Turzai: GOP to propose 'Keystone Energy Zones' to help shale-gas industry

In an assist to the shale-gas industry, the speaker of Pennsylvania's House said Thursday that Republicans will propose a "Keystone Energy Zone" to extend tax breaks to gas-hungry manufacturers.

Rep. Mike Turzai (R., Allegheny), speaking on the final day of the Marcellus Shale Coalition's two-day conference in Philadelphia, disclosed the tax-break concept as a counterpoint to Gov. Wolf's plan to create a natural-gas severance tax.

"Let's quit talking about this severance tax, and let's talk about how we improve usage," Turzai said during an onstage discussion with David J. Spigelmyer, the coalition's president, and K. Scott Roy, a Range Resources Corp. executive who is the coalition's chairman.

Turzai, an unvarnished supporter of the gas industry, used the friendly Shale Insight 2015 conference to bash Wolf's tax proposal, a centerpiece of the stalemated budget plan. The Democratic governor's $1 billion production tax would mostly fund education.

Turzai and Republicans say the severance tax would impair the gas industry and drive out investment. They say government should fashion policies to encourage more drilling and growth of energy-intensive industries.

Turzai said the Keystone Energy Zone would be modeled on the Keystone Opportunity Zone, which extends 10-year breaks on local and state taxes for businesses that locate in designated areas.

He said the energy zone would "incent people to put in manufacturing facilities that would utilitize natural gas as an energy source or would utilize natural gas as a feedstock for other products."

Turzai did not elaborate on his proposal, and he departed the Convention Center through a freight elevator, telling reporters he had another speaking engagement.

Details of the plan are still being worked out, Turzai's spokesman, Jay Ostrich, said in a phone interview. He said Turzai's aim was to "support the industry instead of crushing it."

The state has been without a budget since June 30. Republicans say they want a stopgap budget to help fund operations. Wolf has promised to veto it.

amaykuth@phillynews.com

215-854-2947@maykuth

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