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Monday, April 17, 2000

Former Bush partner reaps $1 million oil tax break

Richard Rainwater's Pioneer company received largest share from emergency tax relief legislation

Associated Press

DALLAS - The company of a former business partner and political contributor to George W. Bush reaped a $1 million tax break from the governor's call for emergency tax relief for the oil industry last year, The Dallas Morn-ing News reported Sun-day.
   Irving-based Pioneer Natural Resources Co. received the biggest tax cut from a $45 million tax break for small oil and natural gas producers last year, according to The News, which cited state records.
   Richard Rainwater, who was a partner in the Texas Rangers and had other energy and real estate partnerships with Bush, created Pioneer with a 1997 merger and is the company's largest individual owner with 5.5 million shares. He also contributed $100,000 to Bush's 1994 gubernatorial campaign.
   "It is a practice we see throughout this administration," said Tom Smith of Public Citizen, a consumer watchdog group. "We have to ask whether or not this is another opportunity for Bush to benefit his business buddies."
   A Bush campaign spokesman said the governor and Rainwater never discussed the tax relief effort.
   A telephone call to Pioneer was not immediately returned Sunday.
   The tax relief was the first major bill Bush signed during Texas' most recent legislative session. Bush and other lawmakers said the help was needed to keep small producers pumping under what then were low crude-oil prices.
   "The Texas oil and gas sector was in a desperate situation last year and he supported the legislation to help small independent producers and their oil field workers and their families," said Scott McClellan, a Bush campaign spokesman.
   A handful of opponents to the oil tax-break bill protested that it provided corporate welfare to oil companies while offering little long-term relief to the industry. They said other businesses suffered economic downturns without eliciting similar help.
   "It was dressed up as for the little guy, but it was evident from everything it was going to be the big boys who would benefit from it, the ones who can support the Republicans and the governor," said Rep. Kevin Bailey, D-Houston.
   According to tax records from the state comptroller's office, big oil benefited the most. Chevron got a $722,000 tax break; Texaco $632,000; Exxon $449,000; and Union Oil of California $330,000.
  
  

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