In the near future, I plan to introduce legislation that would impose a 6.5% severance tax on Marcellus Shale drillers in the Commonwealth. 

 

In July 2024, I was proud to join the Legislative Budget and Finance Committee (LBFC) of Pennsylvania in releasing its critical report, titled, “A Study Pursuant to House Resolution 2023-131: An Examination of Natural Gas Tax Structures.” This report follows the passage of House Resolution 131, which tasked the LBFC with comparing the natural gas severance tax structures of the top five gas-producing states in the U.S., including Pennsylvania. The findings are striking: 

 

• In 2023, Texas produced 11,539,966 million cubic feet of natural gas, while Pennsylvania produced 7,619,721 million cubic feet.  

• Despite producing 66% of what Texas produces, Pennsylvania collects only 9% of the revenue Texas collects.  

• Over the past five years, Texas has amassed $12 billion in severance tax revenue, dwarfing Pennsylvania’s $1.1 billion. 

 

The LBFC's report underscores that Pennsylvania’s current tax structure is resulting in significant revenue losses. This is because the Commonwealth has adopted an impact fee system rather than a severance tax, the method used by other top-producing states. 

 

At a time when our Commonwealth’s budget is tight and many of our most critical programs are underfunded, we have a responsibility to enact a severance tax that will strengthen our revenue collection. As the second-highest producer of natural gas in the nation, it is time to join a vast majority of gas-producing states and enact a shale tax that will benefit millions while doing no harm to industry. 

 

Please join me in cosponsoring this timely and critical legislation.