STATEMENT OF MRS. NORMAN MILLER, CHASE, KANS., ON BEHALF OF THE CHASE PRESBYTERIAN CHURCH

Mrs. MILLER. Senator Dole, I am Mrs. Norman Miller from Chase, Kans., and I'm going to speak to the situation in a different point of view than any have been spoken here today.

I am an elder in the Presbyterian Church in Chase, Kans., and a few years ago our church was willed 2,700 acres of land which it is our good fortune to have oil on. This tax came out and there were certain exemptions and we have a President that goes before the TV saying he's such a good born-again Christian, but he fails to realize that the Christian Church, the greatest charitable institution in the world and in our own State. In our State I think it would take all 10 fingers if you were to count the colleges that are maintained by the various churches in our State. I give money. We set aside $15,000 for benevolence to certain places, $7.000 of it went to Sterling College and $7,000 went to Long School and then $750 into the Senior Citizen Center in Chase.

I'm asking for an explanation why schools and colleges are exempt from this tax and yet the churches, the most benevolent group of people in the United States, have to pay the tax. Thank you.

Senator DOLE. Thank you.

STATEMENT OF HELEN DROSSELMUYER, KINGMAN, KANS.

Mrs. DROSSELMUYER. I am Helen Drosselmuyer from Kingman, Kans., and I have the same drive and everything that everyone has. I want to get to work if there's anything for me to do. There's a group of us in Belmont, Kans., south of Kingman, but we don't really know what to do. Do we need more testimonial letters or petitions? What do we need? We're ready. I'm ready to go if there's anything for me to do. Senator DOLE. There is. I understand some efforts being made in Kansas and Oklahoma and other States to put together statewide organizations. I am not a part of that but we've been furnishing information to any group. We have had the testimonial of the group for the Southwest Kansas Royalty Association. There's another eastern Kansas association. As far as myself and Senator Kassebaum, you do not need to work on us because we are both pushing this proposal. We do need to work on some of the people in other States, that seems to be the problem.

Mrs. DROSSELMUYER. That's going a little too far for me. Perhaps we could just individually go out and contact people and if we can help you, we would certainly do it.

Senator DOLE. I appreciate that. There are other things that can be done. Even in Great Bend and my hometown of Russell, there are a lot of people who do not have any oil income. They say what are royalty holders complaining about-I don't have any oil on my property. So I guess there is missionary work to be done in your own neighborhood because there are some people who are not fortunate enough to have any oil and don't understand the problem.

Mrs. DROSSELMUYER. There's a lot of people that think the big oil companies the big ones aren't paying this. They don't realize that we little ones are suffering as much as we are.

Senator DOLE. I think it's $56 billion out of $227 billion.

Mrs. DROSSELMUYER. Would you appreciate some more letters or will it do you any good?

Senator DOLE. We like to have a lot of letters.

Mrs. DROSSELMUYER. I can't go out of State.

Senator DOLE. What we can do with your letters is maybe figure out some way to transmit those to Senators in nonproducing States. They would have the same impact as the representative from Springfield had on Senator Percy. Senator Percy is now cosponsoring this bill because somebody pointed out to him that there are a lot of stripper wells in Illinois. There are a lot of stripper wells in New York and in Pennsylvania, but we did not have much support from the Senators in those States. Some were Democrats and some were Republicans.

STATEMENT OF WYLIE GORE, ELKHART, KANS.

Mr. GORE. I am Wylie Gore, of Elkhart, Kans., out in the southwestern corner of the State. I still appreciate you, Senator, and Senator Boren in taking your time and effort to come out to western Kansas to be with us and I certainly appreciate the crowd. I've been to a lot of different hearings and one thing and another and there wasn't enough people, probably more politicians than there were patriarchs, if that's the word.

I'm also one of the farmers that was in Washington last year and I appreciate the attention I got from our people in Washington and some don't like the way they were treated.

I'm an American, natural-born American, and I'm proud of it, but I'm not proud of the way I'm being treated part of the time and we're going to have to start being American and stand up for our rights and get out and start doing something.

My parents have mineral rights, they have some oil production. It's old oil, started in 1965. It's terribly high priced, $10 a barrel, but they got it.

