taxes on MS gas drilling

Been discussed ad naseum over time.

I'm in full support of an impact fee. Whether or not the details are as they should be, I have to see more detail before making a call. But the basic premise is sound.

I do not support a tax which goes to the general fund and can thus be used for other purposes.

Basically, there are indeed impacts of drilling. Roads and bridges and traffic. Increased monitoring requirements, etc. So long as the money goes towards the entities that are immediately impacted, I'm happy. But don't ignore the impacts and simply tax em as a penalty. Or worse, use the money for random grants, schools, etc. and never actually fix the problems created.
 
From what I've read 25% of the fees go back to state agencies however I see nothing about the PFBC getting a cut. Hopefully this will change or is not really spelled out yet.

http://goo.gl/mZMWc
 
It's not much, but at least corbett is finally considering some taxes. One step in the right direction.
 
Finally? Corbett has been expressing desire for an impact fee for dang near a year now.
 
It may not have been a year, but certainly a few months. This is not a change in any manner for Corbett's position, he recommended this and supported it for a while now. The "new" news is merely that it's finally coming to fruition.
 
seems like he wants to let the counties decide what fees to impose and let them collect them. is this a good idea or bad? would it be better for the state to regulate fees? I suppose there are pros and cons either way.
I do agree it's a good idea to get money out of em to help with regulation, enforcement, and damage repair(roads, environment,etc)
funny though, just last year he wanted the state to control all aspects of this industry, in order to "streamline" the process.
 
Dear bikerfish,

Whose job will it be to collect impact fees for the rigs on State land?

Plenty of those roads and bridges are being damaged too, not to mention damage to streams and timbered areas. Those lands belong to everyone in the State, not just the residents of the counties where they are located.

Who's watching out for them, the understaffed DEP and DCNR?

Regards,

Tim Murphy :)
 
good questions Tim. if we use history as an example, it will be us paying for it! hopefully this won't be the case. not only should there be impact fees for the state land, these fees and the royalties generated from the wells should be put back into the state owned lands, not only to repair damage, but also to upgrade our parks, expand state forests, game lands, etc.
just a while back we talked about the state wanting to privatize the parks, probably because they have no money to staff them, but hey, what about all this gas money that is supposed to be generated? put that right back into the parks and state lands. return them to the award winning status they had not all that long ago.
yeah, I'm dreaming.
 
Plenty of those roads and bridges are being damaged too, not to mention damage to streams and timbered areas.

Yeah, but who takes care of those roads and bridges and streams? That's who needs to get the money.

not only should there be impact fees for the state land, these fees and the royalties generated from the wells should be put back into the state owned lands, not only to repair damage, but also to upgrade our parks, expand state forests, game lands, etc.

I totally disagree. Not because I don't support state forests, parks, game lands, etc. Just because I don't see ANY connection with the drilling industry. There are a lot of good causes out there that could use more $$$, where does it end? You can't just ask an industry you don't like to pay for the stuff you do like. I hate mushrooms. Perhaps I should ask that mushroom taxes be imposed to pay for my favorite programs?

I want the drillers to pay for every penny of what they cause, and nothing else. If the DEP's and DCNR budgets have to increase to allow for monitoring, the drilling industry should be responsible for covering the increase. If PFBC's budget went up to monitor fish populations, the drilling industry should pay for it. If a bridge needs repaired after 10 years, when it should have lasted 30, then the drillers should pay 2/3rds. If municipalities have to improve their sewage treatment facilities to account for wastewater handling, well, the drillers should pay for that.

Getting this amount of money correct, and sending it to the correct entities, is difficult, I understand that, and it's likely to lead to debates. The devil is always in the details, and I'm in no position to judge whether this proposal hits the mark or not. I'm just saying I do support the concept of "impact fee", where the money goes to the entities most impacted by the industry.

But they should not be asked to pay for things unrelated to their business, such as you are implying. At least no more than any other industry (they pay business taxes like any other).
 
pcray1231 wrote:


But they should not be asked to pay for things unrelated to their business, such as you are implying. At least no more than any other industry (they pay business taxes like any other).

Why not? It just gets passed on to those rich people heating their homes with gas and using electricity generated with gas.
 
It just gets passed on to those rich people heating their homes with gas and using electricity generated with gas.

Exactly (well, with the sarcasm included). To think a fee or a tax hurts the fat cats in any way is ridiculous. It simply increases the cost of gas and electricity, so it's passed onto the consumer.

Now, if that's a fair increase, meaning it's better reflecting the TRUE cost of drilling, then thats a good thing. The environmental and societal issues should be built into the price. The same should be true of all types of energy, and well, everything else really.

The market is always going to win. Stop fighting it, and instead fight to make it honest. We'll all be better off for it.
 
pcray1231 wrote:
It just gets passed on to those rich people heating their homes with gas and using electricity generated with gas.

Exactly (well, with the sarcasm included). To think a fee or a tax hurts the fat cats in any way is ridiculous. It simply increases the cost of gas and electricity, so it's passed onto the consumer.

Now, if that's a fair increase, meaning it's better reflecting the TRUE cost of drilling, then thats a good thing. The environmental and societal issues should be built into the price. The same should be true of all types of energy, and well, everything else really.

The market is always going to win. Stop fighting it, and instead fight to make it honest. We'll all be better off for it.

Even if the taxes were not passed on to the consumer they would be passed on to the stock holders. Something like 45% of stock traded on US exchanges is owned by public and private pension funds or IRAs and 401Ks. Most of the larger gas drillers are publicly held. These are primarily pensions of working people and retirees. So either way the working man gets pinched.
 
eh, you're right technically, but I'm not overly concerned about stock price. Like you said, 45% is owned by retirement plans. Meaning 55% is owned by investors. Plus, either way, that money is watered down by a billion other stocks, and takes a long time for it to go back into circulation anyway.

