Allegheny County councilman's role in Deer Lakes drilling plan subject of complaint

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A member of the Protect Our Parks coalition who filed an ethics complaint this week said an Allegheny County councilman has a conflict of interest and should recuse himself from the discussion and vote on whether to approve drilling for natural gas beneath Deer Lakes Park.

Councilman Nicholas Futules, D-Oakmont, said there is no conflict of interest and that he does not plan to recuse himself.

The complaint was mailed to the Pennsylvania State Ethics Commission on Thursday by Tim Ludwig, an Etna resident who has been a vocal opponent of the proposed Deer Lakes plan. It says Mr. Futules shouldn't be involved in discussing, debating or voting on the Deer Lakes proposal because he is part owner of property in Penn Hills that has a lease with one of the companies involved.

Mr. Futules, as chair of the council's parks committee, presided this week over council's initial discussions of a plan put forth last month by county Executive Rich Fitzgerald.

The plan, which Mr. Fitzgerald announced March 17, would lease the county's mineral rights for the 1,180-acre park in West Deer and Frazer for natural gas operations by Range Resources and Monroeville company Huntley & Huntley. No drilling operations would take place on the surface of the park, according to the agreement. Instead, horizontal wells would extract natural gas from well pads located on private property surrounding the park.

The deal, if council approves leasing of the land, would yield the county a $4.7 million bonus, plus $3 million for the parks committee and 18 percent in royalties.

The ordinance arrived on council's agenda last week. Mr. Futules set a public hearing that took place Tuesday and scheduled three meetings for council members to discuss the lease, the first of which was held Wednesday. He said he plans to participate when council votes on the ordinance.

Mr. Ludwig said he should recuse himself from the entire process. Mr. Futules' family owns land that contains a shallow well leased to Huntley & Huntley, a financial interest that he has disclosed.

"It's a pretty obvious conflict of interest," Mr. Ludwig said in an interview Friday.

Mr. Futules said the lease in question is one on Futules family land in Penn Hills. He said his family has had a lease for a shallow natural gas well with Huntley since the mid-1990s, and said he receives about $250 a month in royalties.

He sent the Pittsburgh Post-Gazette a copy of a letter from council solicitor Jack Cambest, providing the legal opinion that there was not an ethics violation. Mr. Futules said he also had sought a second advisory opinion, from the State Ethics Commission, and expected to receive a similar answer from that agency.

The issue, when it comes to determining whether a conflict exists, is whether he would benefit financially from the outcome of the Deer Lakes ordinance vote, Mr. Futules said.

"The answer is absolutely no," he said.

"In our minds, that doesn't make a difference," Mr. Ludwig said. "He's still receiving income from that company."

John DeFazio, a Shaler Democrat who is president of council, said he has personally spoken to Mr. Cambest, the solicitor, about whether Mr. Futules' lease represents a conflict. He said he has concluded it doesn't.

"It doesn't gain him anything," he said.

Mr. Futules, co-owner of the Futules' Harmar House banquet facility, motel and catering business, did abstain from council's 2007 vote on the county drink tax.

Discussion about the Deer Lakes plan will continue next week. At the parks committee meeting Wednesday, Mr. Futules said he expects council members will hear presentations by representatives of Range Resources and by Allegheny County Emergency Services Chief Alvin Henderson.

Council members will be able to pose questions to the presenters, as well as legal questions about the lease and ordinance to a panel including Mr. Cambest, county solicitor Andrew Szefi and Stonecipher Law Firm attorney Beau Beard, who was hired by the county to help draft the lease.

Also on the docket for county council next week is a committee meeting set for Thursday to discuss a proposal by Councilwoman Sue Means, R-Bethel Park, who wants council to hire an attorney to conduct an "independent legal review" of the lease.


Kaitlynn Riely: kriely@post-gazette.com or 412-263-1707. First Published April 18, 2014 12:29 PM

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