I'm going to make two statements I probably shouldn't, but I'm going to anyway. The American Revolution was fought over excess taxation without representation. It may be time to look very closely at Mr. Carter's excess profit tax. If this isn't taxation without representation I never saw anything that was. I resent the misrepresentation or lack of truthfulness in his presentation of this matter to the American public on TV. If there was any one thing said about taxes on the widows and orphans and the schools, it damn sure never was shown on TV. And my old grandfather was a Baptist, he was one of the hellfire. and brimstone Baptists. He told me people go to hell for the sins of omission as well as sins of commission. It damn sure ain't right. Thank you, sir.

Senator DOLE. Thank you.

STATEMENT OF CAROLYN A. GERRITZEN, CLAFLIN, KANS.

Mrs. GERRITZEN. I'm Carolyn Gerritzen from rural route, Claflin, Kans. You have my letter. I sent you one and got a big fat letter back and thank you very much for that.

Now, I'm going to flip the record over and play the other side. I haven't heard anybody say how much they paid taxes to the—well,

Barton County, like I did. Independence Township is where my little dab of oil comes from. I paid oil production tax to Unified School District No. 364, also to Barton County, Juco. That's over there. I paid out of $42.56, Barton County Junior College, or Barton County Community College as they wish to be called, $5.65 out of the $42.56, and Claflin Unified School District No. 54 got $25.04 out of the $12.56, giving a total of $30.73 that came out of that $42.56, went to the schools presumably to pay for the teachers and buy books and I don't know what all. And the fire district, it compromised and I understand it's around five, they got $1.10 out of the $42.56. I don't begrudge paying this tax, I gladly pay it because we need education for this generation and the next generation. If the windfall profit tax keeps on, our schools won't be getting this and even if they do, one individual said the oil would be devalued and look at what the schools are missing. That is my point.

Senator DOLE. That's a good point. I think it was stated by one of the witnesses, but that gives us more detail.

Mrs. GERRITZEN. I have a copy of this. I won't give you my tax

statement.

Senator DOLE. I won't be able to pay it.

Mrs. GERRITZEN. I need this here one for my shoe box.

Senator DOLE. The other day in Congress a Member was making a speech and said, "Let me tax your memory," another Member jumped up and said, "Why haven't we thought of that before." The point is I think the American people have been taxed enough. There's a $104 billion proposed in new taxes to go into effect in fiscal year 1981-$104 billion. There's the windfall tax, social security tax, they want to pass an oil import fee now which is just another tax. I think the American people have been taxed enough.

Mrs. HOLLY. I'm Freida Holly of Edna, Kans. I want to know what date the tax starts, what month it starts.

Senator DOLE. Oil produced after March 1, sold after March 1.

Mrs. HOLLY. I have a stripper well and my production tank fills in about 4 months and my last dump was in November. My tank was tagged in February to be emptied, but was not emptied until the first of March and I was charged $300 tax.

Senator DOLE. Let me have you visit with Mr. DeArment, who is right there. Rod, why don't you stand up. Maybe he will be able to clarify that specific problem.

STATEMENT OF GAIL BEESLEY, GOVE, KANS.

Mr. BEESLEY. I'm Gail Beesley from Gove, Kans., and what I'm going to present is probably of little interest of what we've been hearing here today. I hope you won't all say that guy suddenly made it with what I have to say.

We own seven quarters of land in Gove County, Kans. which has $44.000 mortgage on it and we started buying it in 1948 shortly after we were married and our farming and ranching operation lost $18,000 in fiscal year 1979. Three oil wells were discovered on one quarter of that land in 1979. The total withheld in windfall profit tax on our check for April 1980 production which we received in the mail yester

day, a total withheld of $53,000. This accumulates to more than $635,000 withheld per year. This would be withheld for 12 months if production holds at its present level. The amount of $635,000 is more money than the land itself was valued at 1 year before the oil was discovered. My dad started part of what I farm as a homesteader in 1900. We believe firmly in the family farm. My son is going to follow me, is beginning to work with me. We're trying to decide how we can transfer with this inheritance tax and State tax, how we can get this over to our children as they inherit.

