State budgets tied to fossil fuels are slowing the energy transition and leaving workers and communities behind

  Achieving America’s net-zero energy future and avoiding the worst impacts of climate change requires a rapid transition away from fossil fuels toward clean energy. But a significant source of state funding for important programs—including schools, public health, and infrastructure—relies on continued oil and natural gas extraction from federal lands. Simply put, direct payments from the federal government to states are higher when more oil and natural gas is extracted from public lands and waters, creating a perverse incentive to drill more. These payments are at odds with public policy objectives: The federal oil and gas program creates political opposition to climate policy and undermines efforts to build a more equitable economy that works for all Americans.