Pa. Senate passes revenue plan that would tax gas drillers, customers and more

HARRISBURG, Pa. (WHTM) – Whenever legislative leaders can successfully push difficult legislation through their chamber it is, to them and their staffs, a victory.

But Senate Majority Leader Jake Corman (R-Centre) was not exactly celebrating moments after a tax-filled revenue package narrowly passed, 26-24, Thursday morning.

“It was a difficult vote for everybody. It’s not a vote people wanted,” said Corman, who stressed that lawmakers had no other option to honestly balance the books and support the $32 billion budget that overwhelmingly passed nearly four weeks ago.

It would hike taxes on:

  • the folks who take natural gas out of the ground
  • the customers that use natural gas above ground
  • electricity bills
  • phone (landline and cell) bills
  • fireworks

The bill would also borrow $1.2 billion against anticipated payments to the Tobacco Settlement Fund to pay off last year’s deficit. Without the borrowing, Corman insists, an income tax hike would be necessary. He noted that the legislature resisted raising taxes through the Great Recession and have actually cut spending on discretionary programs. Mandated costs like pensions and prisons and health care have skyrocketed, he said, and it’s time to pay the piper.

“Our job is to govern,” Corman said after the vote. “The one thing that became very clear in our caucus is that doing nothing was not acceptable.”

Senate Democrats claimed credit for what they call a “long-overdue”  extraction tax, which will be on top of the impact fee drillers currently pay.

“We have broken ground here in Pennsylvania,” proclaimed Senator Vincent Hughes (D-Philadelphia). “This has been a ten-year effort to try to get a severance tax on Marcellus Shale.”

But as the vote count indicates, it’s a far from a unified Senate.

“You know what the state gesture is, Dennis? It’s this,” said Senator Scott Wagner (R-York) as he shrugged his shoulders. “You shrug your shoulders and walk away.”

Wagner, who is running for governor, was a vehement no vote and believes the budget can be balanced by belt tightening. He criticized his colleagues who voted yes, even fellow Republicans.

“The first option up here in Harrisburg is we need to put taxes on something, and that’s not the answer,” Wagner said. “The bottom line is Pennsylvanians have been pounded enough.”

Passing the Senate is just a first step. It still must pass the house.

“We’re gonna have to take our time and review what’s exactly in these bills,” said House Republican Spokesman Steve Miskin.

That’s the official line.

Unofficially, one Midstate Republican said the senate budget plan is Dead on Arrival. Another, Representative Seth Grove (R-York) tweeted a picture of a fire engine outside the Capitol that said, “Apparently the taxpayer fire brigade was called into Harrisburg to put out the senate tax increases before taxpayers are scorched.”

Corman said he didn’t run the plan past house leadership before passing the bill in the senate.

“I think the Speaker – Mike Turzai – said last week he wanted to see what the senate and the governor would support,” said Corman. “Well, here it is. If they have an alternative plan we’re glad to hear it.”

Gas drillers and their advocates at the Capitol have a plan and it involves bending ears and twisting arms in the house.

“We will be working the house,” said Jim Welty of the Marcellus Shale Coalition. “To make sure they understand one, that we already pay a tax and two, we’re in a competitive environment and the more you make that uncompetitive you give up opportunities for the commonwealth.”

While it’s uncertain in the house, Governor Wolf announced his support of the Senate budget plan.

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