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Democratic hopefuls insist gas drilling tax is winnable, debate gets confrontational over loan

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HARRISBURG, Pennsylvania — A Democratic gubernatorial primary debate Wednesday became edgy, perhaps for the first time after a long string of cordial forums, while the candidates also refused to consider a "plan B" when it comes to their school-funding plans to raise taxes on the state's booming natural gas industry.

During a question about campaign finance and loans, U.S. Rep. Allyson Schwartz turned to businessman Tom Wolf and confronted him over a line of credit he had secured from a bank to raise $4 million for his campaign.

She asked him to disclose the loan agreement, saying that he had provided crucial details about an arrangement that she said could affect his future.

"I think you have to answer those questions," Schwartz told him. "I think the public has a right to know."

Wolf did not disagree.

"I think I do owe an explanation," he responded.

Under questioning by Schwartz, he disclosed the amount he had borrowed — $4 million — and that he had pledged personal assets to secure it. He also agreed to release the loan agreement.

Former Clinton White House environmental adviser Katie McGinty stayed out of the fray. A fourth candidate, state Treasurer Rob McCord, did not attend.

Up until last week, Wolf had only said that he had donated $10 million of his own money to his campaign, a huge jolt of cash that has helped him outspend the field, blanket the airwaves with weeks of TV ads and seize an early and strong lead in independent polls.

In a Friday story in The Philadelphia Inquirer, Wolf revealed that a portion of the $10 million came from a line of credit with a bank that also has loaned money to the York-based business he leads, the Wolf Organization. Up until that point, the only mention of the line of credit was on Wolf's statement of financial interests to the State Ethics Commission last month. It did not say for what purpose Wolf had secured it, what assets he pledged to secure it or how much was borrowed.

Wednesday's debate was at a Widener University law school amphitheater in suburban Harrisburg. The winner of the May 20 primary election gets the Democratic Party's nomination to challenge Republican Gov. Tom Corbett's bid for a second term in the Nov. 4 election.

Asked how they would fulfill their pledges to boost state aid if they could not win legislative approval to raise taxes by hundreds of millions of dollars a year on the natural gas drilling industry, the candidates all challenged the premise of the question.

Rather, they said, the idea is popular around the state and that it is possible to win over a Republican-controlled state Legislature that has thus far imposed a roughly $200 million-a-year "impact fee" on the industry, rather than a billion-dollar tax sought by some lawmakers. Wolf and McGinty suggested that a hunger for more state aid for public schools is motivating support for a gas drilling tax.

"What moves this is when you make it real," McGinty said.

Wolf also suggested that some drilling companies would not oppose a tax. Corbett opposes raises taxes on the gas drilling industry.

Schwartz suggested that there is deep support in the Legislature for a tax, and it would "take a governor who is willing to push and be clear about what has to happen."

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