An update on lawmaker action and other activities at the Ohio Statehouse related to horizontal hydraulic fracturing:
Lobbying: The Ohio Oil and Gas Association and other industry groups played host last month to a lobby day at the Statehouse, where they touted their growing industry and urged lawmakers to increase support for natural-gas development.
“Investments in oil and natural gas are refueling Ohio’s economy,” Robert Eshenbaugh, legislative director for the Ohio Petroleum Council, said in a released statement. “Ohio’s energy revolution took off because lawmakers matched prudent fiscal policies with smart and effective regulation. The Legislature should build on recent success by allowing greater development of Ohio’s vast natural-gas reserves.”
Jurisdiction: The Ohio Supreme Court has ruled that a state commission acted without jurisdiction in an appeal of a drilling permit last year.
The Ohio Department of Natural Resources’ Division of Oil and Gas Resources Management was sued by Chesapeake Exploration LLC on the issue.
Priorities: The Ohio Farmers Union announced its support for an increase in taxes on oil and gas produced from horizontal wells, but it urged Statehouse Republicans to divert the proceeds to help local governments.
The group’s president, Roger Wise, said in a released statement, “Shale counties should see some of that severance-tax revenue. Keep some of the revenue where it’s collected for public education and infrastructure. We know from other states that roads are going to be torn up in drilling areas. Let’s make sure we rebuild them.”
Frack Tax: Last month, Gov. John Kasich reintroduced a proposal to increase tax rates on oil and gas produced via horizontal hydraulic fracturing, though this time as part of a larger tax-reform package that included an income-tax cut and a sales-tax rate cut and broadening to cover services.
A number of groups immediately announced opposition, including the Ohio Petroleum Council.
“While we agree with the governor that all Ohioans should benefit from development of the Utica Shale, the last thing a recovering economy needs is more taxes; and the last thing Ohio’s economy needs is a hefty, tax increase that will harm job growth,” Eshenbaugh said in a released statement. “Ohioans are already benefiting from shale-energy development. We are an industry investing in putting people to work, paying high wages and already generating billions in revenue for the state. This proposal is ill-conceived and ill-timed.”
Stats: The Ohio Department of Job and Family services has released a first-of-its-kind quarterly report on the economic impact of fracking (copies online at ohiolmi.com/ohioshale/ohioshale.htm).
According to the report, more than 167,000 people were working in Ohio’s shale oil and gas industry as of November, earning average salaries between $59,000 and $74,000.
Penalties: Legislation introduced by state Sens. Joe Schiavoni of Boardman, D-33rd, and Frank LaRose, a Republican from Akron, would increase criminal penalties against those who illegally dump oil-field waste.
Tax Hike: State Rep. Robert F. Hagan of Youngstown, D-58th, announced legislation to increase taxes on oil and gas production, with the proceeds going to schools and local governments.
“The Ohio Department of Natural Resources has only a few dozen inspectors for thousands of active and inactive wells,” he said in a released statement. “That’s a terrifying ratio. We need to equip the state and our local communities with the necessary resources to ensure that drilling operations are being conducted in a responsible manner in accordance with the law.”