House Sends Fiscal Code Bill WITH $300 Million In Fund Transfers, Environmental Riders To Governor

The House Tuesday voted 109 to 75 to send a Fiscal Code bill-- House Bill 674 (Sponsor Withdrew)-- to the Governor with a long list of environmental riders and a general provision requiring the transfer of $300 million from unnamed special funds to the General Fund to balance the state budget.

The transfer provision requires the Governor to develop the list of special funds from which to take the $300 million and then submit that list to the State Treasurer.

The bill was passed after attempts to amend the bill and declare it unconstitutional with respect to the provisions dealing with cessation of oil and gas well royalties were beaten back.

Environmental riders include--

-- Oil and Gas Lease Fund: Transfers $20 million [supposed to be $35 million] from the Oil and Gas Lease Fund to the Marcellus Shale Legacy Fund for distribution to the Environmental Stewardship Fund and $15 million transferred to the Marcellus Legacy Fund to transfer to the Hazardous Sites Cleanup Fund.

-- Air Pollution Act Transfer:  Transfers $30.4 million from a settlement by the Attorney General relating to violations of the Air Pollution Control Act by Volkswagen received during the fiscal year to the General Fund.

-- Small Water And Sewer System Funding: $15 million available for small water and sewer projects with a cost of not less than $30,00 or more than $500,000.  Transfers an additional $10 million from Building PA Program to small water and sewer projects.

-- Funding Sewer/Water Laterals: Allows public municipal authorities to use funds to replace private water and sewer laterals.

-- Susquehanna and Delaware River Basin Commissions: Authorizes the Auditor General to audit the river basin commissions and the commissions shall reimburse the Auditor General for the cost of the audit.  In addition, no more than 25 percent of the appropriations to the commissions may be spent in any quarter.

-- Increase Access To Natural Gas: $6 million transfer from the Building Pennsylvania Program to the Natural Gas Infrastructure Development Fund to improve access to retail use of natural gas for schools, hospitals and businesses.

-- Repeals Drilling Moratorium End Date In Southeast: Repeals the January 1, 2018 expiration on the drilling moratorium in the South Newark Basin in Southeast PA.

-- Temporary Cessation Of Oil & Gas Wells: Provisions relating to payments of royalties during periods of nonproduction.

-- Washington Crossing State Park: Requires DCNR to spend $2.2 million on maintenance and upkeep of the park.

Click Here for a Senate Fiscal Note and summary.  Click Here for a House Fiscal Note and summary.

Of the three basic budget-related bills that will implement the $31.9 billion General Fund budget passed in June, the status of the other two are--

-- Administrative Code bill-- House Bill 118 (Kaufer-R-Luzerne)-- is on the Governor’s Desk WITH environmental riders; and

--Tax Code bill-- House Bill 542 (Thomas-D- Philadelphia)-- Senate took no action yet, but at this point it does NOT have the harmful environmental riders.

Severance Tax

House Majority Leader David Reed (R-Indiana) said earlier in the day the natural gas production severance tax bill-- House Bill 1401 (DiGirolamo-R- Bucks)-- is not part of the budget discussions and did not give a specific timeline for consideration.

Over 350 amendments have been filed to the bill so far, and Rep. Reed said the House will have to Caucus on the amendments and ultimately consider them on the Floor through what he expected to be a lengthy amendment process.
House Bill 1401 was removed from the Table and is now on the House Calendar for action.