A revealing email, obtained by Plunderbund, demonstrates the political calculus that took place when House GOP leaders considered plans to raise Ohio’s severance taxes on oil & gas drillers in advance of an expected fracking boom.
On January 22, Lou Blessing, Speaker pro tempore of the Ohio House of Representatives, emailed his GOP colleagues with his thoughts on a possible increase in the tax–something that Governor Kasich was rumored to be considering. In his email, he compares Ohio’s taxes to other states, stating “Ohio is on the very low side” and puts forth two scenarios for raising it, in the following order:
We could impose whatever it reasonably takes to reimburse the locals and the state for additional costs associated with the increased drilling, or we could make it a little higher and reduce the income tax.
Clearly, faced with the prospect of increased tax revenue from fracking, even a top Republican legislator placed assistance to local governments ahead of a tax cut, the only use of the revenue Governor Kasich says he will consider. Kasich is so adamant about not helping local governments, suffering from severe cuts in his two-year budget, actually threatened to veto any measure providing extra cash to communities in the mid-biennium budget review.
In other words, at least one leading House Republican appears to agree with liberal think tanks, the editors of the Toledo Blade, Cleveland Plain Dealer and Akron Beacon Journal and House Democrats that any proceeds from increased fracking taxes should be shared with local governments before we consider cutting the income tax.
Also revealing is when Blessing ponders the political consequences of such a move:
The dems are surely looking to vote “no” and run the “tax raiser” ads.
After outlining various policy options, he closes his email by suggesting they punt until after the elections:
In fact there is no reason we need to do this before the lame duck session.
So, there you have it folks. Cynical election year politics at work. Ohio communities might be struggling, and we might be able to help them, but it could be used against us in campaign ads, so better wait until after November.
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