Local, Business and Industry Leaders Gather to Tout Benefits of Natural Gas Impact Tax

“The Act 13 impact fee is probably the most important piece of legislation for rural Pennsylvania in my lifetime.”
– Senator Gene Yaw

Pennsylvania’s current tax on natural gas – the impact tax – works.

That message was echoed by the Williamsport/Lycoming Chamber of Commerce, elected leaders from across the region, and business voices yesterday, as they gathered in Williamsport to discuss the winning tax policy solution for communities across Pennsylvania.

Created in 2012 under Act 13, Pennsylvania’s impact fee – or tax – is on track to generate nearly $1.7 billion, with nearly $400 million staying in the 10-county Northeast Pennsylvania region. The bulk of these funds have directly supported significant, community-enhancing projects, such as flood mitigation, park and trail restoration, critical infrastructure repair, among others.

The impact tax is real. We pay it. It goes beyond the impact tax though. It’s the total financial contribution we make to the Commonwealth,” noted Seneca Resources’ Rob Boulware at Thursday’s event. Responsible natural gas production has generated nearly $6 billion in tax, lease and royalty revenues, billions in royalties for private Pennsylvania mineral owners, renewed investment interest in the Commonwealth and supports tens of thousands of jobs over the past decade.

Lycoming County leaders highlighted their support for natural gas development and maintaining the current impact tax during the news conference:

Senator Gene Yaw:

“Most of the people who say that Pennsylvania doesn’t have a severance tax don’t have a clue about what an impact fee is. … Pennsylvania is the only state that has an impact fee. We’re the only state that figured out how to get the money where the impact is. And that’s a real plus. …Who has benefited from this impact tax? We [rural Pa.] have – there’s no doubt about it.”

Cogan House Supervisor Howard Fry:

“I certainly hope that Harrisburg takes a look at what the gas companies do that they aren’t required to do. They need to take a look at how those dollars are being spent because it’s so much more important than a severance tax will be.

The impact fee allowed our township to build a cinder shed. With the impact fee we were able to update our buildings and put in a playground.”

Lycoming/ Williamsport Chamber of Commerce President and CEO Jason Fink:

“This impact fee tax is being used to tackle infrastructure issues in Lycoming County, and being used well. …We believe the fairest way to tax this industry is already happening.”

Lycoming Co. Commissioner Jack McKernan:

We whole heartedly believe in the impact fee and the good that it’s done in Lycoming County.  …It gives the county flexibility to use the money where it’s needed. We’ve used it for the airport, senior centers and other projects. Lycoming County has gone back to the state to receive additional money for senior housing. There’s money through DEP we’re working to tap for our levee project.”

MSC President David Spigelmyer:

“It is not only the $1.7 billion in impact tax that’s benefitting Pennsylvanians. Consumers are saving money, our air is cleaner, and billions of dollars have been invested in the Commonwealth. … The governor’s plan would pancake taxes on top of taxes rendering the state uncompetitive.”

Rep. Gareth Everett:

“I have the good fortune of representing rural Lycoming County where there’s 806 or so producing wells … Local municipalities have been able to take care of a myriad of issues with this impact tax money. And those are things they would not have been able to tackle. …We are already taxing the industry and the good part about it is the money is going to the right places.”

Rep. Jeff Wheeland:

“We’re blessed here, and we should never take it for granted. There’s a cause and effect when you over tax the natural gas industry or any industry.”

Here’s what the local media is saying about the event:

Impact Fee vs. Severance Tax

“The lawmakers discussed several ways the impact fee has helped this area, including helping to expand the Susquehanna River Walk, which has gotten more than $300,000 dollars in impact fee money. The Williamsport Regional Airport has also benefitted. “Our impact tax in Pennsylvania takes in more money than does the severance tax in the combined states of Colorado, West Virginia, Ohio,” Rep. Everett said.” (5/30/19)

Natural gas industry along with local and regional leaders oppose severance tax

“Pennsylvania is sometimes called “the Texas of the Northeast” in some circles. That’s because the natural gas industry has become one of the largest sources of income for the state. …The impact fee is a tax on the natural gas industry. The tax was implemented in 2012 and has racked in more than a billion dollars for local communities since enacted.” (5/30/19)

Marcellus Shale Coalition says that impact fee has significant benefits

“Members of the Marcellus Shale Coalition say the natural gas impact fee is a tax and should be thought of as such as Gov. Tom Wolf seeks a severance tax on the natural gas industry. … “It’s a tax,” said David Spigelmyer, president of the coalition, who estimated the gas impact fees have generated $1.7 billion in the state since 2012. The billions of dollars goes out to communities impacted by the drillers in Pennsylvania, he said. “(5/31/19)

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