Proposed act would put 5% tax on natural gas extraction, raise up to $1B
By Kyle Carrozza, Staff Writer, The Times
Gov. Tom Wolf introduces his proposal for a natural gas severance tax, with much of the proceeds to go to education funding, at Caln Elementary School, Wednesday.
CALN – Gov. Tom Wolf visited Caln Elementary School Wednesday morning to introduce the Pennsylvania Education Reinvestment Act, a proposed severance and extraction tax on natural gas extraction that will largely go toward state education funding.
After meeting with teachers, listening to a music class performance, and discussing the hardships of playing reed instruments with students, Wolf explained the proposition in a press conference.
The act would place a 5% severance tax on gas extracted in Pennsylvania as well as 4.7 cents per thousand cubic feet of volume extracted. Wolf said that the tax would be projected to raise $1 billion per year over the next four years. While some of the money will go toward environmental oversight of extraction operations, as well as “impact fee” funds currently being paid out to municipalities and counties as well as researching alternative energy sources, Wolf said that the “lion’s share” will go toward education.
Gov. Tom Wolf works with young students Wednesday during a visit to Caln Elementary School.
Critics of a severance tax have said that charging companies to extract gas will discourage business growth in Pennsylvania. Wolf responded to those criticisms saying that the act is modeled on a similar West Virginia tax.
“They’ve actually been the laboratory, and it’s worked,” he said.
Wolf said that Pennsylvania is the only state that has these natural resources and no severance tax.
Wolf thinks that this money should go toward education because of state cuts to education funds over the last few years. The first stop on his statewide tour to introduce the act, he said that Coatesville Area School District has lost $3.5 million in state funding since 2010-11.
“That’s not good economics. That’s not smart,” he said. “If we’re going to get our commonwealth back on track, we have to figure out how to fund education better.”
Coatesville Area School District Superintendent of Schools Cathy Taschner talks about the financial challenges facing districts such as Coatesville as Gov. Tom Wolf looks on.
Coatesville Superintendent Dr. Cathy Taschner said that these funding cuts have led to many struggles in the district.
“In Coatesville, we’ve struggled to provide event the basics,” she said.
Taschner called the proposition “a step in the right direction.” In order to balance budgets, the district must either increase revenue, which largely relies on taxes, or cut expenditures, which can have negative effects in the classroom.
“What he’s proposing is going to change the balance,” she said.
Coatesville Area Teachers Association President Audra Ritter hopes that money raised would go directly to the classroom, helping to fund textbooks and student programs.
Gov. Tom Wolf shares a conversation with Audra Ritter, President of the Coatesville Education Association, as state Sen. Andrew Dinniman looks on.
She wants Wolf’s visit to Caln to help shed light on districts like Coatesville that are in financial distress. Statewide, Coatesville was hit the second hardest out of all school districts by the state’s education cuts.
“It shows that we work hard, we do what we need to do, but there has to be some help. And hopefully now there will be some help so that students in Coatesville get the same opportunities that other districts get,” said Ritter.
