A severance tax on natural gas production that would fund Gov. Tom Wolf's proposal for $4.5 billion in infrastructure improvement and economic development initiatives over four years would not harm drillers or dissuade them from further exploration, cabinet officials said Tuesday.

Cabinet members discussed and answered questions about Wolf's proposed “Restore Pennsylvania” plan during a conference call with the media.

The proposed severance tax of .91 cents per million cubic feet of gas combined with the existing impact fee would add up to a 5.9 percent levy that is less than the 7.5 percent severance tax charged in Texas, said Sam Robinson, deputy chief of staff.

“Texas produces 21 percent more in gas, but collected 700 percent more in severance taxes. There is room in the industry for them to pay more,” without inhibiting their ability to produce gas, Robinson said.

The tax would generate $300 million a year over and above the impact fee.

Robinson said the total levy is competitive with taxes assessed in other gas-producing states.

Exploration companies won't leave Pennsylvania, where they have invested in pipelines and other infrastructure, because of the addition of a severance tax, said J.J. Abbott, press secretary.

The difference between Wolf's previous calls for a severance tax and the Restore Pennsylvania proposal is that the proposal allocates proceeds to specific infrastructure, economic development and storm preparedness and recovery initiatives, Robinson said.

The plan's five spending categories for severance tax proceeds are: storm preparedness and disaster recovery; high-speed Internet access; demolition, revitalization and renewal; transportation capital projects; and downstream manufacturing, business development and energy infrastructure.

Money would be allocated for each initiative in the first year, but the amounts can be changed in following years based on demand, Robinson said.

Municipalities would apply for grants to the departments in charge of the initiatives, he said.

The grant process would be competitive, but the goal is to provide funding for “high-impact infrastructure projects in every district in every corner of the state,” Robinson said.

According to the proposal, 520,000 residents in rural areas and 250,00 urban residents lack reliable high-speed internet service.

The initiative would provide grants for installation of high-speed internet infrastructure.

The storm preparedness and disaster recovery initiative includes three measures.

First is providing funding to help municipalities prepare for flooding and severe weather, upgrade flood walls and levees, replace high-hazard dams and conduct stream restoration and maintenance.

Second is establishing a disaster relief trust fund to assist individuals who suffer losses that are not compensated by the Federal Emergency Management Agency or other programs.

The third is providing grants to municipalities working on pollutant reduction plans to help them comply with stormwater mandates. Additional incentives will be provided for communities working with neighboring communities.

The downstream manufacturing, business development and energy infrastructure initiative is aimed at helping businesses to benefit from the ethane cracker plant Royal Dutch Shell is building in Beaver County and take advantage of locally produced gas.

The initiative would expand the Business in Our Sites program, which allows municipalities and economic development partners to attract expanding businesses by building an inventory of ready sites. In addition, the initiative would provide increased spending flexibility to give municipalities and businesses access to natural gas, and provide grants to help downstream businesses install combined heat and power and microgrid systems at existing or new facilities.

The demolition, revitalization and renewal initiative includes funding to establish land banks and acquire and demolish blighted buildings for new development opportunities or green space.

Funding to maintain the Brownfields program that converts former industrial and commercial properties into recreational sites or returns them to tax rolls as commercial, residential or industrial sites is part of the initiative. Money for removing lead paint from old homes is included.

Green infrastructure measures include funding for state parks, creation and revitalization of local parks, and funding for new hiking, biking and ATV trails.

The transportation capital project initiative includes funding for local road upgrades, new flexible funding options for businesses that need local infrastructure upgrades to enable development projects and multimodal and large-scale transit projects.

The initiative would assist paving and repair projects on rural roads and provide technical assistance and funding for dirt and gravel roads; provide funding upgrades to roads that serve expanding businesses; and fund public transit projects.