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House Co-Sponsorship Memoranda

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House of Representatives
Session of 2015 - 2016 Regular Session


Posted: May 6, 2015 11:03 AM
From: Representative Margo L. Davidson
To: All House members
Subject: Pennsylvania Education Reinvestment Act
In the near future, I plan to introduce the Pennsylvania Education Reinvestment Act proposed by Governor Tom Wolf. This is an essential component of the 2015-16 Budget. The Act imposes a reasonable tax – comparable to our neighbors – on the extraction of natural gas within the state. Its intention is to raise needed new revenue for our state’s public education system.

The tax proposed in the Education Reinvestment Act is modeled after the severance tax in West Virginia, which has also seen a boom in production from unconventional drilling over the last decade. The severance tax would impose a rate of 5% on the market value of gas severed in Pennsylvania (with a floor of $2.97), along with an additional $0.047 cents per Mcf extracted. It should not be lost that this reasonable severance tax is just one part of growing a healthy and successful unconventional natural gas industry in the state. Simultaneously, we can use a portion of the proceeds to help provide for a better educated citizenry.

Pennsylvania currently ranks 45th in the nation in the percentage of funding provided by the State for public education. With Pennsylvania sitting on one of the largest deposits of natural gas in the world, it is up to us to use this resource wisely so it benefits all Pennsylvanians and helps to fund our schools. Pennsylvania is currently the only major natural gas producing state in the country that does not have a severance tax and the time is long past.

I hope you’ll join me in co-sponsoring this important piece of legislation.

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Introduced as HB1142