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House Moves Gas Leasing Moratorium, Senator Expresses Concern About DCNR Comments
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By a vote of 26 to 8 the House Appropriations Committee this week reported out House Bill 2235 (Vitali-D-Delaware) providing for a five year moratorium on leasing further State Forest lands for Marcellus Shale gas drilling. "This is another important step and puts the bill in position to be voted on by the full House next week," said Rep. Vitali. "I'm optimistic it will pass with bipartisan support because it is such an important issue. We need to take a step back and analyze the impact the industry will have on our state forests."
The bill also would require the state Department of Conservation and Natural Resources to issue a report every year to the governor and legislature about the impact of current natural gas exploration and drilling on state forests. The state has leased 692,000 acres of state forestland to natural gas drilling companies.
Rep. Vitali introduced the bill earlier this year in response to a proposal negotiated during last year's budget agreement to raise revenue for the 2010-11 fiscal year by leasing more state forestland to drillers. An appropriations bill passed by the House last month assumes $112 million in revenue from state forest leases.
"We could have as many as several thousand natural gas wells in the state forestland that we have already leased, and we do not know what the cumulative impact will be," Rep. Vitali said. "The remaining state forestland is environmentally sensitive. To lease that acreage would be reckless."
Rep. Vitali has suggested a severance tax on natural gas drilling or a similar fee -- which other major natural gas producing states levy, but Pennsylvania budget negotiators refused to consider last year -- would be an appropriate revenue option.
The legislation is expected to be brought up for a vote in the full House next week.
Sen. White Questions DCNR Comments Sen. Mary Jo White (R-Venango), Majority Chair of the Senate Environmental Resources and Energy Committee, issued a statement this week commenting on recent statements made by DCNR Secretary John Quigley on leasing Marcellus Shale rights on State Forest land. Those statements made at a Marcellus Shale Symposium at Bucknell University last weekend, and reported by the Harrisburg Patriot News, said in part-- "We will see a degradation of Penn's Woods the likes of which is unprecedented in the history of the state. We have not seen the tip of the iceberg.
"The State Forest has been used to balance the state budget two years in a row," said Secretary Quigley. "(Marcellus cash) has become the crack cocaine of state government."
Sen. White's statement said,
"Last week, Department of Conservation and Natural Resources (DCNR) Secretary John Quigley came before the Senate Environmental Resources and Energy Committee, as well as the Senate Republican Caucus. Secretary Quigley assured us that development of the Marcellus Shale natural gas was occurring in a responsible manner on state forest land, and that his agency was well-positioned to ensure that the integrity of our state forest system was maintained.
"Given these assurances immediately prior to his confirmation vote, I am astonished at his comments as reported from the recent symposium at Bucknell University.
"Secretary Quigley is reported to have said that Marcellus Shale cash “has become the crack cocaine of state government.” I doubt Governor Rendell, who appointed Mr. Quigley and who has agreed to the limited leasing of state forest land that is now in place, would agree with this assessment. Before the Senate, Secretary Quigley testified that the amount of leasing to date will not threaten the state’s highly valued Sustainable Forest certification. An internal memo from Secretary Quigley to Governor Rendell last year stated that the state could actually lease an additional 48,000 acres beyond what is already available and still maintain our certification.
"At a February budget hearing, Secretary Quigley stated that he is preparing a new lease offering for early summer. Included in his budget request is an allocation to hire additional staff to ensure that the lease terms covering natural gas development on state forest land are adhered to. I strongly support the addition of these staff. Additionally, leases for state forest land contain rigorous environmental standards that preclude surface disturbance in wild and natural areas, limit the number and location of wells, and generally cap all surface well pad disturbance at less than 2% of the acres actually leased. In exchange, Pennsylvania has received nearly $270 million in lease payments – money which has been used to educate our children, fund our hospitals and protect our natural resources.
"It is fair to discuss the rate and timing of a severance tax on natural gas. We should also be mindful that natural gas activity is already generating hundreds of millions of dollars in tax revenue for state and local governments through lease and royalty payments, sales and use tax, and other economic impacts. However, we should not confuse the issue of paying a severance tax with ensuring compliance with our environmental laws. DCNR does not have enforcement powers over gas producers; that is the responsibility of the Department of Environmental Protection (DEP). Last year, with bipartisan legislative support DEP increased its permitting fees substantially to add nearly 100 new enforcement staff. Recent actions by DEP have demonstrated that existing laws provide more than sufficient authority to deal with gas producers who violate our laws.
"It is DCNR’s job to manage our forests, and it is Secretary Quigley’s job to be honest with elected officials – and the public. If Secretary Quigley truly believes that the legislature and Governor are complicit in “a degradation of Penn’s Woods the likes of which is unprecedented” in our history, then he should not have given us false assurances during his confirmation process. The Senate thought Mr. Quigley was up to the task. Perhaps we were wrong."
Secretary Quigley was confirmed by the Senate last week.
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4/26/2010 |
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