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Turzai pushes back against Wolf's severance tax, Restore PA plans

By Paul J. Gough – Reporter, Pittsburgh Business Times

Speaker of the House Mike Turzai threw cold water on the Wolf administration’s plans to institute a severance tax, Gov. Tom Wolf’s sixth attempt in as many years against the natural gas industry and its supporters in the General Assembly.

Turzai, R-McCandless, also in an interview with the Business Times discounted Restore Pennsylvania, Wolf’s signature infrastructure improvement plan that is in the proposed 2020-21 budget for a second year.

“It’s just the same retread that had no traction in the past and it won’t have any traction again,” Turzai said.

Tuesday, Wolf’s proposed budget included spending on Restore PA, which would fund improvements to brownfields, spend more on environmental cleanup, removal of blighted buildings and bolster the state’s access to broadband Internet. The same day, the Pennsylvania Senate and the Pennsylvania House passed House Bill 1100, part of the GOP’s competing Energize PA set of legislation, which would provide incentives for companies to develop brownfield sites and use Pennsylvania natural gas to create products like methanol, ammonia and urea.

Turzai pointed to the success of tax incentives that helped lure Royal Dutch Shell to build a petrochemical plant in Beaver County, where about 7,000 workers are participating in what is likely the country’s largest construction projects right now.

“We want to replicate that opportunity on brownfield sites all across the Commonwealth of Pennsylvania,” Turzai said.

That’s different from the administration’s Restore PA proposal.

“He wants to float a bond of over $4.5 billion to be paid back over 20 years at $300 million annual in a severance tax,” Turzai said. “Nobody is interested in that kind of indebtedness and nobody is looking to a severance tax to fund that kind of indebtedness.”

Senate Republicans in 2017 backed a severance tax proposal but it did not pass the Pennsylvania House, where the GOP has a majority. Turzai said that the impact fee that was imposed in 2012 is working fine and there’s no need for a second tax on oil and gas production

“Everyone knows a severance tax will shut down the growth of energy independence and manufacturing and the development of the petrochemical industry and all the family sustaining jobs that are incumbent with it,” Turzai said.

A Wolf administration spokesman didn’t immediately return an email seeking comment.

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