Wolf wants new tax on natural gas production

HARRISBURG — Facing a deep, pandemic-inflicted budget deficit, Gov. Tom Wolf will ask lawmakers for billions of dollars funded by higher taxes on Pennsylvania’s huge natural gas industry for workforce development and employment assistance to help the state recover.

Mr. Wolf said Thursday the money — part of his budget plan that will be unveiled next week — would aid workers whose jobs were upended by the pandemic and help fix the pandemic’s disruptions that heavily affected certain industries, lower-wage workers, minorities and the disabled.

While details on it were few, Mr. Wolf suggested that the billions of dollars from a new severance tax on natural gas production would at the very least boost the offerings of community colleges and the state’s seven industrial resource centers, which are set up to help Pennsylvania’s manufacturing industry.

“That’s going to help us come out of the pandemic faster than pretty much anything else we can do,” Mr. Wolf told reporters during a video news conference.

Mr. Wolf, a Democrat, has run for office twice on making the state’s natural gas industry “pay its fair share,” and he also wants lawmakers to raise Pennsylvania’s minimum wage in steps to $15 an hour.

However, the Republican-controlled Legislature has rebuffed Mr. Wolf’s overtures every year for both requests: a tax on natural gas production and an increase in the state’s $7.25 minimum wage.

A chorus of industry organizations quickly opposed those ideas Thursday.

“In fact, these proposals will only serve to slow our economic recovery,” said Gene Barr, president and CEO of the Pennsylvania Chamber of Business and Industry.

More helpful, Mr. Barr said, is the state providing grants or loans to businesses hit hard by the pandemic and extending pandemic liability protections to employers and health care institutions, legislation that Mr. Wolf opposes.

Moreover, House Republicans — whose opposition has been unwavering to increasing the minimum wage and taxes on the natural gas industry — show no sign of shifting their stance.

House Majority Leader Kerry Benninghoff, R-Centre, questioned the need to mandate a $15-an-hour wage when starting wages at some convenience stores and big-box stores already rival that, with benefits, and said it is counterproductive to tax a natural gas industry that provides feedstock for protective equipment during the pandemic.

“Why would you want to tax the one industry that’s providing the raw materials for this very emergency equipment that people still don’t have enough of?” Mr.

Benninghoff said.

Mr. Wolf will finish his second term in office facing the same stumbling blocks as when he began: a state treasury buffeted by deficits and Republican majorities in the state Legislature that are deeply skeptical of his agenda.

Mr. Wolf is scheduled to issue his full budget proposal Tuesday to the Legislature. It will be his seventh year in office, and perhaps least predictable.

He has said he is counting on the federal government for more coronavirus recovery aid to help fill the state’s projected budget deficit.

Mr. Wolf otherwise has not called to raise income or sales taxes to fix the state’s finances, and is predicting a strong economic rebound in Pennsylvania.

The pandemic derailed any debate around his top priorities last year, including funding college scholarships in Pennsylvania’s stateowned universities to help address the student debt crisis, requiring public schools to provide full-day kindergarten and pumping $1 billion into cleaning up environmental hazards in public school buildings.

Two years ago, Mr. Wolf tied a proposed natural gas tax to his sweeping Restore Pennsylvania infrastructure plan to fund things like highspeed internet expansion in rural areas to flood protection projects to fixing up blighted urban areas.

Mr. Wolf said he is confident that a Biden administration is going to produce its own infrastructure plan, and said the billions from a proposed natural gas tax could go into the state’s workforce development needs.

While the price of natural gas has changed in the past two years, Mr. Wolf said he hoped a bond issue for his workforce development proposal could reach a similar number, which was $4.5 billion to be repaid over 20 years.