Wednesday, June 20, 2012

Corbett's Special Interests

As a candidate for governor of PA, Tom Corbett promised to work to reduce the burden of taxation. And so I guess he is keeping his word by supporting a proposal to allow the foreign-based corporate giant Royal Dutch Shell to reap the economic benefits of the Marcellus exploitation without having to pay its fair share of tax on earnings from the natural gas processing plant that it hopes to build here in PA.

 On some fronts, Corbett is working to eliminate state spending. For example, the budget of PA DEP has already been cut, and the governor is pushing for further cuts. The message to the gas drilling, processing, and transport businesses is “Not only will we exempt you from paying your fair share of taxes, we’ll also stay out of your way while you do whatever is deemed necessary to get the gas.”

Royal Dutch Shell will gain about 72 million dollars over each of the next 25 years, whereas the average middle-class Pennsylvania taxpayer may end up with an annual tax reduction in the neighborhood of $50.    Royal Dutch Shell already stands to receive up to 15 years of tax cuts and exemptions under a bill Corbett signed earlier this year to designate the cracker-plant site as an expanded Keystone Opportunity Zone.

 Before construction of the cracker plant could even begin, the still-operating zinc smelter site needs to be cleaned up.  Its owner, Horsehead, has racked up numerous federal and state environmental violations and some experts suggest cleanup costs could reach into the tens of millions.  It was originally reported that taxpayers of Pennsylvania would be paying for the cleanup, although now Corbett is backing off on this. So it appears there will be no environmental remediation whatsoever, given that our governor is reluctant to impose upon the mineral extraction industry.

 How is Pennsylvania going to pay for cleanup, tax credits, tax cuts, and exemptions for this one extra- special corporation, Royal Dutch Shell? Looking at Corbett’s budget proposal, he will be doing it through cuts to state-funded education initiatives and needed social services.   Hasn’t the natural gas industry received enough special considerations through the passage of Act 13 and with $1.8 billion per year in subsidies from Pennsylvania tax dollars?

 At a recent town meeting, representatives from one natural gas corporation were asked why they were at the meeting.  The response was, “so we can educate you, get on with our job, and leave. “  Key point – get on with our job and leave.   The natural gas industry, as a whole, has no vested interest in Pennsylvania communities.   They do not live here; they do not raise their families here.  They exploit what they are allowed to exploit, and they leave. 

The objectively estimated Marcellus reserves would meet U.S. gas demand for about six years, using 2010 consumption data, according to the Energy Department. This is quite a bit less than the 17 years previously projected by gas-friendly estimates.   If this new prediction is correct, in approximately 6 years the natural gas industry will pack up their carpet bags and leave.   The natural gas industry will leave the financial responsibility of cleanup and generations of health costs to the people of Pennsylvania.  

1 comment:

  1. How many teachers, police, first responders, social service providers will be laid off to pay for Royal Dutch Shell's tax cuts, exemptions and subsidies?