Pennsylvania

Energy. Environment. Economy.

Marie Cusick

Reporter

Marie Cusick is StateImpact Pennsylvania's Harrisburg reporter at WITF. Her work regularly takes her throughout the state covering Marcellus Shale natural gas production. Marie first began reporting on the gas boom in 2011 at WMHT (PBS/NPR) in Albany, New York. A native Pennsylvanian, she was born and raised in Lancaster and holds a degree in political science and French from Lebanon Valley College. In 2014 Marie was honored with a national Edward R. Murrow award for her coverage of Pennsylvania’s natural gas industry.

Sunoco begins pipeline work at Raystown Lake

Crews working for Sunoco Logistics clear trees for the Mariner East 2 pipeline at Raystown Lake in Huntingdon County.

Marie Cusick / StateImpact Pennsylvania

Crews working for Sunoco Logistics clear trees for the Mariner East 2 pipeline at Raystown Lake in Huntingdon County.

The sounds of buzzing chainsaws echoed through the hills around Raystown Lake Thursday afternoon, as contractors for Sunoco Logistics cleared trees to make way for the new Mariner East 2 project.

The 8,300 acre lake in Huntingdon County is a popular spot for swimming, boating, hiking, and mountain biking. It draws about 1.5 million visitors annually.

Kathy Criswell, of Huntingdon was walking her dog on the unseasonably warm day and remarked on all the noise.

“We come out to the lake often– either walking, on the boat,” she says. “I don’t know a ton about the pipeline, but it is disappointing to see the number of trees that had to be cut down for it.”

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A year later, pipeline report is largely ignored

A scene from one of the many contentious public meetings of the state's pipeline infrastructure task force.

Marie Cusick / StateImpact Pennsylvania

A scene from one of the many contentious public meetings of the state's pipeline infrastructure task force.

Pennsylvania has rapidly become a hub for the development of new natural gas pipelines. In recent weeks, billions of dollars worth of projects have been approved by state and federal regulators. Shortly after he took office, Governor Tom Wolf convened a major task force to recommend ways to coordinate planning and best practices for this building boom.

But a year after the panel issued a report with 184 recommendations, it appears much of its work has been ignored.

“Put on a shelf somewhere”

The Governor’s Pipeline Infrastructure Task Force had problems from the beginning

For one thing, it was really big, with 48 members and another 100 volunteers on workgroups. They also had a hard time agreeing on anything. There were representatives from the gas industry, government, academia and environmental groups, and they weren’t exactly all on the same page.

Finally, the public meetings were often disrupted by protesters. At the last meeting, about a year ago, seven people were arrested. The whole effort was spearheaded by then-secretary of the state Department of Environmental Protection, John Quigley.

At the group’s final meeting, he said the report was just a first step, and state’s work on pipelines should continue.

“This is the start of a conversation,” Quigley told the group. “This is fertile ground. I do believe this is a very fertile document that can generate a lot of positives.”

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State funding to DEP is inadequate, says advisory panel

DEP

Marie Cusick / StateImpact Pennsylvania

DEP's Harrisburg headquarters at the Rachel Carson State Office Building.

An advisory panel to the state Department of Environmental Protection warns consistent cuts to the agency over the last 20 years have reached an “unsustainable level.”

In a letter sent Tuesday to state Senate Appropriations Committee chairs Patrick Browne and Vincent Hughes, DEP’s Citizens Advisory Council chairman William Fink says the cuts are threatening the agency’s ability to do its job.

“General Fund appropriation for the Department has decreased steadily from a high of $245.6 million in [fiscal year] 2002-03 to the current $152 million in the proposed FY 2017-18 budget.”

Fink also cites the recent warning Pennsylvania received from the U.S. Environmental Protection Agency, saying it lacked the staffing and resources to enforce clean water standards. The shortage caused the number of unaddressed Safe Drinking Water Act violations to nearly double in the past five years, from 4,298 to 7,922. These failures could be grounds for taking primacy away– costing Pennsylvania millions of dollars in federal funding.

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Atlantic Sunrise pipeline opponents begin encampment

Protesters gathered in January to ceremonially burn the environmental impact statement for the Atlantic Sunrise pipeline.

