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Governor presses for severance tax to repair levee

Pennsylvania Gov. Tom Wolf listens as Frances McJunkin, Deputy Director of Lycoming County Planning Department talks about the levy along Lycoming Creek in Williamsport Friday afternoon. DAVE KENNEDY/Sun-Gazette Correspondent

Gov. Tom Wolf toured the levee at Williamsport on Friday afternoon, taking the opportunity to discuss funding options for repairs that are driving up the levee’s recertification process.

He welcomed a crowd that included city officials and levee working group officials.

“Let’s create a big pool of resources,” Wolf said, adding a severance tax on natural gas drilling similar to Texas and Louisiana would potentially bring in $4.5 billion a year.

Non-state residents using products pulled out of the ground here in Pennsylvania would pay for about 80 percent of a tax on natural gas drilling, he said.

“Restore Pennsylvania will provide funding to help towns and cities upgrade flood walls and levees, replace high-hazard dams, and conduct stream restoration and maintenance to help protect our communities.”

“You separate it out of the budget and have a big pool of money to address the needs of all of Pennsylvania,” Wolf said.

“We’re the only natural gas-producing state in the country that doesn’t have a severance tax,” Wolf said.

“As you know, the severance tax is exportable. We pay the severance tax to Texas, Louisiana, whenever we fill up our tanks with gasoline.”

Wolf, who said he visited the region two years ago when statewide flooding hit, said, “the best we can do in Pennsylvania right now is to say if you reach the threshold that the federal government has for disaster relief, which is $18 million, $19 million, and we can do our best as a state help get to that level.”

“If we don’t reach that, we don’t qualify for federal disaster relief.”

Wolf said in addition to federal dollars where appropriate, he proposes a plan to create a special fund to help flood victims and those communities with other infrastructure needs by imposing a severance tax on natural gas drilling in the state.

The governor says his tax would yield about $300 million a year, which over 20 years would be $4.5 billion.

More than $4 billion in economic assets are protected by the levee, which holds back rushing waters of the West Branch of the Susquehanna River and Lycoming Creek.

Currently, relief wells, cross pipes and two I-walls are at risk of failure if not repaired and improved. The city and four other municipalities are protected by the levee, said Fran McJunkin, deputy director of planning and the Greater Williamsport Levee Work Group spokeswoman.

Speaking for the city, William E. Nichols Jr., city finance director, said issues are arising, such as the levee remaining uncertified, which was reported to have cost ShopVac Corp. — located in the industrial park near the levee — $300,000 a year more in insurance.

The levee rehabilitation and recertification process is expected to cost more than $16 million if done in the next five years.

Wolf listened and nodded.

The levee recertification is needed so those protected by it since the mid-1950s don’t have to pay for flood insurance, and it is a reason for enacting the severance tax.

“No other state is in the position like Pennsylvania,” Wolf said, again referring to his visit to the region two years ago post-flood damage.

Acknowledging he does not want to respond to homeowners after floods occur only to say he is sorry, Wolf said the severance tax could be used to prevent such losses.

“If your house was washed out, you’ve been devastated,” Wolf said of a need for a bipartisan solution to address infrastructure, flood mitigation and costs associated with post-flooding clean up.

“My take is the natural gas industry can do great things,” Wolf said. “Use it to make the state better.”

State Sen. Gene Yaw, R-Loyalsock Township, agrees on a need for a funding stream.

“We need proactive money,” said Yaw, who helped get $2 million in a state Redevelopment Assistance Capital Project grant, most of which will be used toward design and replacing relief wells.

The well replacement and repair is expected to take place this year, McJunkin said.

The levee currently protects more than 6,000 properties.

“Our local communities protected by the second largest levee system in the state have recognized the importance of adopting a regional approach to address the levee recertification process,” said Randall J. Allison, council vice president. “To that end, we are grateful for the support and advocacy from our county commissioners, our state legislative team led by the senator and from the governor with today’s visit and proposed infrastructure initiative.”

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