Compromise drilling fee could generate $190 million first year
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HARRISBURG -- The Marcellus Shale legislation expected to come up for a vote this week is projected to raise more than $190 million in its first year, rising to $333 million by 2015.
That projection was among the details distributed to Senate Democratic lawmakers as both chambers prepare for speedy votes this week on the proposal.
A bipartisan conference committee is expected to be formed this afternoon to approve the Republican-negotiated version of the regulatory and impact fee bill, according to top Senate staffers. A vote in the Senate could occur as soon as this evening, followed by a vote in the state House of Representatives as soon as Tuesday.
A 173-page draft of the anticipated shale proposal says the plan would peg the per-well fee to the price of natural gas. That tiered system would raise between $190,000 and $355,000 per well over 15 years, compared with the House version's $160,000 over 10 years and the Senate's $360,000 over 20 years.
The measure would distribute 60 percent of the funds to local governments with gas drilling, with the remaining 40 percent to be deposited into a state Marcellus Legacy Fund. That fund would provide money for water and sewer projects, bridge repairs, plugging of old wells, and recreation projects, as well as for giving incentives to companies to locate an ethane cracker plant or other refinery facility in the commonwealth.
The drilling fee would not be charged on a statewide basis. Each county will be able to decide whether to charge the fee. If a county decides not to charge a fee, local officials in half of the municipalities in the county could vote to override that decision and charge the fee.
The 40 percent local share of the fee would be divided among the county, municipalities that have wells and municipalities that have damage or other impact from wells in nearby communities.
A county that chooses not to charge a drilling fee would lose its local share.
Other funds would be doled out, prior to those distributions, to county conservation districts, the Fish and Boat Commission, the Public Utility Commission, the Pennsylvania Emergency Management Agency, the state fire commissioner, and for a three-year program to convert vehicle fleets to natural gas.
First Published February 6, 2012 3:25 pm
