Sunday, March 20, 2011

Corbett: Natural gas tax could hurt Pa. - News - Citizens Voice


Gov. Tom Corbett sloughed off a poll Thursday that shows Pennsylvanians opposed to his steep education funding cuts and in favor of taxing the natural gas industry, arguing the tax would not end state budget woes but could alienate "a cornerstone of the future."

"We didn't campaign based on polls; we're not governing based on polls," Corbett said during a news conference after an appearance at the Greater Scranton Chamber of Commerce. "It's not what we were elected to do."

Corbett opposes the natural gas severance tax and his proposed 2011-12 budget cuts funding for public schools, higher education, public libraries and other education-related entities by $1.5 billion, or 15 percent.

A Franklin & Marshall College poll released Wednesday showed more than three-fifths of residents favor taxing natural gas production while more than three quarters oppose the education cuts.

Critics of Corbett's budget argue a natural gas tax would not chase away the industry because Pennsylvania is the only state with no local or state severance tax and companies will not leave billions of dollars in potential profits in the ground.

But Corbett said he fears the industry will transfer gas well-drilling equipment and money for investment to other states where severance taxes on gas extraction might be lower if Pennsylvania imposes a severance tax on gas.

"It's important to get this industry rooted in Pennsylvania," he told reporters.

"I want them building their headquarters here," he said during his speech to about 50 chamber members.

Corbett specifically defended the higher education cuts, which Penn State University President Graham Spanier has said could lead to higher tuition and closing of some Penn State satellite campuses.

"It's Spanier that's taking the fight to the students," Corbett said. "He's the one that, when hearing the budget, immediately said, 'We're going to put this on the backs of the students,' where he's been putting it the entire time."

Over the last decade, Penn State has received $3.5 billion in state money while more than doubling tuition, the governor said.

"Who's putting it on the back of the students?" he said.

Corbett said the painful cuts are necessary because of the $4.3 billion budget deficit he inherited from Gov. Ed Rendell, whose natural gas tax proposal, he noted, would have produced only $170 million next year.

"I think people lose sight of that," he said of the inherited deficit. "That's what I can't lose sight of."

Corbett reminded the chamber audience his budget is only a proposal and said he would listen to amendments, but said the bottom line for spending will be his proposed $27.3 billion.

"The final number of spending will not be above $27.3 billion or I will not sign the budget," he said.

Corbett dismissed the argument that he did not ask businesses and corporations to sacrifice in his budget.

"First off, businesses and corporations have been sacrificing," he said. "Their business has been so far down that they haven't been able to employ people. รข€¦ I'm not sure what you mean by them sacrificing. Does that mean more taxes? Well, you know where I am on more taxes."

Corbett pointed to the elimination in his budget of legislative initiative grants - legislators' money for special projects - that often went to companies.

Corbett's budget reduces funding for the Department of Economic and Community Development - the source of many grants and loans for corporate and business development by $114 million, or more than a third of its 2010-2011 level. Much of that was money provided by one-time federal economic stimulus money.

"We have many corporations that come to us that are always asking us for more money," the governor said. "We're going to look at those very carefully. We have to reduce the spending there. And we have to let the free enterprise system work."

Corbett told the chamber audience no one should be surprised that he opposes raising taxes because he promised that while campaigning for the office.

"I came straight out with what I said I'm going to do," he said.

Corbett said the $20 million in funding that Rendell promised for renovating Lackawanna County remains under review. He declined to say if there is reason to think he would not approve the money.

"I've been so busy with this budget, that's one that I haven't really sat down and looked at," he said.

Corbett also said he will name a transportation task force to examine ways of paying for transportation projects and mass transit within 30 days.

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