Harrisburg Scrooges deny severance tax

Posted 8/21/12

One of the main reasons Pennsylvania’s budget this year is coming in December rather than June is because Gov. Tom Wolf really, really wanted the budget to include a severance tax, similar to those …

This item is available in full to subscribers.

Please log in to continue

Log in

Harrisburg Scrooges deny severance tax

Posted

One of the main reasons Pennsylvania’s budget this year is coming in December rather than June is because Gov. Tom Wolf really, really wanted the budget to include a severance tax, similar to those in every other state where shale gas resources are being exploited.

Wolf campaigned heavily on the notion of a severance tax and won the race. Other elected officials, even some Pennsylvania Republicans, also campaigned on adopting a severance tax, but most Republicans, especially those in positions of leadership, have heartily opposed the tax.

House Speaker Mike Turzai has been an especially vocal critic of a severance tax, and Turzai has also been the recipient of about $150,000 in contributions from the oil and gas industry in the last three elections. Turzai’s office says this large amount of money does not have an impact on his legislative decisions.

Does anyone really believe that?

Does anyone really believe that any politician of any political party, whether at the local, state, or national level, can accept huge amounts of money from an individual or industry, and then behave as if it never happened?

We don’t believe that’s possible. Many voters agree.

It seems likely that former Gov. Tom Corbett was turned out of office during the last election, at least in part, because of his perceived too cozy relationship with the fossil fuel industry in the state.

Polls suggest that a majority of Keystone State voters would like to see a severance tax. Gas industry defenders say with the price of gas so low these days, the industry can’t afford any severance tax. Yet, somehow, drillers in other states manage to keep moving gas and pay severance taxes.

In any case, Republican leadership dug in their heels, and after months of stalemate, Wolf gave in and decided to withdraw a severance tax as part of this year’s budget. This has brought protests from many quarters.

Larry Schweiger, CEO of the statewide environmental advocacy organization PennFuture, released the following statement: “A budget that does not include a severance tax not only ignores the will of a majority of Pennsylvanians, but also shifts much of the tax burden squarely on their backs. Rather than listening to their constituents, lawmakers are listening to well-funded industry interests at the expense of our environment.

“Pennsylvania is the only gas-producing state in the nation without such a tax. Even with the current impact fee, the state is giving away a finite natural resource at the lowest rate in the nation. The scales are clearly stacked against Pennsylvania’s citizens, public health, air, land, and water.”

Members of the industry told Rep. Michael Sturla as far back as 2011, that the industry would not leave the state even if there was a severance tax that was 1% higher than that of any other state.

Wolf has promised to bring up the issues of a gas tax when he presents his 2017 budget proposal to the general assembly. Because of the lengthy impasse this year, that is likely to come only a month or two after the 2016 budget is passed (at press time, the Senate was planning to go ahead with a vote on the budget compromise reached with Wolf, though it remained unclear whether there is enough support in the House to pass it.)

When Wolf does include a severance tax in his 2017 budget proposal, we hope the Republican leadership will give it serious consideration, instead of the knee-jerk rejection they greeted it with this year and every year since the gas boom began.

Comments

No comments on this item Please log in to comment by clicking here