PA Budget and Taxing the Oil and Gas Industries

Below is a letter from the PA State Forest Coalition. Has some good contact numbers and other info in it.

72 Days without a State Budget  – Help the Politicians Solve the Budget Impasse

Pennsylvania is poised to be the center of the Marcellus Gas industry.  Our location, close to pipelines and the big markets on the East Coast, is ideal because their biggest cost is transportation – getting the gas to markets.

The Gas Industry will make billions of dollars from drilling in the Marcellus. That’s a given.  Pennsylvania taxpayers should not be stuck paying for the damage they do to our roads, bridges and water supplies.

Natural gas is not subject to local taxation in Pennsylvania (PA Supreme Court 2/19/09), so the Townships & Counties suffering the damage will have a big problem footing the bill for repairs.

Pennsylvania State Representative Bud George has proposed a Natural Resource Severance Tax Act (House Bill 1489).  Of the 14 states with large natural gas fields, only California and Pennsylvania do not have a gas severance tax.  HB 1489 is a fair bill. It would ensure that tax dollars would be returned to the communities suffering the impact of the industry.

The Pennsylvania bill is nothing new – it is simply copying what West Virginia had recently enacted – but the Lobbyists are crying to our politicians “Don’t kill our infant industry with a tax on the gas we take”.                             Bullfeathers, folks.

The Oil & Gas industry can certainly afford the extraction fees.

The 200 largest O&G companies now operating in Pennsylvania all have between 108 and 5,374 wells.  A total of almost 98,000 wells.

See DEP’s listing at:

http://www.dep.state.pa.us/dep/deputate/minres/OILGAS/2008%20Operators%20w%20GT100%20Active%20Wells.htm

A recent Penn State publication titled “Marcellus Shale: What Local Government Officials Need to Know,” stated on page 15 that local municipalities will “very likely will face higher demands for services and thus higher costs, and yet receive little new revenues to pay for those services. The result could be higher local taxes  .  .  . ”

View the entire document at:

http://downloads.cas.psu.edu/naturalgas/pdf/MarcellusShaleWhatLocalGovernmentOfficialsneedtoknow.pdf

HB 1489 would ensure that the gas industry pays its own way for the impact it will make on the boroughs and townships in Pennsylvania because the municipalities would share part of the revenue.

When we remember the damage left behind by previous extraction of oil and coal in Pennsylvania  (taxpayers are still footing the bills for that damage), it is only fair that the industry pays their own way this time around.

We’ve been 72 days without a State Budget.   Go to www.legis.state.pa.us, enter your zip code in the upper-right corner and contact your State Senator and Representative.

Use a few of the talking points we covered to convince your legislators that we’ll be stuck for the bills associated with the Marcellus Gas extraction unless the Gas Companies pull their own weight for a change.

.   .   .   Do your good deed for the week for Pennsylvania

Dick Martin
Coordinator,  PaForestCoalition.org

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