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House, Senate Pass Marcellus Shale Bills

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A wide-ranging Marcellus Shale impact bill, similar to what Governor Tom Corbett proposed in October, passed the state House on Thursday afternoon.  The bill includes both a per-well impact fee and a series of new environmental regulations, but Democrats like Mike Hanna (D-Clinton) say it’s not enough.  “We must vote no on Governor Corbett’s tax bill because it is completely inadequate and can be more accurately characterized as a massive giveaway to the multimillion dollar oil and gas industry,” Hanna said during floor debate.  Hanna, however, was on the losing end of a 107 to 76 House vote.

The impact fee that passed the Senate on Tuesday (29 – 20) would charge drillers more money, over a longer period of time.  It would amount to an effective tax rate of 3%.  “We’re not the lowest in the country and we’re not the highest,” explained President Pro Tem Joe Scarnati (R-Jefferson).  “But we’re in competition; we’re in competition for jobs.”  In 2012, Senate Republicans say the impact fee would raise a minimum of $155-million. 

House and Senate Republicans must now iron out the differences between the two bills.  “What we have to do is get everybody sitting down at the table to talk about it, but we’re finally moving,” Corbett told a gaggle of reporters earlier in the week. 

Meanwhile, former Governor Ed Rendell is still backing a more significant severance tax on natural gas drilling.  “To my colleagues, both Republicans and Democrats in southeast Pennsylvania, if you vote for either of these bills and don’t insist on a real tax, you are courting political suicide,” Rendell said at a recent capitol appearance.  “Because you should see what the feeling is in southeast Pennsylvania.”

Marcellus Shale

Lawmakers, Environmental Groups Call for More Control of Air Emissions From Drilling Industry

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Some state lawmakers and a number of environmental groups say there’s not enough attention being paid to air pollution caused by Marcellus Shale drilling.   Representative Greg Vitali (D-Del.) says the Department of Environmental Protection must do more to address air pollution caused by drilling activity.     

Vitali says a lot of the pollution comes from the various machinery used in the drilling process. He cites compressors, condensate tanks, dehydrators and other equipment.  He says the pollutants involved are nitrous oxides,   sulfur oxides, volatile organic compounds, particulate matter, carbon monoxide and methane.

Vitali says DEP needs to increase its air pollution staffing to address the problems.  He says they need more money, and the way to do that is to increase air pollution fees.  He says regulations under the Rendell administration which would have given DEP 8 million dollars more the air program were stopped by the Corbett administration.  He says the state needs to enact those air pollution fees.

Vitali adds that DEP needs to require drillers to use best available pollution control devices for their compressor engines.

Representative Camille “Bud” George (D-Clearfield) says we have to make sure our state and federal governments have appropriate oversight. He called on state government to look past what’s most convenient for industrial gas drillers and do what’s best for Pennsylvania.

Representative Eugene DePasquale (D-York) says the state needs a fair and adequate Marcellus Shale drilling tax to ensure the state has both clean air and water.  He says the state needs people in DEP fully staffed with the tools to protect the environment.

Jan Jarrett of PennFuture says air emissions from the Marcellus Shale industry will make it extremely difficult for Pennsylvania to attain healthy air, if the state doesn’t use the regulations currently at its disposal to reduce emissions as the industry develops.      

Jarrett says Pennsylvania does not meet the national health based standards for ozone pollution, but the southwest regional office of DEP alone has permitted more than 13 thousand tons per year of nitrous oxide emissions associated with the Marcellus industry. She says DEP also needs to require drillers to provide accurate information about emissions from gas development activities.  She says it’s time to end the gas industry’s exemption from air pollution laws; otherwise, Pennsylvania’s air quality will deteriorate.

Representatives of other groups including the American Lung Association and Sierra Club also spoke out for more regulation of air emissions from the natural gas drilling industry.

Citizens Commission Releases Its Own Marcellus Shale Report

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After a series of public meetings around the state, a citizens group formed by several environmental groups and other organizations has released its report on the Marcellus Shale industry.   While there’s a lot of discussion about an impact fee or severance tax, the Citizens Marcellus Shale Commission also feels enforcement and regulatory reform are paramount.  Dan Surra, who co-chaired the panel, says the overriding feeling the commission received is that people feel their politicians and regulatory agencies that are supposed to be protecting them aren’t.

Surra says in regard to a tax or fee, the commission favors a robust tax similar to West Virginia’s, and giving counties the ability to tax gas and mineral rights.  But he says that’s a small part of the report.  He says people feel clean air, clean water and their quality of life are at risk and the state needs better enforcement and updated regulations to protect the people of the Commonwealth.

