Responsible Drilling Alliance

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21
Apr

HB 1950 – SB 1100

HB 1950 – SB 1100

A closer look at proposed PA laws

that will affect you and your property

 

Our Commonwealth is on the brink of enacting legislation that would impose and impact fee on drilling for natural gas. In order to assist you in making an informed judgment on the merits of one of the most vital aspects of the bills currently being considered, the Responsible Drilling Alliance, a Lycoming County based non-profit citizens education and advocacy organization, has prepared this guide.


Logic might dictate the best way to be fully informed would be to actually read the proposed legislation, Senate Bill 1100 and House Bill 1950. However, for most of us, that could be akin to torture. But, if you insist, there is some good news; as it now stands, the language of Senate Bill 1100 now appears in both bills. Whether this is just cut, copy and paste magic, and parts or all of HB 1950 will suddenly re-appear sometime during the legislature’s deliberations, we do not know, but for now you can follow this link to the wording in effect on 12-9-11: http://e-lobbyist.com/gaits/text/356777

 

Those of you who rely on analysis by a trusted – or reviled – source, we suggest a few, below.

As we are a sound bite and spin-oriented society, we wouldn’t want to disappoint you. For quick, easy reading to get you up to speed, as our Texas friends say, here are a few quotes across the spectrum of opinion:

 

“Allowing oil and gas operations as a permitted use in all zoning districts is inconsistent with the purpose of the Municipal Planning Code and municipal comprehensive plans. The taking of authority to accomplish coordinated development, safety, health, general welfare and comprehensive planning away from local governments and giving it to the state’s Attorney General is unreasonable.” Armstrong Township (Lycoming County) Supervisor and Chairman James Dunn 

           

“This legislation had the full support of the Pennsylvania State Association of Township Supervisors…”claimed Senator Gene Yaw, referring to PSATS in his e-mail to people who contacted him on SB1100.

“Let me share a couple erroneous statements made to me in recent days”:  



1. PSATS endorsed HB1950 and SB 1100…..FALSE 



2. PSATS is leading the charge to strip local government of their role……FALSE

3. PSATS doesn’t care about the health and safety of our communities and residents…..ABSOLUTELY FALSE
… As we move forward, the Corbett Administration is still committed to the total stripping of local authority (way BEYOND zoning) through complete preemption, and is pushing the legislature to eliminate local determination in every way.

 PSATS will continue to fight for a local role in this important economic development opportunity so long as it is done environmentally safely and not at a cost to local taxpayers. But we need your help! 

Please call your State Representative, State Senator, and Governor Corbett (717-787-2500) and tell them you oppose the re-insertion of pre-emption to exclude local government in any Marcellus legislation!
 David M. Sanko
 Executive Director
, PA State Association of Township Supervisors, in an e-mail to Roulette Township Supervisors Secretary/Treasurer Jonathan Huff as reported Solomon’s Word blog http://solomonswords.blogspot.com/2011/12/pa-state-association-of-township.html

“… while legislative leaders have reached a compromise favorable to the state’s leading business organizations on zoning, the two chambers are still at oddswith each other and the Corbett administration on other important aspects of the proposals…One key component upon which the business groups agreed with the Legislature is the zoning compromise that would allow local officials to regulate oil and gas so long as laws provided for “reasonable” development of oil and gas. Local officials and gas companies would also be able to request that the Attorney General review an ordinance to determine whether it allowed reasonable development….’We… support legislation that sets our clear, statewide, uniform standards reserving to our local governments their relevant zoning powers,’ the business organizations wrote…..However, it’s unclear whether the Corbett administration is open for changing their stance on the zoning aspect of the legislation. In November, the governor actively pushed for a plan that would totally negate all local zoning on Marcellus Shale drilling.”  Kevin Zwick, Capitalwire Staff Reporter 12/8/11  http://pennsylvania-solutions.blogspot.com/2011/12/pa-marcellus-news-digest-december-8.html

