Pennsylvania Governor Tom Corbett is proposing tens of millions of dollars-worth of tax credits for a “cracker” plant planned by Shell Oil Co. in Beaver County, Pennsylvania. Over the course of a 25 year plan, the tax credits would total about $1.7 billion, or around $67 million per year. This would capitalize on the ongoing natural gas drilling in the Marcellus Shale region. The cracker facility would convert ethane from natural gas produced in the Marcellus shale region into more profitable chemicals such as ethylene, which is used to make plastics, tires and footwear.
The credits would not be available until 2017, but Corbett and his administration are wasting no time seeking legislative approval. “It’s a competitive climate out there,” says Steve Kratz, a spokesman for the Department of Community and Economic Development. “This is about re-industrializing the state.” There are currently 26 of the nation’s 29 crackers on the Gulf Coast, and no other plants are being proposed in northeastern United States.
Citizens for Pennyslvania’s Future (PennFuture) is a a statewide organization determined to protect and improve the state’s environment and economy. PennFuture President and CEO George Jugovic Jr. is not so supportive of the governor’s plans. “The governor’s proposal violates his own belief that the free market, and not government, should pick winners and loser,” says Jugovic.
The Corbett administration might win over the naysayers once the topic of creating jobs is brought up. Lawmakers promise anywhere from 10,000 to 20,000 new jobs that will be created as a result of the new cracker plant. If the amount of jobs proposed is accurate, the public and other officials might be more compelled to support the tax credit. This many new jobs could mean millions of dollars pumped back into the economy, an idea that should not be taken lightly, especially with the number of Americans losing their jobs these days.
Corbett says the refinery will attract other plants that will create jobs and other benefits for the state’s economy. “What this is really aimed at is growing a manufacturing base all across Pennsylvania,” says Corbett. Jogovich doesn’t agree. “By choosing to offer Shell a $1.7 billion dollar tax break while proposing to cut nearly $900 million to public education, the governor is choosing winners and losers and he has cast his lot with choosing to further help a multi-billion dollar corporation over the education of future generations,” says Jugovich.
No matter where you stand on this issue, there is no denying that a plant of this magnitude will have quite an impact on the unemployment rate – which lingers around 7.5% in Pennsylvania, just below the national rate of 8.1% – something we just cannot ignore.