LITTLE ROCK — 40,000 signatures.”
Nelson, a former gas company executive and two-time Republican nominee for governor, said he has suspended efforts to collect the 41,160 signatures needed to replace those disqualified on the gastax petitions by the secretary of state. He said he doesn’t expect that to change unless the state Municipal League offers to collect more signatures or
Unless there is a large swell of public support, the campaign to increase the state natural-gas severance tax rate through an initiated act is over, the proposal’s lead supporter said Tuesday.
“You’ve got to be realistic,” said the backer, Sheffield Nelson, a Little Rock attorney. “It’s a long, hard haul to get there is a strong public show of support for the measure.
“There’s several good reasons [to collect more signatures] out there; we’ll just have to see how it unfolds in the next few days because a lot of things come to light when you take a position like this, and we’ll just have to see if they do,” Nelson said. Nelson said he is suspending collecting signatures but will decide early next week on whether to quit collecting them altogether.
Natural-gas companies spent more than $1.6 million to defeat the proposal, which if approved by voters would have raised the tax rate to 7 percent of market price for all wells and would not deduct treatment costs from the taxable amount. Severance tax is what companies pay the state in exchange for severing a natural resource, such as natural gas or timber.
The increase was also opposed by the Arkansas State Chamber of Commerce. Chamber President Randy Zook said he would be shocked if there was visible public support.
“He’s had over a year to generate the outpouring, and it hasn’t come,” Zook said.
The secretary of state’s elections director, Martha Adcock, wrote in a Thursday letter to Nelson that only 21,347 of the 69,774 signatures Nelson submitted belong to registered Arkansas voters. Some were discarded because they were duplicates or were signatures of multiple people that appeared to all be in the same handwriting. Most of the disqualified signatures were on forms that weren’t properly signed by the canvasser or a notary.
It takes signatures from 62,507 registered Arkansas voters to get a proposed initiated act on the ballot this November. The measure would become law only if approved by a majority of Arkansans in a statewide election.
The deadline for Nelson to submit more signatures or submit proof that some or all of the rejected signatures are valid is Aug. 20.
“There’s nothing I can do to take it off that clock,” Nelson said. “Really, you are in one of those situations where you don’t have to make a decision. Time runs on you, the clock’s running, and I’m aware of that.”
Nelson said 10,000 signatures have been given to him since July 6 when he turned in his petitions. He said that starting Tuesday he would no longer pay people to collect the signatures.
Zook said the chamber and gas companies will watch to make sure Nelson doesn’t continue the signature-collecting campaign.
“We’re vigilant, we’re not calling in the dogs at this point,” he said.
The Municipal League, which endorsed the measure, submitted fewer than 3,000 signatures, Nelson said.
Municipal League Executive Director Don Zimmerman said mayors he spoke with didn’t seem enthusiastic about collecting more signatures in 100-degree-plus heat in the next few weeks. He said he told Nelson on Monday “there was not much commitment, not near enough. As far as collecting the signatures, don’t count on us going forward.”
Zimmerman said he doesn’t expect anything to change in that regard.
“This one’s probably history, it seems to me,” he said.
Zimmerman said the league would probably support another rate increase in the future.
Aside from those submitted by the Municipal League, the rest of the signatures were collected by people who were paid $1.20 for each. Nelson said his group paid $97,000 total to canvassers.
Nelson said he doesn’t intend to take legal action against the canvassers who turned in the 48,427 invalid signatures, but he thinks the state should show that the law against forging signatures on a petition is serious by prosecuting the offenders.
The secretary of state said Monday that the office does not plan to ask for an investigation by the Arkansas State Police. A state senator has.
Arkansas Code Annotated 7-9-103 states that it is a Class A misdemeanor to sign another person’s name to a petition, knowingly sign a petition more than once, knowingly sign a petition when not legally entitled to do so and knowingly misrepresent the purpose of a petition.
It is also a Class A misdemeanor for a canvasser to knowingly make a false statement on a petition form or for a notary to knowingly fail to witness the canvassers affidavit. A Class A misdemeanor is punishable by up to one year in jail and a $2,500 fine.
The current tax ranges from 1.25 percent to 5 percent, depending on the type of well and other factors. The tax is assessed on the market value of natural gas, minus costs for transportation and treatment.
Most of the revenue from a tax increase would go to the state Highway and Transportation Department Fund (70 percent), and to county and municipal aid funds (30 percent). Aside from that distribution, $20 million would go to municipal roads.
Nelson has said his initiative is about making gas companies pay to fix damage their trucks cause to Arkansas roads. Opponents say such a tax increase would prompt the natural-gas companies to slow production or leave the state.
Also Tuesday, Nelson made public a letter from the federal Securities and Exchange Commission that states that it will look into allegations by Nelson that the companies that oppose his measure have lied to shareholders.
Nelson alleged that two publicly traded natural-gas companies — Southwestern Energy and XTO Energy, a subsidiary of Exxon Mobil — had either lied to Arkansans about the impact of raising the tax or had withheld information from their investors.
The letter states that any review or investigation would not be public unless the commission takes formal action.
Front Section, Pages 1 on 07/25/2012