“The legislation requires municipalities’ ordinances to ‘provide for the reasonable development of minerals’. What’s reasonable? By and large, that’s for the Attorney General and the Commonwealth Court to decide… the legislation would allow the Attorney General to file suit against the local government in Commonwealth Court, in order to invalidate the ordinance. Effectively, the Pennsylvania Attorney General would be suing on behalf of an aggrieved drilling company. If a special master appointed by Commonwealth Court rules on the driller’s behalf, the court would have the power to make the municipality pay both sides’ legal fees.” Scott Detrow, State Impact/NPR November 18, 2011.

https://stateimpact.npr.org/pennsylvania/2011/11/18/preemption-language-gone-but-pennsylvanias-impact-fee-would-still-limit-local-governments/

 

“The bill also establishes an appeals process for operators through the Attorney General’s Office regarding local zoning ordinances…Senate Bill 1100 does not preempt local municipalities from passing zoning ordinances related to natural gas development. Simply, it allows an operator or person with a royalty interest to developable land to request the Attorney General to review a local ordinance to determine whether it allows for the reasonable development of oil and gas.”  Senator Yaw, in his e-mail to those who contacted him on the legislation. 

 

“Both bills would require local governments to allow gas operations in all zones, including residential. This would eliminate the ability of townships to take steps to protect the health and quality of life of residents and the aesthetics and character of communities. Importantly, many citizens of the Commonwealth could see decreases in the value of their home and property.” Nadia Steinzor, Earthworks Fact Sheet (scroll down to the end of page to read what Nadia Steinzor wrote)

 

“Pennsylvania Supreme Court rulings have made it clear that the state Oil and Gas Act gives municipalities the right to use our zoning code to restrict the location of gas wells—similar to how we sometimes restrict other types of economic activity through zoning…We also believe that local decision making is part of a democratic society. We have been elected and appointed to fully represent the interests of our constituents. This includes the right of municipalities to determine what is best for their communities and residents.”  11/16/11 letter fromlocal officials to the General Assembly  http://www.pacleanwatercampaign.org/gasdrilling/local-officials-sign-letter-to-state-legislature-defending-local-rights/

 

“SB 1100 makes sweeping new restrictions on what towns can do with their zoning. Well pads and frack pits full of chemicals will be allowed as close to 300 feet to your home, or your child’s school… the restrictions would make it almost impossible for townships to exercise their rights and obligations to protect their residents, businesses, and community quality of life.”  Myron Arnowitt, state director of Clean Water Action  http://stateimpact.npr.org/pennsylvania/2011/11/18/preemption-language-gone-but-pennsylvanias-impact-fee-would-still-limit-local-governments/

 

“The bills significantly limit municipal land use authority. While neither bill expressly preempts all local land use regulations, it is not clear what meaningful role would remain for local governments. Because of ambiguous drafting and the extent of statewide regulations included in the bills, there is a risk that the legislation could be interpreted to occupy the field of oil and gas regulation and thus fully preempt local zoning authority. Further, on their face, the bills take away the most important zoning tool available, which is the ability to identify which zoning districts are appropriate for which activities. Under SB 1100 and HB 1950, each municipality would be required to allow gas drilling operations in every zoning district.”  Jordan B. Yeager, Esq., Curtin & Heefner, LLP, Memorandum, “Limitations on Local Zoning Authority Under HB 1950 and SB 1100, 12/4/11 

 

“Pre-emption Language Gone, But Pennsylvania’s Impact Fee Would Still Limit Local Governments.”  State Impact (NPR), November 11, 2011

https://stateimpact.npr.org/pennsylvania/2011/11/18/preemption-language-gone-but-pennsylvanias-impact-fee-would-still-limit-local-governments/

 

 

Responsible Drilling Alliance:

The Responsible Drilling Alliance, of course, has an opinion on impact fee legislation. For those of you not familiar with us, RDA is a grass roots organization comprised of citizens who are interested in and concerned about the development of shale gas drilling in our neck of the woods, our state, and around the world. A 501-C3 non-profit, RDA was founded in 2009 by 4 Williamsport area residents, Jon Bogle, Janie Richardson, Robert Cross and Ralph Kisberg. Of the four, two have or had gas leases, one will only have a lease on his country retreat property over his dead body, one owns 21 apartment units in downtown Williamsport, one has chronic respiratory problems, one is a business owner/job creator, and one’s life and no doubt property value has been severely impacted by a compressor station located on a neighbor’s property a quarter mile from the family home of over 30 years. 

