Allegheny County Council goes deep into Deer Lakes drilling plan

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In Allegheny County, April has quickly become Deer Lakes Park month.

The county is considering a proposal for gas drilling beneath Deer Lakes Park, a 1,180-acre green space in Frazer and West Deer. Allegheny County Executive Rich Fitzgerald last month announced the details of the proposed deal with Range Resources and Huntley & Huntley, and on April 2 held a public meeting about the plan in West Deer.

Now, the 15-member Allegheny County Council must consider an ordinance that authorizes leasing of the county's mineral rights beneath the park, with the condition that no drilling occur in the park.

Supporters say the plan adds protections for drilling operations already underway in northern Allegheny County, and that opponents say wrongly provides use of a county park for industrial activity.

Council will hold a public hearing on the topic at 5 p.m. Tuesday. Council's parks committee will hold meetings at 5 p.m. on the next three Wednesdays to talk about environmental and safety factors, legal questions and economic factors.

Likely to be at the center of all this talk? The lease proposed by Mr. Fitzgerald, a document he has called the "most comprehensive non-surface lease" in Pennsylvania.

At 80-plus pages, it is no quick read. Kit Pettit, however, has read it.

Mr. Pettit, an attorney who leads the oil and gas practice for Downtown law firm Bernstein-Burkley, P.C., last year reviewed for the Pittsburgh Post-Gazette the lease for drilling on county-owned lands near Pittsburgh International Airport.

An attorney who represents landowners, including some in the area near Deer Lakes Park, Mr. Pettit says he cannot say whether it is the most comprehensive non-surface lease in the state. But he said it is the most comprehensive one he has read.

"It is certainly above and beyond, with respect to the typical non-surface oil and gas lease," he said. That's largely because, though it is a non-surface oil and gas lease, it controls surface users in the larger area.

"That is where the real value is, is not only did the county get a non-surface lease, but they've also been able to restrict the gas company's operations on the properties on which they do have surface rights," Mr. Pettit said. "And you don't often see that."

The deal calls for Range and Huntley to give the county a $4.7 million bonus payment, another $3 million for a Parks Improvement Fund and 18 percent in royalties. In terms of economics, the bonus payment, at $4,000 an acre not including the parks improvement fund, is above the current market value for the area by about $1,000, Mr. Pettit said.

Mr. Fitzgerald, announcing the proposed lease March 17, touted enhanced terms such as an expansion of Pennsylvania Department of Environmental Protection water testing requirements, coordination with local fire departments for safety plans, and requirements that Range makes county road repairs, among others. An updated lease was posted on the county's website late last week, showing "modifications/clarifications and correction of typos" that Mr. Fitzgerald said Friday was "nothing substantial."

The county, in crafting the lease, hired N. Beaumont Beard of Stonecipher Law Firm, and county solicitor Andrew Szefi told council members last week that the county "would not have as good a lease as we have" without hiring Mr. Beard.

"Range and Huntley & Huntley have agreed to many more terms and conditions than they would typically agree to in any individual landowner's lease," Mr. Pettit said. The typical lease for an individual landowner is eight to 10 pages, he said.

Some enhancements he pointed out in particular were provisions on noise and light pollution, traffic impacts and road repairs for county lanes and water testing 1,000 feet beyond DEP requirements.

For a community that went through a coal mining era that was "incredibly destructive," many residents in the area -- though certainly not all -- see the lease agreement as a way to gain additional protections, said Gerry Vaerewyck, a township supervisor for West Deer.

Mr. Vaerewyck, who said he has a Huntley & Huntley lease on his 10-acre property, cited protections regarding road use as well as the prohibition against drilling activity in the park, one of West Deer's biggest features, as positive components of the lease.

"The fact that the county is able to negotiate those aspects with them is a big help," he said.

But opening land beneath a county park to gas drilling is a line that many people say they do not want to cross. PennFuture opposes drilling beneath Deer Lakes Park, or any county park for that matter.

"Our position is that existing parks should not be a magnet for increased industrial activity," said George Jugovic, an attorney with PennFuture. And looking at the lease, he said the proposal has shortcomings. Although the lease requires water testing, it doesn't explicitly outline what must be tested for, Mr. Jugovic said.

"We thought that would be something that they could have worked into the agreement," he said.

He said the lease also should have required testing of groundwater, additional air monitoring requirements, and should route all proceeds from drilling into parks improvements. He also said he was concerned wording in the lease would allow Range to shift the cost of any future taxes Pennsylvania imposes on gas drilling to the county by reducing its royalty payment.

Protect Our Parks, a coalition that has been vocal against the drilling plan at county meetings for months, prepared a four-page response to lease proposal. The group lists first their concern that the ordinance the county council will vote on does not have the lease document attached to it, which they said could allow future changes to be made to the proposal.

As for the lease itself, the portion of the lease that calls for Range and Huntley to coordinate to "minimize" the impact of their trucks to school bus traffic won't reduce the number of heavy vehicles on the narrow, winding roads in the area, the document says. The lease also doesn't guarantee how much of the $3 million parks improvement fund will go to Deer Lakes Park in particular, it says.

And although the lease requires Range to hold two job fairs, John Detwiler, a retired engineer and a Protect Our Parks member, said he doubts they will lead to many new jobs, because the lease doesn't require the company to hire anyone.

"[Rich Fitzgerald] hasn't come away with very much," Mr. Detwiler said after reviewing the lease.

But not all environmentalists oppose the lease.

Jeanne Clark, a Pittsburgh activist who worked for PennFuture as its communications director for more than a decade, spoke in favor of the lease earlier this month at the West Deer meeting. The lease, she said, would provide enhanced protections for the park and the people who live near it. She urged members of council to approve the plan.

In a subsequent interview, she said that as a member of the energy and environment vision team created to advise Mr. Fitzgerald after he entered office, she had been part of early discussions about drilling on county lands. She reiterated a point often made by Mr. Fitzgerald: that gas drilling operations are happening in the area around Deer Lakes Park anyway, and that the lease adds enhancements.

"It will protect the park, it will protect the local community, and it will be a real benefit for the citizens of Allegheny County," Ms. Clark said.


Kaitlynn Riely: kriely@post-gazette.com or 412-263-1707.

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