On April 24, 2009, former Speaker of the House Newt Gingrich addressed a House Energy Commerce subcommittee in which he lauded Del. Saxman for his stand on drilling off the coast. In his remarks that were carried on Real Clear Politics, Mr. Gingrich testified about the American Clean Energy and Security Act of 2009.
In the midst of ideas and concerns about energy, Mr. Gingrich addressed the legislative work of Del. Saxman:
Create public/private partnerships in coastal states to fast track the ability of oil and natural gas companies to develop offshore oil and gas resources. If Congress were to lift the ban on offshore oil and gas development (or at least grant coastal states the right to develop the resources with a plan to share revenue with them), states would move swiftly to set up partnerships that will maximize the best use of oil and gas revenues.Read Speaker Gingrich's entire remarks here.
Efforts in Virginia provide a good example. In 2004, two Virginia legislators, Delegate Chris Saxman and Senator Frank Wagner, learned that Virginia manufacturers were warning of the rising costs of energy because of tightening energy supplies. Once they discovered that oil and gas resources exist off Virginia's shores, and that the state could experience rapid economic development from the actual business of energy exploration and development, Saxman and Wagner immediately designed legislation that would have Virginia petition the federal government for permits to drill offshore. In addition, the legislation specified that a significant portion of oil and gas royalties, state fees, and licenses collected by the state would go to improve Virginia's transportation infrastructure, clean up the Chesapeake Bay, and invest in technologies related to new energy production.
The economic potential for Virginia is significant. The oil and natural gas revenue estimated to accrue to Virginia is $13.53 billion dollars over thirty years, or $451 million annually. This is a conservative estimate that could increase with technological advances.
But these are not all the economic benefits that Virginia would reap. In just the Hampton Roads area near Norfolk, it is estimated -- based on experience with the oil and gas industry in Nova Scotia and Louisiana -- that oil and natural gas development would result in around $8 billion in capital investment and 2,600 new, high paying jobs. These new jobs would have an estimated payroll close to $650 million annually. Virginia would thus see $271 million more flow into the state treasury in the form of state and local taxes as a result of this increased economic activity.
This new tax revenue could then be used to fund transportation projects in the Hampton Roads area and throughout the state.
Imagine funding new roads, cleaning up the environment, and making investments in basic research and development science to promote new energy sources - all without raising taxes. How many coastal states besides Virginia would like to achieve that combination of benefits? Coastal states could lower energy costs for their residents as well as the energy costs of fellow citizens across the country, while relieving congestion and cleaning up the environment.