Pennsylvania communities to share $204 million in Marcellus Shale impact fees

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HARRISBURG -- Nearly 1,500 towns across Pennsylvania and each county government will share $204 million in the coming days as a result of the new fee that shale gas drillers paid on their wells, state officials announced this morning.

That's the amount raised in drilling impact fees from energy companies operating in the state's Marcellus Shale region.

Drillers paid the $50,000 fee on each of 4,022 horizontal shale wells. Another 311 shallower vertical wells were assessed at a lesser rate of $10,000 each.

Gov. Tom Corbett, who supported the per-well fee over alternative plans for a drilling tax based on gas production, said at a news conference this morning that the fees are structured in a way that will ensure communities bearing the brunt of the activity receive "nothing less than their fair share" of compensation.

"When we were confronted with the challenges and opportunities of this emerging industry, our goal was to get things right, " Mr. Corbett said. "I think today's number of $204 million is a clear sign that we did."

The drilling impact fee was approved as part of the Marcellus Shale law passed by the Legislature in February, known as Act 13. The law also overhauled environmental rules and outlined what towns can and cannot control in regard to gas drilling.

Of the revenues raised through the new law, $109 million will be distributed to county and municipal governments in the state's shale drilling region.

Slightly more than one-third will be doled out to counties, with Bradford and Tioga in the state's northeast and Washington in the southwest receiving the largest shares. Bradford will receive $8.4 million, Tioga is slated for $4.8 million, and Washington can expect a check topping $4.4 million.

Allegheny County is slated to receive about $1.1 million, a total that includes $79,000 based on the number of local wells and slightly more than $1 million from the statewide "legacy fund" that can be used for bridge or recreation projects.

All 67 counties will receive a portion of the legacy fund, regardless of whether they have any shale gas wells. Those dollars are divided based on population. Philadelphia County will receive nearly $1.3 million from that portion of the revenue.

The remaining local dollars not distributed to counties -- about $68 million -- will go to towns that host or are close to well sites. Public Utility Commission chairman Rob Powelson said local officials can expect to receive checks within the next 10 days.

Four southwestern towns that have seen their local ordinances challenged -- Allegheny County's South Fayette, as well as Cecil, Robinson and Mount Pleasant in Washington County -- will not be receiving checks while their drilling rules are pending state review.

If the towns' ordinances are deemed to exceed their local authority under the new state law, the towns will not be eligible for the funding until their ordinances are revised.

Greene County commissioner Pam Snyder, who attended this morning's news conference, said local officials had been waiting for the final totals to be announced before they began to figure out how to spend those new dollars.

"That process starts now," Ms. Snyder said, adding that water and sewer updates, housing assistance and back-filling the county's reduced state human services dollars are top contenders for funding. homepage - breaking - state - marcellusshale

Harrisburg Bureau Chief Laura Olson: lolson@post-gazette.com or 717-787-4254. First Published October 15, 2012 4:15 AM


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