The Santa Barbara County Board of Supervisors unanimously agreed yesterday to research the possibility of taxing each barrel of crude oil extracted from unincorporated county land.

In a presentation to the board, John Baker, assistant county CEO and planning and development director, outlined the county’s recent budget concerns and the various considerations in enacting such a tax. The board then approved further research into the potential impacts of a tax and agreed to revisit the issue in two weeks.

According to a Planning and Development Energy Division report, the proposed tax would charge local oil producers a set dollar value per barrel on all crude oil extracted within the unincorporated boundaries of the county, including state tidelands. The report stated that such a tax is already in place in five other California cities, which charge anywhere from $0.31 per barrel, as in Huntington Beach, to $0.59 per barrel, as in Signal Hill.

The report used a sample tax of $1.20 per barrel, a rate that would generate $3.84 million per year for the county, based on 2006 production figures. Although several board members expressed reservations about taxing local energy companies, all agreed that the county is facing difficult economic times that call for creative new revenue generating solutions.

After hearing the presentation, 3rd District Supervisor Brooks Firestone said he agreed that the tax could provide solutions to recent county budget strains.

“I don’t like the idea of taxes, but I’d like to point out to [energy companies] that we have an insoluble problem,” Firestone said. “We are going to be facing cuts into basic services that the people of the county expect and there are certain things that we just can’t cut.”

After reminding his peers that his term would end in just two months, Firestone added that he felt a personal urgency to help leave the county in a healthy economic condition.

“I don’t like the position we’re in, but I hate leaving the legacy to the county of not having the revenue to cover basic needs,” Firestone said.

During the meeting, board members said the tax could assist in funding several public projects. Supervisor Salud Carbajal said the proposed North County Jail would fail without a source of supplemental income.

“We are in a difficult place,” Carbajal said. “We need to pull a rabbit out of a hat in order to fund [the proposed jail] and its operations.”

Another issue raised by the board members was whether the tax might swell the already heightened cost of fuel in the county. Baker responded to this by explaining that the tax would not affect prices as they are set by international markets.

Furthermore, Supervisor Carbajal voiced the concern that such a tax might encourage an increase in oil production, which could have negative environmental impacts on the county.

“It’s unlikely that I would be in favor of supporting more onshore or offshore oil production, and I’m concerned about the incentivization for these companies, but we need to keep the door open because even though I would vote against it, I would hate for the county to lose those revenues,” Carbajal said.

The proposal presented to the board recommended the county prepare a ballot measure for the tax so that it can appear in the upcoming Nov. 4 election. In order to do this, the board would have to approve the measure by July 4 and submit a ballot order by August 22.

Supervisor Janet Wolf said that if the tax is passed, it will serve as an effective way to alleviate budget strains.

“I think this is a very wise proposal,” Wolf said. “I think that if we take this on we should do all the research we can, make sure everyone is on the same page and that we do it with some zeal.”