Municipal League to back severance tax drive | Arkansas Blog

Municipal League to back severance tax drive

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Sheffield Nelson, the Republican politico and former gas company executive who's made a more productive gas severance tax his leading political project, announced today that the Arkansas Municipal League had agreed to help him get a severance tax proposal on the 2012 ballot. The lobby for city government will help get the 70,000 or so signatures necessary for the initiative.

The Municipal League earlier had endorsed Nelson's proposal for a flat 7 percent tax to replace a sliding scale tax that provides big exemption for both some old gas production and new production in the Fayetteville shale. He said this could produce $200 million a year or more for the state (against about $54 million currently). He's lately said he's working on a rewrite of the initiative, which he hopes to submit to the attorney general for review next week, that would add a feature directing about $20 million of the money directly to city streets. You can see where the Muni League might like that.

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