Oil Tax Initiative Funds Reported

SACRAMENTO —  A Hollywood producer and a Silicon Valley investor have poured $2.1 million into their campaign to put an initiative on the November ballot that would finance alternative energy research by taxing crude oil produced in California.

Steven L. Bing, head of Shangri La Entertainment and a financial backer of the 2004 film “The Polar Express,” contributed $1 million and Vinod Khosla, a Menlo Park venture capitalist and founding chief executive of Sun Microsystems Inc., put up $1.1 million, according to the initiative campaign’s first financial report, filed Wednesday with the secretary of State’s office.

In a separate report, a coalition of oil companies dubbed Californians Against Higher Taxes said it had collected $577,000 to fight the Bing-Khosla initiative, which could impose as much as $380 million a year in new taxes on California crude.

The state’s largest oil producer, Aera Energy of Bakersfield, was the biggest contributor at $250,000. The company is backed by affiliates of Exxon Mobil Corp. and Royal Dutch Shell. Plains Exploration & Production Co. of Houston, the fourth-biggest producer in California, gave $150,000.

Both sides said they were preparing for a tough and costly battle.

“We’re kicking off our signature drive next week,” said Fiona Hutton, a spokeswoman for Californians for Clean Alternative Energy, the group formed by Bing and Khosla. “We’re all set and ready to go.”

Oil industry spokesman Al Lundeen, referring to the outpouring of financial support from oil companies, said: “We take this as a serious threat.”

To get on the ballot, the proposed initiative must collect valid signatures from about 600,000 registered California voters. With $2 million already on hand, proponents should have no trouble financing a successful petition drive, analysts said.

“In initiative politics, this is as good as it gets,” said Shaun Bowler, a political scientists who studies initiatives at UC Riverside.

The initiative would mandate that money raised by the oil tax would bankroll a new state agency that would make research grants to scientists at California universities and support the development of new vehicles and fuels that would contribute to a 25% drop in petroleum use in a decade.

The initiative would prohibit oil producers from passing the tax along to consumers of gasoline and diesel fuel.

However, a review of the measure by the state’s legislative analyst’s office questioned whether California tax officials could be sure that at least part of the levy would not be reflected in prices at the pump.