Commission member Roberta Winters of the League of Women Voters of Pennsylvania, says they heard four main areas of concern. First was the contamination of the water, air and land, followed by the undue consumption of water, protection of vital and sensitive natural places and the establishment of meaningful rights for landowners and communities to make sure they have a voice in decision making.

Dan Surra says the report makes a number of regulatory and enforcement recommendations, and it’s a very inclusive document.  He says the legislature needs to take a hard look at the recommendations.

The report calls for specifying and protecting areas of the state that are unsuitable for drilling, including extending a moratorium on drilling in state forests and putting stricter protections for air quality and surface and groundwater prior to issuing a new round of permits. It also calls for an office of consumer environmental advocate in the Attorney General’s Office to provide a forum for public complaints to be heard and investigated.

Marcellus Shale

New Database Will Track Water Quality in Marcellus Shale Drilling Areas

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A new database will help track water quality in areas affected by Marcellus Shale drilling.  Development of the database is being led by Penn State researchers.  It’s funded with a 750 thousand dollar grant from the National Science Foundation. 

Penn State Geo sciences professor Susan Brantley says the web site is already being set up and they’ve started collecting data. The Director of Penn State’s Earth and Environmental Systems Institute and principal investigator says it should be on line by early this winter. 

The database will collect information from government agencies, researchers and citizens groups that are sampling water quality. Brantley says they want to make data available to everyone, so people can share it, look at other people’s data, compare it and think about it.  She says they hope to study it a scientists and work with citizens to help them learn how to look at water quality data and understand what it means.

Brantley says with the Marcellus Shale industry developing as fast as it is, citizens want to be able to look at their water chemistry and water quality and make sure any impacts are kept to a minimum.  She says some environmental impacts happen with almost any industry.

Brantley believes the database will be valuable to citizens and the drilling industry. She says there’s no reason why the gas companies want to have problems in Pennsylvania.     

In addition to Penn State, Pitt, Bucknell and Dickinson College are collaborating.  Dickinson scientists have been training citizens in water sample collection.

Brantley says she’s excited that she’ll be working with some of the citizen scientist groups.  She will help them put their information into a larger database and determine what it means. She says they’ll be looking at all of the data together to try to understand what impact there is, if there is impact from the shale drilling.

Marcellus Shale Boom Has More Impacts Than Meet The Eye

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The Marcellus Shale boom is affecting anglers and boaters state wide, and they may not realize it.  The Pennsylvania Fish and Boat Commission is responsible for all fish, reptiles and amphibians in the Commonwealth.

Tim Schaeffer, Director of the Bureau of Policy, Planning and Communication   says by the end of the summer, they had reviewed five times more permits this year for waterways encroachment than all of last year.  He says they do all of that with fishing license dollars and get no general fund money or portion of the permit fees that the Department of Environmental Protection receives.

Commission staff must also review water withdrawal applications to make sure aquatic life is protected.  Schaeffer nearly 25% of the “Species of Special Concern” reviews they do each year are attributed to Marcellus.  He says permits for access roads and pipelines, everything that comes into DEP and crosses a stream, must be reviewed.

Schaeffer says waterways conservation officers have the authority to enforce environmental laws.  He says they’re often the first ones out there who see an erosion or sediment issue and can work proactively with the companies on changes that need to be made.

Schaeffer says the Marcellus Shale Advisory Commission report itself identifies the impacts of the Marcellus Shale boom that are appropriate for compensation, listing state natural resource agency oversight, permit review and enforcement.  He says they’re one of those state natural resources agencies and they think it’s unfair to have boaters and anglers  bear the burden.

Some Question the Structure of Gov’s Impact Fee

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The Marcellus Shale plan that Governor Tom Corbett rolled out provides for an “impact fee” to be adopted by the counties where the natural gas drilling takes place.  In the first year, counties could impose a per-well fee of up to $40,000 dollars.  The maximum fee would drop over the next several years, but Corbett says the revenue would actually grow along with the number of wells. 

The County Commissioners Association of Pennsylvania (CCAP) supports the direction of Corbett’s Marcellus Shale plan.  “Our only issue with the proposals is a significant concern that we have with the plan that the local impact fee would be levied separately by the counties,” CCAP executive director Doug Hill said in an interview with Radio PA.  “It needs to be uniform, it needs to be consistent, it needs to be predictable, and that does not happen if it is county-by-county, with the potential for varying rates within the counties.” 

