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Storch, Klempa Seek Tax Revenue Reallocation

January 20, 2012
By JOSELYN KING Political Writer , The Intelligencer / Wheeling News-Register

A bill before the West Virginia Legislature seeks 3 percent of oil and gas severance tax revenues for the counties and municipalities where wells are drilled, with the money earmarked for development and infrastructure improvements.

Delegate Erikka Storch, R-Ohio, proposed the measure, House Bill 4129, on Thursday. It is the first piece of legislation for which she is primary sponsor.

Sen. Orphy Klempa, D-Ohio, proposed an identical measure, Senate Bill 157, last week in the Senate. The language in the bill was crafted during discussion among members of the Northern Panhandle caucus.

The legislation, as written, would assign 1 percent of the tax attributable to the severance of oil and gas to the county commissions of the oil and gas producing counties. An additional 2 percent would be directed to municipalities within the oil and gas producing counties.

The bill states the proceeds of the 3 percent of tax revenue can't exceed the sum of $20 million during one fiscal year.

The funds would be deposited into a specific fund titled the "Oil and Gas County and Municipality Reallocated Severance Tax Fund," and these deposits would be distributed quarterly to the oil and gas producing counties and municipalities in the state.

The legislation, though, specifically bans the counties and municipalities, in turn, from depositing these dollars into their general funds. They are instructed to create a separate fund for the revenue, and this money could only be used for economic development and infrastructure projects.

Storch's measure lists 10 additional sponsors, including local Delegates Ryan Ferns, D-Ohio; Mike Ferro and Scott Varner, both D-Marshall; Dave Pethtel, D-Wetzel; Roger Romine, R-Tyler; Roy Givens, D-Brooke; and Randy Swartzmiller and Ronnie Jones, both D-Hancock; as well as Tim Miley, D-Harrison, chairman of the House Judiciary Committee; and Amanda Pasdon, R-Monongalia.

Storch said the initial support from Harrison and Monongalia counties - both oil and gas producing counties with large representation in the House - bodes well for the legislation.

"(The bill) should help counties and municipalities have money for expenses not covered by gas companies," she said. "They may be taking care of the routes they travel (when drilling) - but not necessarily the routes leading to the route. ... And none of the money is for the general revenue fund. That's a positive."

Klempa's legislation has seven additional sponsors in the Senate, including Senate President Jeff Kessler, D-Marshall; Larry Edgell, D-Wetzel; Jack Yost, D-Brooke; Bob Williams, D-Taylor; Bob Beach, D-Monongalia; Roman Prezioso, D-Marion, finance committee chairman; and Dave Sypolt, R-Preston.

Klempa could not be reached for comment Thursday.

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