|Posted:||January 9, 2015 09:40 AM|
|From:||Representative Scott Conklin|
|To:||All House members|
|Subject:||Dedicated LIHEAP funding from Natural Gas Severance Tax|
|In the near future, I plan to introduce legislation that implements a 10¢ per volume severance tax on natural gas extraction, in order to dedicate up to $300 million in annual revenue to LIHEAP.
As many of you are aware, the Low-Income Home Energy Assistance Program, also known as LIHEAP, is a Federally-funded program that helps low-income households meet their home heating needs through cash grants sent directly to their utility company. In Pennsylvania, eligible households are those whose gross annual incomes are equal to or less than 150 percent of the Federal Poverty Income Guidelines. LIHEAP provides heating assistance funds that keep seniors and vulnerable Pennsylvanians warm during the winter months. Unfortunately, funding for LIHEAP has precipitously declined in recent years from $311 million in 2009 down to $203 million in 2014.
Through my legislation, a 10¢ per volume severance tax would be levied on each one thousand cubic feet (MCF) of natural gas extracted. In 2013, the most recently reported full year of production, Pennsylvania extracted approximately 3.2 trillion cubic feet (TCF) of natural gas. At this production level, a 10¢ per volume rate would generate approximately $300 – $350 million in revenue, which would only increase as production increases. That said, as significant increases in natural gas production levels are expected in the coming years, my legislation dedicates the first $300 million in annual revenue to LIHEAP. This will provide vital energy assistance to eligible households who may otherwise not receive benefits without increased funding to the program. Any remaining revenue, beyond the first $300 million, would be dedicated to the Property Tax/Rent Rebate Program established by the Taxpayer Relief Act. In addition, my legislation permits for the continued levying of the unconventional gas well fee established by Act 13 of 2012 to ensure areas impacted by natural gas drilling activities are able to continue to mitigate those impacts.
Heating assistance is critical for Pennsylvania’s vulnerable seniors and families, and the abundance of natural gas in Pennsylvania, which is often utilized for heating purposes, provides an appropriate revenue source to supplement funding for LIHEAP. As such, please join me in sponsoring this important legislation.
Introduced as HB528