$201,977,000 Diverted From Environment, Energy Funds To Balance FY 2020-21 State Budget

On November 20, the House and Senate passed and sent to the Governor their version of a completed FY 2020-21 budget in Senate Bill 1350 that adds about $11 billion to the temporary budget they passed in May for a total General Fund budget of $36.5 billion, about four percent above last year.    

The new budget has no new taxes and fills, for the moment, a multibillion deficit caused by the COVID pandemic. Read more here.

The budget is being moved with the support, generally, of Republicans, but not Democrats.

Gov. Wolf indicated he will sign the budget.  Read more here.

The budget deals with the deficit by using more than $3.3 billion in federal COVID pandemic aid to pay for state expenditures and transfers more than $431 million from special funds.

The budget ignored requests by Gov. Wolf in August to provide additional aid to small business, restaurants and bars, renters, frontline health care workers and other groups hard hit by the pandemic.  Read more here.

The final FY 2020-21 takes $201,977,000 from a dozen dedicated environmental and energy funds to help balance the state budget.  These transfers appear in the Fiscal Code bill-- House Bill 2536--  accompanying the budget.

The dedicated environmental, energy and conservation affected-- there are others-- are--

-- Diverted from Oil & Gas Lease Fund To Pay DCNR Operating Costs - $48,827,000

-- PennVEST Fund - $10,000,000

-- PennVEST Drinking Water Revolving Fund - $26,000,000

-- PennVEST Water Pollution Control Revolving Fund - $9,000,000

-- Recycling Fund - $50,000,000

-- Underground Storage Tank Indemnification Fund - $30,000,000

-- Industrial Sites Cleanup Fund - $10,000,000

-- Industrial Sites Environmental Assessment Fund - $7,500,000

-- Agricultural Conservation Purchase Easement Fund - $5,000,000

-- Surface Mining Conservation & Reclamation Fund $4,000,000

-- Energy Development Fund - $1,000,000

-- Environmental Education Fund - $500,000

-- Highway Beautification Fund - $150,000

Defunding these programs will mean--

-- PennVEST drinking water, wastewater and nonpoint source pollution cleanup projects will not get done;

-- Farmers cannot be helped to save their farms through the farmland preservation program;

-- Brownfield industrial sites will not be cleaned up and made safe;

-- Surface coal mine reclamation projects will be delayed or canceled;

-- Community-based recycling programs will be left unsupported;

-- Recreation and conservation project funded by DCNR’s Oil and Gas Fund will not get done;

-- Environmental education efforts will be set back; 

-- Clean energy projects will not move forward; and

-- Highway beautifical projects will not be done.

No transfers were identified, so far, out of the Keystone Recreation, Park and Conservation Fund or  Environmental Stewardship Fund for this budget.

This could have been much worse, but it’s still, obviously, bad.  And, with all these one-time budget fixes, environmental funding will face significant challenges again next year.

Related Provisions

The Fiscal Code bill also contains these other environmental provisions--

-- Pays Debt Service: Transfers $13,782,000 from Personal Income Tax Revenue to Environmental Stewardship Fund to pay the Growing Greener bond issue debt service.

-- DCNR Regional ATV Pilot Program: Establishes a Regional ATV Pilot Program to provide local access or serve as a trail complex for ATV uses in the Elk, Moshannon, Sproul, Susquehannock and Tioga District Forests.

-- Act 54 Deep Coal Mining Surface Damage Report: DEP prohibited from spending more than $280,000 per fiscal year on evaluating the impact of underground coal mining or surface features or surface and groundwater as required by Act 54 of the Bituminous Mine Subsidence and Land Conservation Act. This is a variation on Senate Bill 763 (Bartolotta-R-Washington) to limit DEP’s ability to review impacts of deep coal mining. Read more here. Read more here about damage caused by underground mining.

-- Alternative Energy Portfolio Standards - Close Borders: Tier II sources of alternative energy generation must come from sources within Pennsylvania - a change that matches the AEPS solar provisions and was wanted by waste coal-fired power plants.

