Senate Committees Hold June 1 Joint Hearing On Severance Tax Proposals
The Senate Environmental Resources and Energy and Finance Committees are scheduled to hold a joint hearing on natural gas severance tax proposals on June 1.
There are 5 severance tax bills pending in the Senate, two Republican and three Democrat--
-- Senate Bill 395 (Brewster-D-Allegheny) adopting a 5 percent severance tax all devoted to education funding, while keeping the impact fee, but crediting what producers pay to the severance tax (sponsor summary).
-- Senate Bill 415 (Haywood-D-Montgomery) providing for an 8 percent natural gas severance tax with the proceeds dedicated to these uses: $100 million dollars off the top would go to the Growing Greener Program; 60 percent of the money would go to fund Public Schools; and 40 percent would go towards reducing the unfunded pension liability (sponsor summary).
-- Senate Bill 519 (McGarrigle-R-Delaware) which would impose a 4 percent tax on the value of natural gas at the wellhead. All the revenue from the tax would be devoted to fund basic education and nothing for any environmental restoration program (sponsor summary).
-- Senate Bill 719 (Tomlinson-R-Bucks) providing for a 5 percent natural gas severance tax with proceeds dedicated to state employee and school employee pension funds (sponsor summary).
-- Senate Bill 741 (Leach-D-Montgomery) imposing a 5 percent natural gas severance tax to create the Pay It Forward, Pay It Back Pennsylvania college scholarship fund (sponsor summary).
The severance tax proposed by Gov. Wolf has not yet been introduced in the Senate or House.
The hearing will be held in Hearing Room 1 of the North Office Building starting at 10:30 a.m.
Sen. Gene Yaw (R-Lycoming) serves as Majority Chair of the Environmental Committee and Sen. John Yudichak (D-Luzerne) serves as Minority Chair of the Committee.
Sen. John Eichelberger (R-Blair) serves as Majority Chair of the Finance Committee and Sen. John Blake (D-Lackawanna) serves as Minority Chair.
Sen. Brewster Introduces Governor’s Natural Gas Severance Tax Proposal
On Thursday, Sen. James Brewster (D-Allegheny) introduced Gov. Wolf’s natural gas severance tax proposal as Senate Bill 116 (sponsor summary).
The legislation as introduced clarifies provisions related to the existing Act 13 drilling impact fee saying it would expire on January 1, 2016, but would set specific caps on allocations for local governments, environmental and other programs from revenue generated by the severance tax thereafter.
The legislation also maintains the $2.97 base minimum price of natural gas used to calculate the severance tax and a provision which hopes to void existing contracts landowners have that would make them responsible for paying a portion of the severance tax.