Today the House Natural Resources Committee considered the energy portions of the American Energy and Infrastructure Jobs Act (the transportation bill). Three bills—H.R. 3407, H.R. 3408, H.R. 3410 were marked up, dealing with the development of oil shale on public lands and offshore drilling in Alaska, the eastern seaboard, and other coastal areas. All three bills were discussed as being incorporated into the transportation bill as potential revenue generators to offset the nation’s transportation funding needs. But counting on the revenue that may or may not be generated from these new oil and gas leases to fund transportation priorities is nothing more than a budget gimmick that could exacerbate future budget deficits.

For years, taxpayers have lost billions in uncollected royalties and fees on oil and gas leases on public lands and offshore in federal waters. In the Gulf of Mexico, many leases operate royalty-free, despite sky-high gasoline prices and record high oil and gas industry profits. In addition, oil shale revenue is speculative because it is in its very early stages of development, and therefore is extremely difficult to ensure taxpayers will receive a fair return for extracted shale. No country in the world has established a commercially viable oil shale industry.

The royalty collection system is broken. It must be fixed before taxpayers can feel confident they are getting a fair return for the resources they own. Simply providing more access to federal resources will not solve these problems and could cost taxpayers billions more in lost revenue.

The problems don’t end there. Funding transportation needs today with speculative revenue from future energy development is not only fiscally foolish because it would siphon off revenue from the Treasury; it destroys the “user pays” principle upon which our transportation system is based.

With the country facing trillion dollar deficits for the next decade, any revenue that taxpayers do receive from oil and gas extraction must be returned to the Treasury.