H.R. 5983 creates a dedicated federal trust fund to finance disaster resilience and recovery programs by imposing new taxes on oil and gas producers. The bill establishes three new excise taxes: a 13 percent tax on crude oil and natural gas extracted from federal leases in the Gulf of Mexico, a windfall profits tax on large oil producers when crude prices exceed 2015-2019 baseline levels, and an additional 10-cent-per-barrel tax on all crude oil. These tax revenues would fund FEMA programs focused on hazard mitigation, flood prevention, and building resilient infrastructure in disaster-prone communities. The legislation affects major oil and gas producers who extract or import more than 300,000 barrels daily, with the tax provisions effective starting January 1, 2025, for most provisions. The bill creates a sustainable funding mechanism for disaster preparedness and recovery without relying on general appropriations, directing revenue exclusively to proven FEMA resilience initiatives.
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