Organizations Laud DiGirolamo-Murt Proposal to Enact Drilling Tax in Marcellus Shale
– Organizations representing environmental issues, labor unions, the drug and alcohol treatment community, domestic violence prevention, Christian advocacy, fair housing efforts, adults with special needs and good government came together today at a Capitol press conference to urge action on legislation to enact a drilling tax in the Marcellus Shale natural gas formation.
The legislation is being sponsored by Reps. Gene DiGirolamo (R-Bucks) and Tom Murt (R-Montgomery/Philadelphia) as a fair way to ensure natural gas drilling companies are paying their fair share, compared to other industries in Pennsylvania, and provide financial support to areas in the state budget that have taken drastic funding reductions in recent years.
Among the organizations speaking at Tuesday’s press conference included: Citizens for Pennsylvania’s Future (PennFuture), United Methodist Advocacy in Pennsylvania, Drug and Alcohol Service Providers Organization of Pennsylvania, Pennsylvania Coalition Against Domestic Violence, Pennsylvania Housing Alliance, the Coalition for Labor Engagement, Accountable Revenues (CLEAR Coalition), Education Voters of Pennsylvania, Pennsylvania Budget and Policy Center, and the Waiting List Campaign, a group that advocates for adults with special needs.
“The coalition that is forming behind our drilling tax plan represents a diverse spectrum of groups – the one common thread of these organization is their mission to help Pennsylvanians in need or to get our economy back on track. They all have a critical stake in this issue,” DiGirolamo said. “When developing this legislation, we knew that the plan we put together had to reflect a compromise with both the industry and to win over our colleagues with its commonsense structure. I thank these organizations for speaking out about this legislation, and I think that with their backing and encouragement, this is a drilling tax proposal that can advance into law.”
"I believe that the bill I have co-sponsored with Representative DiGirolamo will bring fairness to a system that has been operating without contributing to the real needs of our state,” Murt said.
The lawmakers and representatives of the various stakeholder groups present at today’s press conference emphasized that Pennsylvania is the only major natural gas-producing state in the nation that does not have a tax or fee levied on natural gas extraction. Most Pennsylvanians support a tax, which would represent a very small fraction of the profits the natural gas drilling companies are reaping. In addition, every Pennsylvanian is impacted by natural gas drilling, and therefore, the entire Commonwealth should benefit from the tax.
The tax -- to be set at 4.9 percent -- is estimated to generate $362 million during the 2012-13 fiscal year and rise to $562 million annually within five years. This rate is lower than neighboring West Virginia, where the industry is also thriving. The tax revenue would be broken down into three areas: 28 percent to local governments; 28 percent to environmental programs; and 44 percent to state government.
Those programs that would be targeted to receive revenue would include statewide environmental programs, hazardous site cleanup programs, local municipalities (those that both host drilling sites and others), affordable housing, conservation districts, education, job training, transportation infrastructure and human services.
The lawmakers also noted their proposal meets the following criteria: it’s fair and reasonable to the industry; it will sustain the growth of the industry and be comparable to rates in other states; it assists host communities and helps with job creation, social and environmental costs and impacts; it makes long-term investments in natural resources and environmental programs, along with the economy and human capital; it strengthens the Commonwealth’s safety net for times of need; and it makes sure every citizen can benefit from development in the Marcellus Shale.
The lawmakers are currently in the process of seeking co-sponsors for the bill.
State Representative Gene DiGirolamo
18th District, Pennsylvania House of Representatives
State Representative Tom Murt
152nd District, Pennsylvania House of Representatives
Contact: Jennifer Keaton