House Begins Debate On Natural Gas Severance Tax Bill

The House Monday began debate and considered the first nine of several hundred amendments to legislation-- House Bill 1401 (DiGirolamo-R-Bucks)-- imposing a natural gas severance tax.

The House first amended the bill to move the existing language from the Tax Code to Title 58 relating to Oil and Gas.  As a result, a significant number of amendments were no longer germane to the bill and were out of order.

On the second try, the House adopted a new provision 97 to 95 that would declare oil and gas well-related permits deemed approved if DEP did not finish their review by the deadlines imposed by existing law.  

This was one of the environmental riders in the original Senate-passed budget package agreed to by the Senate and the Wolf Administration.

A third amendment passed the House 100 to 93 to freeze existing unconventional oil and gas well permit fees until January 1, 2021.  DEP is now working on a proposal to increase the fees to pay increased regulatory program costs.

The fourth change adopted by the House 178 to 13 would direct the first $150 million generated by the tax to the General Fund and any remaining would be divided equally between the state employee and school employee retirement funds.  

The existing language in the bill would direct all the revenue to the General Fund, which Rep. DiGirolamo said would only generate around $150 million a year.

The final change adopted by the House 100 to 91 would allow a permit holder to move a well a maximum of 50 feet from the original permitted location without getting a new permit.

The House voted down amendments that would simply rename the existing Act 13 drilling impact fee a “severance tax? 84 to 109; a limited forced pooling requirement for extracting natural gas from unrelated gas lessors 51 to 142; and an amendment was withdrawn that would have eliminated the severance tax by giving a well driller credit for the impact fees paid.

The House resumes debate on the bill at 11:00 Tuesday morning.
NewsClip:
AP: Natural Gas Tax Bill Comes Up For Debate In House