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Corbett should revisit, consider reversing his gas tax position

Apart from the state's budget crisis, one of the more controversial issues Gov.-elect Tom Corbett will face is Marcellus Shale gas development in the state. The day after voters selected Corbett to be the state's next chief executive, there were 2,500 people at a meeting in Pittsburgh on so-called unconventional gas, such as shale gas.

There appears to be a consensus that reasonable regulation is necessary to protect the environment and prevent taxpayers and property owners from being harmed by drilling operations. There also is growing agreement that the industry should pay some gas extraction tax, so long as the cost is in line with tax burdens the industry faces in other states.

As a candidate for governor, Corbett received about $700,000 in campaign donations from the natural gas industry, and his opposition to an extraction tax on Marcellus Shale gas troubled some voters. The appearance of a linkage between his no-tax position and significant campaign donations, which also benefited others in Harrisburg, deserves an explanation.

The campaign money is given for a reason — and it's not for good-government reforms. It's clearly intended to prevent regulations that the industry perceives as burdensome, or taxes that reduce profits. And beyond direct campaign donations, industry lobbyists will try to influence any legislation considered in the General Assembly.

The big campaign donations and active lobbying efforts should focus public attention on the issues of gas-related regulation as well as the extraction tax debate in Harrisburg.

Corbett and other politicians supported by the gas industry should explain their opposition to an extraction tax. They should demonstrate why they say that any level of extraction tax will harm job creation.

One argument hinted at during the campaign is that Pennsylvania has such an array of other taxes, that gas drillers here already face a total tax burden comparable to what they pay in other states that have an extraction tax. If this is true, Corbett makes the case. But if not true, the burden is on Corbett, as well as others opposed to an extraction tax, to offer a viable explanation.

Somewhat surprisingly, those at odds with that view and accepting the idea of a reasonable extraction tax include Dave Porges, president and CEO of Pittsburgh-based EQT Corp. Porges said his company is prepared to pay an extraction fee, but prefers that the money go to local communities where the drilling is happening and not to Harrisburg where it would be dumped into the General Fund.

Another notable supporter of a gas extraction tax is former Gov. Tom Ridge, who now earns money as an adviser to the Marcellus Shale Coalition. Ridge has said a reasonable extraction tax would not hamper drilling operations in the state. Does Corbett know something Ridge and the coalition don't?

And when it comes to better regulation, one gas company executive suggested that unsafe operations can lead to injury, death or serious contamination of the environment — and that's not good for the industry. Think what the BP oil spill in the Gulf of Mexico did for the image of deep-water oil drilling.

Better regulation will reduce the possibility that a shoddy operator will have an incident that harms the entire industry.

So, Corbett has an opportunity to rethink — and reverse — his questionable campaign position on a gas extraction tax.

The Marcellus Shale gas industry has the potential to be a major economic engine in Pennsylvania. But citizens want the gas industry to operate in ways that protect human safety and the environment. They also want the industry to pay for damage it causes to local roads and for the additional state inspectors required to monitor drilling operations.

Unless he can offer a solid rationale for no extraction tax, Corbett should reverse his position — which appears to benefit only the natural gas industry, at the expense of taxpayers.

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