Can a tax on natural gas drilling help fix Pa.’s infrastructure problem?

Pennsylvania Gov. Tom Wolf visits Fairhill, one of Philadelphia's poorest neighborhoods, to push for a severance tax on natural gas, which he says could be used to fight urban blight. (Emma Lee/WHYY)

Pennsylvania Gov. Tom Wolf visits Fairhill, one of Philadelphia's poorest neighborhoods, to push for a severance tax on natural gas, which he says could be used to fight urban blight. (Emma Lee/WHYY)

Gov. Tom Wolf strolled through one of the state’s poorest communities on Friday to talk up Restore Pennsylvania, a wide-ranging infrastructure initiative he wants to fund with a long-sought severance tax on natural gas drilling.

“For 15 years, we’ve been giving everybody a free ride,” Wolf said to the cluster of residents and elected officials walking with him in the Fairhill section of North Philadelphia, the latest stop of this outreach campaign.

Wolf estimates the tax would generate $4.5 billion over four years. Under the administration’s plan, the money would go to high-speed internet access, storm preparedness, manufacturing, public transit projects and blight removal in struggling neighborhoods like Fairhill.

“We have the capacity to address these issues. We need to stop saying, ‘Let’s put it off. Let’s wait. Let’s see if we can find something to maybe work at the margins.’ We have something that could actually address these issues,” said Wolf.

Pennsylvania is the only state with natural gas drilling that doesn’t have a severance tax. Wolf has called for one since he was elected in 2014, but the idea has never gone far in the General Assembly, in part because of staunch opposition from Republican lawmakers.

The governor said Friday that Restore Pennsylvania could finally “break the logjam” and move a severance tax from dream to reality.

“This not a Republican or Democratic thing,” said Wolf, adding that roughly 80% of the tax would be shouldered by out-of-state natural gas companies, not Pennsylvania residents.

Rev. John Payne, who leads Ebenezer Baptist Church in Fairhill, hopes Wolf’s latest pitch is successful. His childhood neighborhood was ravaged by the crack epidemic of the 1980s. It’s never bounced back, though residents say real estate developers have become more interested in investing because of its proximity to gentrifying sections of Kensington.

Blight is still commonplace, though, with overgrown vacant lots and boarded-up buildings easy to find.

“It becomes a mental issue. The blight gets into your psyche,” Payne said.

In 2012, state lawmakers passed Act 13, which imposed an impact fee on natural gas companies that use fracking techniques.

The majority of that revenue is used by local governments for housing projects, public infrastructure and stormwater management, among other things. The rest goes to various state agencies involved with regulating the industry, as well as the Marcellus Legacy Fund.

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