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900-920 Water Street
Downtown Mall
Meadville, PA  16335
Phone (814) 336-1136
Hours 8 a.m.- 4:00 p.m. (M-F)

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Cranesville, PA 16410
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Hon. Brad Roae
162B East Wing
Harrisburg PA 17120-2006
Phone: (717) 787-2353
Fax: 717-782-2902

E-mail:
  broae@pahousegop.com

Roae Votes Against Job-Killing Natural Gas Tax
9/29/2010

Rep. Brad Roae (R-Crawford) today voted against a bill that would enact a new job-killing tax on Pennsylvania’s growing natural gas industry at a time when nearly one out of 10 Pennsylvanians who wants a job cannot find work.  The new tax would drain approximately $1.9 billion from Pennsylvania’s economy during the next five years.

 

After the vote, Roae issued the following statement:

 

“I voted no on this job-killing $1.9 billion tax increase.  When I spoke during the debate on the floor, I pointed out that in the next five years, $1.9 billion of severance tax will be collected.   That is $1.9 billion over the next five years that will be added to our natural gas bills.  Companies like National Fuel buy gas and sell it to us for what they pay for it.  Utilities make their money from the distribution charge and monthly service charge.  Households, churches, schools, businesses, nursing homes and others that use natural gas will pay this $1.9 billion in taxes in the next five years.

 

“I also argued on the House Floor that it is possible that the tax will be taken to court and not allowed to happen.  Article III, Section 10, of the Pennsylvania Constitution states, ‘All bills raising revenue shall originate in the House of Representatives.’  This legislation, Senate Bill 1155, originated in the Senate, not the House of Representatives.

 

“The $110 million of severance tax for this fiscal year if overturned would get us to more than $1 billion of revenue in the budget that does not really exist.  For example, Pennsylvania already has $716 million from the MCARE fund transfer that the courts are requiring to be taken back out of the General Fund and put back into the MCARE fund.  Then there is the $250 million less than expected federal money that is causing another budget hole. 

 

“There is also the jobs issue.  If this tax slows down this rapidly expanding industry by 20 percent, that is 20,000 lost jobs since it had been estimated that 100,000 new jobs would be created.  It will cost about $1 million more to drill a Marcellus Shale well in Pennsylvania compared to other states due to the regulatory burden and drilling requirements.  This is significant, because this would reportedly be the highest severance tax in the county coupled with the already existing higher level of environmental and safety rules and regulations that are in place.   For example, it may not be cost effective or a good investment for companies to drill in different parts of Pennsylvania based on the thickness of the shale formation.”  

 

The bill now heads to the Pennsylvania Senate for consideration.

 

Rep. Brad Roae
6th District
Pennsylvania House of Representatives
(814) 827-6054
(717) 787-2353

Contact: Dan Massing

dmassing@pahousegop.com

 (717) 772-9845

Member Site:  RepRoae.com

Twitter:  Twitter.com/RepRoae

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