Severance Tax Wish List

Legislators are justifying the enactment of a natural gas severance tax by claiming the revenue will go towards environmental impacts. In reality, the environment is just one of a host of suggested beneficiaries. Legislators and activists have proposed everything from funding LIHEAP to buying farmland.

Here’s a taste of their extensive wish list. A severance tax could . . .

  1. Plug this year’s budget shortfall.
  2. Monitor public health impact.
  3. Preserve state’s natural resources.
  4. Create an escrow fund for community adjustments.
  5. Fund research on economic, environmental, and health effects.
  6. Aid affected municipalities.
  7. Aid affected counties.
  8. Help municipalities deal with crime.
  9. Cover the costs of environmental cleanup.
  10. Fund infrastructure repair.
  11. Cover emergency services.
  12. Mitigate other social costs of drilling.
  13. Build roads.
  14. Build bridges.
  15. Train employees for natural gas jobs.
  16. Extend Gov. Rendell’s Growing Greener II program, which already received $625 million of taxpayer dollars.
  17. Make bond payments for Growing Greener.
  18. Preserve farmland.
  19. Purchase open spaces.
  20. Fund state parks.
  21. Help with environment restoration.
  22. Aid mine reclamation.
  23. Plug old wells.

Using a gas tax a a “dedicated funding stream” has been suggested, for a number of state government funds, including:

  1. The Environmental Stewardship Fund.
  2. Conservation District Fund
  3. The Pennsylvania Game Commission
  4. The Pennsylvania Fish and Boat Commission
  6. Hazardous Sites Cleanup Fund
  7. Liquid Fuels Tax Fund

All in all there are at least 30 suggested uses for severance tax revenue. Despite the fact that the severance tax would have gleaned only $56 million if enacted last October – less than 1% of the total PA Budget, and less than the Film Tax Credit and only a fraction of subsidies for alternative energy.

Gov. Rendell may be incredibly innovative in finding new things to tax, but he cannot match the ability of lawmakers and special interests to come with ideas on how to spend other people’s money.