Some lawmakers agree.  “This proposal only authorizes counties to impose a fee, it doesn’t require them to impose a fee,” says State Senator John Yudichak (D-Luzerne), the minority chair of the Environmental Resources and Energy Committee.  In a statement, State Rep. Mike Sturla (D-Lancaster) called the plan complicated and ill-conceived.

But Governor Corbett calls the structure of his proposed “impact fee” important to the package.  “If you bring the money here to Harrisburg first, history demonstrates to us that administrations and legislatures – the money goes into the General Fund – start raiding the General Fund for other budgets,” Corbett explained to reporters on Wednesday.  “I believe the money needs to go where the impact is.” 

Under the Corbett plan, 75% of the impact fee would be retained at the local level.  The remaining 25% would be divvied up among PennDOT, the Department of Environmental Protection, PEMA and more.

Gov. Tom Corbett

Gov. Tom Corbett unveiled his Marcellus Shale plan on Monday.

Two State House Republicans Call for Drilling Tax

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Governor Corbett has proposed an impact fee on natural gas wells to be assessed at the county level, but some lawmakers continue to push for a broader fee on gas extraction, with more money going statewide.   Two House Republicans, Representatives Tom Murt and Gene DiGirolamo,  are  calling for a tax of 4.9 percent on the gross value of units of deep  gas reserves extracted at the well head.

Representative DiGirolamo (R-Bucks) says their plan would divide the revenue three ways, with 28% of staying at the local level, 28% going to environmental programs and 44% being used for state programs.   The plan would dedicate some of the revenue from a severance tax to Drug and Alcohol Treatment and services for adults with special needs.

The Governor’s plan calls for 75% of the money to be spent for impacts at the county and municipal level and 25% to be divided among specific state agencies.   Representative Tom Murt (R-Montgomery/Philadelphia),   says they agree with the Governor’s position that any tax or fee assist local communities with the cost and impact of drilling.  They also propose the revenue make long term investments in natural resources, environmental programs, our economy and our human capital.

Representative DiGirolamo says it’s imperative to support environmental programs around the state and all of Pennsylvania’s residents should benefit from the shale.  He believes the bill is a reasonable approach to the issue.

The lawmakers were joined by environmental, labor, Christian advocacy, fair housing, good government and other groups in urging support for a drilling tax.  Among them was Jan Jarret, president of PennFuture.  She says the bill makes long term investments in environmental restoration and conservation to make sure we have the resources on hand to address problems the industry will bring to the state’s forests, streams and air.  She says it also makes sure the resources are there to police the drilling industry.

Governor Corbett Announces Marcellus Shale Proposal

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Governor Corbett has released his plan for the Marcellus Shale industry, calling for some stronger regulations, an impact fee and the development of green corridors for natural gas vehicles.  He made the announcement after weeks of reviewing the recommendations of his Marcellus Shale Advisory Commission.

The Governor’s proposed impact fee on Marcellus Shale wells would be adopted by counties. He says 75% would be shared among each county and its municipalities. Twenty-five percent would go to the state, with the largest share to PennDOT and the rest split among the Department of Environmental Protection, Pennsylvania Emergency Management Agency, the Pennsylvania Public Utility Commission, and the State Fire Commissioner.

The Governor is also calling for enhanced environmental standards for drilling operations, and higher penalties for violations. He wants to increase the gas well setback distance from water wells and  public water supplies. He would also increase the well setback distance from streams, rivers, ponds and other bodies of water. He wants to increase the well bonding fee.

The Governor’s plan would allow DEP to take quicker action to revoke or withhold permits for operators who consistently violate the rules.

The impact fee would be up to $40,000 per well in the first year, $30,000 in the second, $20,000 in the third and no more than $10,000 in years four through ten.  He says that’s a total of $160,000 per well. Governor Corbett says estimates show that the fee would bring in about $120 million dollars in the first year and $200 million within six years.

Of the 75% that would stay at the county collecting the fee, Governor Corbett says 36% would be retained by the county, 37% would be distributed to municipalities that host the drilling pads and the remaining 27% would be distributed to all municipalities in a county that is impacted by Marcellus using a formula based on population and highway miles.

Governor Corbett says the money could be used for things such as road maintenance and repair, water and sewer system construction and repair, projects to increase affordable housing for low income residents, social services and municipal planning.

The Governor says he will seek to develop green corridors in the state for natural gas vehicles. He says we have all this gas; we need to have a market for it.

Governor Corbett says the energy under our feet is going to be fueling the state’s economy, heating the homes, lighting houses and businesses for generations to come. He says it’s cleaner and it creates much fewer emissions. He says energy means jobs. The Governor made his announcement at a carpenters’ training facility in Pittsburgh Monday morning.