Click here to subscribe today or Login.
WILKES-BARRE — Department of Community and Economic Development Secretary Dennis Davin this week came out in strong support of Gov. Tom Wolf’s Restore Pennsylvania plan, saying “blight, lack of broadband access, inadequate flood protection, and aging transportation and green infrastructure is hurting our quality of life and holding back the growth of our economy.”
Davin offered his testimony about Restore Pennsylvania to the House and Senate Democratic policy committees.
“Our role in state government is to help cultivate vibrant communities and foster equal opportunity for every Pennsylvanian, regardless of their ZIP code,” Davin said. “With the problem building over the last few decades, we need a bold plan to be able to make our commonwealth stronger for the coming generations. “I believe Restore Pennsylvania is that plan.”
If enacted, Restore Pennsylvania, according to Wolf, would invest $4.5 billion over the next four years in significant, high-impact projects throughout the commonwealth to help catapult Pennsylvania ahead of every state in the country in terms of technology, development, and infrastructure. The plan would be funded through the monetization of a commonsense severance tax. The existing impact fee on natural gas drilling would remain in place.
However, last week House Speaker Mike Turzai, R-Allegheny, said Wolf’s Restore PA plan would more likely destroy Pennsylvania.
“Let me be clear, infrastructure investment is critical to the ongoing success of Pennsylvania’s economy,” Turzai said last week. “No one disagrees with the value of these projects. House Republicans do, however, have serious issues with the governor’s irresponsible, anti-competitive, and likely insufficient proposal to pay for them.”
Turzai went on to say that House Republicans believe that infrastructure needs can be funded under existing programs and by the private sector.
Yudichak, Baker disagree
State Sen. John Yudichak, D-Nanticoke, said Wolf and his administration have toured communities across the Commonwealth, including stops in Luzerne and Carbon counties, to illustrate how passage of the bipartisan Restore Pennsylvania proposal could positively impact local public infrastructure projects.
“Communities across Pennsylvania have supported the legislation, and it is now time to come together as Democrats and Republicans to pass Restore Pennsylvania,” Yudichak said.
But Sen. Lisa Baker, R-Lehman Township, acknowledged the need for infrasutrcture spending but questioned whether Wolf’s approach is the correct one.
“The menu of eligible projects aligns with our priorities, but we have yet to agree on an acceptable way to pay for it,” Baker said. “In the end, we will have to pull in money from a variety of sources. As with prior infrastructure programs, a new one will depend on borrowing, and could be structured to require a public referendum.”
Baker also said the governor’s plan to repay the debt through a severance tax will have a negative economic impact on Northeastern Pennsylvania.
State Rep. Gerald Mullery, D-Newport Township, said infrastructure projects across the commonwealth have not been completed for far too long because of a serious lack of funding at the state and local levels.
“Restore PA will allow many of these long-needed improvements to take place and that’s why I co-sponsored the legislation,”
Paying for it
Davin said there is a lot of “misinformation” about what the severance tax will do and what it won’t do.
“Yes, we have an impact fee — but that impact fee is based on number of wells rather than volume of production,” Davin said. “As technology has increased and we need fewer wells to extract the same volume of gas, we’re not seeing the returns on the impact fee that we may have been anticipating when the fee was originally introduced. The result is that Pennsylvanians aren’t getting their fair share for the resources under our feet.”
“Rather than be based on number of wells, a severance tax would be tied to volume of production, as is the standard in other states, Davin explained.
Additionally, Davin said gas companies here pay no local property taxes and very little in state taxes.
“So when those opposed to a severance tax say use terms like ‘double taxation’ to imply it would be an unfair tax that will drive the industry out of Pennsylvania and cost us jobs, in my mind, that argument does not hold water,” Davin said.
