Tuesday, September 11, 2012

The Money Well

Pennsylvania's new fee on gas drillers has raised more than $200 million, most of which will be distributed to counties and towns to fix roads, restore water supplies and pay other expenses borne by local governments in the Marcellus Shale region.
A state law signed in February imposed the so-called "impact fee" on energy companies exploring the Marcellus Shale, a sprawling rock formation that holds the nation's largest reservoir of natural gas. Drillers were required to pay $50,000 for each horizontally drilled well and $10,000 for each vertical well drilled through 2011.
 
Let's play a game.  Ready?  Guess who the gas drillers will pass on expenses to, so that they can operate at the same profit level they were prior to this "impact fee" instituted by the state government?

Give up?

You...you dumb schlub!!!  This is just another form of fund raising by state government forcing private business to subsidize the government coffers so they don't have to cut as much from their spending spree as they should.  The private drillers will just pass the costs onto the consumers when the natural gas comes to market. 

That being said, it isn't half as bad as how the Federal Government operates.  They don't give you up front costs.  Instead, they add on in the middle of a project, or just flat out pull your permit via the EPA overseer.   Sometimes they live so far out in a fantasy land that they require make-believe obligations:
As bizarre as it sounds, the New York Times reports that oil refiners were required to blend 6.6 million gallons of cellulosic ethanol — a biofuel made from grasses such as switchgrass, woodchips, the inedible parts of plants and other organic material — in the gasoline intended for cars or pay a fine. But since cellulosic ethanol has never been mass-produced, there was none to buy. And so the refiners paid the fine (or is it a tax?).

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