Pennsylvania Senate To Vote On Plan To Close $2B Budget Hole

HARRISBURG, Pa. (AP) – Consumers’ utility bills would go up, Marcellus Shale drillers would pay a tax they’ve long resisted and Pennsylvania would make a new effort to capture tax revenue from internet sales under legislation poised for a vote in the state Senate.

Republicans who control the chamber unveiled their plan to close a $2 billion hole in the $32 billion state budget late Wednesday. It includes a mix of taxes and borrowing.

The proposal would borrow $1.3 billion against Pennsylvania’s annual share of the 1998 multistate settlement with tobacco companies. It would also introduce a new severance tax on Marcellus Shale natural gas drilling.

Senate Majority Leader Jake Corman emerged from closed-door talks Wednesday night to announce details of the GOP’s plan. He says the severance tax is expected to raise about $100 million each year.

The gas industry has long resisted a severance tax, saying it would harm the state’s competitiveness. GOP leaders have long rejected such a tax.

Gas drillers currently pay an impact fee, which is distributed among the state government and local communities where drilling takes place.

Corman also revealed new or higher taxes on consumers’ natural gas, electric and telecommunications bills. Corman says the new taxes will raise a total of about $550 million per year.

The GOP-controlled Appropriations Committee approved the legislation Wednesday. It heads to the Senate floor for a vote on Thursday.

Democratic Gov. Tom Wolf commended the Senate “for taking a responsible step toward balancing the budget,” including the tax on gas drillers.

The bill faces an uncertain future in the GOP-controlled House. House Republicans tried but failed last week to come up with a solution to the budget deficit.

Continue Reading: Marcellus Shale – CBS Pittsburgh

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