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Governor Justice makes his tax pitch to West Virginia’s oil and gas industry

CHARLESTON, W.Va. — Speaking to a ballroom full of representatives of West Virginia’s Oil and Gas Industry, new Gov. Jim Justice provided a suggested response to anyone who says he would like to raise taxes.

“If any living human comes up to you and says Jim Justice wants to raise your taxes, tell them to kiss your butt. But don’t say ‘butt,'” Justice said to laughter at the winter meeting of the West Virginia Independent Oil and Gas Association.

“Jim Justice wants to lower our taxes. But what Jim Justice wants to do more than anything is save our state.”

Justice had a few serious messages for the oil and gas industry too, including his advocacy for a tiered severance tax that would raise tax rates when times are good and lower when times are tough and his view that a newly-proposed tax of two-tenths of a percent on gross revenues would raise $214.3 million necessary to balance the state budget.

He also endorsed legislation the oil and gas industry would like to enable horizontal drilling across properties where most, but sometimes not all, landowners have agreed to terms.

“I’m going to make a lot of people mad, probably, at me,” he said, “but I cannot understand why in the world we can’t get that through,” Justice said to applause. “I would be an absolute proponent of that.

“There’s a long-lost 18th cousin who owns two-tenths of 1 percent and they’re in never-never land and they can’t be found so therefore you can’t execute the lease. That needs to go too,” he said.

Justice spent much of his half-hour presentation making the case of his tax plans, which he describes as necessary to get the state out of budget trouble and onto the path of prosperity.

Selling the plan to the oil and gas industry, one of the bright spots of West Virginia’s economy, is likely a necessary step toward eventually guiding the plan to broader acceptance.

Justice met earlier this week with Democrats in the state Legislature and was to meet today in caucus with legislative Republicans.

After Justice’s State of the State address a week ago, Republican leaders in the House and Senate immediately blasted his plan of raising $450 million in new revenue, mostly through taxes, to balance the budget.

Justice got a warm reception before the oil and gas industry, whose representatives rose to their feet and applauded as he entered the ballroom.

“We’re all West Virginians. At least I hope a lot of you are,” Justice said in his warmup. “I know at least 25 percent of you probably voted for me.”

He said the oil and gas industry is generally healthy, but the rest of the state’s economy is not.

“We’ve got to find a way that works for you and works for the state,” he said, touting his tiered severance tax proposal.

As he did in his State of the State address, he used a whiteboard and markers to describe the plan.

“I know you’re good people,” he said. “You don’t need to be hogs. I don’t need to be a hog. I like to eat a lot, but we don’t need to be hogs.

“I’m going to help if it gets bad. But I’m going to expect you, as great West Virginians, to say ‘Yeah, I’m good with that, and I completely understand.'”

And, as he did in his State of the State address, Justice described desire for the state Division of Environmental Protection to work more cooperatively with businesses. For the second time, he described the agency’s inspectors as wearing sloppy clothing such as tank tops and flip flops.

“I don’t want to damage the environment in any way. I don’t want to damage the water in any way. But you and I both know just this: that if the person comes and comes to you with the attitude of can-do versus coming to you with a badge in their pocket and trying every way in the world not to do, you can’t get to first base.

“I will absolutely give you my word beyond belief that I will not allow it to happen. We’ve got to change. Our DEP needs to function just this way: first of all, they don’t need to show up in a tank top and flip flops on, haven’t shaved in three months, and look at you and say ‘By god, you’re not doing that.’ They can at least look like something. And the first words out of their mouth should be ‘some way, somehow if this is what you’re wanting to do, we’re going to try to help you within the constraints of the law.'”

That again drew applause from those gathered.

Justice said West Virginia’s oil and gas industry would benefit from an increased focus on marketing.

“The hog facility always goes where the cornfield is. The crackers ought to be where the gas is,” he said. “I’ll work as diligently¬†as I possibly can to make that a reality.”

Gov. Jim Justice smiles for a photograph with leaders of the West Virginia Independent Oil and Gas Association.




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