Tuesday, June 28, 2011

House Republican Leader To Offer Marcellus Impact Fee, Oil And Gas Fund Proposal

Rep. David Reed (R-Indiana), Chair of the Republican Policy Committee, has filed an amendment to Senate Bill 303 (MJ White-R-Venango) now on the House Calendar which would allocate monies from the Oil and Gas Fund to support the Growing Greener Program and establish a per well Marcellus Shale impact fee
The proposal has two parts--
-- Transfers from the Oil and Gas Lease Fund:
-- 25 percent of the available yearly ending balance to the Environmental Stewardship Fund;
-- 7.5 percent of the available yearly ending balance up to $7.5 million to payment in lieu of taxes to communities with State Forest land;
-- 1 percent of the available yearly ending balance up to $3 million to a Catastrophic Fund associated with unconventional wells;
-- $40 million to the Hazardous Site Clean Up Fund. This transfer will be updated annually based on the CPI (inflation rate).
-- Marcellus Shale Per Well Impact Fee:
-- Fee Schedule: Year 1: $50,000; Year 2: $25,000; Year 3: $25,000; Year 4: $10,000; Year 5: $10,000; Year 6: $10,000; Year 7: $10,000; Year 8: $10,000; Year 9: $10,000; Year 10: $10,000;
-- In cased when a well is re-stimulated (re-fracked) the fee rate reverts back to $10,000 per year for 5 additional years. If an existing well is used to drill to a different strata (Utica) then the impact fee structure resets at year 2 ($25,000).
-- Revenues collected under this fee are distributed as follows: 37.5 percent to host counties; 10 percent to host counties dedicated to EMS and first responders; 25 percent to host municipalities on a per well basis; 17.5 percent to all municipalities within a host county; 10 percent to Conservation Districts.

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