In other words, we are typical of any group of people in the area. Some of us stand to benefit from gas development, some of us hate it, all of us love this area, especially our topography, our waterways and pubic forests and the overall environment we have chosen to live in (at least the way it was before the endless trucks, drill rigs, pipelines and compressor started to appear). All of us, like most of you, have serious concerns about the future of the area and what gas development means for the long term future here.

There are other issues regarding the impact fee legislation we chose not to focus on in the Sun Gazette ad as we feel the right to local determination of community standards is something we as a community should able to unite on across the political spectrum.  At this point, we will all see the basic right of our communities to make their own zoning standards radically altered unless our political leadership hears a loud and clear message from and an overwhelming number of us.  

If you have concerns about big government, or the power of corporations to influence the political process, or just your neighborhood and the value of your home, we urge you to look into this facet of the proposed impact fee legislation and then get involved and attempt to get your friends, neighbors and family involved.

Send a clear message to the Governor and the legislature that, while sensible minimum standards for gas development are necessary, communities must be left to control their own destiny, and decide for themselves where best to allow for gas development. As it stands now, if this legislation passes, that right will essentially be taken out of our hands.

Let’s be clear on one thing: we are not trying to stop gas development or anyone’s right to the gas under their property; that would be a gigantic waste of our time and surely would be overturned through legal challenges. The passing of ordinances banning “fracking” in some communities has been cited as the reason the heavy handed and convoluted process for review of ordinances was put in the legislation. This is simply ridiculous, as are those illegal ordinances

The gas industry is here to stay. They are quite capable of extracting gas from almost 2 miles away from a well pad now. Figuring out how to maximize exploitation of the resource, within the boundaries communities set is their problem and they will figure out a way to solve it. A good number of people in our region stand to benefit  from gas development, but it is not necessary for anyone to benefit at the expense of their neighbors. Look at the pictures in our Sun Gazette ad, they are all from Pennsylvania. Your neighbor has the right to host a well pad and see his gas extracted, but if your township decides that a 300’ set back from the edge of the well pad is not acceptable in some of its zones, why shouldn’t they be able to say, “Sorry, not good enough in this part of our community”? SB 1100 and HB 1950 would, in all probability, take that decision-making authority away. It would also allow for your neighbor to have a compressor station placed 750’ from your home. This may sound acceptable to some, but if your community decides that is not so in all of its zoning districts, it ought to have the right to say so. Ask those residents of Mifflin Township who have lived with problems from noise and emissions from the Canoe Run Compressor station for the past couple of years if they think even a ¼ mile setback has proven acceptable to their quality of life and resale prospects in their neighborhood. 

Thanks you for taking the time to read this. If you like what we have presented here today and would like to join us, membership in RDA is free. Go to the homepage of our website: and find the ‘’join” tab. Joining RDA will allow you to receive our e-newsletter, where we report and comment on gas issues locally, around the state, the nation, and occasionally, the world. If you really like what we are doing, donations are welcome to help keep us going. There is a link to donate on the website. If you prefer not to join us but would like to keep informed on what we have to say, check the website each week for the newsletter or “like” RDA on Facebook.

 

Responsible Drilling Alliance, Board of Directors

Ralph Kisberg

Robert Cross

Janie Richardson

Barbara Jarmoska

Mark Szybist

Jen Slotterback

 

P.O. Box 502

Williamsport, PA 17701

For those who seek out the opinions of our elected officials, we provide you below with letter’s by our area legislators: Representative Everett, Senator Yaw, and Representative Mirabito.

 


Garth Everett:

I know that you are receiving emails from environmental groups telling you that I am the devil for voting for HB 1950. Well, below is a synopsis of what HB 1950 does and I think there is some pretty good stuff in it. It is not the Marcellus fee bill that I would have written myself, but, in order to get 102 votes in the House, it is as good as we could do right now.

