Natural gas tax could hurt Pa
Gov. Tom Corbett sloughed off a poll Thursday that shows Pennsylvanians opposed to his steep education funding cuts and in favor of taxing the natural gas industry, arguing the tax would not end state budget woes but could alienate “a cornerstone of the future.”
“We didn’t campaign based on polls; we’re not governing based on polls,” Corbett said during a news conference after an appearance at the Greater Scranton Chamber of Commerce. “It’s not what we were elected to do.”
Corbett opposes the natural gas severance tax and his proposed 2011-12 budget cuts funding for public schools, higher education, public libraries and other education-related entities by $1.5 billion, or 15 percent.
A Franklin & Marshall College poll released Wednesday showed more than three-fifths of residents favor taxing natural gas production while more than three quarters oppose the education cuts.
Critics of Corbett’s budget argue a natural gas tax would not chase away the industry because Pennsylvania is the only state with no local or state severance tax and companies will not leave billions of dollars in potential profits in the ground.
But Corbett said he fears the industry will transfer gas well-drilling equipment and money for investment to other states where severance taxes on gas extraction might be lower if Pennsylvania imposes a severance tax on gas.
“It’s important to get this industry rooted in Pennsylvania,” he told reporters.
“I want them building their headquarters here,” he said during his speech to about 50 chamber members.
Corbett specifically defended the higher education cuts, which Penn State University President Graham Spanier has said could lead to higher tuition and closing of some Penn State satellite campuses.
“It’s Spanier that’s taking the fight to the students,” Corbett said. “He’s the one that, when hearing the budget, immediately said, ‘We’re going to put this on the backs of the students,’ where he’s been putting it the entire time.”
Over the last decade, Penn State has received $3.5 billion in state money while more than doubling tuition, the governor said.
“Who’s putting it on the back of the students?” he said.
Corbett said the painful cuts are necessary because of the $4.3 billion budget deficit he inherited from Gov. Ed Rendell, whose natural gas tax proposal, he noted, would have produced only $170 million next year.
“I think people lose sight of that,” he said of the inherited deficit. “That’s what I can’t lose sight of.”
Corbett reminded the chamber audience his budget is only a proposal and said he would listen to amendments, but said the bottom line for spending will be his proposed $27.3 billion.
“The final number of spending will not be above $27.3 billion or I will not sign the budget,” he said.
Corbett dismissed the argument that he did not ask businesses and corporations to sacrifice in his budget.
“First off, businesses and corporations have been sacrificing,” he said. “Their business has been so far down that they haven’t been able to employ people. … I’m not sure what you mean by them sacrificing. Does that mean more taxes? Well, you know where I am on more taxes.”
Corbett pointed to the elimination in his budget of legislative initiative grants – legislators’ money for special projects – that often went to companies.
Corbett’s budget reduces funding for the Department of Economic and Community Development – the source of many grants and loans for corporate and business development by $114 million, or more than a third of its 2010-2011 level. Much of that was money provided by one-time federal economic stimulus money.
“We have many corporations that come to us that are always asking us for more money,” the governor said. “We’re going to look at those very carefully. We have to reduce the spending there. And we have to let the free enterprise system work.”
Corbett told the chamber audience no one should be surprised that he opposes raising taxes because he promised that while campaigning for the office.
“I came straight out with what I said I’m going to do,” he said.
Corbett said the $20 million in funding that Rendell promised for renovating Lackawanna County remains under review. He declined to say if there is reason to think he would not approve the money.
“I’ve been so busy with this budget, that’s one that I haven’t really sat down and looked at,” he said.
Corbett also said he will name a transportation task force to examine ways of paying for transportation projects and mass transit within 30 days.
March 18, 2011
by Borys Krawczeniuk (Staff Writer)
bkrawczeniuk@timesshamrock.com
http://citizensvoice.com/news/corbett-natural-gas-tax-could-hurt-pa-1.1120478#axzz1GxRsqoZJ
Don’t turn Pennsylvania into Texas
Introducing his first budget last week, Gov. Tom Corbett proposed gutting state funding for education while sparing natural gas drillers from the type of production tax imposed by all other major gas-producing states. Corbett argued that a gas industry unencumbered by a production tax would turn Pennsylvania into “the Texas of the natural gas boom.”
Well, there already is a “Texas of the natural gas boom.”
It’s called Texas.
And despite a longstanding, but loophole-ridden, 7.5 percent production tax on the nation’s most productive gas wells, Texas, like most states, is faced with a huge budget deficit.
In fact, a recent report by the nonpartisan Center on Budget and Policy Priorities found that Texas’ projected budget gap for fiscal year 2012 is the largest in the nation when measured against its current budget, at 31.5 percent.
Unlike his fellow Republican budget-cutters in Pennsylvania and Wisconsin, where projected budget shortfalls stand at 16.4 and 12.8 percent respectively, Texas Gov. Rick Perry can’t blame greedy state employee unions or out-of-control social spending for his money woes.
State employees in Texas have long been barred from collective bargaining and the state is notoriously stingy when it comes to spending on schools and social programs.
A 2009 study by the National Education Association found Texas ranked near the bottom for per-capita spending for public welfare programs and per-student expenditures in public schools. Nearly one-quarter of Texans lack health coverage, according to the U.S. Census Bureau, compared to about 10 percent in Pennsylvania and 15 percent nationwide.
That still hasn’t helped Texas escape the downturn in tax revenues ravaging all states, due largely to a weakened economy that seems to just now be on the road to recovery.
In fact the very refusal by uber-conservatives like Perry – who has proposed that his state opt out of the Social Security system and maybe the Union itself – to even consider reasonable and fair tax increases over the years is what has driven Texas closer to the brink than any other state.
That’s the road Tom Corbett is proposing we follow in his proposed budget.
He would rather take money and services away from public-school students, the poor and elderly than impose a fair tax on the gas industry, which, by the way, contributed nearly $1 million to his campaign.
Corbett’s proposed budget is unfair, unconscionable and unethical.
And it is likely to land us in the same mess as Texas.
http://citizensvoice.com/news/don-t-turn-pennsylvania-into-texas-1.1117896#axzz1GJB7bAaK
March 13, 2011