Severance tax deal
Gov. Mike Beebe's office has announced a 10 a.m. news conference Tuesday to detail the terms of an agreement with gas producers on an increase in the severance tax.
Does this mean resistant legislators such as Death Star Bob Johnson will go along? Beebe is to begin working on them tonight. He won't call a session unless the deal is a sure thing.
The other immediate question concerns the terms. We're calling around.
Let's guess -- a 5 percent severance tax, but a 42-month (or until payback) exemption for all gas wells, not just those in the Fayetteville Shale, completed during a certain time period, probably pre-dating the agreement. Why 5? It's about midway between the 7 proposed by Sheffield Nelson and the 2.5 "offered" by some in the industry. Why 42 months? The governor had been pushing for 36 months. The gas industry had been pushing for 48 months. 42 splits the difference. Your rank speculation is as good as mine.
Comments
Never underestimate Arky leggies ability to provision away any benefits to the people this proposed legislation may bring. Later there will be provisions which eliminate the tax when the well's production dips below a certain point and so on.
"The honest politician is one who, when he is bought, stays bought."
We assume at least 60% of them are bought, and paid good money for the buyout, thus they will continue to pimp out for the industry. The tax will drop to near nothing by the time the pimps are finished with it. Go with Sheffield's proposal!
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Posted by: eLwood![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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March 10, 2008 05:53 PM
Oops. Above quote goes to U.S. Senator Simon Cameron (1862
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Posted by: eLwood![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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March 10, 2008 05:55 PM
Let's go the Intitative route. It won't have any problem in passing. But the pols don't want that for obvious reasons.
"Once a man holds public office he is absolutely no good for honest work."
---Will Rogers
Posted by: Cato![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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March 10, 2008 09:13 PM
We're really jerking our own chain when we think we're ever going to get a fair shake from _______ (list your corporate bastard or Congressman here)
Posted by: Deathbyinches![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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March 10, 2008 09:30 PM
In 1957, natural gas baron Witt Stephens, in a generous mood, decided he'd let Governor Orval Faubus and the Ledge raise the severance tax a pittance (from 3/20th of 1 cent to 3/10th of 1 cent). A half century later, the gas lobby is still running the show.
Raising the severance tax to a decent level (which 5 percent would be, although it'd still be lower than Texas, Oklahoma, or Mississippi) will be rendered meaningless if the gas production with the most value is "exempted" from the higher rate for any significant period of time.
It's like a twisted version of Monopoly, where Chesapeake and Southwestern drill up a bonanza on Boardwalk, but only have to pay as if they'd hit dry wells on Baltic Avenue. How on earth could the state generate any decent or predictable amount of additional revenue under this scenario?
Sounds like chump change...gas companies continue to suck up robber baron largesse worthy of Jabba the Hut and the people of Arkansas (still) get treated like chumps.
Posted by: muckraker![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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March 10, 2008 10:50 PM
"My choice early in life was either to be a piano-player in a whorehouse or a politician. And to tell the truth, there's hardly any difference."
~~~Harry S. Truman~~~
Posted by: succubus_demon![[TypeKey Profile Page]](http://www.arktimes.com/blogs/arkansasblog/nav-commenters.gif)
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March 11, 2008 09:36 AM