Revenue to make up 33% budget cuts
By Yasmin Tadjdeh | PA Independent
HARRISBURG — The state Department of Conservation and Natural Resources is making up state funding cuts with revenue from leasing state forest lands, but one environmental group says some of those leases may be illegal.
Despite a $27.2 million, or 33 percent, cut in state-level funding this year, DCNR’s overall budget increased from $282 million to $284 million. The increase was made possible by $65 million from the Oil and Gas Lease Fund, which is up from $35 million last year. The Oil and Gas Lease Fund was created in 1955 to maintain revenue from DCNR’s leases with natural gas drilling companies for portions of the state’s 2.1 million acres of forests.
In addition to money from gas leases and the state, DCNR’s budget consists of federal and environmental funds as well as timber sales.
Because of large revenue from the leases, the state has cut funding from DCNR, which has been trimming its budget without hurting its operations, said DCNR spokesman Terry Brady.
“We have had to implement some ongoing, service reductions at all of our state parks as a result of shortening the number of months that our seasonal staff work to save money, and tightening our belts in other ways,” said Brady.
Among the cost-saving efforts are shortening camping and swimming seasons, closing some restrooms and improving maintenance. However, Brady said, there will be “no state park closures.”
But, some natural gas drilling leases may be violating a federal law requiring that land purchased with federal funds must be available for public use, according to the Pennsylvania chapter of the Sierra Club, a lobbying environmental protection organization. Since natural gas drilling requires closing at least a portion of the land for building gas wells, the public does not have full access, they argue.
Since 1947, DCNR has garnered millions of dollars in revenue for leasing state forest lands to natural gas drilling companies, particularly from recent Marcellus Shale leasing. Leasing revenue comprised 23 percent of DCNR’s budget last year.
No gas drilling is occurring on any of the state’s 117 state parks, which are run by the state Bureau of Forestry, and are different from the state forests maintained by the DCNR.
The first Marcellus shale lease on state forest lands occurred in 2008 and spanned more than 74,023 acres, generating $163 million, said Brady. Subsequent Marcellus leases have yielded $250 million for nearly 65,000 acres.
However, the public is “losing thousands of acres of public land … to the (natural gas) drilling industry,” said Jeff Schmidt, director of the Pennsylvania chapter of the Sierra Club. “The public is not being compensated.”
The federal Land and Water Conservation Fund Act, passed in 1965, gives money through the Land and Water Conservation Fund, or LWCF, to states to help them acquire and maintain public forest lands. The fund requires that land purchased with its money must be available for public use.
Because natural gas drilling frequently makes land unusable for the public due to the construction and operation of gas wells and access roads, an equal amount of leased land must be opened up through a process called conversion. For example, if 100 acres is purchased through LWCF funds, 100 acres must be made available somewhere else for public use, said Schmidt.
In the letter, the Sierra Club said DCNR is not properly documenting whether those lands being used for natural gas drilling were funded through LWCF. In addition, the environmental group said DCNR is improperly allocating funds from the Oil and Gas Lease Fund for salaries and operating costs, not conservation efforts as required under law.
The Sierra Club also sent this letter to the National Park Service and the state Department of the Environmental Protection
Phil Sheridan, a spokesman for the National Park Service Northeast Region, said it is reviewing the letter.
“At this point, we will do our due diligence,” said Sheridan, who said no timetable existed for when the matter would be resolved.
Brady said DCNR is reviewing the letter and he is not aware of any timetable.
State Sen. John Yudichak, D-Luzerne, minority chairman of the Senate Environment Resources and Energy Committee, said the state must tread carefully when deciding to lease public forest lands for natural gas drilling.
“I’m concerned that in a rush to solve a budget crisis that we are making decisions that could have …long-term effects,” said Yudichak.
As the Legislature considers an impact fee on natural gas drilling companies, the details of the fee structure could affect the state’s lease revenue. Many natural gas drilling leases contain clauses requiring the land owner to pay any additional taxes or fees after the lease is signed.
