Pennsylvania’s ‘Giveaway’ Tax Rate for Gas Processors

There was a May 23, 2022 story in Louisiana’s ‘Natchitoches Times’ with a headline that really caught my eye:

“Pipeline Compressor Station to Bring Major Revenue”

“An example of a similar facility is a gathering station near Robeline that has an assessed value of $5 million. Tax wise, it generates $93.21 for every $1,000 of value. Recently, is generated $549,000 that is distributed to School Board District 9, Fire District 5 and Parish Government including the library, health unit, government buildings and Road District 40.”

Pipeline compressor station to bring major revenue – Natchitoches Times – May 23, 2022

(There’s a compressor station about 3-miles southwest of Robeline so this one could be it)

This new Louisiana compressor station will be situated on 10 acres of land zoned Industrial. Without seeing the plans for this compressor station, I selected a pipeline compressor station in Washington County Pennsylvania that’s situated on a slightly larger (12.2 acres), zoned Industrial, and has some of the highest compression horsepower of several dozen other compressor stations in the county.

While the compressor station in Louisiana is assessed at $5 million and recently generated $549,000 of tax revenue, the Buffalo Compressor Station is assessed for $552,100 and recently generated about $9,000 a year in tax revenue from Washington County, McGuffey School District and Buffalo Township .That’s less than 2-percent of the tax revenue produced by what appears to be a similar facility! In other words, the one in Louisiana produces more than 60-times the tax revenue for local schools, fire districts, roads, libraries, health units and government buildings than the one in Pennsylvania.

Think maybe Washington County taxpayers are getting ‘Buffaloed?’

Now, let’s look at the BIGGEST gas processing plant in Washington County Pennsylvania to see what it paid in annual taxes. The massive Houston Pa gas plant is situated on 184 acres, and is assessed for $8,522,600 yet only paid about $144,000 in annual taxes to Washington County, Chartiers-Houston School District and Chartiers Township. That’s only about one-fourth what that much smaller Louisiana compressor station produced in tax revenue!

Sound like local taxpayers are getting ‘fracked’ more than the gas under their feet?

Frac yes!

At the same time, oil and gas interests, and their Harrisburg lobbyists, have kept the Commonwealth of Pennsylvania from instituting a meaningful severance tax on gas production, even though so much of the gas is exported out-of-state and overseas. You’ll find more of those details in an earlier blog, “Pennsylvania’s Impact Fee is ‘Chump Change.”

“There’s a sucker born every minute.”

Quote attributed to P.T. Barnum

One Comment on “Pennsylvania’s ‘Giveaway’ Tax Rate for Gas Processors

  1. Then you also have Union Twp in Washington County, Pa that refuses to accept or charge any “impact fees” from EQT …. EQT is raping, polluting destroying lands and roads and the citizens are locked out of EQT meetings with the current board of mafioso supervisors and a solicitor attorney buying and selling gas leases….
    Ethical? Legal?

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