What’s In Gov. Wolf’s New Budget For The Environment? Not Much
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Gov. Tom Wolf Tuesday proposed a $32.7 billion General Fund budget along with $2.7 billion (Republicans say $3.6 billion) in personal income, Sales, tobacco, Bank Shares, and  insurance premium tax increases. 

He also proposed a new severance tax on natural gas production, with a credit toward the drilling impact fees paid, to go into the General Fund, and an increase in the state waste disposal fee from $7.25 to $9.00/ton.

The proposed budget includes $50.9 million in additional General Fund support for the Department of Conservation and Natural Resources to take another step toward weaning the agency off the Oil and Gas Lease Fund revenue.

The proposed budget would increase the state waste disposal fee by $1.75/ton with the resulting $35 million in revenue to be deposited in the Oil and Gas Lease Fund (page H48) to help make up for the loss of revenue from DCNR natural gas royalties to the Fund.

The existing and new waste fees are also proposed to be expanded to construction and demolition and residual waste which are not now covered.  Captive waste landfills would remain exempt from the waste fees.

The current fees are $4.25/ton to pay debt service for the Growing Greener II bond issue (it was used annually to fund Growing Greener Projects), a $2.00/ton recycling fee and a $1.00/ton minimum host community benefit fee.

The fee increase and expansion are necessary, according to the proposal, to allow the continued transfers out of the Oil and Gas Lease Fund to the Environmental Stewardship (Growing Greener) Fund and the Hazardous Sites Cleanup Fund required by Act 13.

$35 million is to be transferred to the Environmental Stewardship Fund and $15 million to the Hazardous Sites Cleanup Fund in FY 2016-17.

A change in law is needed to raise and expand the waste disposal fee.  If the fee increase is not enacted, there will be reduced funding available for both the Growing Greener and Hazardous Sites Cleanup programs.

What Wasn’t Proposed

What Gov. Wolf did not propose was any way to fund the Chesapeake Bay cleanup program reboot the Administration announced on January 21

That announcement said, “obtaining additional resources for water quality improvement by participating in planning a new round of “Growing Greener” funding, which will have Bay compliance as a primary goal, potentially making available several hundred million dollars to devote to local water quality issues and ultimately Bay compliance” was a priority in the strategy.

What the Governor proposed was a cost-to-carry budget, with only a few environmental initiatives--

-- $2 million to fund eFACTS permit information system replacement at DEP;

-- 2 new positions for Covered Device (electronics waste) Recycling Act Administration at DEP for a total of 2,691 full-time positions, although the freeze imposed by the Governor’s Budget Office prevents 200 vacancies from being filled;

-- $2.5 million increase in PA Conservation Corps at DCNR;

-- 1 new position for PA Conservation Corps for a total of 1,427 full-time positions, although the freeze imposed by the Governor’s budget office prevents vacancies from being filled;

-- $0 for Heritage Parks Program; and

-- $0 funds will be transferred from the Marcellus Shale Legacy Fund to DEP in FY 2016-17, $10.3 million was transferred in FY 2015-16.

The Governor did not mention the environment once in his remarks.

5 Things To Look For

Of the five major items the Digest said to look for last week, the three big ticket items were a disappointment--

1. Will The Downward Spiral Of Funding/Staff For DEP Change?  No, the Governor proposed a cost-to-carry budget with an increase of 2 positions in DEP’s complement for the Covered Device (electronics waste) Recycling Act and 1 position at DCNR.

2. Will The Next Growing Greener Proposal Focus On Restoring The Environment? There was no next generation Growing Greener funding program announcement in the Governor’s budget proposal.

3. Investing DCNR’s Oil & Gas Fund In Conservation, Not Operations: Yes, the Governor’s proposal includes another $50.957 million to shift funding for administrative costs from DCNR’s Oil and Gas Fund.

4. Keep The Keystone, Recycling, Storage Tank And Other Environmental Funds Whole: Yes, based on what we know now.

5. Will A New Severance Tax Proposal Return Drilling Revenues To Help The Environment?:  No. A 6.5 percent natural gas severance tax was proposed, with a credit for Act 13 drilling impact fees paid, and would go into the General Fund.

Given the fact Gov. Wolf said he based his FY 2016-17 budget on the “agreed-to” budget framework, comparing his budget proposals to previous budgets gets complicated.

To simplify the comparison, here are a series of charts that presents budget numbers in each of the categories: FY 2014-15, the “agreed-to” budget framework, the Republican-passed budget Gov. Wolf signed in December, the “as signed FY 2015-16 budget Gov. Wolf line-item vetoed and the Governor’s FY 2016-17 budget.  (Click Here if you cannot read the charts correctly.)

                                                       “Agreed-To                                   As Signed       Governor’s

DEP                      FY 2014-15      Framework”     GOP Budget    FY 2015-16   FY 2016-17**

General Operations

12,432

13,126

13,376

13,376

16,032

Env. Program

28,517

29,522

28,277

28,277

31,085

Env. Protection

84,438

89,305

87,172

87,172

92,190

Conservation Dist.

2,506

2,506

2,506

2,506

2,506

Sewage Facilities

0

610

900

0

0

DEP CAC

 

250

0

 

0

Total G.F.

139,233

[or 141,488]**

147,555

143,520

142,620

[or 148,824]**

156,248

Source: Governor’s Budget Office- December Tracking Run

**Source: Governor’s 2016-17 Executive Budget Document

Initiatives/Changes:

-- $0 funds will be transferred from the Marcellus Shale Legacy Fund to DEP in FY 2016-17, $10.3 million was transferred in FY 2015-16.

