Samantha Melamed says PBPC estimates PA could be raising almost twice as much revenue from Marcellus Shale:
The natural gas industry extracted more than $6 billion worth of shale gas in Pennsylvania last year. The state’s cut — announced this week by the Public Utility Commission — was around $200 million, or 3.3 percent. And according to the Pennsylvania Budget and Policy Center, that’s a little more than half of what a West Virginia-type drilling tax would have raised. They figure a more aggressive tax could have brought in $387 million for 2011.
“There are real questions about whether Pennsylvania’s fee is enough to pay for the impacts of drilling on local communities,” said Sharon Ward, director of the center, in a statement. “Local communities have short- and long-term issues to address and should not be shortchanged.”
Maybe so, but Democrats shouldn’t get drawn into a debate over “impact” costs. The reason to try to raise twice as much revenue from Marcellus Shale is that we can. Frackers can’t get at Pennsylvania’s gas from Ohio or West Virginia. They can only get at it if they’re in Pennsylvania, and if they’re in Pennsylvania, they have to pay Pennsylvania’s tax rates on gas drilling. Mike Sturla said gas companies told him they’d still drill in PA if the tax was the highest in the nation. So why not have the highest natural gas tax in the nation?
The reason to raise twice as much money from fracking is that the state needs the money for useful public services and pensions, and the money’s got to come from somewhere. It would be better to raise as much money as we can get from fracking, to the point where we’re using the proceeds to lower taxes on sales and income.
Read Cate Long for more on how PA’s getting ripped off.