Highlights: It puts an impact fee on wells that stays in our local impacted communities, it funds important statewide environmental programs from the gas leases on state lands, it strengthens environmental safeguards concerning drilling and it allows for some local zoning control over drilling operations.

My choice was not to vote for HB 1950 or some other Marcellus fee bill, my choice was to vote for HB 1950 or get nothing. I chose something over nothing.

The Senate has also passed a Marcellus fee bill, SB 1100. Like HB 1950, it has some good features in it and some I am not so crazy about. Right now individuals from the House, Senate and Governors office are working to put together a bill that can get at least 102 votes in the House, 26 in the Senate and a signature by the Governor, if the negotiating team cannot do that, we will go another year and maybe another session without any meaningful Marcellus legislation.

So, if you are an “all or nothing” person, you may hope that the negotiations fail and that we can “fight the fight” another day and hope for a bigger and better fee bill. I, however, live in the world of the possible and will continue to work for the best bill we can get right now and then, probably, vote for it. We can then see where we are and start working on other bills to ensure that this development is done in a manner that is environmentally responsible and fair to those of us living in and around the development.

Here’s some more detail on what’s in the bill:

Implements per well (not per pad) fee over the first ten years of a well’s life. It is during these years that most local impacts are felt, little impact from wells over the out-years when they are simply producing wells.

· 75% of the proceeds of the fee goes to counties and local communities with or near wells

· 25% goes to state agencies and is restricted for use on local Marcellus impacts

Allocates funds from the Oil & Gas Lease Fund (the fund where Marcellus royalties from state land leases is held) to county conservation districts, the environmental stewardship fund (Growing Greener), the hazardous sites clean-up fund and local communities with a high percentage of state land.

Strengthens environmental safeguards:

* Increases setbacks from streams, water wells, buildings and public water supplies.

* Enhances DEP ability to deny, suspend, or revoke a permit.

* Requires 24 hour notice to DEP before commencing certain critical activities.

* Requires DEP approved water management plan.

* Enables Environmental Quality Board to promulgate regulations.

* Requires DEP to consider municipal comments.

* Prohibits development of a well pad or drilling in a floodplain unless certain conditions are met.

* Requires conditions related to security, lightning, noise and odor.

* Permits DEP to extend the 9 month reclamation timeframe.

* Extends rebuttable presumption for unconventional well operators to 2,500 feet and 12 months.

* Authorizes DEP to enter into contracts with well control specialists.

* Requires additional information including hydraulic fracturing information with well completion reports.

* Establishes bond amounts based upon length of well bore with a blanket cap of $250,000.

* Requires inspection of erosion and sedimentation control measures prior to drilling.

* Requires inspection reports to be posted on line.

Allows local municipalities to enact local ordinances relating to oil and gas development that do not conflict with current state or federal law and allow for the ”reasonable development” of oil and gas.

Again, thanks for your input on this matter. I will continue to keep you informed on this issue as it moves through the legislative process and will

work to get the best bill possible for our area and for the Commonwealth of Pennsylvania. – Rep. Garth Everett, letter to those who contacted him


Gene Yaw:

Thank you for contacting my office concerning natural gas drilling in Pennsylvania.  I appreciate hearing from you on this important matter.

Since the debate to impose a statewide severance tax or local impact fee began, many proposals have been put forth for consideration before the Legislature.  Many of these proposals dedicated a larger portion of funds for statewide programs.  From day one, I felt that a majority of revenue generated by any tax or fee must be distributed to our local governments and environmental programs.  Local governments are looked upon to repair our roadways, offer emergency response and provide agricultural conservation, while receiving no financial support from the state to alleviate stresses felt by the industry.  A fair revenue stream would offer counties, townships and boroughs much needed help in dealing with new obstacles brought on by the natural gas industry.  A fair revenue stream would also give our municipalities the opportunity to improve the quality of life in areas which are impacted by the natural gas industry.  Through it all, it was imperative that the health and safety of our citizens remained at the forefront, as well as that of our environment.

