Pennsylvania governor vetoes gas tax credit bill

Cranes as they work on construction of the Shell Pennsylvania Petrochemicals Complex and ethylene cracker plant Oct. 3, 2019, in Potter Township, Pa. House Bill 1100 would have incentivized developers to build similar facilities in the northeastern corner of the state.

Gov. Tom Wolf vetoed a bill Friday that would have given tax credits to petrochemical plants in northeastern Pennsylvania — the latest shot fired in a growing dispute between the administration and lawmakers on both sides of the aisle.

“Rather than enacting this bill, which gives a significant tax credit for energy and fertilizer manufacturing projects, we need to work together in a bipartisan manner to promote job creation and to enact financial stimulus packages for the benefit of Pennsylvanians who are hurting as they struggle with the substantial economic fallout of COVID-19,” Wolf said Friday.

Lawmakers, however, criticized Wolf for rejecting a bill that creates jobs — especially during a time when a record number of residents have applied for unemployment and some businesses don’t know when, or if, they’ll open their doors again.

“[When] Pennsylvania’s workers are currently facing unprecedented challenges, Gov. Wolf had an opportunity to help expand job opportunities in northeastern Pennsylvania,” said Mike Straub, a House GOP spokesperson. “Instead at this time, he chose to turn his back on creating family sustaining careers.”

House Bill 1100 would give tax credits to businesses that use natural gas when manufacturing fertilizers. Businesses would have to spend at least $450 million building a new facility that will create at least 800 jobs to qualify for the 30-year program. Both chambers passed the legislation in February and warned Wolf a veto override vote would be imminent should he reject the bill.

Sen. John Yudichak, I-Luzerne, said Friday making good on that promise would be a top priority once the state “beats back” the coronavirus pandemic and lawmakers return to the capitol.

“The veto of House Bill 1100 places Governor Wolf on the side of anti-job, radical environmentalists who have maliciously misrepresented the facts on this pro-worker, pro-jobs piece of legislation and places the Governor’s policies squarely in opposition to legislation that has the potential to attract thousands of prevailing wage jobs and billions of dollars in private investment to Pennsylvania when we need jobs more than ever,” he said.

Wolf said he supports investment in the petrochemical industry, but argues that HB 1100 lacks adequate oversight of taxpayers funds and includes “illusory” prevailing wage requirements for construction workers “because the critical enforcement and investigative tools provided under the Pennsylvania Prevailing Wage Act are absent from this bill.”

“I could be supportive of awarding an incentive such as this, but only after a thorough analysis of a proposed project and the inclusion of appropriate enforcement mechanisms to ensure that workers constructing these types of facilities rightfully are paid prevailing wages,” he said.

David Taylor, CEO of the Pennsylvania Manufacturers Association, said Wolf’s veto forfeits hundreds of family-sustaining jobs that could fuel the economy “for generations to come.”

“With just the first two projects, House Bill 1100 would have attracted a billion dollars in upfront capital investment, hundreds of millions of dollars in wages to construct and staff the plants, and more than 3,500 direct, indirect, and induced jobs across northern and northeastern Pennsylvania,” he said.

Mark Szybist, senior attorney at the Natural Resources Defense Council, said Wolf’s decision prioritizes the wellbeing of his constituents over fossil fuel industry profits.

“Now more than ever, lawmakers need to provide support to struggling Pennsylvanians and build a more resilient and equitable future based on family-sustaining clean energy jobs,” he said. “It’s unthinkable that legislators would even consider overriding the Governor’s veto.”

Lawmakers have until the end of legislative session on June 30 to override the veto. Legislators must whip up two-thirds of each chamber — 136 votes in the House and 34 in the Senate — to successfully overturn the governor’s decision.