October 18, 2019
In her eight years on Ebensburg’s borough council, Cecilia Houser has witnessed the gas industry’s “Impact Fee” restore area streams, improve a borough park and support fundraising efforts for Hastings Swimming Pool.
To Houser, it’s proof the job-creating industry is paying its fair share.
It’s also a reason Houser and Somerset County Chamber Director Ron Aldom joined a group of oil and gas industry executives and pro-business lobbyists as part of a statewide effort to voice opposition to Gov. Tom Wolf’s “RestorePa” plan.
Wolf has gathered bipartisan support, particularly in the Senate, for RestorePa, proposing to impose a severance tax on gas drilling. In doing so, Wolf said it would enable the state to build “critical infrastructure” – repair decades-old flood walls, address stormwater concerns, eliminate neighborhood blight and expand broadband internet – high-ticket items the state has struggled to support in recent years.
Wolf and Lt. Gov. John Fetterman toured the state this spring, saying local input would determine how different regions such as Johnstown, Altoona or Scranton would benefit from the funds.
But Stephanie Catarino Wissman noted that the state’s gas industry has already injected nearly $1.7 billion from fees since 2012 – a large portion of which has been used to support local priorities.
“Pennsylvania’s (taxing) system is working. Our industry is already paying its fair share,” said Wissman, the executive director for Associated Petroleum Industries of Pennsylvania.
API-Pennsylvania is a trade group that represents all segments of the oil and natural gas industry in the state, including many companies that solely do business here, she said.
A “severance tax” could hammer companies like those – at a time their investment is helping drive Pennsylvania’s economic growth, according to Pennsylvania Independent Oil & Gas Association Executive Director Dan Weaver.
Wolf, he said, fails to mention that when he travels the state “overselling” the benefits RestorePa would bring.
“He keeps selling this (bill) will be a godsend to virtually every community he visits,” Weaver said.
Wolf has defended his plan – and the “modest” fee, which he estimates would generate $300 million a year.
“My vision for Pennsylvania includes vibrant towns and cities with new development, opportunities in rural and disadvantaged areas, and a modern, interconnected commonwealth,” Wolf said during a Johnstown stop in February. “Unfortunately, after decades of neglect and declining federal investment, Pennsylvania is falling behind, and we need a bold plan to get us back on track.”
To Wolf, that plan requires Pennsylvania to enact a severance tax on gas production – something every other gas drilling state in the nation has done. His office has pointed out that the tax hasn’t stopped drilling from occurring in those states, noting that the resource is only abundant in certain parts of the country – Pennsylvania among them.
Houser has a different view.
If it has the potential to risk jobs, Pennsylvania should reconsider, she said.
“Government has the power ... to make this a more friendly place to do business,” she said.
Aldom’s biggest worry is “the trickle-down” effect.
Anytime a fee like this is levied against an industry, it’s the folks at the bottom who suffer, he said.
“In Somerset County, most of our wells are on dairy farms” – as revenue generators to help support their operations, he said. “In the end they’ll be the ones impacted. They’ll pay the price for it.”