Oops, Wrong Kilgore

In a recent ad countering Jerry Kilgore’s campaign that Tim Kaine wants to raise the gas tax, the Kaine campaign makes the following statement: “Fact, Kilgore, as a paid lobbyist, tried to raise natural gas taxes by 66 percent.”

I don’t know where the Kaine campaign got its information, but there’s one fellow, Frank Kilgore, a Wise County resident, who thinks he knows. He’s hopping mad, and he’s blasting out e-mails to let people know about it.

Issue One. Frank K. (no relation to Jerry) believes that Kaine ad is referring to a request by Buchanan County a few years ago to increase the gas severance license tax by an additional one percent. That tax is on producers, almost all of them big corporations, not consumers. However, the vast majority of Virginians, who aren’t from Southwest Virginia and have never heard of a gas-severance tax, would assume that the “natural gas tax” is a consumer tax. The Kaine ad conspicuously ignored the distinction.

Issue Two. The “gas tax,” which funds public improvements and economic development projects, is widely supported. Says Frank Kilgore: “There is, I guarantee, 100 percent support among coalfield voters for these coal and gas local revenues.”

Issue Three. Wrong Kilgore. Jerry Kilgore never lobbied for the gas tax increase — Frank Kilgore did, when he was assistant county attorney.

The (Jerry) Kilgore campaign confirms Frank Kilgore’s account. Says the Kilgore campaign website: “Kilgore served as a lobbyist for Buchanan County and advised … against seeking an increase in the gas severance tax. This is not a tax on consumers, rather a tax on companies that extract natural gas from the ground. Kilgore predicted the bill would go nowhere and it died in committee.”

Concludes Frank Kilgore: “For Kaine to twist this issue into a lie is beyond the pale and should immediately be retracted.”

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  1. Will Vehrs Avatar
    Will Vehrs

    Every campaign does this kind of stuff. The difference, it seems to me, is that the Kaine campaign does it while loudly claiming they’re running a “positive” campaign and that only the other guy is negative or misleading.

  2. Anonymous Avatar

    Hmm. There is only one Kilgore who registered as a lobbyist from 1999-2001, and his name ain’t “Frank.”

  3. Jerry Gray Avatar
    Jerry Gray

    Whether Frank Kilgore was registered as a lobbyist or not, the error needs to be corrected.

    Jerry Kilgore WAS the lobbyist for Kellog Brown Root (of Halliburton fame)who successfully convinced then-Governor Gilmore to approve a no-bid deal with KBR for $33M to plan a 6 mile segment of the Coalfields Expressway.

    The premise of the CFX is that the only thing holding Southwest Virginia back from economic prosperity (translation-industrial development) is the lack of a 4-lane highway with flat land next to it.

    The deal Jerry Kilgore got for KBR has turned out to be even sweeter–the planning cost has now ballooned to $55M, according to VDOT, and will finish out at $63M.

    KBR has made a wise investment in Jerry Kilgore–for donations of a few thousand dollars, it has reaped millions.

  4. Jim Bacon Avatar

    Jerry, Check out my latest Bacon’s Rebellion blog entry, and then follow the link over to the Road to Ruin blog. You should be pleased at what you started.

  5. Anonymous Avatar

    Let me get this right. Re Buchanan County and the natural gas severance tax…1) Jerry Kilgore didn’t do it 2) if he did the tax is paid by the companies not the consumers and 3) it was very, very popular with the people of the county.

    As an attorney in private practice Jerry Kilgore and another lawyer in his firm Stephanie Hamlett are shown as registered lobbyists for Buchanan County for the 1999-2000 session, and show a fee of $3,100 (probably not the entire bill.) Ms. Hamlett is now in the AG’s office, by the way. Under the statement asking what they are lobbying for it merely says “local government.” FRANK Kilgore is listed as the local official authorizing their hiring, the principal.

    You could look it up on the Secretary of the Commonwealth’s web page.

    In news reports when Kaine first brought this up, Kilgore did not deny the contrract, but said he only made a couple of phone calls to legislators and reported back that the bill would not fly (not bad pay for a couple of phone calls.)

    Looks like you’ve found another rabbit to chase down a hole, but on this one you were sold a bill of goods.

    Oh and how it is mystically possible that the cost of the severance tax never shows up ultimately in a customer’s bill? It ain’t big, but it’s there. Puhleeez.

  6. Jim Bacon Avatar

    Anonymous 5:02: Very interesting. Let me run your assertions past Frank Kilgore and see what he says.

  7. Anonymous Avatar

    When you do, ask him if Stephanie Hamlett (the other lawyer on the contract) did the lobbying. Perhaps that is how they are parsing this — she did the work. Wouldn’t matter much. Or did they really pay them no less than $3,100 (and it could have been more, those reported figures only cover the actual time lobbying sometimes) only for being told, bad idea, bill won’t pass.

  8. Jim Bacon Avatar

    Anonymous 5:02, Here is Frank Kilgore’s answer to your first question (with minor changes to punctuation):

    “My response is simple, as my letter states we did hire Jerry to do some lobbying. He did not lobby for the severance tax bill. I did that. He worked on the Coalfields Expressway project. Jerry advised me early on that the tax increase would not get out of committee and that he would not pursue it, as to do so would be a waste of Buchanan County’s funds. That is not lobbying, that is giving sage and ethical advice. I proceeded to work on it anyway as requested by my client, the Buchanan County Board of Supervisors. The bill died very quickly in sub committee as I recall and Jerry was nowhere around when it happened. There is a huge difference between giving advice that a bill won’t fly and lobbying for it. I hope that any lawyer or lobbyist and the general public understands the difference.

