Inquirer Editorial: Drillers can afford real tax

Just because Pennsylvania House Republicans have approved an inadequate impact fee on natural-gas wells drilled in the Marcellus Shale doesn't mean the state has to be saddled with that.

A prominent environmental group rightly describes the effective tax rate of only 1 percent on drillers as "a slap in the face" to state taxpayers.

The per-well fee would be far less than the gas-extraction taxes levied in most major drilling states, and that follows years of Harrisburg inaction during which the multinational drilling industry has enjoyed a huge tax break in the Keystone State.

What's more, the House legislation supported by Gov. Corbett would shortchange statewide needs by reserving most of the revenue for the local gas-drilling communities. Only 25 cents on the dollar would reach Harrisburg for statewide transportation improvements, emergency response, and environmental cleanup and conservation efforts.

For the 26 counties with gas-producing wells - primarily in the west and along the state's northern border - the fee revenue would come with strings: Local governments would be barred from enforcing zoning rules that limit drillers, even with such tools as noise regulations in residential areas.

Are such land-use rules the "confusing hodgepodge of local ordinances" that the state's chief business lobbying arm contends, or are they the best means to assure that communities are not overrun by drilling operations?

In short, the House measure represents a lost opportunity to enact the substantial drilling tax and environmental safeguards that two-thirds of state residents tell pollsters they support.

Except for Corbett's unworkable no-tax pledge, there's no reason for Pennsylvania to fashion itself as a tax haven for drillers tapping into the Marcellus formation. The gas isn't going anywhere, nor are the drillers likely to pull up stakes before the rich supply is tapped out.

At least the state Senate sees the need to up the ante somewhat: Its take on the impact fee and drilling regulations would provide an effective 2.2 percent tax over a well's life, bringing revenues in at nearly twice the rate of the House plan. A Senate-approved proposal also would direct 45 cents from each $1 to the state, which would more fairly share the gas-boom benefits with residents in this region.

In talks with House colleagues, GOP senators from the Philadelphia area, in particular, must hold out for the natural-gas legislation most voters support and deserve. It should be done by New Year's, but not if that means an early Christmas for drillers.