On January 12, the PA Environmental Defense Foundation filed an amended petition for Extraordinary Jurisdiction with the PA Supreme Court asking that Court to take over all the issues raised by the Supreme Court’s June 20 decision declaring the use of DCNR’s Oil and Gas Fund to balance the state budget unconstitutional, since Commonwealth Court said it would not in a January 8 ruling.

The PA Supreme Court had remanded the June 20 case to Commonwealth Court asking that it sort out a series of issues resulting from the decision.

The June 20 decision was based in part on the Environmental Rights Amendment to the state constitution which the PA Supreme Court said creates a trustee duty on the Commonwealth to spend those funds only for conservation purposes, not for balancing the budget.

To date, more than $1.1 billion from the sale of public natural resources has been used to fill gaps in the state budget, according to PEDF.

On January 8, Commonwealth Court issued an ruling saying it would only review whether upfront bonus and land rental payments from natural gas drilling on State Forest land are constitutional, and not the General Assembly’s continuing practice, including in the FY 2017-18 budget, of using natural gas revenues to pay for DCNR operations.

John Childe, PEDF attorney in the lawsuit, said of the January 8 opinion, “The Commonwealth Court Opinion limiting the Remand from the Supreme Court to one issue dealing with the Bonus payments is without any factual or legal support. We are considering our options.”

The new PEDF petition said the PA Supreme Court’s June 20 Order to Commonwealth Court was clear, that relief was not limited in the way described by Commonwealth Court in its January 8 order. 

PEDF quoted from the June 20 decision--

“Having established … that all proceeds from the sale of our public natural resources are part of the corpus of our environmental public trust and that the Commonwealth must manage the entire corpus according to the fiduciary obligations as trustee, the Commonwealth Court’s decision cannot stand.

“In light of our specific holding that section 1602-E and 1603-E [of the Fiscal Code] are facially unconstitutional, the pre-2008 appropriations scheme as set forth in the [Oil and Gas] Lease Fund Act and [the Conservation and Natural Resources Act] again controls, with all monies in the Lease Fund specifically appropriated to the [Department of Conservation and Natural Resources (“DCNR”)].

“As to the remaining acts and decisions [PEDF] challenges, we clarify that their constitutionality depends upon whether they result from the Commonwealth’s faithful exercise of its fiduciary duties vis a vis our public natural resources and any proceeds derived from the sale thereof.

“For example, the Governor’s ability to override decisions by the DCNR regarding leasing is contingent upon the extent to which he does so in a manner that is faithful to his trustee obligations, not his various obligations.”

Further from the June 20 decision, “The Commonwealth (including the Governor and the General Assembly) may not approach our public natural resources as a proprietor, and instead must at all times fulfill its role as a trustee.

“Because the legislative enactments at issue here do not reflect that the Commonwealth complied with its constitutional duties, the order of the Commonwealth Court with respect to the constitutionality of [Fiscal Code Sections] 1602-E and 1603-E is reversed, and the order is otherwise vacated in all respects. The case is remanded to the Commonwealth Court for further proceedings consistent with this Opinion.”

The new PEDF petition then goes on to list the remaining acts and decisions the Commonwealth Court’s January 8 ruling said the Court would not deal with which PEDF believes the June 20 decision requires it to consider--

-- Whether the Section 27 public trust and the trustee duties thereunder mandate that funds from the extraction and sale of the natural gas and oil must be retained for the conservation and maintenance of the area impacted by the extraction and sale of the natural gas and oil;

-- Whether the Respondents violated Section 27 and their duties as trustee under the Section 27 public trust by requiring DCNR to lease additional State Forest land for natural gas and oil extraction and selling that oil and gas for revenue;

-- Whether the Respondents violated Section 27 and their duties as trustees under the Section 27 public trust by overriding DCNR’s determination not to lease any more State Forest land for oil and gas extraction;

-- Whether the Respondents violated Section 27 and their duties under the Section 27 public trust by using the revenue from leasing State Forest land, the bonus payments received for obtaining the leases, and royalties paid for the sale of natural oil and gas to pay annual operating expenses for DCNR;

-- Whether the Respondents violated Section 27 and their duties as trustees under the Section 27 public trust by enacting Sections 1602-E through 1605-E of the Fiscal Code (72 P.S. §§ 1602-E through 1605-E);

-- Whether Sections 1604-E and 1605-E of the Fiscal Code violate Section 27; and

-- Whether the Respondents violated Section 27 and their duties as trustees under the Section 27 public trust by enacting 58 Pa.C.S. Chapter 25 (related to the Oil and Gas Lease Fund); and transferring $50,000,000 from the Oil and Gas Lease Fund to the Marcellus Legacy Fund for distribution to the Environmental Stewardship Fund and the Hazardous Sites Cleanup Fund.

The PEDF petition asks the PA Supreme Court to take over the remaining issues or in the alternative order Commonwealth Court to grant Summary Judgment requested by PEDF and set a briefing schedule.  Click Here for a copy of the proposed Order.

A copy of PEDF’s new petition is available online.

For more information on this case, visit the PA Environmental Defense Foundation website.

Related Stories:

PEDF: Commonwealth Court Efforts To Narrow Focus Of Review Of How State Spends DCNR Oil & Gas Payments Without Factual, Legal Support

PEDF Files Petition Requesting PA Supreme Court To Enforce environmental Rights Budget Decision

PEDF Files Petition Urging Court To Declare New Transfers From Oil & Gas Fund Unconstitutional, $1.1 Billion At Stake

PA Supreme Court Declares Law Diverting Oil & Gas Lease Funds To General Fund Unconstitutional

[Posted: Jan. 15, 2018]

1/22/2018