Cuts and diversions in the budget just adopted by the state have dramatically reduced spending for environmental and natural resource programs in Pennsylvania by $347 million in just one year according to Donald S. Welsh, President & CEO of the Pennsylvania Environmental Council.

"The unprecedented 26 percent cut in the Department of Environmental Protection and 18 percent cut in Department of Conservation and Natural Resources budgets raise significant doubts about the capacity of both agencies to fulfill their missions," said Welsh. "Environmental programs for some reason seem to have been singled out for cuts that go way beyond the average 9 percent suffered by other agencies."

The General Fund budget of DEP was cut $58 million, or 26.7 percent, with most of the cuts coming in line items used to fund staff positions. Over 300 positions are at risk of being eliminated as a result of these cuts.

DCNR's General Fund budget was cut $21 million, or 18.5 percent, with again many of the cuts coming in personnel line items. There are about 160 positions at risk of being eliminated at DCNR.

"Of great concern is the diversion of $203 million from the Oil and Gas Fund to the General Fund that was earmarked for improving recreation and access to our State Parks and Forests," said Welsh. "Taking the proceeds from mineral rights sales away from conservation programs erases 55 years of precedent in Pennsylvania."

$143 million was transferred from the Oil and Gas Fund to balance to 2008-09 budget, and $60 million is to be transferred to balance the 2009-10 budget. Another $180 million is set to be used from the Fund to balance the 2010-11 budget as well.

"Adding to these diversions is the requirement in the budget to lease thousands of acres of State Forest land for Marcellus Shale natural gas drilling to raise the money needed for the diversions," said Welsh. "It is a sad day for the Commonwealth when we are selling off our natural resources to balance the budget."

A bill accompanying the budget requires the Department of Conservation and Natural Resources to lease as many acres as necessary to yield $60 million in revenue to balance the budget.

There is no cap on the acres to be leased or a minimum bid price. This provision of the budget would have been even more destructive had it not been for the leadership of a bi-partisan coalition of House members who vigorously fought to protect state lands from unmitigated extraction.

"These cuts are bad enough on their own, however, they are only the latest in a series of cuts or diversions over the last several years," said Welsh. "Funds for watershed restoration, abandoned mine reclamation, wastewater plant operations, storage tank cleanup, diversions from the Keystone Recreation, Parks and Conservation Fund and more have all gone to balance the budget."

Here is the list of cuts and diversions over the last seven years:

-- $376 million in Act 339 grants intended to support wastewater plant operations were eliminated to balance the budget;

-- $143 million diverted from the DCNR Oil and Gas Fund to balance the 2008-09 budget;

-- $79 million cut from the DEP and DCNR General Fund budget during 2009-10 fiscal year;

-- $60 million diverted from the DCNR Oil and Gas Fund to balance the 2009-10 budget;

-- $100 million in 2002 from the Underground Storage Tank cleanup insurance fund to balance the budget (although this is slowly being repaid over 10 years);

-- $52.7 million “one-time” diversion from the Keystone Recreation, Parks and Conservation Fund in 2006 to balance the budget;

-- $50 million in 2007 and 2008 from the Environmental Stewardship Fund, which supports mine reclamation and watershed restoration, to fund the Hazardous Sites Cleanup Program because there was no agreement on how to fund that program;

-- $85 million in FY 2007-08, 2008-09, 2009-10 from the Environmental Stewardship Fund to pay debt service on the Growing Greener II bond issue and taking funding away from restoration projects each year for the next 25 years (reflecting a pattern of only environmental programs being required to address their own bond debt service) which means twice the $650 million made available by the Growing Greener II bond will be paid out and not available for projects after the program ends in 2010;

-- $15 million from the Recycling Fund in to balance the 2008-09 budget;

-- $18.4 million put into budgetary reserve in 2008-09 from the Department of Environmental Protection and Department of Conservation and Natural Resources; and

-- $5 million reduction in Resource Enhancement and Protection (REAP) farm conservation tax credit program in FY 2009-10.

"Before last week’s budget was adopted, we were already below the point of providing sufficient funding for environmental and conservation programs; programs that protect public health, rebuild our communities, and sustain our state’s quality of life,” said Welsh. "Its time to stop ignoring the need for additional, long-term revenue sources like a natural gas severance tax. Without rebuilding adequate investment, we cannot hope to meet our legal obligations to cleanup our air and water or take care of the natural resources in our public trust."

In responding to concerns about environmental budget cuts, Sen. Mary Jo White (R-Venango), Majority Chair of the Senate Environmental Resources and Energy Committee, said the cuts have to be put in the overall context of the budget. (click here for a copy of the response)

Part of the context Sen. White listed--

-- Making available $1.6 billion in water infrastructure funding for wastewater, drinking water, dam and flood control projects in 2008 through the H2O Program and the $400 million voter approved bond issue last fall;

-- Additional water infrastructure project monies received by the state as a result of the federal stimulus package administered by the PA Infrastructure Investment Authority;

-- $26 million of the $58 million cut from the DEP budget were in just two line items Consumer Energy rebates and the Safe Drinking Water (special legislative project) line items;

-- DEP is in the process of increasing permit fees that could raise $20 million annually for the agency whenever those regulations are finalized [but many of those regulations have yet to be finalized or were just proposed delaying any significant revenues for a year or more];

-- On diversions from the Oil and Gas Lease Fund in DCNR, Sen. White said, "When the Oil and Gas Lease Fund was created in 1955, it is safe to assume that no one foresaw an infusion of money like we have seen from leasing natural gas rights. Even after these transfers, the Oil and Gas Lease Fund will still be left with considerably more money than pre-Marcellus Shale leasing. For example, DCNR received $168 million from the September 2008 lease offering, and is retaining $25 million for its own uses – more than the Fund spent over the past 4 years combined;" and

-- On diversions of $85 million from the Environmental Stewardship (Growing Greener) Fund to pay the debt service on the Growing Greener bond issue, Sen. White noted the $650 million bond issue could not have been approved without a way to pay for it and the amount of money the bond made available for environmental, farmland preservation, recreation, energy and economic development projects should not be ignored. [Up to $60 million a year can be diverted out of the Environmental Stewardship (Growing Greener) Fund to pay debt service, which over the next 25 years means twice the $650 million made available by the Growing Greener II bond will be paid out of the Fund and will not available for projects after the program ends in 2010].

"By no means do I wish to minimize the real impact the state’s budget will have on programs and employees across the board. However, I do not think it is accurate to assert that environmental and conservation programs have been disproportionately targeted by the General Assembly," said Sen. White. "The final budget is certainly open to critique, but I encourage all to evaluate the budget and spending priorities fairly and in their proper context."

For more information, visit the PEC website.