Recently, the Senate voted to approve Senate Bill 1100, legislation that would enact a fee and distribution structure, strengthen environmental regulations and implement added environmental safeguards.  The bill also establishes an appeals process for operators through the Attorney General’s Office regarding local zoning ordinances.

The impact fee would be competitive with fees and taxes done in other states with an effective rate of 3%.  The structure would last for twenty years with the first year being $50,000, second year being $40,000, third year being 30,000, fourth year through the tenth year being $20,000 and the eleventh year through the 20th year being $10,000.

I am pleased that a majority of the fee would be distributed to local communities who are directly impacted by the natural gas industry.  The remaining funds would go to infrastructure needs across the state, such as deficient roads and bridges, storm water and sewer projects, environmental initiatives and the Hazardous Sites Cleanup Fund. 

Senate Bill 1100 also promotes the use of Pennsylvania’s abundance of natural gas by using money derived from 2010 fee revenue for a Natural Gas Development Program.  This program would use roughly $26 million to provide loans, grants and rebates for the conversion or replacement of buses, public transit authority vehicles and medium and heavy duty vehicles with natural gas engines.  In addition, the funds would be used for the construction of natural gas fueling stations and the purchase and installation of the necessary natural gas fleet refueling equipment for vehicles operating on natural gas.

This legislation made sweeping changes to the Oil and Gas Act which were previously updated in 1984.  As I have said before, protecting the environment was one of the most important issues surrounding the natural gas discussions, and this legislation does just that.   SB 1100 would:

·         Restrict a well from being located within 1,000 feet of a public water supply source defined in the Safe Drinking Water Act;

·         Triple the setback distance from streams from 100 feet to 300 feet;

·         Triple the distance of presumed liability for contamination for the operator from 1,000 feet to 3,000 feet;

·         More than double the setback distance from an existing building or personal water well from 200 feet to 500 feet;

·         Increase well bonding limits from $25,000 to $600,000;

·         Increase civil penalties from $25,000 to $75,000;

·         Require disclosure of hydraulic fracturing components; and

·         Require the department to adopt regulations regarding the transportation of wastewater.

In addition to the above, the oil and gas drilling industry is also subject to the federal Clean Water Act, Clean Air Act, the state Clean Streams Law, the Air Pollution Control Act, the Solid Waste Management Act, erosion and sediment control and post-construction storm water discharge and other statutory and regulatory requirements.  Clearly, this industry is heavily regulated. 

Senate Bill 1100 does not preempt local municipalities from passing zoning ordinances related to natural gas development.  Simply, it allows an operator or person with a royalty interest to developable land to request the Attorney General to review a local ordinance to determine whether it allows for the reasonable development of oil and gas.  This is consistent with Pennsylvania’s ACRE program which settles disputes between the agricultural community and local governments.  The zoning provision in the legislation still allows municipalities to impose restrictions including: setbacks, lighting and noise restrictions consistent with other industrial activities in a zoning district and applicable state laws or regulations.  Furthermore, if a municipality determines that no well site can be placed so that a well head is at least 500 feet from an existing building in a residential district, the municipality retains the power to prohibit oil and gas operations or permit it as a conditional use.

This legislation had the full support of the Pennsylvania State Association of Township Supervisors, County Commissioners Association of Pennsylvania, The Pennsylvania State Association of Boroughs and the Pennsylvania League of Cities and Municipalities, to name a few.  All of these organizations participated in the discussions of this bill.  I appreciate hearing from you on this important issue.  Please do not hesitate to call should you have additional questions or concerns. 


Rick Mirabito:

Marcellus proposals treat Pennsylvanians

like second-class citizens

At a Capitol news conference this week regarding drilling in the Marcellus Shale, I said, “we should plan for the future and not be swept up by the euphoria of today.”  

The people of Lycoming County appreciate the jobs and economic development that is occurring with the development of the gas industry but they repeatedly have told me that they do not want to be left paying for the social, environmental and economic impacts of the industry.

