House Bill 1950, the House GOP Marcellus /Utica Impact bill is local enabling legislation allowing communities and the Commonwealth to respond to the various issues and concerns regarding unconventional drilling within the Commonwealth.
The House voted 107-76 on Nov. 17 to approve the legislation.
It is a bill allowing counties the option to impose an impact fee on Marcellus Shale drilling companies to help local communities mitigate local impacts of the drilling; it is supported by the state’s local government associations as letters of support from PSATS, CCAP, and the Borough’s association were sent to members of the House. The Growing Greener Coalition supports the House Republican Marcellus/Utica Impact bill.
Read the letters of support from PSATS, CCAP, the Borough’s association and Growing Greener here.
The bill prohibits an impact fee from being passed on to property owners or leaseholders.
The Marcellus/Utica Impact Bill illustrates the House Republican commitment to job opportunities represented by the natural gas industry. It further demonstrates the belief that natural gas exploration and production can be done in a safe and responsible manner.
The House GOP plan creates uniformity to specifically help those communities dealing with the drilling; strengthens the laws, regulations and oversight to protect water and the environment; and brings needed, dedicated funding for programs benefitting the state’s environmental resources.
The Marcellus Shale natural gas industry has already created tens of thousands of jobs, by providing the industry with stability and predictability as House Bill 1950 does, they should stay in Pennsylvania and create jobs and encourage related new businesses in the years to come.
Additional information on the bill can also be found here.
This is how and what the Marcellus/Utica Impact bill does...
Dealing With Local Ordinances:
· Allows local governments a continued voice to determine where drilling can occur in communities.
· Allows local municipalities to continue to use or develop local ordinances relating to oil and gas development that do not conflict with existing state or federal law and allows for the “reasonable development” of oil and gas.
· Allows an operator, owner or anyone with royalty rights under a lease agreement to request the Attorney General to review a local ordinance to determine whether it allows for the reasonable development of oil and gas.
Dealing With Local Impacts:
· Allows counties to decide whether to adopt a fee from Marcellus/Utica drillers – or not; it is solely a local option.
· The money from the fees can be used for:
o Local roads and bridges.
o Water and sewer system construction and/or repair.
o Emergency response for training, equipment and/or recruitment.
o Preserving water supplies.
o Projects aimed at increasing the availability of affordable housing.
o County Conservation District assistance.
o Delivery of social services including domestic relations and drug and alcohol treatment.
o Local planning.
o Local tax reduction.
· Prohibits impact fee costs from being passed on to the property owner or leaseholder.
Dealing With Statewide Drilling Impacts:
· The Commonwealth portion of the Local Impact Fee will support emergency preparedness, regulatory oversight and transportation infrastructure.
o PEMA and the Office of the State Fire Commissioner will plan and oversee emergency response training and planning, and purchase needed specialty equipment.
o The PUC will receive funding for inspecting and enforcing pipeline standards.
o The Department of Health will be funded to investigate and deal with health-related issues and educate the public regarding shale development.
o DEP will have money to plug abandoned oil and gas wells.
o Money will be sent to PennDOT for transportation maintenance.
Helping Statewide Environmental Concerns:
· The House GOP proposal will dedicate portions of the state Oil and Gas Lease Fund to help several state environmental funds:
o County conservation districts, which provides local support and conservation oversight over development projects.
o Environmental Stewardship Fund (Growing Greener), which funds watershed improvements, acid mine drainage remediation, farmland preservation, and open space preservation.
o Up to $5 million for payment in lieu of taxes (to communities with state forest land).
o The Hazardous Site Clean Up Fund (HSCF), with the transfer updated annually based on the CPI (inflation rate), which provides support to clean up sites which have been contaminated through various accidents and/or past processes.
§ The fund currently receives $40 million annually from the Capital Stock and Franchise Tax. The tax is set to expire January 2014.
· The Oil and Gas Lease Fund was created in 1955 by the General Assembly. It is funded by the sale of nonrenewable oil and gas resources owned by the state and reinvesting the money into public conservation assets benefiting all Pennsylvanians.
o Historically, this fund averaged $3 million to $5 million a year before the Marcellus drilling started growing.
o The revenue from the increase in Marcellus Shale leases is up and conservatively estimated to generate $250-$500 million in royalties annually in the coming years.
Holding Drillers Responsible:
The House GOP Marcellus/Utica Shale bill brings regulations up-to-date by addressing new technology in oil and gas development and provides greater protection and accountability. The bill:
· Provides uniformity in safety standards.
· Requires operators to provide notice to property owners within 2,500 feet of the proposed well, as well as the host municipality or any municipality within 2,500 feet of the proposed well.
It helps ensure the safety of residents and local employers by:
· Increasing the setback distances:
o Between a private water well and an unconventional natural gas well from 200 feet to 500 feet.
o To streams, ponds, and other bodies of water from 100 feet to 300 feet.
o Restricts well drilling from within at least 1,000 feet of a public water supply, unless waived by the water supply operators.
· Prohibiting well sites in a flood plain if the site contains storage of hazardous materials, chemicals or cuttings.
· Requiring the well operator to:
o Install security fencing and warning signs.
o Ensure lighting at the site be directed to minimize glare.
o Comply with Federal Energy Regulatory Commission noise regulations.
o Prohibit noise standards above 60dbA for natural gas compressor stations.
o Comply with laws governing air quality.
· Requiring 24-hour notice to DEP before commencing certain critical activities.
If accidents occur, the House GOP proposal holds drillers accountable by:
· Increasing the civil penalties currently in the Oil and Gas Act.
· Requiring DEP to post well inspection reports through its website.
· Allowing DEP the authority to revoke a well permit for non-compliance with applicable state laws.
Additional Provisions:
- Creates the “Clean Transit Program” to provide for loans to large mass transit agencies to purchase new compressed gas buses.
- Creates the “Keystone Transit Program” to provide for competitive grants to small mass transit authorities to purchase new compressed gas buses.
Overview: Counties may implement a local impact fee on unconventional well drilling to be collected and distributed at the county level.
Impact Fee
Impact Fee Schedule (“up to”)