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Friday, October 2, 2009

Legislators Have Deep Rift With Budget Agreement

Gas Production Tax, State Land Leasing At Play In Budget Debate

Several of the issues that are at play in the marathon state budget impasse have major implications for Potter County – particularly the debate over opening more state forest and game lands to natural gas drilling and the proposal to impose a “severance tax” on gas production.

Meanwhile, the county’s financial situation is growing especially tight due to the lack of state reimbursements for mandated programs. The impact is being felt most directly at Potter County Human Services, where most employees are currently working just two days a week and cash reserves are falling.

Potter County Commissioners Doug Morley, Paul Heimel and Susan Kefover have been communicating frequently with the lobbyists and analysts of the County Commissioners Association of Pennsylvania (CCAP) to keep abreast of developments that affect the county’s financial situation. CCAP’s government relations manager, Kristen Goshorn, reported late Thursday that state lawmakers appear far from agreement on key budget proposals, even though they were required to have the fiscal 2009-10 spending plan in place by June 30.

House Democratic Caucus leaders do not currently have the votes to pass the agreement announced by three caucuses and the governor on Sept. 18. Items of disagreement include a proposal to lease additional acres of state forest land, taxation of small games of chance revenues, and removal of the sales tax exemption for the arts. Some House members would prefer to see a severance tax on natural gas and a tax on smokeless tobacco to replace these revenue sources.

There’s no agreement on how any revenue from a tax on natural gas would be distributed and whether counties, school districts and municipalities would receive a portion of the money. Potter County Today