I was joined by Armstrong Township Supervisor and Chairman James Dunn who focused on the effects on local communities and the usurpation of local zoning laws. Dunn said, “Allowing oil and gas operations as a permitted use in all zoning districts is inconsistent with the purpose of the Municipal Planning Code and municipal comprehensive plans. The taking of authority to accomplish coordinated development, safety, health, general welfare and comprehensive planning away from local governments and giving it to the state’s Attorney General is unreasonable.”

Chairman Dunn noted that local communities would no longer be able to regulate drilling activities through local ordinances, preventing them from making reasonable, open and transparent decisions based on the individual needs of each community.  

I believe this loss of local control will hurt our quality of life. H.B. 1950 and S.B. 1100 treat Pennsylvanians like second-class citizens because they fail to do what is allowed in almost every other state. Thirty-eight states have severance taxes and 21 of them also allow local communities to assess local impact fees with 100 percent of the revenue coming back to local communities to deal with local impact.

It is estimated that by 2020 the Marcellus Shale will provide 25 percent of the natural gas in the United States. As we export our gas to other states and even to other countries, without a fair severance tax and impact fees, we – the taxpayers of Pennsylvania – will be left with the cost of natural gas production.

This is fundamentally wrong.

If you have questions about this or any state-related issue, please contact me. Don’t forget to follow me on Facebook.


Prepared by Nadia Steinzor, Earthworks, December 2011:

Hidden impacts of the impact fee bills: property devaluation and damage

As the Pennsylvania legislature works to reconcile bills on natural gas development passed by the House (HB1950) and Senate (SB1100), lawmakers are being asked to weigh the gain of some impact fees against the loss of municipal zoning rights.

Both bills would require local gov­ern­ments to allow gas operations in all zones, including residential. This would eliminate the ability of townships to take steps to protect the health and quality of life of residents and the aesthetics and character of communities. Importantly, many citizens of the Commonwealth could see decreases in the value of their home and property. Key reasons for concern include

·      The bills could allow infrastructure such as well pads, drill rigs, chemical storage, and waste pits as close as 300 feet to homes.[i]

·      The requirement to allow commercial and industrial activities in residential areas would be a special favor for only the gas industry. In many cases, other types of businesses (from hair salons to light construction) could face greater restrictions on locating in a residential area than gas operators.

·      The New York Department of Environmental Conservation’s 2011 economic assessment of gas drilling concluded that regional property values could initially rise because of economic activity and an influx of workers—but once mineral rights are leased and drilling occurs, the value of residential properties would likely drop due to proximity to wells and infrastructure.[ii]

·      A 2001 study in Colorado showed that properties with coal-bed methane gas wells were valued 22 percent less than similar properties without wells.[iii]

·      A 2011 study by the town of Flower Mound, Texas, concluded that properties with houses that were less than 750 feet away from a drill site experienced an average sales price drop of two to seven percent.[iv]

·      Homeowner’s insurance generally excludes the types of property damage associated with oil and gas drilling (such as air pollution, water well contamination, and chemical spills) done on residential property.[v]

·      Title insurance can contain specific exclusions that could potentially void coverage (which is necessary to buy or sell a property) when commercial activities like drilling, storage, or transmission of gas occurs on a residential property.[vi]

·      Mortgages from many banks and lending institutions require specific setbacks for oil and gas development from buildings. Homeowners could potentially have problems obtaining loans or refinancing or selling their properties if drilling operations are in close proximity to homes.[vii]

[1] Ecology and Environment, Inc. Economic Assessment Report for the Supplemental Generic Environmental Impact Statement on New York State’s Oil, Gas, and Solution Mining Regulatory Program. August 2011.

[1] BBC Research and Consulting. Measuring the Impact of Coalbed Methane

Wells on Property Values. November 2001.

[1] Chris Roark. “Council hears presentation on drilling-property value impact.” Flower Mound Leader Star, March 25, 2011.

http://www.planostar.com/articles/2011/03/26/flower_mound_leader/news/413.txt

[1] Elisabeth Radow. “Homeowners and gas drilling leases: boon or bust?” New York State Bar Association Journal. Vol 83, No. 9, November/December 2011.

[1] “County Work Group Urges State to Address Gas Drilling’s Effects on Real Estate.” New release, Tompkins County, New York, May 31, 2011.

