Rep. Henry to have an exception included in this bill for our industry. Don Briggs testiﬁed in the House Committee and the bill passed out of the House, but failed to pass in the Senate. Rep. Henry had the bill recommitted as a stuffy resolution for the Law Institute. HB 798 – Provides relative to the procedure for lifting the oyster lease moratorium. We worked very closely with the members of the oyster task force to amend this bill to a form that would work for all parties. The bill is primarily aimed at restoring leases that have been lost due to coastal restoration. The ﬁnal result is that a commission will meet to promulgate rules for the lifting of the moratorium. This commission will include LOGA, LMOGA, LLA and others. HB 1117 – Provides for leasing and permitting of underground storage caverns. This bill updates current law to include carbon dioxide and liquid hydrocarbons as items that could be stored in underground storage caverns. It also clears up the permitting and leasing process for underground caverns. The bill passed unanimously and is effective August 15, 2008. 27 http://www.loga.la

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LOGA Industry Report - Fall 2008 Contents Chairman's Corner President's Perspective Commissioner's Comments From the Pipeline... Supreme Court Upholds Act 312 LOGA Challenges Commission's Ad Valorem Tax Rules The Haynesville Shale - Waiting for the Gas to Come In 2008 Legislative Recap Gulf Coast Prospect Expo 2008 2nd Annual LAGCOE Open Golf Tournament Conservationist by Trade Katrina Relief Fund Update DNR Intent Natural Gas Production Surges: A Free Market At Work IPAA Washington Report Legal Updates New Members Index to Advertisers

LOGA Industry Report - Fall 2008

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