Governor Wolf Tells PA Chamber to Stop Putting Oil and Gas Interests Ahead of Children and Schools

May 18, 2015

Harrisburg, PA – Governor Tom Wolf today sent a letter to the Pennsylvania Chamber of Business and Industry regarding their misguided opposition to a commonsense severance tax in Pennsylvania. Pennsylvania remains the only major gas-producing state in the country without a tax on natural gas.

Since the introduction of Governor Wolf’s budget, the Pennsylvania Chamber of Business and Industry has repeatedly put oil and gas interests over the interests of children and fixing our schools. Instead of working with the governor on shared priorities including greater investments in education, manufacturing, workforce development, as well as major business tax cuts that will enable companies to invest in Pennsylvania and grow here these groups are simply supporting the status quo.

  • The Pennsylvania Chamber of Business and Industry
  • America’s Natural Gas Alliance
  • Associated Pennsylvania Constructors
  • Associated Petroleum Industries of Pennsylvania
  • Consumer Energy Alliance
  • Manufacturer & Business Association
  • Marcellus Shale Coalition
  • National Federation of Independent Businesses
  • Pennsylvania Aggregates and Concrete Association
  • Pennsylvania Business Council
  • Pennsylvania Builders Association
  • Pennsylvania Chemical Industry Council
  • Pennsylvania Food Merchants Association
  • Pennsylvania Forest Products Association
  • Independent Oil and Gas Association
  • Pennsylvania Manufacturers’ Association
  • Lodging Association

Below is the full text of Governor Wolf’s letter:

Dear _____________:

As a businessman and a former member of the board of the Pennsylvania Chamber of Commerce and the former president of my local board, I am disappointed that you have come out in opposition to a commonsense severance tax that will help to fund Pennsylvania’s schools and achieve many of our shared priorities. Furthermore, it seems that your decision is based less on the facts and our shared policy goals, and more on your need to appease oil and gas special interests.

When I crafted my budget, I took many ideas from the business community including increased funding for schools to produce a strong workforce, a lower corporate net income tax, an end of the Capital Stock and Franchise Tax, and an investment in manufacturing and workforce development. Politics aside, I know from my experience in business that these ideas work and as business people yourselves, you know the same.

Your organizations support lowering the Corporate Net Income Tax, phasing out the Capital Stock and Franchise Tax, investing in manufacturing and our workforce, and most importantly, funding our schools and making sure that you have a strong workforce to draw from. But instead of working together to achieve our shared goals, you have chosen to side with corporate special interests who simply seek to oppose progress and real economic development.

The facts you outlined in your letter are simply talking points from the oil and gas drillers. It is bogus rhetoric, and it does nothing to change Pennsylvania, fix our schools, or create jobs. You know that the severance tax I’ve proposed is critical to getting Pennsylvania back on track, and it will do so at minimal cost to Pennsylvania citizens. You know that since Pennsylvania exports a significant amount of the natural gas it produces, an estimated 80% of the tax will be paid by non-Pennsylvanians. Furthermore, despite false claims to the contrary, natural gas companies remain strongly profitable. Last year the value of natural gas severed in Pennsylvania was nearly $11 billion, up from $4 billion in 2011. Moreover, natural gas prices, which have been depressed both nationally and locally, are expected to improve significantly by the time the severance tax takes effect next year.

You have repeatedly called for major reductions in our Corporate Net Income Tax rate. My budget cuts the CNI in half. Why aren’t you supporting me on this?

You have long said we have to end the Capital Stock and Franchise Tax. My budget does so on Jan 1. Why aren’t you working with me to end the Capital Stock and Franchise Tax?

You have called for a stronger education system. Education is the cornerstone of my budget. And the investments we will make in our schools will come from a commonsense severance tax. Why aren’t you working with me to fix our schools?

You have called for workforce development and a focus on manufacturing. My budget will support the growth of manufacturing in Pennsylvania and it will do so in part by strengthening our workforce. Why aren’t you working with me to create new manufacturing jobs in Pennsylvania?

We cannot keep doing the same thing and expecting different results in Pennsylvania. Instead of working with me to address our shared priorities, you are standing with oil and gas special interests and opposing progress for Pennsylvania. You are ignoring your own priorities and you are hurting businesses, schools, and the people of Pennsylvania who desperately need change. It is simply unacceptable.

Now is the time to do big things in Pennsylvania. That’s what I’m trying to do. What you’re doing is ignoring your own goals and your own priorities and in the process, you’re letting down our commonwealth.

Tom Wolf

MEDIA CONTACT: Jeff Sheridan – 717.783.1116

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