PA NG Severance Tax

November 12th 2010 update.

The Severance tax has not yet been passed.

Some people are happy it has not passed because in the version that was being submitted, I have been told by Nancy J that only 16% of the tax would go to the municipalities and of that 16%, only 40% will go toward protecting the environment.  (6.4% of the total tax is not a fair share.)

86% would have gone to the general fund.

Still, at this time, the gas companies are extracting Natural Gas from the State of Pennsylvania without paying anything for it. and that is not capitalism.
That is why the tax needs to be passed As Soon As Possible.
If it is not passed, some independent news person should follow the money and do their job and write a News Story about it. (and publish it!).

Here are the basic links that have been located:      Simple Fact Check...    Site to help Generate an email ...

13October2010  Tom Corbett  is not for the Severance Tax

10October2010     Governor Ed Rendell Strongly Urges the Senate to pass the Severance tax (Here is the letter that was written by the Governor).
10October2010     PennFuture clearly summarizes the situation.

The Pennsylvania Natural Gas Severance tax is a Tax on the Gas companies for the Natural Resources that they are taking from the ground of Pennsylvania.  It is not a tax on the people of Pennsylvania...  This page is dedicated to providing the facts about the Severance tax.

To Begin:  The Gas industry lobbied intensely to continue not paying anything for the gas that is (and will be) extracted.  There was a grassroots movement to insist on the tax and to provide some of the collected money to environmental groups and also to the Pennsylvania general fund. (Action item Alert Sample letter.docx) and (Why PA needs a Severance tax). There was support from some of the elected officials as well. (Rep Steve Santarsiero), (Sen Chuck McIlhinney)

Drilling Fact of the Day

We knew some legislators liked the drillers but we didn’t know that they really really really liked them.

The Pittsburgh Tribune-Review reports that some legislators want to give away nearly $70 million to drilling industry-related projects. That’s how much the drilling industry – which pays no severance or property taxes here in Pennsylvania – is due to get from Pennsylvania taxpayers if the projects authorized in the 2010-11 Pennsylvania Capital Budget Bill are actually funded.

These proposed gifts from the taxpayers to the drillers include:

  • $1.25 million to construct a multi-tenant industrial building in Clearfield County
  • $4.5 million for a wastewater treatment plant for flowback fluids from hydraulic fracturing operations in Bradford, Clearfield County
  • $6 million for a wastewater treatment plant in Morris, Clearfield County
  • $6 million for a wastewater treatment plant in Philipsburg, Clearfield County
  • $10 million for a Marcellus shale enterprise center in Sandy, Clearfield County
  • $4 million for a wastewater treatment plant in Wayne, Clinton County
  • $4 million for a wastewater treatment plant in Horton, Elk County
  • $2 million for a Marcellus shale learning resource center and laboratory at Powdermill Nature Reserve in Cook, Westmoreland County
  • $31.5 million for the Delaware & Hudson Railway to establish transload facilities and upgrade infrastructure from the New York state line through Susquehanna, Wyoming, Lackawanna, Luzerne, Columbia, Montour and Northumberland counties, to accommodate "new commodities and developing markets."

What a great way for our legislators to pay back their new BFFs who have spent millions in campaign contributions and high-priced lobbyists to keep from paying severance taxes – and all at no additional expense to the legislators! It’ll come out of the money we all pay for taxes.

This most recent outrage will show how little the drillers care about the average Pennsylvanian, and why we must insist that the drillers PAY – not receive – their fair share through a robust severance tax.

Contact your senator today with one message – make the drillers pay their fair share.

Pennsylvanians who have signed leasing agreements are being frightened by rumors that passage of a severance tax will mean that the drillers can deduct the tax from the lease payments. But the House bill prevents exactly that. We hope any bill passed by the Senate would also protect the Pennsylvanians who signed leases in good faith.

There are also commercials that imply that a tax would increase the ultimate price of gas to consumers. Again, that’s simply not so. Pennsylvania gas bills already include severance taxes levied by other states. But our money is not staying here – it's going to Texas, Louisiana, Arkansas, and other states that have severance taxes.

The facts are far from scary. A robust severance tax with money dedicated to Growing Greener, the Fish and Boat Commission, the Game Commission, and the municipalities that host the drillers that are dealing with the public safety and social problems drilling can bring is good for all. It will protect our economy, our environment and our local communities.

