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Opinion - Let's Establish Local Revenue Sharing For Communities Impacted By Marcellus Shale
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By Ed Troxell, PA State Association of Boroughs

One of the principles established by local revenue-sharing legislation from the state's new casinos is the reality that major developments have impacts on neighboring municipalities as well as the host communities.
 
The Commonwealth would do well to apply the same logic to taxes and fees generated by drilling in the Marcellus Shale formation for natural gas.
 
Casinos and modern natural gas drilling have surprisingly similar impacts.
 
They create traffic issues in neighboring municipalities, concerns about regional police protection costs and seriously increased demand for water and wastewater disposal.
 
The megacorporations involved in what is called the Marcellus Shale "play" in Pennsylvania are quick to point out that they historically have been willing to post significant performance bonds and pay for the cost of remediating direct damages to roadways and other facilities in host communities.
Good for them and good for the host communities.
 
History has shown, however, that this policy is not really good enough, though, to address the unforeseen impacts of extensive drilling beyond the immediate neighborhood.
 
Drilling wells 5,000 to 10,000 feet deep and then drilling out horizontally for one or two miles requires tremendous quantities of water -- most of it mixed into a concentrated chemical fluid and forced underground at fantastic pressures to fracture and dissolve the shale that has trapped the natural gas in place for millions of years.
 
In most cases, the water is trucked in -- and then trucked out again for treatment and disposal elsewhere.
 
It's like building a huge chemical plant on a small, visible footprint.
 
The gas companies are good at what they do -- but there are still risks.
 
Speaking on behalf of boroughs in the Marcellus Shale region, there are community concerns that can only be alleviated by a regional approach to gas drilling.
 
While some boroughs cover large land areas, most are compact and have few sites where derricks and rigs and water storage lagoons can be located for shale drilling.
 
By the very nature of community development, though, the major access roads to the region all lead through the borough, water supplies for the townships also are water supplies for the borough and wastewater treatment, too, is a regional function.
 
As a concept, Pennsylvania's boroughs and many other municipalities we have talked with are supportive of drilling in the Marcellus Shale.
 
Increasing domestic supplies of clean-burning natural gas is a good thing; it should help to keep energy costs down.
 
It should benefit the region's economy.
 
In fairness, however, every effort needs to be made to ensure that boroughs and other municipalities neighboring Marcellus Shale installations are "held harmless" from their negative impacts.
 
Municipalities look forward to the economic boost felt from the industry.
 
But they simply can't afford to subsidize them by absorbing costs produced by increased traffic or water or water treatment issues.
 
We think the General Assembly is approaching this issue with an open mind and a commitment toward fairness to all parties.
 
All we ask is that they remember to save a "seat at the table" for boroughs and, for that matter, all neighboring municipalities.

Ed Troxelli s the director of government affairs for the Pennsylvania State Association of Boroughs representing more than 900 boroughs and 9,100 public officials.

5/8/2009

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