Gov. Tom Corbett Monday announced the Marcellus drilling law enacted in February (Act 13) has generated more than $204.2 million through the new impact fee.  He was joined by Sen. Joe Scarnati (R-Jefferson) a primary author of the bill in the Senate

Most of this money will be distributed directly to local communities across the state.

“The Marcellus industry continues to create jobs and prosperity for our state’s working families,” Corbett said. “We are excited and encouraged by this growth, but we know that every leap forward has an impact. That’s why this impact fee is appropriate; millions of dollars will go directly to help the communities who need it.

“I’ve said it before, energy equals jobs; not just in the industry itself, but in various fields all across Pennsylvania,” Corbett said. “We’re ushering in a new industrial revolution, and we’re doing it responsibly with our world-class environmental standards and by providing the communities who are hosting and impacted by natural gas development with the financial resources they need to address those impacts.”

“The development of the Marcellus Shale industry has been a tremendous asset to Pennsylvania’s economy,” said Sen. Scarnati. “This annual fee revenue collected is being distributed to municipalities and counties to fund a number of local services, from emergency preparedness to road, bridge and infrastructure projects.”

“The Marcellus Shale industry has provided Pennsylvania with numerous family-sustaining jobs, economic growth and the potential for energy independence,” Sen. Scarnati said.  “I am pleased that the municipalities and counties where drilling takes place will soon be receiving significant assistance, without placing any increased tax-burden on citizens.”

Corbett said that counties and municipalities may use these funds on various expenses related to impacts from natural gas development, including:

-- Construction, repair and maintenance of roads, bridges and other public infrastructure;

-- Water, storm water and sewer system construction and repair;

-- Emergency response preparedness, training, equipment, responder recruitment;

-- Preservation and reclamation of surface and subsurface water supplies;

-- Records management, geographic information systems and information technology;

-- Projects which increase the availability of affordable housing to low-income residents;

-- Delivery of social services, including domestic relations, drug and alcohol treatment, job training and counseling;

-- Offsetting increased judicial system costs, including training;

-- Assistance to county conservation districts for inspection, oversight and enforcement of natural gas development; and

-- County or municipal planning.

Under Act 13, state agencies with responsibility and oversight of natural gas development will receive $25.5 million in funding, including the Department of Environmental Protection, the Public Utility Commission, the Pennsylvania Emergency Management Agency, the Office of the State Fire Commissioner, and the Fish and Boat Commission.

In addition, $72.4 million will be distributed to state and local programs through the Marcellus Legacy Fund--

-- $14.4 million to Commonwealth Financing Authority;

-- $7.2 million to Environmental Stewardship (Growing Greener) Fund;

-- $18.1 million for water and sewer projects (PennVEST, H2O Program);

-- $10.8 million for greenways, recreation trails, open space, nature areas;

-- $18 million to PennDOT for highway/bridge replacement; and

-- $3.6 million to DCED for natural gas conversions.

In addition, 60 percent of the remaining funds will be allocated directly to counties and local municipalities that host Marcellus Shale natural gas development.  All told, 35 counties and 1,485 municipalities will share in $108.7 million.

The remaining 40 percent of the revenue – or $72.5 million – will be distributed to all 67 counties and their municipalities across Pennsylvania, and set aside for competitive grants for projects such as water and sewer, local bridge improvements, local community park and recreation, Growing Greener and other municipal projects.

The announcement comes at a time when nearly 240,000 Pennsylvanians are employed directly and indirectly within the oil and gas industry. The $204.2 million in impact fee revenue is also in addition to the over $1.6 billion in corporate, sales and personal income taxes generated by the industry since 2006, including $420 million last year.

Additionally, the abundance of low-cost natural gas has driven electric and natural gas prices down nearly 40 percent since 2008, saving Pennsylvania businesses and consumers over $2 billion annually.  After importing 75 percent of its natural gas just five years ago, Pennsylvania is now a net exporter of gas for the first time in more than 100 years.

“We have said we were going to do this right – for our citizens, our environment, and local communities.” Corbett said.  “I thank the members of the General Assembly who partnered with my administration in enacting this historic legislation. Today’s announcement is a major milestone in this shared goal.”

Click Here for an overall breakdown of impact fee income.  Click Here for a breakdown of fee income by county/local government.

