Under Wolf plan, conservation agency will still rely on gas royalties

Marie Cusick

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Marie Cusick was the Harrisburg reporter for StateImpact Pennsylvania.

March 4, 2015 | 1:43 PM

A natural gas rig in the Tioga State Forest. The state Department of Conservation and Natural Resources manages drilling on public land and has become increasingly reliant on gas royalty money in recent years.

Joe Ulrich / WITF

A natural gas rig in the Tioga State Forest. The state Department of Conservation and Natural Resources has become increasingly reliant on gas royalty money in recent years.

Under the budget proposal Governor Wolf unveiled Tuesday, the state Department of Conservation and Natural Resources will continue to rely heavily on natural gas royalty money to fund its general operating expenses.

“Over the past few years, we saw a significant reduction in the amount of our budget supported by the General Fund,” says DCNR spokeswoman Chris Novak. “As that number went down, our draw from the Oil and Gas Lease Fund went up significantly.”

The Oil and Gas Lease Fund is supported by drilling royalty money. Wolf’s budget would make the department slightly less reliant the fund, but it would still make up over a third of its $342.6 million proposed budget.

Novak says DCNR’s dependence on royalty money makes its budget less stable.

“This is a first step to reverse that direction,” she says of Wolf’s plan. “We are restoring $20 million from the General Fund.”

Environmentalists have complained the royalty money poses an inherent conflict of interest for the department, which is charged with balancing conservation interests in state parks and forests and promoting the use of natural resources, such as timber, oil, and gas.

Under Wolf’s plan, DCNR would receive $117 million from the Oil and Gas Lease Fund– down from $122 million.

“It’s positive it’s less than last year, but $117 million is still way too much,” says state Rep. Greg Vitali (D- Delaware). “I think even people in the [Wolf] administration would concede, the Oil and Gas Lease Fund is not to be used to run government, but the problem is this huge budget deficit.”

The Oil and Gas Lease Fund was established in 1955 and intended to be used for conservation purposes. In 2009 the legislature approved a change to give the General Assembly control of the money. That move was unsuccessfully challenged by an environmental group in a recent lawsuit.