Policy research group criticizes proposed Ohio GOP severance-tax bill

YOUNGSTOWN — Policy Matters Ohio released an analysis of a Republican-backed severance-tax bill, criticizing it for imposing too-low rates on oil and natural gas extracted from horizontal wells and for directing revenues toward tax breaks.

House Bill 375, introduced last month with the support of the Ohio Oil and Gas Association and House leadership, would tax production from horizontally fractured, or fracked, wells at 1 percent of the net value for the first five years.

After that period, the rate would increase to 2 percent for high-producing wells and drop back to 1 percent when production declines.

The revenues would fund both Ohio’s oil and gas regulatory framework and the Ohio Department of Natural Resources. The rest would go toward a statewide income-tax reduction.

But Policy Matters Ohio on today took aim at multiple parts of the bill in a report authored by Wendy Patton, a senior project director at the independent policy research institute.

“House Bill 375 proposes the lowest rates and most generous provisions for the oil and gas industry of three severance tax proposals considered in Ohio during the past year,” the report said.

For the complete story, read Wednesday's Vindicator and Vindy.com