PUC: Drilling Impact Fee Revenue Drops Below $200 Million This Year

The Tribune Review reported Wednesday the state will collect about $6 million less in drilling fee revenues for the 2012 reporting year than during the first year of collections-- $198 million versus $204 million-- bringing the total collected so far to $402 million.

Lower natural gas prices and a lower second year fee for some wells resulted in the reduction.   The Impact Fee producer payments for 2012 were due to the Public Utility Commission April 1.

“Act 13 is a law that has helped bring Pennsylvania forward both economically and environmentally,” Gov. Corbett said. “In addition to enacting some of the most rigorous environmental standards in the nation, we’ve brought in more than $400 million for our communities directly impacted by unconventional drilling, along with other environmental efforts across the state.”

“As this industry grows, benefitting all Pennsylvanians with thousands of new jobs, lower energy prices, and increased energy independence, Act 13 has played a key part in our role making sure that it grows safely and responsibly,” Corbett said.

Payments for some wells are still being challenged by some producers. As per the law, disputed wells are not reflected in the current data available. Any additional payments received from these disputed wells will be updated on the website and included in the 2012 Reporting Year disbursement if they are received prior to when the calculations are made to distribute the funds.

“I am pleased to see the positive effect that the Marcellus Shale Impact Fee revenue funds are having across our state,” said Sen. Joe Scarnati (R-Jefferson).  “This reasonable impact fee on the industry provides the necessary funding to protect Pennsylvania’s natural resources, particularly during a time when we continue needing to find ways to stretch our tax dollars.”

Sen. Scarnati was a chief architect of the Marcellus Shale Impact Fee legislation, which was enacted last year after considerable discussion among state government, local government, citizens, representatives of environmental groups and representatives of the industry.

The law protects the environment by providing for environmental safeguards, while also imposing a reasonable annual impact fee on each well.

“The passage of Act 13 last year was a major achievement for Pennsylvania residents,” Sen. Scarnati said. “The Marcellus Shale Impact Fee legislation is the result of great collaboration between Gov. Corbett, members of the House of Representatives and my colleagues in the Senate.”

“The provisions laid forth in Act 13 are ensuring that our environment is protected, counties and municipalities receive the funding they need and also place an increased level of transparency on natural gas drilling,” Sen. Scarnati said.  “The feedback and response we have received from individuals regarding Act 13 is extremely positive, yet I am amazed that there are local officials in Derry Township Westmoreland County, for example, who are actually complaining about receiving millions of dollars for local projects.”

Sen. Scarnati also stated that the zoning provisions laid forth in Act 13 are currently being reviewed by the Supreme Court.

“The shale industry has brought tens of thousands of family-sustaining jobs and economic growth to Pennsylvania, hopefully including a soon-to-be $2 billion ethane cracker plant. It is important that we continue to see this significant economic growth within our state.  It is my hope that the Supreme Court will recognize the importance of providing the industry with increased stability through validating the zoning provisions in Act 13,” Sen. Scarnati said.

Marcellus Shale Coalition CEO Kathryn Klaber issued the following statement regarding the release of 2012 impact fee revenue data by the Public Utility Commission:

“This is more exciting news for the Commonwealth, with literally every Pennsylvanian benefiting from responsible Marcellus development, even as commodity prices remain at historic lows.

“These funds, in addition to the hundreds of millions in natural gas-related tax revenue, are ensuring that critical projects and investments will continue across the state, regardless of where natural gas production occurs.

“It’s also a stark reminder that these benefits should not be tempered by policies that discourage safe, tightly-regulated natural gas development, especially as it relates to local zoning.”

Interactive Fee Webpage

The PUC Wednesday introduced an interactive website that allows users to better examine information related to the collection and distribution of the state’s unconventional gas well Impact Fee.

“In administering the Impact Fee, the PUC has been unwavering in our efforts to be transparent with the implementation of the law,” said PUC Chairman Robert F. Powelson. “This website takes that to the next level by providing an interactive, searchable resource where residents, local officials or anyone interested in the Impact Fee can view what money was collected and distributed as well as the calculations behind those numbers.”

 The website includes graphical data analysis including the top paying producers, well count breakdowns and top collecting counties and local governments.

Additional information on the amount of money expected for 2012 as well as the amount of money collected to date can be found on the website.

Payments for some wells are still being challenged by some producers. As per the law, disputed wells are not reflected in the current data available. Any additional payments will be reflected as they are received before calculations are made to disburse the funds.

Users also can search statistics such as money paid by producers or money dispersed to state, county or local government. The information also breaks down the distribution calculations outlined in the law in areas such as eligible wells per county/ municipality and distributions to municipalities and counties with qualifying wells and to municipalities that are located within a county with qualifying wells and are contiguous to a municipality with wells or within five miles of a municipality with wells (based on population and highway miles calculations).

Distributions of the Impact Fee by the PUC are due to county and municipal governments by July 1. County and municipal government information on how the 2011 Impact Fee monies were spent are due to the PUC by April 15.

On February 14, 2012, Gov. Corbett signed into law Act 13 of 2012, the Unconventional Gas Well Impact Fee Act, which amended Title 58 (Oil and Gas) of the Pennsylvania Consolidated Statutes. 

The PUC is responsible for implementing the provisions contained in Chapters 23 and 33 of the Act. Chapter 23 provides for the imposition, collection and distribution of an unconventional gas well fee (also called a drilling impact fee).

Chapter 33 governs local ordinances that impose conditions, requirements or limitations on oil or gas operations.

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

At its April 16 meeting, DEP’s Citizens Advisory Council will hear a presentation from PUC Commissioner Pamela Witmer on Act 13 drilling fees received and how it was distributed.

NewsClips:

Drop In Natural Gas Prices Hits Drilling Fee Revenue

PA Will Get 3 Percent Less In Drilling Fees

Impact Fee Proceeds Decline With Price Of Gas

Towns To See Fewer Drilling Fee Dollars


4/8/2013

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