Sunday, October 10, 2010
Governor Wants Tax on Natural Gas
Gov. Ed Rendell called a high-level meeting for Monday with legislative leaders and natural gas industry representatives in an effort to broker an elusive compromise on a severance tax bill.
With several obstacles keeping Senate Republican and House Democratic leaders from agreeing on a severance tax on natural gas production, the governor sent a letter Friday to leaders saying it's time to "get to work" on an agreement before time runs out to deal with the issue in the current session.
In a sign of how elusive compromise is, Senate Republican leaders said they won't attend a meeting on Monday but will be available to talk with Mr. Rendell Tuesday morning instead. The delay won't have any impact on advancing a severance tax bill, said Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi, R-9, Chester.
The governor will go ahead with the Monday meeting anyway, said spokesman Gary Tuma in response.
Mr. Rendell also is inviting representatives of leading natural gas companies in Pennsylvania to participate in this meeting at the Capitol. He said former Gov. Tom Ridge, a spokesman for the Marcellus Shale Coalition, an industry trade group, would be a welcome addition to the group, but added he isn't certain who will attend.
The maneuvering over the meeting comes with little sign of agreement among legislative leaders on a severance tax rate as well as side issues. Mr. Arneson said his caucus has been enaged in active and ongoing dicussions over Marcellus Shale issues in recent weeks with Democratic lawmakers and Rendell aides.
"The substance of the talks have been on issues not pertaining to the tax," said Brett Marcy, spokesman for House Majority Leader Todd Eachus, D-116, Hazleton.
The Senate returns Tuesday for the final three voting days in the legislative session that ends Nov. 30, while the House isn't scheduled to return until after the Nov. 2 election unless agreement is reached on a severance tax. Mr. Rendell said both chambers may need to add session days to accomplish that goal.
He said House lawmakers deserve credit for passing a "reasonable" tax bill last week at 39 cents per thousand cubic feet, or mcf, of natural gas at the wellhead, but added that bill met with nothing but "carping and criticism" from the Senate.
The governor has said he won't sign a bill that phases in a severance tax rate at 1.5 percent during the first five years of a well's production before a 5 percent rate kicks in, as Senate Republican leaders have proposed. Senate leaders say the House-passed tax rate is unacceptable.
Mr. Rendell said lawmakers are already late on a commitment to pass a severance tax bill. House and Senate leaders included a declaration of intent to pass a severance tax bill by Oct. 1 as part of the state fiscal code enacted in July. A portion of severance tax revenue would be used to balance the current state budget. "When I signed the fiscal code, I signed into that promise," added Mr. Rendell.
Hanging over the issue are reservations voiced by Senate Republican leaders that the House-approved severance tax bill violates a constitutional prohibition against mixing bill topics. The severance tax was added to a Senate-passed county code measure. GOP leaders are seeking an opinion on the matter from the Legislative Reference Bureau.
Mr. Marcy said his caucus is confident the bill would withstand any court challege. He said the Senate can choose other bills as a vehicle if they have doubts.
In the past, legislative leaders have routinely agreed on what bills to use as vehicles for enacting major iniatives, said Tim Potts, founder of Democracy Rising, a group advocating legislative reforms. The two caucuses are engaging in brinkmanship to advance the bill version each prefers, he added.
Contact the writer: firstname.lastname@example.orgTerror contract hearing set
The state Senate Veterans Affairs and Emergency Preparedness Committee, chaired by state Sen. Lisa Baker, R-20, Lehman Twp., will hold a public hearing 10 a.m. on Wednesday in the Majority Caucus Room on the main floor of the Capitol in Harrisburg.
This hearing, a follow-up to one held Sept. 27, is to provide the administration of Gov. Ed Rendell an opportunity to report on the progress of its inquiry into the Homeland Security no-bid contract with the Institute for Terrorism Research and Response. It will also be to outline any proposed changes in personnel or agency functions, and to give recommendations for improving cooperation among key state agencies. Testimony will be given by a panel of officials: Gen. Robert French, state Emergency Management Agency director; Col. Frank Pawlowski, state police commissioner; and the governor's chief of staff Steven Crawford, who is spearheading the internal investigation.
Last month, it came out that the Institute for Terrorism Research and Response had been preparing intelligence bulletins for the state Department of Homeland Security that listed nonviolent protests and events, including those by natural gas drilling opponents. Mr. Rendell said he was "appalled" and canceled the $103,000 contract.
Posted by Larry at 12:51 AM