-- $2 million to fund eFACTS permit information system replacement

-- 2 new positions for Covered Device Recycling (electronics waste) Act administration for a total of 2,691 full-time positions, although the freeze imposed by the Governor’s Budget Office prevents 200 vacancies from being filled.

                                                       “Agreed-To                                   As Signed       Governor’s

DCNR                   FY 2014-15      Framework”     GOP Budget      FY 2015-16     FY 2016-17

General Operations

5,809

12,313

12,313

12,313

19,552

State Parks

2,276

34,297

33,297

33,297

62,450

State Forestry

1,050

11,195

11,195

11,195

36,104

Heritage Parks

2,250

2,750

2,250

0

0

Total G.F.

14,527

63,697

62,197

59,947

121,293

Initiatives/Changes:

-- $50.957 million more to shift funding for General Operations, State Parks, Forests from the Oil & Gas Lease Fund

-- $2.5 million increase in PA Conservation Corps

-- $0 for Heritage Parks Program

-- 1 new position for PA Conservation Corps for a total of 1,427 full-time positions, although the freeze imposed by the Governor’s Budget Office prevents vacancies from being filled.

                                                       “Agreed-To                                   As Signed       Governor’s

Agriculture          FY 2014-15      Framework”     GOP Budget      FY 2015-16     FY 2016-17

General Operations

25,269

28,434

27,640

27,640

36,036

Conservation Districts

869

869

869

869

869

Total G.F

126,892

140,282

151,447

[or 121,773]*

52,924

142,557

*Source: Governor’s Budget Office - Later Tracking Run

Initiatives:

-- No change in authorized positions

Budget Hearings

Agency by agency budget hearings will be held by the Senate and House Appropriations Committees from February 22 to March 11.  The hearings for environment-related agencies will be held--

— February 24: Senate— Dept. of Conservation & Natural Resources, 10:00;

— February 24: House— Public Utility Commission, 1:00;

— February 25: Senate- Dept. of Environmental Protection, 10:00;

— February 29: House— Dept. of Conservation & Natural Resources, 2:00;

— March 1: Senate- Dept. of Agriculture, 3:00;

— March 1: House- Dept. of Environmental Protection, 9:30; and

— March 9:  House- Dept. of Agriculture, 1:30.

House budget hearings are held in Room 140 (Majority Caucus Room) and the Senate budget hearings are held in Hearing Room 1, North Office Building.

The complete schedules are available on the Senate Appropriations Committee and House Appropriations Committee webpages.

Here are the major budget documents from the Governor’s Budget Office--

-- Governor’s Budget Remarks

-- FY 2016-17 Executive Budget

-- FY 2016-17 Budget In Brief

-- FY 2016-17 Line-Item Spreadsheet

-- Schools That Teach Budget Briefing

-- Jobs That Pay Budget Briefing

-- Health And Safety Budget Briefing

-- Government That Works: Innovation And Efficiency Budget Briefing

-- Click Here for the remainder of the documents

NewsClips:

Wolf Proposes 6.5% Natural Gas Severance Tax

Wolf’s Budget Not As Reliant On Severance Tax

Severance Tax On Shale Gas Still In Wolf’s Budget

Severance Tax To Spell Disaster For PA Shale Groups Say

Will Drillers Leave Because Of Severance Tax? Already Have

PLS: GOP Severance Tax Bills Vetted In Committee Without End Game

Republicans Discuss Marcellus Severance Tax Bills

Republicans Talk About Natural Gas Severance Tax

House Panel Reviews Marcellus Drilling Tax

House Committee Takes Up Severance Tax Plans

Op-Ed: Gas Drillers Already Pay Their Fair Share Of Taxes

Wolf: My Message Won’t Change By Booing Me

Bumsted: Wolf Proposes $32.7 Billion Budget, Warns Of Time Bomb

GOP: Wolf Left For Neverland With Tax Proposals

PLS: Legislature’s Democrats See Path Forward On Budget

House Republicans Pass Supplemental Funding Bills

GOP Leader: Wolf’s Budget Has No Chance

John Baer: Another PA Budget That’ll Never Be

Analysis: Wolf Just Picked Another Budget Fight, Where Do They Go?

Op-Ed: PA Is In Crisis, We Must Pick A Better Path, Tom Wolf

Op-Ed: Wolf Reaches For Reset, Hits The Detonator

State Treasurer Race May Hold Key To Budget Standoff

PA Capitol Digest Budget NewsClips

Related Stories:

PEC, CBF-PA: Lack Of Funding, Focus Is Critically Harming Pennsylvania’s Environmental Programs

CBF-PA: Wolf’s Budget Proposal Lacks Adequate Funding For New Clean Water Plan

CBF: Obama Budget Helps Chesapeake Bay Farmers At Critical Time, Shorts Cities

Wolf Budget Proposes To Raise, Expand State Waste Disposal Fees To $9.00/Ton

Gov. Wolf: PA Is Facing Fiscal Crisis That Must Be Solved: Kane Khronicles Kontinue

Senate, House Had $100.3 Million Reserve As Of June 2015

Wolf Shrinks DEP’s Staff By Another 200, Even Though DEP Has More Money

Op-Ed: Pennsylvania Must Invest In Its New Clean Water Plan

Drilling Impact Fees Drop By $5,000 Per Well In 2015, Loss Could Be $34 Million

IFO: DCNR Oil & Gas Lease Fund Revenues To Drop Nearly 40 Percent

CBF-PA: PA Releases New Strategy For Meeting Chesapeake Bay Cleanup Commitments

DEP: Pennsylvania Not Meeting Chesapeake Bay Cleanup Commitments

Analysis: PA Isn’t Cleaning Up Our Rivers, Abandoned Mines Quickly Enough


2/15/2016

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