Impact Fee Moves Forward, But Plan’s Details Remain Unclear

October 26, 2011 | 4:42 PM

By Scott Detrow

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State Sen­ate lead­ers are aim­ing at pass­ing a nat­ural gas impact fee bill by early next week.

The first step toward that goal hap­pened this after­noon, when the Sen­ate Appro­pri­a­tions Com­mit­tee unan­i­mously approved changes to Sen­ate Bill 1100, which Sen­ate Pres­i­dent Pro Tem Joe Scar­nati ini­tially intro­duced in May.

The com­mit­tee gave the green light to a 61-page amend­ment, hik­ing penal­ties imposed on drillers who vio­late reg­u­la­tions, and broad­en­ing buffer zones between nat­ural gas wells and water sources. The amended lan­guage adds trans­parency to the reg­u­la­tory process, by increas­ing the amount of infor­ma­tion drillers pro­vide to the Depart­ment of Envi­ron­men­tal Pro­tec­tion, and host­ing those reports on a pub­lic website.

For more details on the amend­ment, check out StateImpact’s anno­tated copy of the leg­is­la­tion at the bot­tom of this post.

The amend­ment has a major catch: it actu­ally strips all impact fee lan­guage out of the bill. Scar­nati explained the par­lia­men­tary tac­tic is a way to buy more time for Repub­li­cans and Democ­rats to nego­ti­ate details of a fee struc­ture. “It is obvi­ously maybe the most divi­sive, as far as the level of the fee, the type of the fee that is imposed upon, and dis­tri­b­u­tion,” he said. “So in order to give every­body an oppor­tu­nity to have a fair debate on that, we chose to take it out.”

Scar­nati and other law­mak­ers will con­tinue nego­ti­at­ing the fee’s details through the week­end, and aim to roll the new lan­guage out by Mon­day. Gov­er­nor Corbett’s pro­posed impact fee lines up with Scarnati’s pre­ferred approach in many ways, includ­ing the amount of money charged per well, and how much money is dis­trib­uted to coun­ties, munic­i­pal­i­ties, and the state.

The main dif­fer­ence is who imposes and col­lects the levy – the county or the state. Cor­bett wants the deci­sion of whether or not to impose a fee to remain on the local level, while most law­mak­ers would like to see the state set a stan­dard­ized rate, and col­lect the rev­enue. Scar­nati stayed vague on which method would make it into the final bill, though he did note he met with Cor­bett for an hour on Mon­day, to dis­cuss the legislation’s details.

Demo­c­ra­tic lead­ers are work­ing closely with Scar­nati and other top Repub­li­cans to reach a con­sen­sus on the plan, though both Minor­ity Appro­pri­a­tions Chair Vince Hughes and Allegheny County Demo­c­rat Jim Ferlo made it clear their “aye” votes today were cast to move the process along, and not as a sign of sup­port for the plan.

One likely sore spot is Scarnati’s pro­posal to bar munic­i­pal­i­ties from receiv­ing impact fee rev­enue, if they impose strict ordi­nances on drillers. Today’s amend­ment left the “model ordi­nance” sec­tion intact. Under the Scar­nati plan, the Pub­lic Util­ity Com­mis­sion would draft a statewide stan­dard for local reg­u­la­tions. If a town­ship sur­passed the model ordi­nance, it wouldn’t get any rev­enue. Scar­nati acknowl­edged the pro­posal has received harsh criticism.“You know, we’re try­ing to work through a plan here that still gives locals – and I believe they should have – auton­omy in decid­ing what goes on within that com­mu­nity,” he said. “Yet some con­sis­tency across the state. So we’re try­ing to strike a bal­ance there, and we’re cer­tainly try­ing to keep town­ships out of court.”