Another Counter-Productive Energy Tax Proposal in PA
Posted February 5, 2019
Back in 2015, Pennsylvania Gov. Tom Wolf’s first year in office, we first likened his bid to hike taxes on natural gas production to killing the goose that lays golden eggs. That’s because over the years natural gas production has significantly benefited Pennsylvania – the nation’s No. 2 natural gas producer – in jobs, economic lift and impact fees paid by industry that have helped support public infrastructure, storm and water systems, public safety, housing and more, all over the commonwealth.
Negatively impacting a key Pennsylvania industry doesn’t make sense. Yet, in this new year, Wolf is back with a new tax scheme that could impede natural gas production and its benefits – a proposal to borrow money to invest in infrastructure that would be paid back through a new natural gas production tax. Again, a tax on top of the impact fees industry already pays.
Timing is everything. A new report from the state Independent Fiscal Office estimates that impact tax collections for 2018 activity will total $247 million for distribution across Pennsylvania in April – the largest annual revenue total ever generated. That follows nearly $1.5 billion in revenues from the existing impact tax since 2012.
API-PA Executive Director Stephanie Catarino Wissman calls Wolf’s proposal – the fifth such request in five years – “counterproductive” and “anti-consumer.” Wissman:
“In the end, if enacted, this additional tax will discourage investments and risk the loss of revenues that have helped bolster communities and infrastructure in all 67 counties. This initiative doesn’t restore Pennsylvania; it jeopardizes Pennsylvania’s economic strength in a world economy.”
It's hard to look at it any other way. Wolf has said his plan could fund infrastructure. But the logic doesn’t work. Industry already is investing billions in infrastructure across the commonwealth. The benefits of this investment and the crucial funding generated by the existing impact tax for the state’s economy, communities and families in every corner of Pennsylvania cannot be overlooked.
As with the governor’s past attempts to hike taxes on a key producing, revenue-generating industry, this one is ill-conceived and potentially counterproductive to what all Pennsylvanians want: affordable energy that does its part to help the state and communities where it operates. Wissman:
“Over the past decade, Pennsylvania has led the way for the nation in natural gas production. Due to our energy leadership, the world has seen a monumental shift in the balance of energy power. This leadership is delivering for communities across the commonwealth – cutting family budget expenses and bringing manufacturing jobs back. … We look forward to working with the legislature and the administration on policies that build on Pennsylvania’s successes, rather than the same tired ideas that will only pull us in the wrong direction.”
About The Author
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Previously, Mark was a reporter, copy editor and sports editor at an assortment of newspapers. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela have two grown children and four grandchildren.
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