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Analysis: Environmental Riders Never Voted On By The House/Senate Keep Showing Up In Budget Bills, And It’s Getting Worse

The tactic of hooking last minute riders to budget bills passed by the Senate and House is now being used on a much more frequent basis to kill or change programs that have nothing to do with the budget and only very infrequently to do something positive for the environment.

Here are some examples from the current budget bills on the Governor’s desk and from budget-related bills in 2016, 2014 and 2013.

As you can see, the breadth and scope of the environmental riders added, or attempted to be added, to the budget-related bills is increasing dramatically.

Administrative Code

The Administrative Code bill-- House Bill 118 (Kaufer-R-Luzerne)-- now on the Governor’s desk includes these never before seen riders or provisions never voted on before--

-- Changing Manganese Standard: Directs the Environmental Quality Board to adopt a proposed manganese standard within 90 days that includes the 1 milligram/liter manganese standard established under 25 Pa Code Chapter 93.7 and insure the standard is met at the point of intake for water suppliers (25 Pa Code Chapter 96.3). The 1 milligram/liter standard is 20 times the level of manganese that water suppliers are allowed to have in their water supplies, according to EPA’s secondary maximum contaminant level. [Supported by the coal industry. Click Here for more.]

-- Conventional Oil & Gas Wastewater Treatment: Requires water treatment facilities providing water disposal services exclusively to conventional oil and gas wells shall be allowed to operate under existing permits through December 31, 2019. Supported by conventional oil & gas drilling industry and applies to three privately-operated conventional wastewater treatment facilities.

-- Solar Borders: Requiring solar energy credits under the Alternative Energy Portfolio Standards to be purchased within Pennsylvania. Senate Bill 404 this session, House Bill 2040 last session.

-- Wyoming County State Park: Requires DCNR to conduct a feasibility study for the establishment of a state park in Wyoming County, including an appraisal of the fair market value of property proposed for a state park.

Fiscal Code

The Fiscal Code bill-- House Bill 674 (Sponsor Withdrew)-- includes these never before seen riders or provisions never voted on before.

-- Temporary Cessation Of Oil & Gas Wells: Provisions relating to payments of royalties during periods of nonproduction.

-- Susquehanna and Delaware River Basin Commissions: Authorizes the Auditor General to audit the river basin commissions and the commissions shall reimburse the Auditor General for the cost of the audit. In addition, no more than 25 percent of the appropriations to the commissions may be spent in any quarter.

-- Air Pollution Act Transfer: Transfers $30.4 million from a settlement by the Attorney General relating to violations of the Air Pollution Control Act by Volkswagen received during the fiscal year to the General Fund.

2017 - It Could Have Been Worse

In the “it could have been worse” category, the original Senate-passed version of the Tax Code Bill-- House Bill 542, Printer’s Number 2259-- included these provisions that would have emasculated DEP’s ability to regulate air, water, mining, oil and gas and waste--

-- Third Party Permitting: Directed DEP to establish a third-party permitting program to authorize a licensed professional landscape architect, engineer, land surveyor or geologist to issue any of DEP’s permits without being either qualified or having to comply with conflict of interest requirements.

-- Legislative Approval Of Methane Permits For Oil & Gas Operations: Establishing a 7-person Committee-- 6 of them General Assembly appointments-- to approve the final DEP General Permits covering methane emissions from oil and gas operations.

-- Deemed Approved Oil & Gas Permits: Require oil and gas permits to be deemed approved if DEP did not review them within certain timeframes.

Fortunately, industry and business leaders distanced themselves from these provisions just after they saw the light of day and the turmoil it raised.

2016 Veto Of Fiscal Code Riders

In March of 2016, Gov. Wolf vetoed a Fiscal Code bill-- House Bill 1327 (Peifer-R-Pike)-- that contained provisions to kill DEP’s Chapter 78 conventional drilling regulations and make DEP start over and another that slowed consideration of any state plan to comply with the EPA Clean Power Climate Plan.

