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STACK is bigger and better than ever, thanks to acquisitions and rapidly increasing audience — P. 5 SPECIAL REPORT: Nela Park is showing the way for lighting industry and community — Pages 13-18
Clinic can learn from cable, too
A 6.5% tax on oil and gas extracted in Ohio would amount to about $3 on each barrel and about 15 cents on each mcf of gas.
DAN SHINGLER
Health care giant’s innovation team is building diverse array of corporate partnerships
Taxing time for oil Ohio Tax Commissioner Joe Testa, a staunch proponent of increasing the severance tax, conceded that the lowprice environment for oil and gas is not helping the administration to win support. Cutbacks at steel mills that supply the industry, reductions in drillers’ budgets and low prices at the gasoline pump all drive home the point that prices are low, Testa said. But he said the impact on Ohio’s drillers is being overblown, largely because Ohio is a natural gas play for drillers, and it’s the price of oil that has taken the biggest hit over the last six months. He does not think the state will see a sharp cutback in drilling. “A lot of it, I think, is more rhetoric than reality,” Testa said. “Production will increase, and we were really very conservative on the production (assumptions). Our production projections really mirror the industry’s pretty well.” Much of the pushback against the
Maybe the next big medical breakthrough will come from a cable company? Big companies from all sorts of industries are helping the Cleveland Clinic come up with big ideas — and turn them into products. And none of them are health care companies. In fact, one is a cable company: Last week, Cox Communications became the fourth major corporation to form an alliance with Cleveland Clinic Innovations, the Clinic’s business development team. Why would the Clinic want to work with a cable company? Cox could help the Clinic figure out how to deliver health care services to the home, said Brian Kolonick, general manager of the Clinic’s Global Healthcare Innovations Alliance program. After all, Cox serves roughly 6 million homes and businesses in the United States. Thus, the Clinic and Cox have formed Vivre Health, a joint venture company that would commercialize technologies and services related to home health care delivery. Indeed, all four of the major corporations that have formed alliances with Cleveland Clinic Innovations bring different capabilities to the table. Lubrizol is a specialty chemicals company. Parker Hannifin makes mechanical products. IBM sells hardware, software and technology consulting services. However, they all see opportunity in the health care sector. And they can help the Clinic develop new products, Kolonick said. Some would be commercialized by the partner companies, and some would be spun off into joint venture companies. “We can learn a lot from somebody working in a completely different space,” he said. The Clinic is working on specific projects with each of
See OIL, page 30
See CLINIC, page 27
Kasich’s plan to raise burden comes at a difficult period for industry By DAN SHINGLER dshingler@crain.com
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Ohio Gov. John Kasich might have run up against his toughest opponent yet in terms of raising the state’s severance tax on oil and gas, and it isn’t the Republican-controlled Legislature that’s opposed to the idea philosophically. It’s low oil and gas prices, which are giving the drilling industry more rhetoric and evidence of hardship to combat the tax proposal — and which could sap the proposal’s potential revenues. The collapsing prices of the commodity already have caused drillers to pull back in Ohio, and a tax increase would only exacerbate the situation, they say. The governor, however, remains firm. “It’s never the right time,” Kasich shot back recently, when asked by a reporter at a Columbus event whether it was a bad time to propose a tax increase on the industry.
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Kasich contends that drillers in Ohio have received what amounts to a “free ride,” because Ohio’s severance taxes are much lower than other producing states. The governor proposes to increase the tax on oil and gas extracted in Ohio to 6.5% of the commodities’ value, up from the current flat tax of 20 cents per barrel of oil and 3 cents on each thousand cubic feet (mcf). At recent prices, the 6.5% rate would amount to a tax of about $3 on each barrel of oil brought up in Ohio, and about 15 cents on each mcf of gas. If Kasich gets his way, Ohio would go from having the lowest severance taxes in the United States to having a rate that is higher than West Virginia’s rate of 5%, but still lower than the 7.5% rate that Texas collects. Kasich said other governors just shake their heads in disbelief when he tells them Ohio’s current tax rate, because it’s so low. But is now the time to try to raise the rate?
By CHUCK SODER csoder@crain.com
HIGHER EDUCATION
Local professionals amp up efforts to get more women involved in STEM fields ■ Pages 19-24 PLUS: WOMEN IN STEM STORIES ■ COLLEGE INCENTIVES ■ & MORE
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