-- Alternative Energy Portfolio Standards Solar Expansion: Adding to the definition of 'customer-generator' net-metered distributed generation systems supporting the Department of Military and Veterans Affairs

-- PFAS Cleanup: Earmarks $3,970,600 of PennVEST funds to address PFAS contamination in a township of the first class with a population between 55,000 and 65,000 in Montgomery County.

These transfers and the related riders are contained in the Fiscal Code bill accompanying the budget-- House Bill 2536.  Click Here for a Senate Fiscal Note and Summary.

Agency Budgets

State environmental and conservation agency General Fund budgets were generally flat in the final FY 2020-21 budget, but looked like they increased due to funds shifted and restored as part of the convoluted FY 2019-20 budget.

The General Fund line item for DEP is still below the 1994-95 level of support.  

Bottomline is they were cut because scheduled increases in pay and benefit costs will eat into that ‘cost-to-carry’ budget number.

The budget does support conservation districts and regional water agencies like the Delaware and Susquehanna River Basin Commissions from the General Fund rather than taking it from the Environmental Stewardship Fund.

The budget does not include a permanent fix for funding the Hazardous Sites Cleanup Fund as proposed by Gov. Wolf in February.  This Fund is used to address hazardous waste and PFAS cleanups and to pay Pennsylvania’s share of federal Superfund cleanup costs. Read more here.

And, of course, there is no Restore PA Program Gov. Wolf proposed to fund flood protection, recreation, environmental restoration and other critical infrastructure projects funded by a severance tax on natural gas. Read more here.

Gov. Wolf also proposed a $1.1 billion plan to address lead and other hazards in schools and drinking water systems that is not part of the budget.  Read more here.

These proposals went by the wayside due to the pandemic and as a result of Republican opposition.

Here’s a brief summary of the General Fund portion of environmental agency budgets--

Agriculture: $169.691 million, down $1.6 million

DCNR: $134.830 million, up $17.652 million due to fund shifts from last fiscal year 

DEP: $156.337 million, up $22.190 million due to fund shifts from last fiscal year. This is less than the 1994-95 General Fund support for DEP of $165.6 million. Read more here.

The General Fund budget bill is Senate Bill 1350.  FY 2020-21 Budget Spreadsheet. Summary of Budget.

The budget bills now go to the Governor for his action.  He could sign or veto the bills or could let them become law without his signature as he has with budgets in the past.

Related Articles This Week:

-- Hundreds Of Thousands Oppose Cuts In Local Recreation, Conservation Project Funding 

Related Articles - Budget:

-- Budget Background: Where Did The $2.93 Billion In Environmental Funding The General Assembly Diverted Or Cut Go?

-- New Poll Shows 90% Of PA Voters Want Senate, House Members To Address Environmental, Conservation Priorities, Provide More Funding For Critical Programs

-- PA Farm Bureau, 45 Other Hunting, Angler, Business, Environmental, Watershed Groups Urge Senate, House To Pass On-Farm Conservation Funding Bill This Year

-- PA Conservation Districts Ask Lawmakers To Keep Same Funding For Their Vital Services As They Finalize FY 2020-21 State Budget

-- State Parks Continue To Break Visitor Records In September: 4.7 Million Visitors, Up 31 percent Over Last Year

-- State, Regional, Local Outdoor Recreation ‘Through The Roof’ Across Pennsylvania

-- Op-Ed: Now Is The Time To Invest In Parks, Not Cut Them

-- Analysis: 2020 Is A Make Or Break Year For Environmental Funding

-- House Speaker Cutler: Republicans Will First Raid Dedicated Funds To Balance Budget In November

-- House Republicans Pass Bill To Freeze Funding For County Conservation Districts, Local Parks, Farm Conservation, Watershed Restoration Projects; Will Hurt Local Economies

-- House Republicans Moving Bill To Reallocate Keystone Fund, Damage Vitality Of PA’s Outdoor Economy

-- Analysis: Why Republican Freeze On Funding For Local Parks, Trails, Farm Conservation, Mine Reclamation, Recycling Is Bad For The Economy, Communities, The Environment

-- Senate Environmental Committee Puts Spotlight On Funding Needed To Implement PA Clean Water Plan At Chesapeake Bay Briefing

[Posted: November 20, 2020]  PA Environment Digest