The veto forced the Senate and House to make the changes, but this time through the regular legislative process, which they did.

In July 2016, the Fiscal Code bill that was signed into law-- House Bill 1605 (James-R-Butler)-- included a provision that exempts any well that does not penetrate the Onondaga horizon from the Oil and Gas Conservation Law which came from Senate Bill 1145 (Yaw-R-Lycoming).

Also in July 2016, the Tax Code bill-- House Bill 1198 (Barrar-R-Delaware)-- included a new tax credit for Coal Refuse Energy and Reclamation.

2014 Amendment Changes Conventional Oil & Gas Well Regulations

The Fiscal Code bill in 2014-- House Bill 278 (Baker-R-Tioga)-- contained an amendment forcing DEP to promulgate separate conventional and unconventional oil and gas regulations to update environmental protection requirements further delaying the regulations.

The forces behind the delay tried again, as noted above, to kill the conventional regulations all together in another Fiscal Code bill that was vetoed by the Gov. Wolf. Ultimately they succeeded by passing separate legislation.

In this same Fiscal Code bill, Gov. Corbett line-item vetoed provisions related to $150,000 for independent research on natural gas drilling and legislative earmarks for sewage facilities planning and operations and for Washington Crossing Historical Park.

The legal challenge to this veto is now before the PA Supreme Court after being upheld by Commonwealth Court.

2013 Fiscal Code Surprises

In 2013, the Fiscal Code bill-- Senate Bill 591 (Vulakovich-D-Allegheny)-- that became law contained provisions-

-- Ending Consumer Energy Program: Eliminating General Fund appropriations to DEP for the Consumer Energy Program for FY 2012-13 and FY 2013-14;

-- Natural Gas Research: Appropriated $150,000 for independent research regarding natural gas drilling to DEP;

-- Sewage Facilities Planning Grants: Gave priorities to municipalities in counties of the sixth, seventh and eighth class with approved applications for Sewage Facilities Planning Grants;

-- Extended Storage Tank Fund Payback: Extended the payback of the Storage Tank Fund to July 2029,

-- Funding Certain Sewage/Water Projects: $3 million was appropriated to the Commonwealth Financing Authority for water and sewer projects costing between $50,000 and $150,000; and

-- Washington Crossing Historic Park: Directing DCNR to enter into an agreement to manage Washington Crossing Historic Park with the PA Historical and Museum Commission.

With the budget landscape being increasingly littered with environmental riders-- many up to no go-- it will ultimately be up to Commonwealth Court and the PA Supreme Court to decide whether this practice is constitutional and how far legislators can go.

In June, the PA Supreme Court issued an opinion declaring the 2009 and 2010 Fiscal Code and other amendments diverting more than $478 million from DCNR’s Oil and Gas Fund to the General Fund unconstitutional because there was no evidence the General Assembly considered the use of the funds in its role as public trustee for natural resources under the Environmental Rights Amendment to the state constitution.

Future decisions on this issue should be just as interesting.

(Written By: David E. Hess, Former Secretary, Department of Environmental Protection.)

State Treasurer Authorizes $1.8 Billion Line Of Credit For General Fund

NewsClips:

AP: Budget Bills Are Ugly But Wolf Has Little Choice But To Sign

PA Budget Standoffs: July 1 Needs To Mean Something Again

Op-Ed: Budget Bills Do Not Honor Our Environmental Rights In PA, Alan Peterson, MD

Micek: Wolf Presses For Tax On Gas Drillers

Wolf Urges New Severance Tax

Op-Ed: Natural Gas Severance Tax That’s Not Worth The Price, Rep. Vitali

Op-Ed: Severance Tax Supporter Now Against It Because Of Permitting Tradeoffs, Rep. Vitali

Op-Ed: Gas Drilling Is Good For State Economy, Marcellus Shale Coalition