Commissioners weigh in on severance tax
STEUBENVILLE – Jefferson County commissioners on Thursday agreed to support a coalition fighting for a bigger piece of a proposed state severance tax on gas and oil wells.
Terry Bell, a former Salem Township trustee but still president of the county township trustees’ association, said there is pending state legislation in an Ohio House committee to levy a severance tax on gas and oil sold from wells.
Bell told the commissioners the revenue from the tax is currently set to be distributed with the bulk of the money going to reduce income taxes of state residents and only 15 percent to 24 Ohio counties that have gas and oil well production.
Bell said the 15 percent will be split among counties, cities, villages and townships. He believes townships, which are experiencing the brunt of the oil and gas drilling, will come up on the “short end.”
Bell said the legislation as of Thursday called for the first $21 million in severance tax revenue going to the Ohio Department of Natural Resources for regulatory enforcement, orphan and abandoned wells and geological mapping.
Bell presented a resolution being considered by the 24 counties with gas and oil wells demanding 75 percent of the severance tax.
Bell said there aren’t any estimates on how much money the severance tax will generate.
County Commissioner Tom Gentile said the money going to local governments should be higher. He said it appears the intent of the proposed law is to take the revenue and spread it across the state instead of going to the areas impacted with drilling.
County Commissioner David Maple questioned why the local governments should be requesting 75 percent of the severance tax money and if it is realistic.
Bell said the local governments could negotiate down for a percentage of the money instead of negotiating up.
Maple believes the revenue distribution from the severance tax should be “weighted” toward the affected communities. He said it isn’t just roads that have to be maintained but increased law enforcement and litter as a result of drilling workers coming into an area.
“If you set roads aside, there are other community problems that develop out of (drilling). We should have more access to those funds than Toledo,” Maple said.
County Commissioner Thomas Graham said the region for the first time is experiencing economic development because of the oil and gas drilling.
“We are entitled to the money coming in. It isn’t fair to be distributing the money around the state when the economic boom is in our area,” Graham said.
Gentile said of the 24 counties with oil and gas producing wells, the bulk will be in about eight counties, including Jefferson County.
“It could finally make a difference in the lives of residents,” Gentile said.
Bell said Jefferson County has 12 producing wells, while Columbiana County has 21; 167 in Carroll County; 57 in Harrison County; 19 in Belmont County; 14 in Monroe County; 25 in Noble County; and 25 in Guernsey County.
Bell said the state Legislature may vote on the severance tax for oil and gas wells and the distribution of funds next week.
County Engineer James Branagan said he fears oil and gas well drillers will back out of road-use maintenance agreements if they have to pay a severance tax.
In other matters, Gentile asked that a percentage of the county’s piggyback tax money currently earmarked for state-mandate projects at the county water and sewer department be reallocated. About $280,000 a year goes to the mandated project fund at the water and sewer department. He said the county has completed two mandated sewer projects in Pottery Addition and Crestview-Belvedere.
Gentile said the money should be reallocated to “other things that will have a greater benefit to the county.”
Gentile didn’t say where the money would go but a public hearing will be held on any reallocation.
County Auditor Patrick Marshall said the commissioners should get an opinion from the county prosecutor’s office on whether the commissioners can reallocate the piggyback tax money.
Maple said the needs of the county are constantly changing and the commissioners should be able to change allocations based on current needs.
Graham said any reallocation of money from the water and sewer department will have no impact on water and sewer rates.
Commissioners also approved a resolution recognizing the 100th anniversary of the cooperative extension offices throughout the country.
Commissioners agreed to advertise on behalf of the county’s Developmental Disabilities Board for the paving of the parking lot and access road at the John Scott Highway facility.
Commissioners agreed to spend up to $2,000 for attorney Dennis O’Toole to write a resolution on a proposed lodging tax for the county.
Commissioners also opened two bids for mowing along county roads during the summer growing season. Maple Excavating of Richmond submitted the apparent low bid of $30,975. The county engineer’s estimate was $35,000.