[1] Ian Urbina. “Rush to Drill Creates Conflicts with Mortgages.” New York Times, October 19, 2011. http://www.nytimes.com/2011/10/20/us/rush-to-drill-for-gas-creates-mortgage-conflicts.html?_r=1&pagewanted=all

 


Marcellus Shale Plan Must Hold Industry Accountable

Marcellus ShaleFor years, the General Assembly has struggled to pass a much needed natural gas drilling impact fee. We have discussed and debated an impact fee combined with critical environmental regulations for Marcellus Shale only to come up short. The recently approved impact fee legislative plans that were passed in the state Senate and the House also fall woefully short, amounting to a missed opportunity, likely never to be seen again.

The overall product of the separate pieces of legislation (Senate Bill 1100 and House Bill 1950) approved in the Senate and the House were disappointing, to say the least.

Senator Hughes Says Republican Marcellus Shale Plan Gives Industry a Pass
Senator Hughes debates on Senate Floor about the Republican Marcellus Shale plan that was approved by the Senate. Click Here to Watch Click here to Listen

The proposal my Senate Democratic colleagues and I recommended was far better than either bill approved in the Republican-controlled House and Senate. The Senate Democratic plan would have raised significantly more revenue and implemented stronger environmental protections while protecting local zoning authority. Unfortunately, this proposal was voted down.

The Republican legislation squanders our best chance to create new job opportunities for infrastructure, energy and economic investments and instead adopts an embarrassingly low tax rate that falls far short of our needs.

While there are concepts in SB 1100 that are worthy of support, there are also many areas where the legislation is deficient.Senate Bill 1100 provides a paltry $14 million in the first year for environmental programs — well short of the minimum $75 million goal that was suggested by respected environmental groups. I fought to bolster funding by amending SB 1100, but was once again blocked by Senate Republicans.

Statewide Comparison of Natural Gas TaxesUnfortunately, the minimal fee stipulated by SB 1100 and the totally inadequate fee proposal contained in the House plan (HB 1950) would leave us far short of the funding needed to make a real difference. In stark contrast by 2014 our Senate Democratic alternative would have supported $750 million in additional infrastructure investment compared to the meager Republican plans.

House Bill 1950 would impose the third lowest effective tax rate among all 31 shale producing states. Senate Bill 1100 would be the 5th lowest tax rate. The Senate Democrats proposal would put Pennsylvania at 7th lowest among all states.

The Republicans argued that levying a more robust fee on the industry would cause them to drill elsewhere. However, states frequently referenced as alternatives to Pennsylvania for drilling — Texas and West Virginia — have much higher effective rates on natural gas production than the rate proposed by Senate Democrats. Moreover, New York has a drilling moratorium in place until environmental studies are performed while the Ohio legislature has two bills pending that would do likewise.

Senate Democrats had high hopes for a plan that would responsibly regulate and tax the shale industry. We were reasonable and open minded in our negotiations and tried to be balanced in our approach. Our efforts were rebuffed by Senate Republicans.

However, this fight is not over. We will have other opportunities to improve the bill before it reaches the governor’s desk. The bottom line is that we must ask more from this industry.

The Marcellus Shale plan should do three things: protect Pennsylvania’s environment and its people; generate adequate revenue; and give local government the ability to protect their communities. Anything less than that is unacceptable.

I urge you all to contact your local state representative, senator and the governor to voice your concerns and displeasure regarding this industry-driven half measure.

View Summary of all Plans

ALERT! EPA Announces Fracking May Cause Groundwater Pollution

You can find out more specifics about the Marcellus Shale Plan and provide your feedback on my website atsenatorhughes.com as well as on Facebookand Twitter (@SenatorHughes).

Offices of State Senator Vincent Hughes

www.senatorhughes.com

DISTRICT OFFICE 4950 Parkside Avenue | Suite 300 Philadelphia, PA 19131 Phone: 215.879.7777 Fax: 215.879.7778

HARRISBURG OFFICE Senate Box 203007 Harrisburg, PA 17120-3007 Phone: 717.787.7112 Fax: 717.772.0579

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