John Baer: In Pennsylvania, tax on rock could be a gas

Posted: September 20, 2010

WITH YOUR Legislature back (however briefly) from its oh-so-deserved summer break, the question of taxing Marcellus Shale sits atop its in-box.

Here, then, a Q & A on the issue, assuming that the only gas known to Philly folks is that emitted from the DRPA, the PHA and City Hall.

Q. Isn't Marcellus Shale a wide receiver for Tennessee State?

A. You're no doubt thinking of Cris Shale, Bowling Green's 1990 All-America punter, drafted and then cut by the Redskins in '91.

Q. So who the heck is Marcellus Shale?

A. Not who, what. It's dark sedimentary rock across two-thirds of Pennsylvania, mostly northern and western counties, from the surface to a mile below.

Q. Where'd the name come from?

A. Marcellus, N.Y., population 1,800, about 10 miles east of Syracuse, where an outcropping of the rock was visible.

Q. Why tax rock?

A. Because this rock traps natural gas, apparently enough to fuel the state forever.

Q. Really? How much?

A. Estimates are 50 trillion cubic feet, almost double the amount the U.S. uses annually, and slightly more than comes from the DRPA, PHA and City Hall combined.

Q. You said "trapped." How do you get it un-trapped?

A. Drill, baby, drill - down and sideways.

Q. Wait, is this the drilling that the state spied on its citizens about?

A. You betcha. State squandered $103,000 of your dough on a no-bid contract with some "anti-terrorism" firm to crush the constitutional rights of anybody who raised questions about this issue or watched the documentary "Gasland" about its dangers or ever tasted a granola bar.

Q. Why?

A. Because Gov. Ed was too busy analyzing football and appearing on every cable-TV talk show there is, and because the people he hired couldn't think of a better use of tax dollars.

Q. Well, what's the concern about drilling?

A. Use of high pressure to force millions of gallons of water, sand and chemicals down to fracture the shale and release the gas.

Q. Chemicals? Like what?

A. Oh, practically harmless stuff such as hydrochloric acid, formaldehyde, ammonium chloride.

Q. Sounds pretty toxic; what happens to the water?

A. Don't ask.

Q. I am asking.

A. Industry says it's reused or recycled, treated, cleaned up and made safe enough to serve to your mother-in-law. Others say it poisons watersheds, sickens or kills livestock and greatly increases sales of bottled water.

Q. How do we know who's right?

A. Not to worry. Since the fracturing, or "fracking," is relatively new, the EPA is doing a $2 million study; results due by the end of 2012.

Q. Why not wait for that before they frack?

A. Because there's money in them there rocks for industry and landowners, and because taxes mean a big takeaway in new revenue for local governments and the state, which would get $280 million just next year.

Q. So when's all this drilling start?

A. Oh, it's well started (Get it? Well?): 500-plus state permits since '05; lots of money for leasing rights on private land, up to $5,000 an acre plus royalties, and only one blowout.

Q. Blowout?

A. In June. A well in Clearfield County spewed gas and 35,000 gallons of fracking water for 16 hours, but what harm could that do? And, remember, the key here is the money.

Q. So we'll get a tax?

A. Well, Gov. Ed once said that lawmakers wouldn't raise taxes to cure cancer, but maybe. Other states tax shale. There's a "deal" for a vote before Oct. 1, and that could happen even though Ed says he's not confident. Plus, lawmakers leave for the year in mid-October (wouldn't you like a schedule like theirs?) and if Republican Tom Corbett gets elected governor, no tax.

Q. Because?

A. He signed a "no-tax" pledge and opposes the shale tax. His opponent, Democrat Dan Onorato, supports a tax. By the way, it's more lucrative to oppose it. Common Cause and Conservation Voters last week said the industry gave Corbett $372,720, or five times the $74,300 it gave Onorato.

Q. The basic argument?

A. One side says a tax stymies the industry and risks jobs. Other side says we're the Saudi Arabia of natural gas and ought to cash in.

Q. But if all that gas is here, won't industry stay to get it, tax or no tax?

A. Duh.

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