Stalemate nears in Pa. Senate over 'shale tax'

October 13, 2010|By Angela Couloumbis, Inquirer Harrisburg Bureau

HARRISBURG - No one in the Capitol is uttering the word dead yet, but prospects are dimming - and time is running out - to strike a deal on proposals to tax the extraction of natural gas from the Marcellus Shale.

"We're still worlds apart," Senate President Joe Scarnati (R., Jefferson) said Tuesday, adding that chances of reaching an agreement "diminish by the hour."

Gov. Rendell put it this way: "The effort to get this done has broken down."

Lest anyone misinterpret the lame-duck governor's mood, he later compared Scarnati to Pinocchio.

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Rendell and Senate Republican leaders spoke after a joint meeting Tuesday. The meeting's stated purpose was to bridge differences over how high such a tax should be, and how it should be distributed among the state, counties, and environmental causes.

Both sides said talks would continue, but neither sounded hopeful of finding common ground on the oft-proposed, oft-delayed "shale tax" before the Senate recesses Thursday before the Nov. 2 election.

The Democratic-controlled House last month passed a bill that calls for a tax of a minimum of 39 cents - roughly 10 percent - per 1,000 cubic feet of natural gas produced. Rendell has said he would support it.

Senate Republican leaders have derided the proposal, dismissing the rate as the highest in the nation and contending it would drive the natural-gas industry out of Pennsylvania. They have also said they believed the measure was passed in an unconstitutional manner.

They support a 1.5 percent tax on gas produced from large wells for the first five years, at which point the rate would jump to 5 percent. Rendell has said he would veto that proposal if it reached his desk.

The sides have been trying to negotiate a compromise since then, but consensus has been elusive.

And Rendell may have hurt his own cause Tuesday. Addressing reporters in his reception room in the Capitol, the governor dropped any pretense of political civility, accusing the Senate GOP of dragging its feet in hope that Republican nominee Tom Corbett - who opposes such a tax - would be elected governor Nov. 2. Democratic nominee Dan Onorato supports taxing natural gas.

At one point Tuesday, Rendell likened Scarnati - one of the top negotiators for the Senate Republicans - to the famous lying puppet.

"Check his nose out tomorrow - it's going to be a bit longer," Rendell said when told that Scarnati had said Senate Republicans have been negotiating in good faith.

Scarnati didn't mince words either.

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