Marcellus shale, a rock formation seated deep beneath the ground all over Allegheny County and much of Pennsylvania, is reportedly one of the biggest natural gas reserves in the country.
Allegheny County Council President Rich Fitzgerald believes the Marcellus shale could be the answer not only to the county's budgetary woes but also to relieving the tax burden on cash-strapped county homeowners in these tough economic times.
To that end, Mr. Fitzgerald, D-Squirrel Hill, yesterday introduced legislation that he said will establish a county policy on developing and increasing energy efficiency in county operations, and at the same time yield homeowners about $55 million in property tax reduction.
A mechanical engineer by trade, Mr. Fitzgerald described his proposal as a "bold economic development initiative" and said the county should set in motion a plan to start extracting, using and selling the natural gas contained in the area's Marcellus shale.
"The county taxpayers are sitting on a very valuable asset, natural gas in the form of the Marcellus shale ... we could tap [these natural gas reserves] at the very least, to heat our own buildings, explore natural gas electric generators, and sell our excess on the open market," he said.
Such a plan, he said, could yield the county as much as $55 million, which is what the county spends on heating, lighting, cooling and operating its buildings and facilities. Instead, he said, the county could then pass on the savings from its energy costs to homeowners in the form of tax relief.
If that happens, county homeowners would see a reduction in their property taxes by as much as 1 mill of the county property tax rate, which is currently 4.69 mills. In real terms, the savings, he said would amount to about $200 a year for a $200,000 house.
Mr. Fitzgerald introduced his proposal at County Council's meeting yesterday and it was moved to the Government Reform Committee where it will be debated before the full council votes on the proposal sometime in the next few months.
In September, the county's Airport Authority wanted to sell off natural gas rights under Pittsburgh International and Allegheny County airports, but it received no bids even after county and Airport Authority officials fought over the rightful owner of the natural gas rights.
Establishing ownership of the gas rights will be a fundamental step if Mr. Fitzgerald's plan is to be implemented, said Kevin Evanto, spokesman for Allegheny County Executive Dan Onorato.
"It's a matter of doing title searches on all the county land to determine who actually owns the natural gas rights on county land," Mr. Evanto said. He added that a panel Mr. Onorato put together to study gas rights ownership at Pittsburgh International Airport did not complete its fact-finding when no bids were tendered for the Airport Authority's plan to sell off natural gas rights.
"When nobody responded to the request for proposal, the issue sort of became moot, but we think it's a smart idea to get a handle on who owns what on all county land now," said Mr. Evanto.
The Airport Authority received no bids at the time because of plummeting of natural gas prices, Mr. Fitzgerald said, "but the prices will go up again and even if they don't, we should be moving towards using our own natural gas in county-owned buildings and facilities to save some money."