March Mineral Madness

by Norm Steenstra

Yes, West Virginia is open for bidness! And guess who doesn’t want to pay taxes? Hint: Disturbing things are happening in Charleston concerning OUR natural resources.

You may recall that in the January Special Session, coal, oil and gas and timber agreed to pay a temporary higher severance tax to pay down the Workers’ Compensation deficit. Mighty neighborly of them, considering they largely created it.

A bill passed – SB 684 – that lowers the severance tax on natural gas from 5 percent to 2 percent on newly-drilled wells. The industry pushed this bill at a time when natural gas prices are at an all-time high and new exploration in West Virginia is booming.

Not to be outdone by their partners in crime, timber followed. Senator Plymale (D-Wayne), a former employee of coal and timber baron Buck Harless, introduced a bill, which passed, that would lower the already pathetically low timber tax from 3.2 percent to 1.2 percent. They cite increased taxes on workers comp as the reason for the raise. Timber is the most dangerous industry in the state and is largely responsible for the fund’s deficit.

Some of West Virginia’s largest coal producers have appealed to the State Supreme Court, arguing that they should not have to pay severance taxes on coal that they export. They are also asking for a refund that could be as much as $500 million on taxes already paid.

These same coal companies bought themselves a judge for a mere $3.5 million. Not a bad return on investment. Maybe the best fix for Social Security is for Big Coal to handle the private accounts.

Coal, oil and gas, and timber companies contributed hundreds of thousands of dollars to Joe Manchin’s campaign and tens of thousands more to state senators and delegates. Add the more than $5 million to defeat pro-consumer Judge Warren McGraw and we see the magnitude of the problem.

There is no limit to the greed of the extractive industries, greed that adversely affects not only our environment but also many aspects of our daily lives.

Steenstra is executive director of WV Citizens Action Group. This article is updated from the March 25, 2005, edition of Capital Eye.