Counties Applaud Early Release Of Drilling Impact Fees

The County Commissioners Association of PA applauded Monday’s announcement by Gov. Corbett that the first-year receipts from the new shale gas impact fee will be released within the next 30 days, well in advance of the statutory December 1 deadline.

The Association also expressed its appreciation to the Administration and to the Public Utility Commission, which has administrative responsibility for the fund, for their collaborative approach to implementing the fee and other administrative components contained in Act 13, amendments to the Oil and Gas Act adopted earlier this year.

According to CCAP President and Lebanon County Commissioner Jo Ellen Litz, “With the financial pressures facing our counties today, and particularly the pressures on our counties whose services are impacted by shale gas development, we truly appreciate the efforts of the Governor and the PUC to make the funds available on an expedited basis.”

While counties are appreciative of the economic development that has resulted from the shale gas industry, CCAP has documented local service impacts ranging from bridge infrastructure, emergency management, and record keeping through criminal justice, human services and affordable housing issues.

She continued, “The early release of the funds is a visible sign of the commitment of the state to help us address these issues.”

CCAP First Vice President and Berks County Commissioner Christian Leinbach concurred: “The early release of these dollars says two positive things: First that the Marcellus Gas industry is already having positive economic impact for our commonwealth and secondly that the strategy employed via Act 13 is providing critical financial support to impacted communities and counties while providing additional aid throughout the Commonwealth.”

He continued, “As counties we appreciate the responsiveness of state agencies to address county’s questions and concerns in implementing the act. We welcome the flexibility we’ve been given to administer funds based on local needs and the commitment of the commonwealth to full public accountability for the distribution and use of these funds.”

The impact fee is paid by producers of shale gas, based on a sliding scale that takes into account individual well production as well as market prices for the resource. The largest portion of the receipts is allocated directly to impacted county and municipal governments, with additional allocations to conservation districts and housing agencies as well as statewide programs to assist with county and municipal bridge infrastructure, local environmental improvement projects, fleet conversion and others.

Marcellus Shale Coalition Statement

Marcellus Shale Coalition president Kathryn Klaber issued this statement regarding natural gas impact fee disbursement announcement made by Gov. Tom Corbett and the Public Utility Commission:

“The safe development of job-creating American natural gas continues to provide significant economic and environmental benefits across our region, and today’s announcement further underscores the fact that Marcellus Shale production is positively impacting every square inch of the Commonwealth. These critical resources will help ensure that local governments are equipped to make the most of this historic opportunity.

“The natural gas industry’s work across the Commonwealth is indeed a true partnership with county and local governments. Importantly, these revenues are being directed to each of Pennsylvania’s 67 counties regardless of where natural gas operations are taking place. In fact, the city of Philadelphia alone will receive nearly $1.3 million, in addition to the positive economic impacts southeastern Pennsylvania has seen – from lower consumer prices to the renewal of the region’s idled refineries

“Our Guiding Principles define our commitment to being responsible neighbors as well as our collective efforts aimed at providing sustainable, broad-based economic and energy-security benefits for all. Without question, today’s announcement demonstrates that our industry is upholding this important promise.”

Legislative Reaction

“Today is a great day for Pennsylvanians, and especially a great day for rural Pennsylvania,” said Sen. Gene Yaw (R-Bradford). “We are talking about tens of millions of dollars that are coming back into our local communities in the Northern Tier, directly benefitting our rural residents.”

Sen. Yaw’s Senate District will receive $42,305,036.23 in impact fee revenue this year, roughly 20 percent of the total $204 million received by the Public Utility Commission who administers the collection and disbursement of the fee.

For more information, visit the PUC’s Act 13 Impact Fee webpage.

NewsClips: PA Details Who Gets Drilling Impact Fee Money

                    PA Communities Share $204 Million In Drilling Fees

                    Local Governments Get Majority Of Impact Fees

                    Big Winners From Gas Drilling Impact Fee

                    How Much Money Each Municipality Receives From Drilling Fee

                    Drilling Payments Cause A Dispute In PA

                    4 Townships Say They’re Owed Impact Fee Money

                    Bradford, Susquehanna Receive Large Share Of Impact Fees

                    Midstate Counties To Grab Share Of Drilling Fees

                    Lehigh, Northampton Counties Share In Gas Fee

                    Lancaster County To Get Drilling Money

                    Drilling Fees Add $1M To Armstrong Coffers

                    Drilling Impact Fees Tiny For Some

10/22/2012