GAS PRODUCERS WANT SEVERANCE TAX REDUCTION - PR Campaign Issues Fuzzy Numbers

(03/01/2008)
By Bob Weaver

State officials will likely wait until next year before West Virginia can change its severance tax on oil and natural gas.

A Senate committee proved unwilling to take up the necessary legislation this week, the last day of this session for bills.

Legislators have been heavily lobbied to reduce the severance tax rates .

Industry groups, mostly the large corporate producers, backed the proposal which would lower the tax rate.

It also would have required the initial purchaser of the oil or gas to collect and relay the tax, which is assessed as those resources are extracted from the ground.

Many of the state's smaller operators questioned the details of the bill.

So did members of the Senate's Committee on Energy, Industry and Mining.

They converted the bill into a study proposal.

Following a highly funded public relations and lobbying blitz by a newly energized gas producer's organization, many of the issues before the legislature have not been widely reported.

A recent public relations letter to the editor from six regional producers to the Calhoun Chronicle said nearly 3,000 gas wells have been drilled in Calhoun, further stating:

"Last year, Calhoun received more than $2,466,304 in severance tax and property tax revenue because of the production of natural gas, with the lion's share going to local schools."

A check on the actual severance tax money received by the county last year, was about $111,000.

The local school system received more, but the actual amount was not available.