Is Drilling in the Marcellus Forcing Land Prices Higher?

The Centre Daily Times (State College, PA) implies that a recent auction of property in Centre County which had been seized for tax liens had higher than expected prices due to drilling in the Marcellus. The article begins thus:

BELLEFONTE — Property at Wednesday’s Centre County auction started selling at $1,000, but it didn’t take long for bidding on the first piece of land to reach $82,000.

Ditto for the next few parcels — all large pieces of Snow Shoe Township property in the Marcellus Shale natural gas region.

“Do I hear $150,000?” asked Chuck Salvanish, who works in the county tax assessment office and doubled as an auctioneer at Wednesday morning’s lien-free property sale in the county Courthouse Annex.

The winning bid on one 264-acre property quickly reached $300,000. Altogether, the sale brought in about $509,000, and drew upward of 100 people…

“I’m amazed at how many people are here,” said Sue Crowley, of Howard Township.

And this:

[Bill] Shreffler bid on a 76-acre Carlin Inc. property in Snow Shoe Township, but stopped at $49,000. The winning bid was $50,000.

Tarry Bratton, of York County, bid $20,000 for 163 acres of Carlin Inc. property in Snow Shoe Township that had at one time been a landfill.

I don’t live anywhere near Centre County, so I don’t know if those prices are high or not. How about you? Have land prices climbed in your area because of the Marcellus and the prospect of drilling? If they have (or haven’t), leave a comment.

Read the full article: County gets $509,000 in auction of property

Centre Daily Times Runs Anti-Marcellus Editorial

The Centre Daily Times (State College, PA) recently ran an editorial with typical scare-tactic, kindergarten logic, while at the same time supporting the obscene taxation of drilling in the Marcellus in Pennsylvania.

The editorial recounts how a number of so-called conservation groups have their greedy hands out and want a piece of the pie (my words, not theirs). So in the tortured logic of these groups, they want to tax tax tax the Marcellus. On one hand conservation groups and the Centre Daily Times decry drilling and paint a nightmarish picture of water and noise pollution, road damage, and general malaise. In the next breath they say, “Oh well, if it’s gonna happen, let’s at least grab a piece of the action for ourselves.” It’s thuggish thinking and thuggish behavior. A protection racket–pay to play. And newspapers like the Centre Daily Times fall right in line, along with their Democrat co-conspirators in Pennsylvania state government.

Perhaps this is a teachable moment? The taxarati (the taxing class), will tell you energy companies will have to pay the tax, and that there’s more than enough money going around that “a little tax won’t hurt anyone,” with the justification that “39 other states do it too.” Wrong. Natural gas prices have come down dramatically in the past 12 months and new exploration is at best a break-even affair at this point.

Point #1: Drilling will slow or stop. Making drilling more expensive by adding more tax may tip the scales and make it an unprofitable venture, and the drilling will stop. There are already indications that new drilling has slowed throughout the Marcellus.

Point #2: Landowners will not escape the tax. Do you think energy companies alone will bear the tax? Wrong! Landowners will also be part of this tax. The energy companies will not bear the burden alone. More tax means less in landowners’ pockets.

Point #3: Consumers will ultimately pay. Do you think corporations simply “live” with making smaller margins of profit? They do not. They pass along increases in higher prices. There truly is no such thing as a tax increase on business that is paid by anyone other than the consumer. It is always the case. You may think you’re “soaking the rich” by increasing taxes on businesses, but those taxes are treated as a cost of business and factored into the price consumers will pay. By taxing business, you have just taxed yourself. Doh!

Wake up PA, and reject the notion of a severance tax on Marcellus drilling.

Read the Centre Daily Times editorial: Tax the source of the mess