Political Pressure Led Philadelphia Democrats To Back Impact Fee

Scott Detrow / StateIm­pact Pennsylvania

Repub­li­can Joe Scar­nati (l) dur­ing Mon­day night’s con­fer­ence com­mit­tee vote

Why did a lib­eral Demo­c­rat who once called the Senate’s Mar­cel­lus Shale impact fee “absurd” end up vot­ing for the bill?

Sen­a­tor Vin­cent Hughes said he was threatened.

The man who allegedly did the threat­en­ing, Sen­ate Pres­i­dent Pro Tem Joe Scar­nati, framed the dis­cus­sions a dif­fer­ent way.  Scar­nati said the nego­ti­a­tions were aimed at gen­er­at­ing more bipar­ti­san sup­port for leg­is­la­tion re-writing gas drilling reg­u­la­tion, and cre­at­ing an impact fee on gas wells.

Both men agree on this: if Philadel­phia Democ­rats hadn’t voted for the leg­is­la­tion, their city would have received less money from impact fee revenue.

While the major­ity of impact fee money would stay in coun­ties and munic­i­pal­i­ties that host Mar­cel­lus Shale wells, 40 per­cent of the rev­enue would go to state agen­cies. That money would trickle down to local gov­ern­ments through project-specific grants, as well as for­mu­las dol­ing out money for recre­ation projects, infra­struc­ture, and other local pro­grams. Scar­nati told Hughes and other Philadel­phia Demo­c­rat, Anthony Williams, that with­out their sup­port, the dis­tri­b­u­tion for­mat would change, and Philadel­phia would see less fee money.

“I deemed the threat cred­i­ble and real, and had to respond accord­ingly,” said Hughes.  Williams said his “yea” vote was based on sim­i­lar con­ver­sa­tions with Scar­nati. “It was clear they had the votes to move it out of the Sen­ate whether we voted for it or not,” explained Williams.

So why did Scar­nati exert pres­sure on the Democ­rats?  He said he had grown frus­trated by Demo­c­ra­tic law­mak­ers request­ing change after change in the impact fee, but who con­tin­ued to oppose it. “This is not a buf­fet,” Scar­nati said. “This is a sit-down din­ner, and all things are included in the din­ner. You don’t just pick and choose what you like out of it, and stand and pon­tif­i­cate and vote against it.”

The major change Scar­nati put on the table: chang­ing the way the Com­mon­wealth Financ­ing Author­ity would approve impact fee-funded projects. The CFA is a four-member panel, made up of Democ­rats and Repub­li­cans. Unan­i­mous votes are needed to approve fund­ing for spe­cific projects. Scar­nati warned the Democ­rats he’d change the authority’s vot­ing reg­u­la­tions, so Repub­li­cans could decide where impact fee money went. “My mes­sage to them was very clear,” Scar­nati explained. “There are pro­grams being dri­ven through the [Com­mon­wealth Financ­ing Author­ity]. And the CFA is a bipar­ti­san com­mis­sion that moves projects through.”

“I’m not about to stand here and put up all the votes in my cau­cus while you just pick the buf­fet items,”  con­tin­ued the one-time restau­rant owner.  “We would all like to eat the filet mignon off the buf­fet and not have to eat the veg­eta­bles. But the veg­eta­bles come with it.”

Scar­nati would have also tweaked population-based fund­ing for­mu­las that drove mil­lions of dol­lars to coun­ties like Philadel­phia, Mont­gomery and Bucks, where there’s no Mar­cel­lus Shale drilling. His chief-of-staff, Drew Cromp­ton, said Sen­ate Repub­li­cans were frus­trated the impact fee would send $15.7 mil­lion in infra­struc­ture funding,yet the city’s leg­is­la­tors weren’t vot­ing for it. Under the population-based for­mula, drilling-heavy Wash­ing­ton County would only receive $256,000 in transportation-specific fund­ing.  Tioga County would take in about $50,000. Of course, the major­ity of impact fee rev­enue will remain at the local level under the impact fee’s for­mula, which sends 60 per­cent of the money to coun­ties and munic­i­pal­i­ties host­ing wells.

“That’s how we came up with some votes,” said Scarnati.

Hughes, who once said the impact fee “falls woe­fully short,” was frus­trated by what he called hard­ball tac­tics. “Philadelphia’s a part of the Com­mon­wealth of Penn­syl­va­nia. An impor­tant part of the Com­mon­wealth of Penn­syl­va­nia. I could not allow Philadel­phia in any way shape or form to be cut out.”