State shale report recommends limited impact fee
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HARRISBURG -- The report from Gov. Tom Corbett's panel of Marcellus Shale policy advisers is out, and an initial look shows several hotly debated issues -- including an impact fee and changes to mineral rights law -- are among the commission's 96 recommendations.
The 137-page report will be a basis for legislative debate this fall, as lawmakers here begin to craft comprehensive measures on environmental protection, drilling safety issues and a drilling impact fee.
As the panel detailed in its final meeting last week, the report recommends "the enactment of -- or authorization to impose a fee for -- the purpose of mitigating and offsetting the uncompensated portion" of impacts from shale gas drilling.
It lists more than a dozen types of local impacts that commission members found during their 120 days of reviewing the state's oversight and assistance to the natural gas industry. Those range from demands on public safety, environmental remediation and strains on local housing availability.
A page at the end includes some cost estimates that the commission received from local officials, but it does not include any direction on how much should be charged or how it should be assessed over time.
But while legislative leaders have said they want to see a fee that includes funds for statewide environmental programs and other projects, the commission said any fee approved should be limited in its scope. They also urged some standardization of local zoning laws, something the drilling industry has long sought.
"The imposition of any fee should be accompanied by appropriate statutory changes to ensure fair and consistent municipal regulation which does not unreasonably impede the development of natural gas," stated the report.
"Any fee should include a correlation between the amount of the fee and costs incurred; should recognize the ongoing nature of certain impacts; and should be done in a manner that does not discourage maintaining or expanding partnerships between well operators and local communities."
They also suggested that Pennsylvania "modernize" its conservation law, which seeks to ensure that drilling is done in a way that most efficiently removes the gas. In order for that to happen, resources at a certain depth below the Marcellus Shale can be "pooled." That would allow a gas company to extract those resources whether someone has leased them or not, though the company would be required to pay a royalty to the owner of those pooled mineral rights.
Following the 15 pages of recommendations, the report includes topical summaries of the more than 650 comments they received during the fact-finding process. The remainder of the report is devoted to a history of the Marcellus Shale, gas drilling in Pennsylvania, and the rules and regulations currently governing that industry.
Lt. Gov. Jim Cawley, who chaired the 30-member commission, lauded the report as the beginning of significant policy change.
"Today, Pennsylvania is taking an important, first step toward creating tens of thousands of jobs and leading the nation toward energy independence and doing so in an environmentally responsible way," said Mr. Cawley in a statement.
First Published July 22, 2011 12:34 pm