Gov. Wolf is confident he has the votes for gas tax, but Republicans beg to differ
Gov. Tom Wolf is convinced he has enough bipartisan support in Harrisburg to finally pass a multi-billion-dollar severance tax on the natural gas industry, but Republican leaders at the Capitol aren't buying it.
Wolf visited Lancaster and York counties Wednesday, March 20, as part of his tour across the commonwealth to stump for Restore Pennsylvania, a $4.5 billion infrastructure plan that would be funded by projected future tax revenues on natural gas companies.
The governor said he knew of about 90 co-sponsors in the Legislature for his proposal, although no one has introduced a bill yet. He said he expects the bill will be announced in the next few weeks.
Wolf has lobbied for the tax unsuccessfully for five years, but he's been unable to overcome objections within the GOP-run Legislature.
This time around, he said, the biggest political challenge to overcome is the perception that the plan is just too good to be true.
"Every other state has it and we’re already paying it, and 80 percent of this would be paid by non-Pennsylvanians who buy the products," he said.
Republican response: John O’Brien is the spokesman for state Rep. Stan Saylor, R-Windsor Township, chair of the House Appropriations Committee.
O'Brien said the governor's plan sounds good in the abstract but that in reality the commonwealth would incur billions of dollars in debt and only later repay that debt with projected severance tax revenue.
Details about the plan are scant, which is another point Republicans are unhappy about.
Wolf said Wednesday it's too early to determine how much funding would go to each county or whether funding caps would be implemented for some projects.
"All of these things are open-ended questions that haven’t been seriously addressed," O'Brien said. "I don’t know how any legislator can sign up for a plan when these details haven’t been provided to them."
Jennifer Kocher, spokeswoman for state Senate Majority Leader Jake Corman, said the tax would display an unwelcoming atmosphere to employers looking to move into the state and would suffocate the job creation climate.
"There’s not a whole lot of appetite for a severance tax in our caucus," she said.
Republicans in the state Senate support maintaining the impact fee, which Kocher said has resulted in about $1.5 billion in revenue from the natural gas industry since it was implemented in 2012.
Support for Wolf: Wolf pushed back on the notion that he wouldn't have Republican support.
He said the Senate approved his last severance tax plan in 2017 and that if the bill had been taken up in the House, he believes it would have passed there, too.
The Senate did vote in 2017 to adopt a severance tax that was reportedly projected to net about $100 million annually, but Kocher said that measure only passed because it was attached to regulatory reforms that tightened deadlines on the state Department of Environmental Protection in its permitting process.
Representatives from the state Department of Environmental Protection visited Chanceford Township in early March to talk about how the revenue would be used for disaster relief. The township was one of the hardest-hit areas in the Aug. 31 flooding last summer.
Natural gas industry: Not surprisingly, the natural gas industry isn't thrilled at the prospect of more taxes.
In a written statement, Marcellus Shale Coalition President David Spigelmyer said the state's natural gas impact fee already generates hundreds of millions of dollars annually for critical infrastructure programs across the commonwealth, along with business taxes and royalties tied to natural gas development on state land.
"Imposing additional energy taxes will cost consumers, hurt local jobs, especially among the building and labor trades, and negatively impact investment needed to safely produce clean and abundant energy that’s ushering in a new era of manufacturing growth," Spigelmyer said.
Local input: At the news conference, local officials spoke in support of the governor's plan.
York County Commissioner Doug Hoke said blighted properties devalue neighborhoods and eat away at community pride, and that the cost of demolishing a blighted property can range from $40,000 for a residential home to more than $1 million for commercial and industrial sites.
"Restore PA is doing what the state should do," Hoke said. "Leading and creating solutions that do not put the burden on local property taxes."
State Rep. Carol Hill-Evans, D-York City, said that when she served on the York City Council, she regularly fielded questions about how the city would deal with blighted properties.
"This is a program that will work," she said. "I intend to go back to Harrisburg and talk to my colleagues on both sides of the aisle to tell them how good this program is, all the good that it can do for all of our residents."
Editor's note: An earlier version of this story gave an incorrect time frame in reference to the state's impact fee. The fee has generated a total of $1.5 billion since 2012.