The Senate and House last week gave final approval to legislation-- House Bill 732 (Kaufer-R-Luzerne) creating a new tax credit to encourage the use of natural gas in manufacturing-- sending it to the Gov. Wolf, who said he will sign the bill over the objections of many environmental groups.
The bill provides up to $26.6 million a year for the credit which is available from January 1, 2024 to December 31, 2049-- over $670 million (House Fiscal Note & Summary).
To qualify for the tax credit, a company must invest at least $400 million in a facility, create 800 new jobs and permanent jobs. (House Fiscal Note & Summary)
The bill is similar to legislation Gov. Wolf vetoed in March-- House Bill 1100 (Kaufer-R- Luzerne)-- but did not have annual limits on tax credit funding.
House Bill 732 is modeled after legislation passed in 2012 and signed into law by Gov. Corbett that helped attract the Shell ethane plant now being built in Beaver County. That tax credit program is worth up to $66 million a year and expires in December of 2044.
To qualify for the tax credit, a company must invest at least $1 billion in a facility, create at least 2,500 full-time equivalent jobs during construction and meet other requirements. Read more here.
Reaction
Sen. John Yudichak (I-Luzerne) issued this statement on the passage of the bill-- “Our struggling economy needs new industries to invest in Pennsylvania and working families in northeastern Pennsylvania deserve a fair shot at securing good paying jobs.
“The Local Resource Manufacturing Tax Credit, which will set the stage for transformative economic growth across a wide swath of industries from the construction trades to manufacturing and energy jobs, is the product of a thoughtful, bipartisan compromise with Governor Tom Wolf and the legislature that proves government can deliver on the promise of economic opportunity for all.
Rep. Aaron Kaufer (R-Luzerne) said-- “This tax credit further opens the door for manufacturers to not only establish roots here in Pennsylvania, but to generate large revenues, boost our region’s economy and provide vast opportunities for job growth.
“Again, this is a once-in-a-lifetime chance for Pennsylvania, especially the northeast region, as it will also allow us to use cost-effective, accessible natural gas to compete with overseas manufacturers.”
David Taylor, President and CEO of the PA Manufacturers’ Association, said-- “The Local Resource Manufacturing Tax Credit in House Bill 732 will bring a new manufacturing industry to Pennsylvania at a time when economic vitality is needed most.
“While making new products like fertilizers and fuel, these manufacturing facilities will create high-value jobs, expand the use of Pennsylvania energy, and attract related industries and additional investments, all of which will accelerate our economic recovery.
“This remarkable effort has brought together Pennsylvania industry – both labor and management – in our shared commitment to a pro-production, pro-jobs, pro-growth agenda for our Commonwealth.”
Anthony Seiwell, Business Manager of the Eastern PA Laborers’ District Council, said-- “By choosing to evolve rather than abandon the manufacturing tax credit previously associated with House Bill 1100, the lives of working families in northeastern Pennsylvania may also evolve.
"The Governor’s administration along with labor, industry, and bipartisan legislators compromised under our shared commitment to promote local construction and manufacturing as well as create thousands of family-supporting jobs."
PennFuture President and CEO Jacquelyn Bonomo issued this statement on the bill-- “Gov. Wolf and the majority of our state legislators have put into law their vision for Pennsylvania’s future—dirty air and water choking our communities, extreme weather caused by climate change, and towns and cities beholden yet again to another economically unviable, polluting fossil fuel industry for the promise of jobs.
“Our state leaders have turned their backs on Pennsylvanians who deserve more than the same failed economic policies of the last century,” said Jacquelyn Bonomo, President and CEO of PennFuture.
“Time and again, polls show a majority of Pennsylvanians support more action to combat climate change, more investments in sustainable industries, and oppose corporate handouts like HB 732, which will provide $670 million in taxpayer subsidies to an already heavily subsidized fossil fuel industry.
“Over 25 years, the subsidy would support petrochemical plants that add over 130 million tons of pollution and create 3,200 jobs.
“In comparison, DEP’s recent modeling suggests aligning Pennsylvania with the Regional Greenhouse Gas Initiative (RGGI) could save 223 million tons of carbon pollution and provide billions in net benefits and 27,000 jobs.
“Not only does House Bill 732 greatly reduce the effectiveness of RGGI, it provides less overall job and economic benefit than transitioning to a clean energy economy.
“As the state Attorney General grand jury report on the shale gas industry shows clearly, the fracked gas and petrochemical industries cannot be trusted to operate safely in the Commonwealth.
“Instead of holding the industry accountable, our so-called leaders are giving them millions in precious taxpayer dollars. Instead of pursuing a cleaner, more prosperous vision for Pennsylvania, the Governor and state legislators have chosen the same dirty past.
“The back-room deal negotiated to create HB 732 is reckless. It is now up to the court system to protect ordinary Pennsylvanians and for future leaders to undo the damage this deal allows.”
NewsClips:
Stephen Caruso: After Closed Door Deal, General Assembly Sends Wolf Revised Natural Gas Tax Credit Bill, Signature Expected
Laura Legere: Legislature Adopts $670 Million Tax Credit Bill For Petrochemical Plants
Jan Murphy: General Assembly Sends $667 Million Natural Gas Tax Credit Bill To Governor Who Plans To Sign It
[Posted: July 18, 2020] PA Environment Digest
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