Royalties bill stalled in state legislature

Marie Cusick

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Marie Cusick was the Harrisburg reporter for StateImpact Pennsylvania.

April 23, 2014 | 9:49 AM

A bill aimed at guaranteeing minimum royalty payments to landowners who have leased their property for natural gas drilling has hit a snag in the state legislature, according to the Towanda Daily Review:

Speaking at a meeting on Tuesday of the Bradford County Council of Republican Women, Baker, R-Wellsboro, said that the leadership of the Pennsylvania House has not yet allowed the bill to come up for a vote on the floor of the House.
There has been a “pushback by a lot of people” to the bill since it was approved on March 17 by the House Environmental Resources and Energy Committee, said Baker, who is one of the prime sponsors of the bill.
The leadership of the House and others have concerns about the bill related to “legality issues and constitutionality issues” and other matters, he said.
“We hope to get a vote on it (on the House floor),” said Baker. “I really believe it will pass” in the House if it is brought up for a vote, he said.
As a result of deductions from royalty checks for post-production costs, many local landowners are receiving royalty payments of 5 percent or less, Bradford County Commissioner Daryl Miller has said.

House Bill 1684 is an effort to clarify the state’s Guaranteed Minimum Royalty Act of 1979, which states an oil and gas lease is not valid unless a landowner receives a one-eighth (12.5 percent) royalty.
The legislation was proposed in the wake of allegations some gas companies are cheating landowners by withholding large amounts of money and paying less than the legal minimum.
The measure was approved by a House committee in March, but it faces strong opposition from the state’s natural gas industry, which argues it’s a legislative overreach that would be unconstitutional because it changes the terms of existing contracts.