It's more about what is right and fair. EVERY industry out there has negative impacts for society, whether they be environmental or other. You can't just pick the industries you hate the most, and ask them to pay for totally unrelated programs that you like the most. But rather, those negative impacts should be built into the price of the product. Failing to do so is a de facto subsidy.
 
pcray, I'm not saying ALL the money should go back into state lands, that's kinda what it looked like I typed though. but I don't think putting some money back into our parks and state forests is asking too much. I wouldn't mind seeing some new restrooms, picnic pavilions, better paid staff, and possibly more jobs created. hell, maybe put some money into a program that could mirror the old CCC, create jobs and teach skills, discipline, self respect, perhaps put some it towards college tuition funding for state residents.
I have to disagree with you about the connection with the drilling industry though. wells are being drilled on state land, in some places the impact is negligible, in other places, it's huge. millions of people enjoy our parks and forests. I see no problem with taking some of the money that is generated on state land and putting in right back into state land for the benefit of the people that use our state land. I'm not asking that money from wells drilled on private property be used, only a percentage of funds that are being generated on public property.
what about an Alaska style permanent fund? heck, then we ALL can get a few bucks in our pockets!!
 
bikerfish wrote:
pcray, I'm not saying ALL the money should go back into state lands, that's kinda what it looked like I typed though. but I don't think putting some money back into our parks and state forests is asking too much. I wouldn't mind seeing some new restrooms, picnic pavilions, better paid staff, and possibly more jobs created. hell, maybe put some money into a program that could mirror the old CCC, create jobs and teach skills, discipline, self respect, perhaps put some it towards college tuition funding for state residents.
I have to disagree with you about the connection with the drilling industry though. wells are being drilled on state land, in some places the impact is negligible, in other places, it's huge. millions of people enjoy our parks and forests. I see no problem with taking some of the money that is generated on state land and putting in right back into state land for the benefit of the people that use our state land. I'm not asking that money from wells drilled on private property be used, only a percentage of funds that are being generated on public property.
what about an Alaska style permanent fund? heck, then we ALL can get a few bucks in our pockets!!

Aren't there two distinct issues here. One is the impact on public resources from drilling on private land. The other would be revenue derived from drilling leases on public land. There is of course impacts on public resources (roads, bridges, etc) from the wells located on public land.

 
Franklin's got it.

Obviously, if a well is drilled on public land, then the public entity that allows it will get some $$$. Same is true of private citizens, if you allow drilling on your land you'll get some money up front plus a % of sales. I have no issues whatsoever with public entities using this money for whatever they wish. In fact, that's how it's already set up. This has nothing whatsoever to do with an "impact fee."

Further, all businesses of any type pay taxes. Those taxes go to the general fund to be used on whatever Washington and Harrisburg feel is high priority. I have no issue with that.

The impact fee, though, is another cost on top of all of that. It is meant to alleviate the problems caused by drilling. This is stuff like roads and bridges, traffic issues in small towns (who may have to alter roads, add stoplights, etc. to adjust), increased monitoring and enforcement costs, wastewater treatment changes, cleanup of any spills or accidents, etc.

So yes, I support such a fee. Otherwise, the taxpayers get pinched for all those associated costs of drilling. It should be built into the cost of doing business for the industry. If feasible, I'd even prefer it be scaled to the impact of each well, thus giving the drillers incentive to avoid causing issues to begin with, though I do realize that'd be very difficult to implement on a large scale. I'd also support an impact fee for most, if not all industries. Cause again, why penalize the drillers for their environmental cost, and not touch coal mining, steelmaking, auto making, farming, and any other industry? The real cost, including not only traditional business expenses, but also the cost to society and the environment, should be built into the market.

You think the farmers who use fertilizers in central PA should be partially responsible for the plight of fishermen in the Chesapeake? I do. Build this cost into the cost of fertilizer. Suddenly, the market can determine whether its worthwhile or not. If consumers deem the fishermen more important than the famers, then the market will make it so. If not, then obviously the fertilizer is more important to consumers, and so be it.

Imagine if coal included all of its environmental costs from the beginning. 1. Coal would have been more expensive, which would accurately reflect it's REAL cost. 2. Coal companies would have strived to protect the environment more than they did to keep their costs LOWER.

But no, I do not support opening up that "impact fee" money for use in anything aside from what it's intended for, such as new restrooms in state parks or establishing new state land. Again, I support those causes, but it's inappropriate use of this particular money. It just establishes bad precedent and reeks of corruption, as everyone and their mother sees green and tries to get the fee increased to fund their pet projects on the backs of consumers.

It is consumers that ultimately pay. That means everyone who uses electricity or gas. If you want the people to pay for more public land and sprucing up existing public land, then do it the traditional way and justify it properly. i.e. tax the citizens and explain to the voters why it's worthwhile. Or if it's the PFBC or PGC, explain to fishermen and hunters how a license increase for this purpose is worth it for them. Don't try to sneak in a revenue stream through some fee from an unrelated industry.
 
pcray, my bad, I keep getting impact fees confused with royalties and lease moneys. I totally agree with you that money from impact fees go straight to repair and reclaimate well sites,roads,bridges,etc. I was arguing that a percentage of royalties and lease moneys made from public owned land be put back into public owned lands, not using impact fee money.
sorry for the confusion, maybe I need a beer!
 
bikerfish wrote:
pcray, my bad, I keep getting impact fees confused with royalties and lease moneys. I totally agree with you that money from impact fees go straight to repair and reclaimate well sites,roads,bridges,etc. I was arguing that a percentage of royalties and lease moneys made from public owned land be put back into public owned lands, not using impact fee money.
sorry for the confusion, maybe I need a beer!

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