Budget Center: $200 Million In Drilling Impact Fees Half Of Potential Revenue

Pennsylvania collected about $200 million in local impact fees on Marcellus Shale wells drilled through 2011, about half of what the Commonwealth could have collected had a more robust natural gas drilling tax been in effect, according to the PA Budget and Policy Center.

The Center calculated that a natural gas drilling tax modeled on West Virginia’s levy would have raised $387 million between July 2009 and December 2011, based on production data from the Department of Environmental Protection. More than $6 billion worth of natural gas was extracted from the state’s share of the Marcellus Shale during that time period.

“There are real questions about whether Pennsylvania’s fee is enough to pay for the impacts of drilling on local communities,” said Sharon Ward, director of the Pennsylvania Budget and Policy Center. “Local communities have short- and long-term issues to address and should not be shortchanged.”

Because the 2011 drilling impact fee payment covered all Marcellus Shale wells drilled from 2006 through 2011, it is comparable to what a drilling tax would have raised through 2011, had one been enacted in mid-2009 when lawmakers first debated the issue.

In most energy-producing states, drilling tax revenue supports education and health care, funds environmental conservation and protection, and ensures that gas producers are paying for the impacts of drilling. Pennsylvania’s drilling impact fee, enacted into law in February, gives the commonwealth one of the lowest drilling tax or fee rates on gas extraction in the nation.

“Pennsylvania can do better,” Ward said. “A more robust drilling tax could have reduced deep cuts to education and human services, while ensuring that local communities are protected from drilling’s impacts.”

NewsClips: PA Could Be Raising Twice As Much Revenue From Drilling

                    Drilling Impact Fees Raises More Than $200 Million

                    PA Gas Drillers Paying $200 Million In Fees For Wells

                    PA Shale Impact Fees Surpass Estimates

                    Drillers Pay Nearly $200 Million In 2011 Impact Fees

                    PA Impact Fee Will Generate More Than $200 Million

                    Natural Gas Firms Paid Nearly $200 Million In Fees

                    Shale Impact Fee Generates More Than Expected

                    PUC Collects An Additional $4 Million In Drilling Fees

                    Editorial: State Still Short-Changed On Drilling Fees


9/17/2012

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