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House Democrats Adopt Budget Diverting, Cutting $459 Million In Environmental Funding
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House Democrats this week approved a budget bill, largely mirroring Gov. Rendell's proposal, that cuts and diverts over $459 million from environmental programs to help balance the state budget. The proposal all but zeros out DCNR's Oil and Gas Fund, taking and additional $143 million.

The proposal also diverts $21.3 million from the Keystone Recreation, Parks and Conservation Fund, however, it is unclear whether this is from DCNR's portion of the Keystone Fund (House Democrat Financial Summary).

The House Democrats also propose, as one option, to fund a portion of community college, PHEAA and other higher education costs with $87 million of an expected $107 million from a new natural gas production severance tax.

This new Higher Education Fund proposal is at odds with House Bill 1489 (George-D-Clearfield) approved two weeks ago by the House Environmental Resources and Energy Committee. The Committee earmarked 40 percent of the revenues-- $42.8 million-- to support environmental and conservation programs. (PA Environment Digest 6/29/09)
 
House Democrats did add about $500,000 to funding for conservation districts in the Department of Agriculture and moved the $350,000 for the PA Center for Environmental Education and $206,00 for the McKeever Environmental Center to the new Higher Education Fund that has no funding source.

There are no details available yet on whether the $10 million Resource Enhancement and Protection (REAP) farm conservation tax credit was funded.

The House Democrat/Governor's proposal is built on a series of $459 million in cuts and diversions proposed since the Governor's February budget address--

-- $77 million in proposed cuts by the Governor to the departments of Agriculture, Conservation and Natural Resources and Environmental Protection (PA Environment Digest 2/9/09);
-- $50 million in Act 339 wastewater plant operations grants not included in the 2009-10 budget;
-- $174 million diversion of DCNR Oil and Gas Fund revenues to General Fund (PA Environment Digest 2/9/09);
-- $12.5 million in additional cuts to environmental agencies in June (PA Environment Digest 6/29/09)
-- $ 3 million in a third round of cuts agreed to by the Governor and House and Senate Leadership last week (PA Environment Digest 7/13/09); and
-- $143 million diversion of DCNR Oil and Gas Fund revenues to General Fund by House Democrats this week( House Democrat Financial Summary).

The total jumps to $502 million if the option to fund higher eduction costs by diverting what was proposed for environmental funding in House Bill 1489 and the diversion from the Keystone Fund turns out to be from DCNR's share.

Other Budget Proposals

Compared to the other budget proposals on the table, the House Democrat/Governor's proposal cuts or diverts less environmental funding overall-- $459 million-- compared to the Senate Republicans and House Republicans, but makes the cuts and diversions in much different places.

Senate Republicans cut a total of roughly $552 million, but many of the cuts are to line items that fund agency personnel so the cuts will have a different impact. (PA Environment Digest 5/11/09)

House Republicans cut a total of about $530 million, but again more in line items that fund agency staff and call for leasing more State Forest land for natural gas drilling. (PA Environment Digest 9/13/09)

These estimates include the diversion of $174 million from the DCNR Oil and Gas Fund that all parties have agreed to do.

One big caution.These comparisons are always very rough because there are details and assumptions in each budget proposal that often do not come to light until later.

Over $1
Billion Lost In Environmental Funding

If the House Democrat/Governor's budget proposal is adopted, and the worse case scenarios come true, it means that over the last six years $1.09 billion in environmental funding has been diverted to balance the budget or pay for programs that could not get funding on their own.

Here's the list of major funding cuts and diversions in the last six years prior to this week's House Democrat/Governor's proposal--

-- $324 million intended to support wastewater plant operations over the last six years to balance the budget;
-- $100 million in 2002 from the Underground Storage Tank cleanup insurance fund to balance the budget (although this is slowly being repaid over 10 years);
-- $52.7 million “one-time” diversion from the Keystone Recreation, Parks and Conservation Fund in 2006 to balance the budget;
-- $50 million in 2007 and 2008 from the Environmental Stewardship Fund, which supports mine reclamation and watershed restoration, to fund the Hazardous Sites Cleanup Program because there was no agreement on how to fund that program;
-- $50 million in 2007 and 2008 from the Environmental Stewardship Fund to pay debt service on the Growing Greener II bond issue and taking funding away from restoration projects each year for the next 25 years – reflecting a pattern of only environmental programs being required to address their own bond debt service;
-- $15 million from the Recycling Fund in 2008 to balance the budget; and
-- $18.4 million put into budgetary reserve in 2008-09 from the Department of Environmental Protection and Department of Conservation and Natural Resources.

Growing Greener Ends

Compounding the impact of all these proposed environmental funding cuts is the fact that Growing Greener II funding will run out next year leaving little or no state funding for mine reclamation, watershed restoration, oil and gas well plugging and other Growing Greener programs.

7/20/2009

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