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Madison County opposes state production tax

The Madison County Board of Supervisors voted unanimously April 14 to approve a resolution opposing a proposed state severance tax on gas wells. The resolution, which states the board of supervisors opposes the proposed statewide severance tax and requests the state legislature not enact the proposed tax, was put forward by Supervisor Elizabeth C. Moran (D – Cazenovia), chairwoman of the Planning, Economic Development, Environmental and Intergovernmental Affairs Committee, and Supervisor John Salka (R,C,I – Brookfield), chairman of the Public Health Services Committee.

The document further recommends that appropriate state agencies convene immediate discussions with the local officials whose municipalities are affected by natural gas well drilling impacts to evaluate the current system of taxation.

Madison County was not alone in this venture.

Officials from Madison County met with elected officials and other Chenango County officials April 2 to discuss their common concerns with natural gas well solicitation and drilling in their areas. The group created a list of issues their communities are facing and decided immediate action was needed to oppose the state’s proposed severance tax that would likely move revenue from the local municipalities who are coping with infrastructure and quality-of-life impacts the activity brings.

Smyrna Supervisor Jim Bays, who hosted the meeting, said the group needs to send a strong message that the impacts felt by the towns and counties must be minimized. One way that can be done is to fight for a local production tax, something long-advocated for by Supervisor Jim Goldstein of Lebanon.

Goldstein led the group in listing off numerous problems experienced in his town, where the number of well permit applications has doubled over the last year. Topping the list of concerns were the protection of potable water sources, seismic testing impacts and rights-of-way use, well-spacing issues, siting issues, safety and oversight after recent well rig fires, prior notification of drilling, leasing practices, educating the public and state agency heads, possible economic development opportunities, self-reporting of well production rates, compulsory integration rules and other environmental impacts.

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“A production tax could mean a 15- to 30-percent property tax reduction,” Will said. “Loss to the industry doesn’t exist, not when they can pay anywhere from $1 to $4,000 an acre.”

Drafts of the proposed resolution circulated among members of the group the first week of April. The resolution asks for the state to put a moratorium on any statewide tax until every facet of the issue can be examined in depth.
The Madison County Board of Supervisors is expected to discuss the matter at its April 14 meeting.

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