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Hagan would raise tax on oil, gas drilling



Published: Thu, February 21, 2013 @ 12:05 a.m.

By Marc Kovac

news@vindy.com

COLUMBUS

Increased taxes on oil and gas produced using horizontal hydraulic fracturing would go to schools and local governments, under legislation being offered by a Democratic state lawmaker.

Rep. Bob Hagan of Youngstown, D-58th, wants to increase the state’s severance tax rate to 7.5 percent, which he said would raise hundreds of millions of dollars over several years.

Percent is of the volume pumped out of the ground times the average price of the oil or gas during the quarter when the payment is made.

The proceeds, he said, could be used to bolster the state’s oil and drilling programming and provide increased state support for schools, counties and townships.

“We should be getting more money, local money, hiring more inspectors, making sure local governments are held OK and whole at least for the damages that are done to their roads and bridges,” Hagan said.

The lawmaker and other statehouse Democrats have made comparable calls in recent months, saying eastern Ohio’s growing oilfields can provide increased funding for local governments affected by the activities.

But the proposal isn’t expected to get much traction in the Republican-controlled Ohio House and Senate, where some GOP lawmakers have already voiced concern about a proposal from Gov. John Kasich to increase the severance tax as part of a larger package to decrease income tax rates.

“It’s inadequate,” Hagan said of Kasich’s proposal to increase the severance tax to 4 percent. “It should be closer to 7 percent that Texas and Oklahoma ... charge in a severance tax.”

Under current rates, filers pay 10 cents per barrel of oil and 2.5 cents per thousand cubic feet of natural gas produced. Production valued at less than $1,000 is exempt if used on the same property where it is extracted, according to the taxation department.


Comments

1grazor50(66 comments)posted 1 year, 10 months ago

well said! Unless the oil companies have a tree that produces money, the taxes are just passed on to the consumer, in other words,, another tax hike! Lowering the state income tax and raising the oil tax was to bring in an extra $3B per year for the state of OHIO. Just remember, the final consumer funds this money, another hidden government cost, when was the last time the government did anything that saved you money. The workers of America pay over half of their wages in taxes and the government wants more.

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2BigJim2234(57 comments)posted 1 year, 10 months ago

Does Bob want to stop all drilling or does he want to raise taxes on them,,,,Not sure where he stands,

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3UticaShale(854 comments)posted 1 year, 10 months ago

Good one Jim, he's a bum and we love him so we keep voting for unqualified leaders like Hagan every election!

He ain't against anything he just worships money.

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4RTS1416(117 comments)posted 1 year, 10 months ago

What? Last week he was introducing legislation to ban the drilling of gas and oil wells to protect the people from the toxins involved in the industry. This week he in introducing legislation to bolster the states oil and drilling program. If any of the people who were singing his praises last week still believe in this clown than you deserve anything you get.

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5walter_sobchak(1982 comments)posted 1 year, 10 months ago

I have to agree with Buckwheat Bob on this issue. Even a broken clock is correct twice a day. The severance tax should be raised to reflect what is paid by these companies in other states. If the companies want this resource, they have to obtain it within the borders of our state. Since this is an Ohio resource, the taxes should be spread out throughout the state to be used in funding schools while at the same time reducing the property tax for schools, as the Ohio Supreme Court has ordered. Unfortunately, the devil is in the details and NONE of the politicians can be totally trusted to work out an equitable formula. Buckwheat's comments about the road and bridge damage is moot since the county engineer's enter into agreements with the companies to repair damage already. In fact, some of the roads need improved prior to operations as the existing roads are not adequate.

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6redeye1(4714 comments)posted 1 year, 10 months ago

This is typical liberal talk, you see if Hagan gets his way this just another tax that we will be paying, except he won't call it a tax. Let's face it , these companies will only raise their prices to cover this so-called tax. So what that means is that we will alll be paying higher prices (TAX) for this so-called increase.In reality it will be a tax on all of us ,but they won't have to call it a tax.

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7AnotherAverageCitizen(1175 comments)posted 1 year, 10 months ago

I cannot belive that kasich. He wants to tax everything. He wants to tax a ticket to the local highschool game. He wants to tax gas and oil. But when Hagen mentions tax, the repubs come out swinging full force.

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8farmforfun(15 comments)posted 1 year, 10 months ago

Typical Democrat, Never created a single job or was responsible for another person having a job, unless it was at the tax payers expense (ie.. government job).
Has no idea on how to create a budget or stick to a budget. And the only solution they can ever come up with is to raise taxes on the job creaters. Does anyone truly believe they can raise taxes on oil and gas and not pay more at the pump or to heat your house. It's no wonder these people are politicians, Private industry would never hire someone this dumb.

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9rickking123(312 comments)posted 1 year, 10 months ago

You can tell that bob is the brother of cuyahoga's "taxing tim" hagan who lost his job as county commissioner when cuyahoga county revamped its form of government. but don't worry tim got a part time consulting job with metrohealth for 90K, until the public outcry caused him to quit.

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10UticaShale(854 comments)posted 1 year, 10 months ago

Here we have the supermajors in the global energy industry, investing billions into Mahoning and Eastern Ohio, then we have our fearless leader yelling to ban fracking in Youngstown, and now he wants to collect revenue from the same thing he doesn't want.

And now you see why Youngstown is the laughing stock of the world now? I would love to hear what the sophistcated business world is saying right now about Youngstown, Ohio?

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