Doing The Right Thing

Airports, schools, cities and county governments are all feeling the pinch from higher energy costs. Natural gas, electricity, gasoline and diesel fuel are costing these organizations as well as the citizens of West Virginia enormously. The state of West Virginia, from severance and the personal property tax revenues are racking in hundreds of millions of dollars from the increase in prices since these taxes are based on the recognized value of the extracted products. The coal and natural gas industries are paying far more taxes than ever budgeted for.

The state will either find other ways to spend this money or they could help the citizens and local governments by lowering the tax on gasoline and natural gas by finding a way to use some of the excess revenue to help offset these increased costs. Until citizens demand such things from their legislators and the Governor, it will not happen.

The state has a real opportunity to help those in need and has the money to do it thanks to the coal and natural gas industry. While industry is doing its part, the question that remains is: does our leadership have the courage to do the right thing?

Windfall Taxes

The biggest windfall resulting from energy prices will be that which the State of West Virginia will receive from the Coal and Oil & Gas industries. Huge surpluses in severance taxes could amount to hundreds of millions of dollars. Rather than increase spending as politicians usually do, now would be a good time for the state to put this surplus to work helping local governments and citizens who will bear the brunt of the higher price scenario.

The state enjoys an automatic hedge against price increases as it receives 5% of the gross revenue brought in by Coal and Gas Industries from their production. State coffers are growing as local governments will see budget busting costs for energy. If the state does not use some of the surplus funds for this purpose, local governments may be forced to raise taxes on citizens to meet their financial requirements.

It’s time lawmakers did the right thing for West Virginia.