Go beyond Act 13: Gas companies should acknowledge local needs in community compacts
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Recent passage of amendments to Pennsylvania's Oil and Gas law -- Act 13 -- is a gateway to Pennsylvania's fourth energy wave as natural gas from shale beds succeeds a couple of centuries of coal mining, the Titusville oil and shallow gas era, and the dawn of nuclear power.
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Act 13 represents an abridgement of local land use controls, usurping powers, rights and responsibilities that have traditionally been the purview of municipal government.
How you see it depends on where you sit.
Act 13 was intended to expedite unconventional gas drilling by providing a uniform set of statewide standards and requiring impact fees to offset the effects of drilling. It was meant by supporters to encourage investment by giving companies regulatory and financial certainty.
But the law also requires municipalities to allow oil and gas operations in all zoning districts regardless of what local codes say. It gives local officials no say on the location of drilling rigs, wastewater pits and compressor stations -- all activities that could affect local property values and, more importantly, human health and the environment. While municipalities must be notified of well-permit applications and may comment on them, the law gives the state the power to make final decisions that cannot be appealed.
Municipalities fought these provisions even before Act 13 was passed. On Wednesday, seven that had filed suit in Commonwealth Court to strike down the impact fee and restrictions on local zoning powers won a stay of 120 days on the zoning limits. Some statewide environmental and nongovernmental organizations have gone on record against this jurisdictional change, too. And citizen activism throughout the state is on the rise.
Critics of the law point out that residents no longer can turn to their local officials for help if they are harmed by this heavy industrial activity. Instead, the Department of Environmental Protection, the Public Utility Commission and the courts will be the arbiters of disputes, moving decisions further away from those most affected by them.
As a result, rather than being content to deal with state agencies of which they have little knowledge and in which they have little faith, the public has begun and will likely continue confronting companies directly to get answers to their questions, concerns and complaints.
At its core, the issue here isn't about bureaucracy, sovereignty or business certainty. It's about a community's sense that it can control its own future. Smart companies will recognize this and respond by going beyond Act 13 dictates and engaging with local stakeholders rather than sticking strictly to the limits of the law.
Disputes resolved outside of the legal process can work to everyone's benefit. And the company that sees this as a part of providing better customer and community service will gain a competitive advantage, as well as avoiding continuous -- and costly -- confrontations.
One approach could be for companies to form voluntary compacts with communities where their wells and supporting infrastructure are located. Similar to the host agreements used by the waste and gaming industries to structure their relationships with local governments and residents, compacts could address a range of issues that may be critical to a community, but reside beyond the requirements of Act 13.
Each compact could be tailored to meet stakeholders' expectations, needs and preferences. One community may want to take advantage of the economic benefits created by gas extraction by working with the company to establish goals for local hiring, purchasing and other opportunities to direct economic benefits towards residents.
Other compacts may choose to emphasize more effective communication between the company and community. Establishing hot lines, websites, advisory panels and other methods to encourage stakeholder involvement can foster greater transparency, trust and understanding among all parties and lessen reliance on legal remedies.
Some communities may want to enlist a company's support for land preservation, enhancement and restoration efforts. A compact might prove a useful framework to discuss such a relationship.
The coming years will see tremendous growth in natural gas drilling in Pennsylvania. Tens of thousands of wells will come on line in about 40 of the commonwealth's 67 counties, and pipelines may affect most of the rest. Everyone agrees that the growth of this industry will affect our state for decades.
Act 13 is -- unless the courts decide otherwise -- a first step in trying to wring out the benefits of this new resource while minimizing its possible adverse affects on people and the land. What no law can do, though, is force the industry and communities to live in relative harmony with each other. That's up to them to work out. The compact model might just serve their purposes.
First Published April 15, 2012 12:00 am