    Kaine’s handlers obviously have not one shred of evidence that Jerry Kilgore lifted a finger in behalf of the severance tax bill other than tell me it wouldn’t fly. Does that translate into the lie stated in the ad that he lobbied to increase natural gas taxes by 66%? Of course not. The allegation is wrong and even the math is wrong.

    This is hackery at its worst and the ad should be pulled, especially after Kaine made a big deal during the last debate that he was going to be the good guy. The ad is deceptive, I was there, I know what happened and didn’t happen, and any ethical campaign would pull it.

  9. Anonymous Avatar

    I agree the ad is a cheap shot, and it was even a cheap shot if Jerry did lobby extensively for the bill. Lawyers and lobbyists are hired to do a job and shouldn’t be blamed for their clients (including criminal defendants, of course.) But sometimes the truth is hard to find, especially when lobbyist disclosure forms do not list the specific matters an individual is working on. This one said “local government.” Technically, picking up the phone to call a legislator on a bill is very much lobbying, by definition, but if Buchanan County mainly paid him to work on the road project instead, then Mr. F. Kilgore should be thanked for his clarification.

    But your intiial post indicated J. Kilgore had nothing whatsoever to do with the issue and it was a fabrication. Now we know it may be an exaggeration, but not a fabrication.

  10. Although Frank Kilgore of St. Paul and I have found ourselves on opposite sides of the aisle in the past, I agree wholeheartedly with his comments regarding Tim Kaine’s false attacks on Jerry Kilgore.

    Either Tim Kaine is too dumb to know the difference between FRANK Kilgore and JERRY Kilgore or he is devious enough…or desperate enough?…or BOTH?!…to cynically attempt to confuse the voters about the issue of Buchanan County’s efforts to increase the severance tax on natural gas.

    As Frank pointed out, this isn’t a tax on consumers but rather on the producers that are making billions and Jerry Kilgore wasn’t involved in these efforts.

    We do support Jerry Kilgore here in Buchanan County (a normally Democratic Co.) in part because of his support of The Coalfields Expressway highway project. And we appreciate all of Frank Kilgore’s good works to improve the image and economy of Buchanan County.

    But I really resent Tim Kaine’s tactics which twist the efforts here in Buchanan County to increase the severance tax on natural gas to improve our schools, etc. into an untruthful attack on Jerry Kilgore.

    Our county has suffered enough damage to its image from Operation Big Coon Dog, the tragic shootings at the law school, devastating flooding, etc. The last thing that we need is an unethical desperate politician such as Tim Kaine to immerse Buchanan County in his mudslinging tactics!

    Three cheers for Frank Kilgore for standing up for what’s right and for Jerry Kilgore for doing what’s right.

    Kilgore’s election will help move Buchanan County and Southwest Virginia forward over the next four years!

  11. Anonymous Avatar

    Here is (abridged) what Gov. Gilmore had to say about this subject:


    Pursuant to Article V, § 6 of the Constitution of Virginia, I veto Senate Bill 1387 because it will increase gas severance taxes at a time when local revenues from gas severance taxes are doubling without a tax increase, and because this tax increase will be passed to consumers in the form of higher heating bills at a time when many citizens are struggling to pay their home heating bills.

    . . . . This tax increase is not necessary because local revenues from gas production taxes are expected to double — from $5.7 million last year to $12 million this year — without a tax increase. Thus, the additional revenues the affected localities say they need already have materialized, and they can address their local needs without raising taxes. Additionally, the tax on coal production is only 2 percent, so it would be unfair to discriminate against gas producers with a 4 percent tax.

    This tax increase would be passed on to consumers in the form of higher heating bills. Heating bills doubled this year for many consumers in Virginia, including many frail elderly citizens on fixed incomes. With gas prices at an all-time high due to low supplies, and with tax revenues already at an all-time high, now is not the time to punish poor senior citizens and other consumers with higher heating costs.

    If anything, Virginia should lower gas taxes to remain competitive in gas production. Pennsylvania has no gas severance tax. West Virginia recently enacted a five-year tax holiday for new methane wells to encourage more production. Tennessee imposes a 3 percent tax, and Kentucky is considering reduction or elimination of its 4.5 percent gas severance tax. Given higher consumer demand for natural gas and a low supply, Virginia should make itself more attractive for the capital investment to drill new wells, not less. Indeed, a 33 percent tax increase could force some small Virginia producers out of business because they tend to rely upon long-term, fixed-price contracts as collateral for loans and lines of credit and they cannot pass higher tax costs to their customers.

    . . . .

    Therefore, I am returning Senate Bill 1387 without my signature.

  12. Jim Bacon Avatar

    Anonymous 12:56 — Interesting documentation! Gov. Gilmore’s statement at the the certainly seems to undercut my argument that the tax was a tax on production, not a tax on consumption.

    As someone (perhaps you) observed, any tax increase, whether at the wellhead, the pipeline or at the home gas meter, will get passed along to the consumer eventually. I don’t dispute that.

    From a political perspective, however, it does make a difference at what stage of production the tax is levied. A severance tax is applied to natural gas at the wellhead (I think). From that wellhead, the gas makes its way to a major pipeline which serves many states. I don’t believe that there is a practical way for the pipeline company to say, this gas came from Virginia, so we’re going to pass along the added cost to Virginia consumers. No, the pipeline company just adds the gas tax to its overall fuel costs, which it passes on to all customers. The benefit (for Virginia) of passing a gas severance tax is that all natural gas customers served by the pipeline, even those outside of Virginia, share in paying the tax.

  13. Anonymous Avatar

    Looks like you need to learn some economics. Since the demand for natural gas is inelastic, the burden of the tax is overwhelmingly on the consumer in the form of higher prices… it doesnt matter whether a tax is officially placed on the consumer or the producer – the only things that matter are supply and demand elasticity.

    so, clearly, your first point is wrong

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