Archive: July, 2010
As we've written before, the best part of the bad state budget is a new tax on natural gas drilling in the Marcellus Shale. However, the actual terms of the so-called “severance tax” weren't included in the budget agreement signed by Gov. Rendell this week. Instead, the legislature simply made a commitment to work out the details of the new tax by October 1st.
Now, environmental activists are alleging that natural gas drillers are planning to use the three month gap to lobby for more lenient regulations.
Myron Arnowitt, Pennsylvania director for the environmental group Clean Water Action, said the industry is seeking concessions in return for its agreement on the severance tax.
We don't have a ton to say about the accident involving the “Duck Boat” on the Delaware River (except that we hope the two missing passengers are OK), but we couldn't help but notice the following paragraph from today's Daily News story:
City officials said the massive barge that struck the tourist-laden Duck boat, the Resource, was owned by the city but operated by a contractor, K-Sea Transportation. The barge hauls sludge from a biofuels plant in Northeast Philadelphia to a recycling plant in Southwest Philly.
The city owns a massive barge used to transport waste from one place to another, operated by the Philadelphia Water Department. Who knew? And, who knew that the city has an outside contract with a company to pull that barge? That's not something we typically think of when we talk about city government. If anything, this little factoid should be a reminder that city government has a lot of moving parts.
The state's energy (and ours) for being outraged about the budget agreement has been preoccupied most recently by the revelation that $20 million of public money is being set aside to build libraries honoring Arlen Specter and Jack Murtha, but let's not forget last week's outrage: the reintroduction of walking-around-money to the budget after last year's budget was proudly declared "WAM free."
Ben explained this all a week ago. Basically WAMs are funds politicians get to hand out as grants. Perhaps they consider how to best leverage this money for votes. Perhaps.
The Independent followed up to get an explanation of why WAMs were back in the budget this year. This is what they got from Gov. Rendell:
The Daily News has some questions about the Redevelopment Assistance Capital Projects (RACP), the $300 million dollar pot of money that will be funding the Specter and Murtha libraries, among other brick-and-mortar projects around the state. The governor has defended the projects by saying they'll create jobs.
We're all for creating jobs, but where's the data on how many jobs will be created? Are they permanent jobs? What public benefit will accrue? Do those benefits exceed the costs?
Also, the list looks like a grab bag of projects; are we borrowing $300 million to make some people happy, or is this part of an overall coherent strategy for economic development?
Remember how the stimulus passed by the federal government was supposed to help states build high-speed rail and other high-tech improvements to mass transit? Well, it's looking increasingly likely that Pennsylvania will miss out on our share of the funds. According to an article in the Pittsburgh Tribune-Review, the state is too broke to come up with the matching funds required by the Federal Railroad Administration.
"We're reviewing any options we have, but it's going to be very difficult to come up with our 20 percent match," said PennDOT spokeswoman Erin Waters.
The Federal Highway Administration rejected Pennsylvania's proposal to charge tolls on Interstate 80, and the state has struggled with a $472 million transportation funding shortfall for next year. It's hard to come up with millions for high-speed rail projects when the state must maintain roads, bridges and transit systems, Waters said.
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- Allegheny County is getting a $3.3 million grant to fight homelessness. (PG)
- Dauphin County is considering layoffs to an agency that provides services to senior citizens. (PN)
- An environmental group has published a nifty report that chronicles decreased funding for the state’s Department of Environmental Protection. (Clean Water Action)
- Keystone Progress is ratcheting up pressure on GOP gubernatorial candidate Tom Corbett to return donations from an oil company involved in the Gulf Oil spill. (Capitol Ideas)
- Good government groups are marking the anniversary of the notorious pay-raise scandal of 2005 by asking the gubernatorial candidates to support reform platforms. (PG)
David Leonhardt floats an idea in his New York Times column today:
Imagine if Washington offered to help states get through today’s shortfalls in exchange for making progress on their long-run problems. In the ideal version of this program, states would get some initial money without strings attached. They need it to avoid those teacher and firefighter layoffs. States that came up with credible plans to reduce their deficits would then get more money over the next few years.
You can't tell from the quote, but by "reduce their deficits" he means reduce employee pension and health care costs, which are the main reasons for the deficits. Of course, coming up with a "credible plan" to do this is a bit easier said than done. But the federal government incentivizing it won't hurt, and hey, if some jobs can be saved in the process, that's all to the good, right?
We have suggested before that the budget the state recently passed is a bit of a joke -- that the main thing Harrisburg lawmakers "agreed" upon is that they wanted to pass a budget by their deadline, and that the hard decisions they postponed in order to be able to say they had an agreement were precisely the things that, under honest circumstances, would have held a budget up.
One of those decisions is the details of a new extraction tax on the Marcellus Shale. Lawmakers have agreed to impose one, but haven't sorted out the specifics. What specifics? What's so complicated?
Actually, it is a bit complicated. The Patriot-News had a good explainer piece yesterday. Here's the crux: Pennsylvania could impose a flat tax on the amount of gas extracted in a given year, but that would fail to take into account the value of the gas -- the tax could prove too low in good years, too high in bad ones. It could also impose a tax on the value of gas extracted, but that would make budgeting difficult because lawmakers wouldn't be able to predict revenues ahead of time.