State Rep. Kate Harper proposes shale tax to fund teacher retirements

 state rep kate harperMontgomery News

By Linda Finarelli

MONTGOMERY COUNTY >> A bill by a local legislator to enact a severance tax on natural gas drilling was aired before the House Environmental Resources and Energy Committee Feb. 8, but no committee vote has been taken to date.

HB 82, sponsored by state Rep. Kate Harper, R-61, calls for a 3.5 percent severance tax on natural gas drilling. The revenue would go “toward the Public School Employees Retirement System to help reduce the unfunded liability that is driving up costs at both the state and school board levels,” a release from her office states.

Harper’s bill would maintain the current impact fee on Marcellus Shale gas producers, the bulk of which goes toward infrastructure needs for communities directly impacted by the drilling. The remainder funds a variety of state environmental programs.

“The environmental committee was not entirely sold” on her bill, Harper said in a March 3 interview. Representatives of those areas benefitting from the natural gas industry “think anything they do will destroy further investment,” she said.

Harper, who has sponsored Marcellus Shale gas extraction bills since 2011, maintains her proposed tax will keep Pennsylvania competitive with West Virginia and Ohio, the two closest gas-producing states, which both have severance taxes.

Pennsylvania is the only gas-producing state without a severance tax.

“It could produce several hundred million dollars and fill in holes in the budget,” Harper said. When combined with the impact fee, it amounts to a tax of about 5 percent, “comparable to West Virginia and Ohio, and provides new money for PSERS, benefitting the General Fund and also local school boards being pushed to raise property taxes” to pay their half of the pension costs, she said.

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