House Democratic leaders urged the state Senate to immediately begin negotiating in good faith to compromise and enact legislation on a reasonable tax on the extraction of Marcellus Shale natural gas, either passing a bill that was already approved by the House or by amending several bills also previously passed by the House and awaiting action in the Senate.
"If no action is taken by the Senate there will not be a tax on giant energy companies extracting a limited natural resource from Pennsylvania and selling it for a profit that is simply unacceptable," House Speaker Keith R. McCall, D-Carbon, said. "Coming from the anthracite coal region of the state, I have seen what happens when companies are allowed to exploit our resources without any thought for compensating the taxpayers or protecting clean water and air."
He added, "Like a majority of Pennsylvanians, and every other natural gas producing state in the nation, House Democrats believe this multi-trillion-dollar industry can afford a reasonable tax on the extraction of this natural gas, and the legislation the House sent to the Senate gets that done."
According to McCall, "The Senate Republicans, who control that chamber, made an arcane, public appeal to the Legislative Reference Bureau – the nonpartisan group charged with drafting all legislation – in an effort to mask their true intentions by using the bureau's advisory opinion as an excuse not to pass an extraction tax.
"The House Democratic Caucus has also requested opinions from the Legislative Reference Bureau, and those opinions show that the Senate Republican argument on constitutionality is intentionally selective."
The bureau's opinions have made it clear that the issue is open to interpretation and there are multiple legislative options already awaiting action in the Senate, which could be used to pass compromise legislation, according to House Democratic leaders.
The Legislative Reference Bureau only issues advisory opinions, not binding legal rulings, and openly acknowledges their review does not consider many of the factors important to a complete court analysis if a challenge is made, the leaders said. The Senate claimed that SB 1155 – as passed by the House – violates multiple provisions of the Pennsylvania Constitution.
McCall said, "The LRB disagreed and found only one violation. This can be easily cured by Senate amendment, according to House leaders. The LRB also stated that the Senate could be in session every day between now and Nov. 30 if it wanted to enact severance tax legislation.æ
"The Senate Republicans have a singular goal: to protect big gas drilling companies at the expense of Pennsylvania's taxpayers and landowners, and that stance is simply unacceptable," House Majority Leader Todd A. Eachus, D-Luzerne, stated. "Last week the Senate claimed the reasonable extraction tax passed by the House – an overall tax burden at or below the rate of most gas-producing states – was unconstitutional. This is simply a delay tactic.
"The Senate's argument on constitutionality is a red herring. Simply put – the ball is clearly in the Senate's court – morally, ethically and legally. Whose side is the Senate on? Out-of-state oil and natural gas corporations or Pennsylvania's working families?"
Eachus and McCall noted that Senate Bill 1155, which the House passed with bipartisan support, has been sitting in the Senate for two weeks and could be brought to a vote immediately.
They said if the Senate Republicans remain concerned about the constitutionality of Senate Bill 1155, the LRB has issued an opinion stating there are other options available to get this done – including House Bill 786 and House Bill 2235, which the Senate could amend with compromise extraction tax language.
Legislative leaders from both chambers met Tuesday morning to discuss options.
"It's time the Senate Republicans stop making excuses, stop delaying, and start getting serious about passing this reasonable tax on Big Oil and Big Natural Gas companies," Eachus said. "Pennsylvania's taxpayers have been waiting too long for big corporations to pay their fair share in this Commonwealth.
"This money is badly needed to provide critical resources for our communities that are impacted by gas drilling as well as to ensure our land, water and air are protected."