LOUISVILLE – Congressman John Yarmuth (KY-3) announced today that he will introduce legislation to finally end federal subsidies to oil companies and return the money to the American people through targeted gas rebates. The savings of nearly $40 billion will provide direct assistance to American drivers struggling with high gas prices through one-time payments of approximately $160 per registered vehicle – an average of $320 per Louisville family.

“It’s American families who struggle when the price of gas rises, not oil companies whose record profits only increase when we pay more at the pump,” Yarmuth said. “That is why I’m introducing legislation to end taxpayer-funded subsidies for oil companies and return that cash to consumers.”

The oil industry is slated to receive about $38.6 billion in federal subsidies over the next 10 years, even as the nonpartisan Joint Economic Committee concluded the subsidies do not lower prices at the pump. Yarmuth’s bill, which he plans to introduce this week, would eliminate the subsidies entirely and immediately inject the full $38.6 billion into the U.S. economy. The economic impact for Kentucky alone would total more than $564 million.

The legislation instructs the Internal Revenue Service and the Secretary of the Treasury to work with states to oversee and distribute rebates to individuals and businesses for each vehicle they own or lease for longer than one year. According to the Federal Highway Administration, there are approximately 242 million privately registered vehicles in the country. The $38.6 billion will be divided among those 242 million vehicles, resulting in rebates of approximately $160 per vehicle.

Even with domestic oil-drilling at an all-time high, the cost of filling the tank continues to rise, and Louisville families and small businesses have been among the hardest hit with prices spiking above the national average in recent weeks.

A Louisville family who spends $50 a week on gas could see an increase of $10 at the pump every week if prices rise to $4.50 a gallon this summer, as some experts have predicted. Under Yarmuth’s bill, the rebate for a family with two cars – $320 – should offset this jump in prices for the duration of the summer.

Erin Burke, who joined Yarmuth at a news conference today in Louisville, is a teacher and mother of three who estimates she and her husband spend more than $350 a month on gas. She said the rebate would bring some much-needed budgeting relief to her family this summer.

“An extra $320 would certainly help,” Burke said. “Most of the driving I do is around town, and even though we live near where our kids go to school, it adds up awfully fast.”

Brelis Spiller is a father of four who also joined Yarmuth at today’s news conference. Spiller said his family spends a lot of time in their minivan – whether he’s taking his daughters to ballet or his son to baseball practice.

“We’re the ones who need the money, not the oil companies,” he said. “Giving that money back to consumers just makes sense.”

High gas prices also squeeze businesses, particularly small companies. Tricia Burke, president of Louisville-based Office Environment Company, said her business spends thousands of dollars on fuel every year. The company, which supplies office products and furniture, employs 26 and maintains a fleet of three vans and two trucks.

“Small businesses like ours have tight margins, and when the price of gas goes up dramatically, it hurts,” said Burke, whose company would receive an $800 rebate under Yarmuth’s bill. “A rebate to help cover that increase would be a big relief this summer.”

As gas prices rise, oil companies are making record profits. Last year, the five biggest oil companies – BP, Chevron, ConocoPhillips, ExxonMobil, and Shell – combined to earn a record $137 billion in profits despite producing 4 percent less oil than in 2010. In the same year, they collected approximately $4 billion (more than $7,600 per minute) in subsidies funded by American taxpayers and laid off more than 10,000 workers.

In 2005, President George W. Bush said, “I will tell you with $55 oil we don’t need incentives to the oil and gas companies to explore. There are plenty of incentives.”

The price of a barrel of crude oil last week hovered around $107. Since 2005, oil companies have received nearly $300 billion in tax breaks.

Yarmuth supports long-term investments in clean energy alternatives and domestic production to reduce U.S. dependence on foreign oil. Still, with gas prices continuing to rise, the Gas Rebate Act helps struggling American families who need help now.