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Times Leader
WEXFORD — Pennsylvania Independent Oil & Gas Association President and Executive Director Louis D. D’Amico Wednesday said it’s “unfortunate” that Gov. Tom Wolf has made a severance tax on natural gas production his primary “line the sand” in the debate over the budget.
D’Amico’s statement came following Wolf’s veto of the FY 2015-2016 state budget passed by the General Assembly.
“The Commonwealth doesn’t tax something to spur its growth,” D’Amico said in an emailed release. “The severance tax would be no different. Why not place an excise tax on Gov. Wolf’s former cabinet making business to help fund education? If the governor opposed that idea because of its negative effect on the sale of cabinets, would he be against education and children? Of course not, but that’s what he says about severance tax opponents.”
D’Amico said Wolf’s plan shows how disingenuous his argument is. He also took exception to Wolf’s argument that Pennsylvania is the only state without a tax on drillers.
“We do have one, but it’s called an ‘impact fee’ instead of a ‘severance tax.’ PIOGA would not oppose legislation to rename it what it is…a tax,” D’Amico said.
D’Amico said PIOGA believes adequate funding for the education of Pennsylvania’s children is an extremely important issue, but it is not connected in any way to a severance tax, any more than it would be connected to a new excise tax on cabinets or any other particular business or industry.
“The only link is the one Wolf’s campaign dreamed up and repeated over the past 18 months,” he said.
D’Amico said the jobs and general state taxes the gas industry and its supply chain businesses provide for education are the real links between natural gas production and education. He said drillers pay the same taxes other businesses and industries pay, as well as the special impact tax.
“So drillers are already paying more than their fair share,” D’Amico said. “If the current general state tax structure that provides education funding uses does not require companies to pay their fair share, then no business is paying its fair share. Another new, special tax on one industry is not “fair’ by any rational measure.”
D’Amico said PIOGA and other industry participants also support and provide assistance to teachers and educational institutions to help prepare children for careers in the energy field.
D’Amico said if drilling continues consistent with the Department of Environmental Protection’s statistics, Pennsylvania can expect to see the total number of unconventional wells drilled in 2015 drop by more than 45 percent from the average of 1,500 a year from 2010-2014.
“A businessman would realize this is the worst time to put another tax on our industry, but a politician insistent on fulfilling a campaign promise that never made any sense would not realize this,” D’Amico said.
The Pennsylvania Independent Oil and Gas Association of Pennsylvania (PIOGA) is the principal non-profit trade association representing Pennsylvania’s independent oil and natural gas producers, marketers, service companies, pipeline companies, and related businesses. PIOGA member companies drill and operate the majority of the state’s crude oil and natural gas, including conventional and unconventional wells.