Wednesday, October 13, 2010

Governor Reports More Positive News On Marcellus Shale Severance Tax

At a just concluded press conference, Gov. Rendell reported a more positive meeting of Senate and House Leaders on adopting a Marcellus Shale natural gas severance tax. He commended Senate Leadership for a willingness to work toward a compromise and "meet in the middle."
The Governor reported the severance tax rate the negotiators are looking at was about 60 percent of the original rate proposed by the Administration (based on the West Virginia law) and providing a phase-in of the rate and for deducting certain production expenses. Shallow gas wells would still be exempt.
He noted distribution of the funds were up to the Senate and House, but there was a need to use some of the revenue to help balance this year's budget.
The Governor also said "other issues" were open for discussion, presumably some of the issues the Senate has been trying to link to the severance tax like regulation of drilling by local communities, spacing of deep coal mines and gas wells and requiring certain safety and environmental inspections.
"The attitude was great today," said Gov. Rendell who said he thought the mechanics of getting it done, i.e. which bill to use, could be worked out.
Senate Republicans, the Governor said, were willing to come back next week to finish up work on the severance tax if there is an agreement. House Leaders had earlier today said they could be coming back on Monday or Tuesday of next week.

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