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County board discusses coal severance tax, approves budget

Posted February 05, 2017 10:00 pm

BY TRAVIS DENEAL STAFF WRITER tdeneal@dailyregister.com

HARRISBURG – Saline County Board members engaged in a lively, passionate discussion about whether to support a coal severance tax in Illinois and whether such a tax would help or hurt the county.

A coal severance tax is money paid by coal operators extracting coal – or “severing” it – from the land. Recently, a group that backs a coal severance tax in Illinois had spoken to county board members, asking the board to formally endorse the proposal, board member Joe Jackson said.

Jackson said the issue is complex and should require additional study before the board endorses or ignores such a proposal.

He said the largest positive benefit would be a potential influx of money to the county, which is one of the top coal producing counties in the state. The group pushing for the coal severance tax, which was not formally named, said up to $22 million could be generated from such a tax from Saline County coal alone, Jackson said. However, Jackson said, Saline County likely would get only about 10 percent, or $2 million, of that money.

And such a tax could create a bleaker picture, he said.

“The drawback is, it could drive the industry out of Saline County,” Jackson said.

He noted that while in 1900 there were nearly 100,000 coal jobs in Illinois, now about 2,400 remain. He said while environmental regulations partly were to blame, many of the jobs were lost to mechanization.

Board member Mike McKinnies said he believed the potential to drive coal operators out with a severance tax outweighed the potential income.

“I hate to see that many jobs possibly leave the county,” McKinnies said.

David Phelps, who also has served as a Congressman, said there are many facets to legislation that could affect coal operators. He told about a law he had authored that would have forced Illinois power plants to burn as much Illinois coal as possible. The state of Wyoming took legal action, saying such a law was not legal.

Board member Roger Craig said based on his knowledge of the proposed coal severance tax, the state was the bigger winner.

“I just think that it benefits the state and doesn't benefit Saline County enough,” he said.

Board member Rick Lane, who was elected to the board in November, offered a practical perspective. He said that due to the finite nature of the resource at some point there will not be enough left to mine.

“It's going to be gone. Then you don't have to worry about jobs, period,” he said, indicating that mining would cease at that point.

Board member Carey Harbison said he believed Saline County would be wise to support such a tax.

“There's probably only about 25 percent of the people employed of what they had before,” Harbison said. “To hold these jobs over our heads is a little much.”

He said because of antipated relaxation of mining regulations from the new presidental administration, more operators may be looking to dig more coal in Saline County.

“Don't think more coal operators won't come in. It's dollars to them,” he said.

Board member Stephen Karns said he also wanted to study the matter further. He said he had approached the board at a time prior to serving on the board representing people who lived in close proximity to a mine who had concerns.

“We tried to express that we were not against coal, just against the way they were mining the coal,” Karns said.

He said he would like to know specifically how a coal severance tax would cut revenues to Saline County mines before he could consider supporting such a measure.

The board also passed its annual budget, which in total amounts to income of $6.086 million and expenditures of $5.9 million, according to budget committee chairman Jackson.

Board president Jay Williams praised the budget committee for their work.

“I want to commend the budget committee for all they do,” Williams said. “Joe, the chairman, Mike McKinnies and Danny Gibbs.”

The board also approved increasing a fee on delinquent property taxes. The fee, which is paid by those in the business of buying properties with delinquent taxes, should add about $16,800 to county coffers, Treasurer Jeff Murrie told the board.

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