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In Monroeville, Gov. Wolf pushes his proposed natural gas extraction tax

| Monday, Feb. 16, 2015, 4:36 p.m.
Gov. Tom Wolf discusses the Pennsylvania Education Reinvestment Act during a news conference Monday at the Monroeville Municipal Center. Behind him are (from left) Sen. Wayne Fontana, Rep. Dan Frankel and Allegheny County Executive Rich Fitzgerald.
Heidi Murrin | Trib Total Media
Gov. Tom Wolf discusses the Pennsylvania Education Reinvestment Act during a news conference Monday at the Monroeville Municipal Center. Behind him are (from left) Sen. Wayne Fontana, Rep. Dan Frankel and Allegheny County Executive Rich Fitzgerald.
Andy Pollack of Irwin hands Gov. Tom Wolf some ideas for alternative energy sources at a news conference Monday at the Monroeville Municipal Center. Wolf was discussing the Pennsylvania Education Reinvestment Act, a plan to impose a 5 percent severance tax on natural gas drilling and direct the revenue to education. Pollack said the water at his previous residence was contaminated by fracking.
Heidi Murrin | Trib Total Media
Andy Pollack of Irwin hands Gov. Tom Wolf some ideas for alternative energy sources at a news conference Monday at the Monroeville Municipal Center. Wolf was discussing the Pennsylvania Education Reinvestment Act, a plan to impose a 5 percent severance tax on natural gas drilling and direct the revenue to education. Pollack said the water at his previous residence was contaminated by fracking.

Public schools in Allegheny County have lost about $47 million in state funding since 2010-11 but could recoup some of that money if lawmakers support a tax on natural gas drilling, Gov. Tom Wolf said Monday during a visit to Monroeville.

With several Democratic officials by his side, Wolf made a push for his tax proposal, saying Pennsylvania ranks 45th in the country for education funding.

“This is an effort to tap into a natural resource that is ours, lies beneath our feet, and turn that into something that creates skills and new jobs for our economy,” Wolf said.

Wolf wants lawmakers to impose a 5 percent severance tax on the value of gas that drillers extract and a levy of 4.7 cents per thousand cubic feet. He said the state Independent Fiscal Office has estimated this would amount to a roughly 5.8 percent tax on natural gas.

Wolf has said the proposal would generate $1 billion during the fiscal year that begins in July 2016, but industry representatives have called this figure overly optimistic.

Labor leaders, small businesses and local government officials worry about the negative effect “that even higher energy taxes will have on the commonwealth's economy,” said Dave Spigelmyer, president of the pro-industry Marcellus Shale Coalition. “Pennsylvanians are looking to their elected officials to help create new jobs, not higher energy taxes.”

Wolf's stop at the Monroeville Municipal Building was the second of the day in a series of visits he's making statewide to promote the proposal. Earlier Monday, he visited a high school in Johnstown. Last week, he visited schools in Chester and Schuylkill counties with much the same message.

Wolf spokesman Jeffrey Sheridan said Wolf plans an appearance this week in the northeast of the state, but he hasn't confirmed a location.

Natural gas strongholds such as Washington and Lycoming counties have not been part of the tour, and Wolf has framed the proposal as an education issue more than one of jobs.

State Sen. Jim Brewster, D-McKeesport, said he expects gas developers to stay in the state — even with a severance tax — because of the sheer size of natural gas deposits in the Marcellus and Utica shale formations.

“The industry is not going to go anywhere,” Brewster said. “This isn't going to hurt the middle class.”

Wolf said he plans to include the tax in the budget he will propose March 3.

Wolf needs to gain support from Republicans who control both chambers of the Legislature in order to pass the tax by June 30 — the deadline for school districts to prepare annual budgets. GOP leaders in the House and Senate have opposed similar proposals.

“We'll have to negotiate it,” Brewster said. “There's other things we can talk about.”

He said one negotiable issue is pension reform — an issue Republicans have pushed to stop ever-increasing contributions to public school workers' pensions.

Senate Majority Leader Jake Corman of Centre County said last week when Wolf released his plan that senators would consider the proposal when “we deal with pensions, which will have the effect of saving significant tax dollars.”

Corman spokeswoman Jen Kocher said “nothing has changed” for Senate Republicans since last week.

Gideon Bradshaw is a Trib Total Media staff writer. Reach him at gbradshaw@tribweb.com.

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