State lawmakers sort of passed the state budget on time last week.
But the document they sent to Gov. Ed Rendell is far from a definitive budget, even if lawmakers work out a last-minute dispute over a new fiscal management agency.
Two huge revenue issues remain to be resolved. One is the budget’s reliance on $848 million in anticipated federal revenue that Congress has not appropriated.
The Legislature also approved a “severance tax” on the extraction of natural gas across the vast Marcellus Shale field, but did not specifically establish the tax or a tax rate. Lawmakers plan to do so by October.
That left open the question of whether the gas industry will have the opportunity to extract from lawmakers changes in state law that they want in exchange for supporting the severance tax.
There is no reason, however, for the government not to impose a severance tax along the lines of those levied by other states, without conditions.
Concessions sought by the industry are substantial.
According to the industry, the state government should either delay implementation of the tax or set a minimal rate for the first three years, so that drillers may recover the capital costs of sinking their wells before paying the full tax rate.
Read the rest in the Scranton Times
Tags: Ed Rendell, Marcellus Shale, State Budget
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