It sounds like from rags to riches when we lost $18,000.00 in 1979 and here only the windfall profit tax is going to amount to over $600,000 next year. What really concerns me is the fact that they withhold this amount of money which in our estimation is purely confiscation of our personal property. We have the deed to it. We own the minerals and the fact these wells in our area usually pump 3 or 4 years, we are automatically going to be pushed into a 50 or 60 percent income tax bracket. After that with subtraction of the windfall profit tax, we don't know how much we are going to be increased on the personal property tax. Just the other day my sister called and said you have four wells on that land. I said no, we have three. She said it's my understanding you have four. I don't know what we'll have for property tax on a quarter of land. I haven't talked to my accountant, but we're probably going to be losing 70 to 80 percent of that back down to stripper wells and will not be able to lease in the future. In years past we've had dry wells drilled and when people came around leasing we wanted to lease everything. They said no, you have a dry hole and we won't take it but when your production ceases down the road a few years we're going to be without this. I think the law is unconstitutional. I would like to see it contested. We're supposed to be a free government. How can they legally come out and take property. I want to put in my short written statement in the record.

Senator DOLE. There is a lawsuit pending, as you probably know, in Oklahoma to test the constitutionality of the windfall tax. We hope it's successful. There is an exemption granted on oil discovered on Indian reservations and Alaskan oil. If it's excise tax it has to be spread equally without exemption, so the lawsuit is based on that theory. As I stated I hope it's successful.

I might say that Senator Long, who is chairman of the Finance Committee and a very powerful Democrat in Congress, promised me on the Senate floor that he would help us find some relief for the royalty owners and some more relief for independent oil producers. Perhaps he can persuade President Carter of the need for this relief, I certainly think it will be in President Carter's political interest to say that before November that a mistake has been made and that he would recommend an exemption for royalty owners or other relief. That would be most helpful, but failing that, we just have to keep working with what we have in persuading members who voted against. us to vote for us.

We have time for one more witness, so this will be the last witness. UNIDENTIFIED SPEAKER. I was wondering when you started that you said that the Senators or your colleagues on the windfall profits, they said well the farmer hasn't got much to worry about or the landowner,

they get the check but they don't realize that there wouldn't be any way for oil companies to drill unless they leased the ground from the farmer. Now, I've purchased ground for the last 12 or 15 years and the purchase price included a mineral base. The original price eliminating the minerals would have been considerably less, so now I have no oil income, but I feel this tax is just at the tip of the iceberg. I was listening to Berglund last week when he said there would be nothing wrong with the grain farmer getting 90 percent or 100 percent of parity, we'll just put a windfall profit tax on there.

Now, if they can do it to the oil industry, they can do it to the rest of agriculture. They can do it to the rest of all the raw materials which is the base of our economy. The fact that they have done it to the oil industry is the fact that the farmer will have to be more watchful to make sure that they don't increase the price and then take it right back or take it back more than what they gave him.

The other thing I was wondering, I never heard it called an excise tax, the windfall profit tax. Is this actually an excise tax or is it classified as something else?

Senator DOLE. It's an excise tax, but very honestly, and many of us were very critical of the President every time he went on television he called it the windfall profit tax. If you're an average listener from a non producing region and somebody says oil producers making a windfall it has an impact. It's one of those words that you use when you want people to agree with you. This is not a windfall profit tax, it's not based on profit at all. You can lose money and still pay the tax. As Mr. David from Lenora testified earlier it's an excise tax purely and simply, not a windfall profit tax.

UNIDENTIFIED SPEAKER. If I buy a tire that has an excise tax on it, now this excise tax will be deducted from my income as an expense. Now, will that hold true as far as the excise tax on the oil?

Senator DOLE. Yes.

UNIDENTIFIED SPEAKER. And you deduct it from your income tax? Senator DOLE. It's deductible but in some cases people don't have to pay any income tax so there's nothing to deduct it from.

UNIDENTIFIED SPEAKER. If I overpaid any taxes or have a rebate coming, would this money come back to me?

Senator DOLE. I do not know if it's refundable.

UNIDENTIFIED SPEAKER. Another thing, we're getting all these taxes, there's a windfall, there's a sales tax, there's a property tax. In our area we're trying to get a water district in. I think it's going to be 3 years now. We can't seem to be making much headway because of the redtape, bureaucracy. Is there anyway of speeding it up?

Senator DOLE. We can't do it at this hearing. I can get Morgan Williams to help you with that.

Mr. ANDREW LARSON. I'm Mr. Andrew Larson from Garden City. If you can spare the time, I'd like to make a statement, about 5 minutes. Senator DOLE. Maybe you'd better put it in the record. Let me say that if anybody has any statements, just leave them at this desk and I want to thank all of those who have been here and those who have stayed throughout. We appreciate your coming. We're going to do our best to do something for you. Thank you.