On June 5, Senators Camera Bartolotta (R-Washington) and Patrick Stefano (R-Fayette) introduced Senate Bill 716 and Senate Bill 717 establishing a Restore PA-lite infrastructure program funded by lifting the moratorium on natural gas drilling on DCNR’s State Forest lands.
Senate Bill 716 would amend the Fiscal Code to prohibit the Governor from placing a lease moratorium on State Forest land as well as lifting the moratorium Gov. Wolf imposed in February, 2016.
The bill includes a specific finding that “The General Assembly has previously recognized the safe and responsible expansion of regulated gas leasing and drilling on public lands in this Commonwealth, including the State forest system, as an appropriate method of energy production as well as an appropriate non-tax source of revenue.”
The bill requires that any money from non-surface disturbance natural gas drilling leases involving State Forest land entered into after the effective date of the bill is to be deposited into a Green Infrastructure Fund, not the Oil and Gas Lease Fund which has been the subject of ongoing litigation.
“Non-surface disturbance” gas drilling is a concept used before by Senate Republicans and by Gov. Tom Corbett in Executive Order 2014-03 which superseded Gov. Rendell’s blanket moratorium on State Forest land drilling.
The 2014 Executive Order defined non-surface disturbance drilling as “oil and natural gas development which results in no additional surface disturbance to state park and forest lands managed by DCNR.”
In August of 2014, DCNR released draft leasing criteria and a draft lease for non-surface disturbance drilling. They defined the key terms further as--
-- Surface Disturbance: The long-term conversion of the park or forest to a non-park or forest use. Examples include creating or increasing the footprint of infrastructure such as roads, pipelines and well pads. This definition shall be used for purposes of evaluating whether a non-surface disturbance leasing proposal would result in “additional surface disturbance.”
-- Temporary Disturbance: Impacts to the park or forest itself, the surface or vegetation that are short-term in nature and will allow the resource to be restored to its normal state naturally. Examples include seismic activity and air and noise impacts associated with an increase in truck traffic.
The Delaware RiverKeeper challenged Executive Order 2014-03 in Commonwealth Court based on the Environmental Rights Amendment to the state constitution.
In the FY 2014-15 budget, Senate Republicans directed DCNR to enter into enough additional “non-impact” natural gas development leases on State Forest land to generate $95 million in revenue to fill a hole in the state’s General Fund budget.
Ultimately, non-surface disturbance leasing was not done because DCNR entered into a negotiated settlement with the PA Environmental Defense Foundation in July 2014 delaying any final action on leasing until Commonwealth Court ruled on the PEDF challenge to using leasing revenues in the Oil and Gas Lease Fund to balance the state budget.
In June of 2017, the PA Supreme Court, citing the state’s Environmental Rights Amendment to the state constitution, found the General Assembly’s use of State Forest land drilling revenues to fund the General Fund and operating expenses unconstitutional because it violated the constitution’s requirement for the General Assembly to act as a public trustee for these resources. Click Here for more.
The second bill in the Bartolotta-Stefano package-- Senate Bill 717-- would also amend the Fiscal Code to create a Green Infrastructure Fund administered by the Commonwealth Financing Authority into which any revenue from non-surface disturbance drilling leases on State Forest land would be deposited.
The money in the Fund could be used for--
-- Blight remediation if an environmental hazard is replaced with green space;
-- Flood control, replace high-hazard dams, conduct stream restoration and maintenance;
-- Paving, repairing and reducing sediment runoff from dirt and gravel roads;
-- Outdoor recreational opportunities at state, county, municipal parks; and
-- Abandoned mine reclamation projects.
It includes a specific provision saying, “The Green Infrastructure Fund is not a constitutional trust” in an apparent attempt to address the 2017 PA Supreme Court decision declaring spending funds generated from drilling on State Forest land for General Fund and non-conservation purposes unconstitutional because they are held in the public trust.
Click Here for a sponsor summary of these bills.
Both bills are now in the Senate Environmental Resources and Energy Committee.
Empty Proposal
The proposal to lease additional State Forest lands for non-surface disturbance drilling faces fundamental hurdles, not the least of which are--
-- Constitutional issues complying with the 2017 PA Supreme Court ruling requiring the General Assembly and the Governor to act as a trustee for Commonwealth-owned resources and not turn them into the state’s piggy bank;
-- Does anyone want to lease the land? Only about 35 percent of the EXISTING Shale gas leases on State Forest land have been developed and there has been very little recent activity, according to DCNR Secretary Cindy Adams Dunn. These leases represent arguably the highest value shale gas drilling areas on State Forest land. There has not be a noticeable overwhelming clamor by natural gas drilling companies asking to drill under State Forest lands; and
-- The non-surface disturbance drilling requirement further limits areas of possible leasing making the whole process much more difficult. The scale of leasing cannot be compared to the 137,000 acres of leases done by Gov. Rendell in 2008-09.
With these and other fundamental issues, it’s hard to see how this proposal would generate much if any revenue for the Green Infrastructure Fund and even if it did, there’s the matter of whether it is constitutional to do so.
Saying in Senate Bill 716 more drilling on State Forest land is an “appropriate non-tax source of revenue,” does not make it so.
Saying in Senate Bill 716 more drilling on State Forest land is an “appropriate non-tax source of revenue,” does not make it so.
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