Drilling Fact of the Day

Seriously, how dumb do some members of the Pennsylvania Senate think we are?
The Senate Republican leaders are claiming they want to vote for a severance tax on drilling in the Marcellus Shale, but the Big Bad House messed it all up by passing an unconstitutional bill. They really want a bill, just not that bill.
The Legislative Reference Bureau – the nonpartisan group charged with drafting all legislation – basically said the Senate’s argument about constitutionality was garbage (except they said “selective”). In short, the bureau pointed out that the General Assembly does the same “gut and amend” action to pass bills all the time, just the way the House passed the severance tax – and no one objects. The bureau further pointed out a number of other bills that the Senate could use to pass a severance tax.
But no, not the Senate leadership. They want the House to come back and pass a brand new bill. And, by the way, it would have to be right away even though the House isn’t in this week, because the Senate leadership says they won’t let anymore votes happen for the entire year after Thursday.
These transparent stalling tactics are classic. The Senate leadership is trying to have to both ways, so their members can say they really did support a severance tax but the House didn’t get it right and their hands were tied.
And they think the voters – 80 percent of whom want the tax – won’t see this behavior as a gift to the drillers in gratitude for the millions the drillers have poured into campaign coffers and lobbyists this year.
Don’t let the drillers avoid paying their fair share through a substantial severance tax. Tell your Senator that you aren’t falling for this stalling game - it’s time to pass the tax NOW.

30Sept2010                                                            :Drilling Fact of the Day

Yesterday’s victory in the House was sweet, but a look at the votes alongside the campaign contributions of the drillers shows that the people of Pennsylvania barely dodged a bullet.

According to an analysis by, a project of Common Cause PA and Conservation Voters of Pennsylvania, the amount of campaign contributions by the drillers was a pretty good predictor of how each representative voted.

From the website:

“The 104 who voted for the bill have taken an average of $824 from the natural gas industry, while the 94 legislators who voted against the bill took an average of $2,900 from the gas industry, or 3.5 times as much as those in favor of a severance tax.  The vote split largely along party lines, with Democrats generally in favor, Republicans generally against.

“The nine Democrats who voted against the bill, Representatives Barbin, Casorio, Deweese, Harhai, Kotik, Markosek, Pallone, Petrarca, Sainato, and White, accepted a total of $64,700 from the gas industry, an average of $6,470 each. Of these Democrats, only Rep. Barbin took no contributions from the natural gas industry.

“The twelve Republicans who voted in favor of the bill, Representatives Beyer, Digirolamo, Harper, Hennessey, Killion, Micozzie, Milne, Murt, O’Brien, O’Neill, Quinn, and Ross, accepted a total of only $1,500, an average of $125 each. Only three of these representatives (Digirlolamo, O'Brien, and O'Neill) received any contributions from the natural gas industry.”

With the drilling tax bill now moving to the state Senate, it’s easy to see what the drillers are likely to do – double their bets by dumping even more money into the campaign coffers of the members of the Senate.

But democracy shouldn’t be for sale to the highest bidder. It’s time to stand up to the drillers and demand that our state Senators vote for their constituents and not for their donors.

Send an email right now to your state senator with one simple message: Don’t get bought off by the drillers – make them pay their fair share, through a substantial severance tax.

Drilling Fact of the Day

The halls of the State Capitol are a little quieter today since the Senate decided to high tail it home instead of finishing the job and keeping the promise they made to the people of Pennsylvania by passing a severance tax on natural gas.

One wonders whether all the money that’s been pouring into campaign coffers from gas drillers and those who stand to profit from drilling somehow deafened legislators, or at least drowned out the many thousands of constituent calls, letters, e-mails and visits that have been steadily flowing into the General Assembly—demanding that they get the job done for Pennsylvania.

Will gas drilling money trump democracy in our Commonwealth? Only time will tell, but there is hardly a moment to spare.

Though the Senate has no firm plans to return before the election, they left the door open a crack by adjourning until “recalled by the President Pro Tempore.” The Governor says negotiations are continuing. But in the words of Sen. Jane Orie (R-40): “Everybody is saying good-bye to each other. No one is saying 'I'll see you next week.’”

What’s it going to be, Senators? The ball is firmly in your court, and the shot clock is winding down. Your constituents are on the sidelines hoping you live up to your promise and don’t let drilling money throw the game.

Send your senator an email now with a simple message: Return to Harrisburg and finish the job.
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