Lowman Henry raises an incredibly salient point in his latest Lincoln Institute column, juxtaposing the dichotomy of how public officials are treating Pennsylvania’s shale gas industry versus how they are treating Amazon.
On one hand, he notes, shale gas has produced more than 243,000 direct and spin-off jobs with an average salary of $93,000 and pumped billions of dollars into the Keystone State economy.
On the other hand, Henry continues, Amazon, in seeking a location for its second headquarters outside of Seattle, is promising $5 billion in development investment and up to 50,000 jobs paying an average of $100,000 over the next two decades.
Yet Henry notes some Pennsylvania officials are seeking to impose a new tax on top of a tax to make the shale gas industry pay its proverbial “fair share” while throwing all manner of “incentives” – that is, public money – at Amazon to lure its “HQ2” to Penn’s Wood.
“Thus, economic-development policy in Pennsylvania continues to penalize success, while attempting to entice new business by offering to have it pay less than its fair share of the tax burden when it gets here,” Henry says.
Lest anyone thinks that’s an argument to subsidize the shale gas industry, it is not. Adds Henry: “Neither Amazon nor the energy companies need special treatment. Marcellus shale drillers and Amazon are each capable of paying the same taxes and operating under the same laws and regulations as other business in Pennsylvania.”
That this dichotomy has been lost on public policy makers – or ignored – does not bode well for sound public policy.
Speaking of the shale gas industry, lots of eyebrows are being raised over a new state proposal that would more than double the cost of a permit to drill a shale gas well – from $5,000 to $12,500.
That’s a 150 percent increase.
As the Post-Gazette reports it, the state Department of Environmental Protection defends the hikes saying program costs — for reviewing permit applications, well-site inspections and policy development – have outpaced permit income.
Industry types lament that the size of the increase appears to be “excessive” and likely will force some operators out of business.
The DEP says considering the shale industry now only drills about 40 percent of the well permits granted; companies will have to become more discerning in the projects they propose.
Talk about arrogance.
The state appears to have some warped glee in using a fee as a way to reduce shale gas exploration/production. Given the commonwealth’s ancillary attempts to jack up taxes on the industry – by constantly pushing for a severance tax on top of the existing impact fee – one continues to clearly get the impression that Pennsylvania seeks not to foster the industry but to cripple it.
The proposed permit fee increase has a long way to go before any chance of implementation. Here’s to a full vetting with plenty of disinfecting sunshine.
The state Supreme Court is expected to rule this year on thus-far, court-rejected, City of Pittsburgh ordinances requiring those doing business in the city to offer paid sick leave and that security workers in many buildings undergo CPR and other safety training.
The ordinances twice have been overturned, once by Allegheny Common Pleas Court and then by Commonwealth Court. The city overreached its authority under a home-rule law provision, the courts found.
One city councilor has taken particular umbrage with the courts’ rulings, posturing in almost comical style about how they shouldn’t be telling Pittsburgh how to oversee its businesses.
Never mind that the City of Pittsburgh has no business imposing its will on businesses by attempting to mandate certain behaviors that clearly are up to those private businesses to decide.
The Port Authority of Allegheny County says it intends to move forward on that Bus Rapid Transit (BRT) project between downtown Pittsburgh and Oakland even if no federal funding is forthcoming.
Where it might make up that estimated $100 million is a question mark.
But here’s a facet of the project that requires re-examination:
As the P-G reports, the $195.5 million BRT would transform the route, configuring it with one lane for buses, one lane for bicycles and one for vehicular traffic.
What mode of transportation appears to be getting the short end of the central planning stick here, class?
Colin McNickle is a senior fellow and media specialist at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
