Unimpressed by governor’s commission’s final report due Friday
By Eric Boehm | PA Independent
HARRISBURG — State senators on both sides of the aisle are unimpressed with Gov. Tom Corbett’s Marcellus Shale Advisory Commission.
The Senate’s top Republican and a high-ranking Democrat publicly have criticized the commission this week for delaying legislative action and failing to deliver a comprehensive plan for an impact fee on natural gas drillers operating in the state. The commission was expected to submit its final report to Corbett on Friday, concluding four months of work.
“Although it’s nice that we have a report, we still need to have legislative interaction,” Senate President Joseph Scarnati, R-Jefferson, said on Thursday afternoon. “It’s delayed that, basically that’s what we’ve done, we delayed legislative action.”
“I don’t think there was any earth-shattering information that came out of the commission, and we waited 120 days,” said state Sen. John Yudichak, D-Luzerne, the ranking Democrat on the Senate Environmental and Energy Committee, on Friday morning. “They came up short on the main thrust of what needs to be discussed.”
Scarnati and Yudichak introduced legislation in the spring to impose a per-well fee on natural gas drilling companies operating in the Marcellus shale region of the state. Neither proposal moved forward, in large part, because of Corbett’s promise to veto any impact fee or tax plan before his commission completed its work.
Corbett formed the Marcellus Shale Advisory Commission in March to find any quantifiable unmet financial impacts of gas drilling. The commission also examined workforce development, environmental protection, fiscal considerations, emergency management and regulatory processes relating to the growing gas industry in northern and western Pennsylvania.
Although the specifics of the report are not yet public, the governor’s commission will recommend an impact fee focusing on local funding issues.
“Our charge from the governor was to determine whether or not there were uncompensated impacts that might require an impact fee, and in some cases, we did find, in fact, that there are,” said Lt. Gov. Jim Cawley, who served as commission chairman. He added that the Legislature would decide the specifics of the fee.
Yudichak said the impact fee not only should mitigate drilling impacts, but also guard against environmental damage, fund infrastructure rebuilding and boost the Pennsylvania economy, all of which will require statewide revenue distribution.
The state Senate has been holding hearings on the impact fee for more than a year, and the senators said the commission did little more than delay the impact fee debate until after the contentious budget session in June.
“I think that Legislative input helps to move the ball forward,” Scarnati said. “We can share our opinions at the time the commission is created or we can share them later; it just takes time if we wait until later.”
Yudichak said Friday the impact fee would be “priority No. 1” for the fall session, echoing comments also made by Scarnati.
During the spring session, Republican leadership in the state House stood behind Corbett’s opposition to a natural gas drilling fee or tax. On Friday, Steve Miskin, spokesman for House Majority Leader Mike Turzai, R-Allegheny, said lawmakers must review the commission’s report before determining how to mitigate the impacts of natural gas drilling.
"Obviously you want to ensure that our water and resources are safe and protected, and we anticipate working with the governor and the senate on the issue," Miskin said.
General Assembly members from the southeastern part of the state say revenue should be spread beyond where the drilling is taking place.
State Sen. Andrew Dinniman, D-Chester, has been an outspoken advocate of a statewide impact fee. He pointed to the several prominent gas lines that cross Chester County to reach Philadelphia or ports on the East Coast.
Environmental groups also have criticized the governor’s commission and called for a statewide impact fee with revenue funding various environmental programs at the state and local levels.
In the spring, Scarnati proposed a $10,000 per-well impact fee with adjustments for the production and value of the gas. In that plan, 60 percent of the revenue would have gone to local municipalities and counties hosting drilling, while 40 percent would go to statewide infrastructure projects and locally run environmental programs.
Yudichak countered with a $17,000 per-well proposal that also included adjustments for production and value. He would have directed 55 percent to local governments and 45 percent to infrastructure and environmental projects. However, 10 percent of the local government revenue would be reserved for parts of the state not directly affected by drilling but with pipelines or other facilities involved in the transportation of natural gas.
At the end of 2010, more than 1,400 Marcellus shale gas wells in Pennsylvania were producing more than 2-billion cubic feet of natural gas daily, according to a report released this week from Pennsylvania State University. Those numbers are expected to grow to more than 2,300 wells producing 3.5 billion cubic feet of gas per day by 2020, according to the report, which was commissioned by the natural gas industry.
The natural gas industry supported 140,000 jobs and paid $1.1 billion in state and local taxes during 2010.
