By Kevin Zwick
Staff Reporter
Capitolwire
HARRISBURG (Nov. 2) – A nearly 130-page Marcellus Shale bill, supported by House GOP leadership, was voted out of the House Finance committee on party lines after about an hour of debate between lawmakers.
“I think it’s time to get moving,” House Finance Chairman Kerry Benninghoff, R-Centre.
Democratic members voted against moving the bill out of committee, objecting that the bill addresses three major issues that should be broken up into separate legislation for more in-depth review.
There were also some murmurs by staff and lawmakers prior to the meeting about the small room chosen for the voting meeting and the lack of time to review the bill, which went up on the Legislative system a little after 5 p.m. on Tuesday night.
During the meeting, Democratic Chairwoman Phyllis Mundy, D-Luzerne, said it is “a terrible bill” with an “extremely low tax rate” that “strips from local governments what little power they do have” to regulate gas drilling.
The bill, introduced by Rep. Brian Ellis, R-Butler, and supported by the House GOP leadership, would “supercede and pre-empt” local laws that regulate natural gas drilling for uniformity, supporters say.
The bill’s fee and distribution structure is similar to that proposed by Gov. Tom Corbett, which allows counties to chose whether to impose a fee on Marcellus Shale gas drilling. Ellis’ bill directs a portion of the fee to PennDOT to cover infrastructure impacts, the Department of Environmental Protection (DEP), the Pennsylvania Emergency Management Agency (PEMA), the Public Utility Commission (PUC), and others agencies.
Some Oil and Gas Lease Fund monies would be directed to statewide environmental programs as well.
House GOP spokesman Steve Miskin said House Majority Leader Mike Turzai, R-Allegheny, is in contact with the Senate on the issue, but “that’s not saying this is a parallel bill to what they’re doing.”
Rep. Margo Davidson, D-Delaware, said “a better quality” bill should be considered, citing other bills introduced by House Republican Reps. Marguerite Quinn, R-Bucks, and Gene DiGirolamo, R-Bucks, and Tom Murt, R-Montgomery.
“[Ellis’ bill] is a collection of what can be passed on both chambers,” Benninghoff said in response to Davidson.
“I don’t believe it’s a perfect proposal,” Rep. Eli Evankovich, R-Westmoreland. “That’s what this process is for.”
Rep. Rick Mirabito, D-Lycoming, said the bill contains “three gargantuan topics” that should be addressed individually, while Rep. Bill DeWeese, D-Greene, said the bill should have “percolated” in the House Environmental Resources and Energy Committee before a vote is held on the floor.
The zoning requirements for the bill would supercede and preempt current local ordinances regulating gas drilling, while prohibiting municipalities from enacting future regulations.
“No local rule, regulation, code, agreement, resolution, ordinance or other local enactment of any municipality may regulate oil and gas operations. All local rules, regulations, codes, agreements, resolutions, ordinances and other local enactments that regulate oil and gas operations are hereby superceded and preempted,” according to the bill text.
Ellis’ bill charges $40,000 per well in the first year, and then decreases by $10,000. In the fourth year, the well fee is $10,000 and remains at that cost until the 10th year of production.
The bill’s distribution structure would allocate 75 percent of the fees collected to host counties and municipalities. Of that the total fee:
· 27 percent retained by the county;
· 27 percent distributed to host municipalities;
· 21 percent distributed to all municipalities, with 50 percent of that distributed based on population of the municipality divided by the population of the county, multiplied by the amount available. The other 50 percent would distributed based using the highway mileage of the municipality divided by the total highway mileage of the county, multiplied by the amount available for distribution;
The other 25 percent of the total fees collected would go back to the Commonwealth:
· 17.5 percent of the total fee to PennDOT for infrastructure impacts;
· 2.625 percent to the DEP, not to exceed $10 million annually, for regulation of unconventional natural gas, plugging of abandoned and orphan wells;
· 1.875 percent to the PUC, not to exceed $2 million annually, for inspection, enforcement and enhancement of pipeline safety standards;
· 1.125 percent to PEMA, not to exceed $2 million annually, for emergency response planning, training and coordination;
· 0.9375 percent to the Department of Health, not to exceed $2 million annually, for collection and disseminating information, and investigating health-related complaints associated with gas drilling;
· 0.9375 percent to the Office of State Fire Commissioner for training and new equipment;
· Any funds remaining in the restricted account after distribution will go to PennDOT.
Municipalities receiving fees could use the money to address impacts included in the Marcellus Shale Advisory Commission, including infrastructure, storm water/sewer projects, emergency preparedness, planning, social services, county and municipal planning and local tax reduction.
The bill also makes changes to the Oil and Gas Act to address setbacks from streams, water wells, building and public water supplies; gives DEP more power to regulate permitting; authorizes expedited permits for additional costs; establishes bonding requirements with $250,000 blanket bond; and requires additional information on hydraulic fracturing, among other things.
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