Marie Cusick / StateImpact Pennsylvania

Protesters gathered in January to ceremonially burn the environmental impact statement for the Atlantic Sunrise pipeline.

Opponents of the Atlantic Sunrise natural gas pipeline are officially launching an encampment in Lancaster County this weekend.

The pipeline was approved by federal regulators earlier this month, although it still awaits permits from the state Department of Environmental Protection and U.S. Army Corps of Engineers. Williams, the company behind the project, expects construction to begin in the second quarter of this year, with the pipeline coming online by mid-2018. It has already begun condemnation efforts to obtain rights of way and temporary easements.

The $3 billion dollar pipeline is designed to carry Marcellus Shale natural gas southward to markets along the east coast and to an export terminal near the Chesapeake Bay. It will go through 10 Pennsylvania counties, but the most intense opposition has come from Lancaster.

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GOP lawmaker reintroduces controversial royalties bill

drill rig Tioga county

Marie Cusick/ StateImpact Pennsylvania

Representative Garth Everett has called himself as a “sometimes marathoner” who is in it for the long haul. He’s now on his third attempt to pass legislation ensuring Pennsylvania landowners are paid a minimum royalty for natural gas development.

On Thursday Everett (R- Lycoming) introduced House Bill 557– an effort to address complaints that some gas companies are cheating leaseholders out of money. Mineral owners have accused drillers of abuses including charging exorbitant fees, misreporting the sale price of gas and volume produced, and failing to adhere to lease language.

Everett’s earlier bills cleared House committees twice, but he blames the GOP leadership for blocking a vote.

“I never had any doubt it would easily receive enough votes on the floor,” he says.

He hopes this year will be different.

“Sometimes leadership will run a bill they might not personally agree with, if there’s enough of the caucus and enough people in the legislature that want the bill run.”

The royalty disputes have led to numerous lawsuits, including one from the state Attorney General’s Office. The issue has also affected leases on public forest land. Last year, following an audit, the Commonwealth recovered more than $1.3 million.

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Lawmaker calls DEP methane strategy a ‘blatant disregard’ of the law

Rep. Daryle Metcalfe (R- Butler) is accusing the Pennsylvania Department of Environmental Protection of trying to sidestep a 1982 law.

Photo: Pa. Legislature

Rep. Daryle Metcalfe (R- Butler) is accusing the Pennsylvania Department of Environmental Protection of trying to skirt a 1982 law.

A Republican state lawmaker is accusing Pennsylvania environmental regulators of overstepping their authority, as they attempt to limit climate-damaging methane leaks from shale gas sites.

In a February 10 letter, Rep. Daryl Metcalfe (R- Butler) accuses Acting Department of Environmental Protection Secretary Patrick McDonnell of trying to sidestep a 35-year-old law, known as the Regulatory Review Act. The law allows legislators to have more oversight in the rulemaking process, but DEP is instead seeking to control methane leaks at well sites and compressor stations through permit changes.

“This administration is acting like it’s above the law,” says Metcalfe. “They’re totally regulating. It shouldn’t be coming through a permit. They are operating in a pretty shady area.”

Methane is the main component of natural gas. Compared to carbon dioxide, it is a much more potent greenhouse gas, although it stays in the planet’s atmosphere for a shorter time period.

Metcalfe says at the moment he’s objecting to the DEP’s process, rather than the substance of the proposed changes. However, he calls them burdensome, costly, and job-killing.

In his letter to McDonnell, Metcalfe writes, “I would invite you to share with me and my colleagues at your earliest convenience your plan to rectify this blatant disregard for the law.”

He says he won’t rule out a lawsuit but hopes it doesn’t get to that point.

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Lawmaker urges Wolf to modernize campaign finance website

Computer

Logan Ingalls / via Flickr: http://bit.ly/1ryPA8o

A Democratic lawmaker is calling on the Wolf administration to overhaul Pennsylvania's archaic campaign finance website.

A Democratic state lawmaker is calling on Governor Tom Wolf’s administration to modernize Pennsylvania’s archaic campaign finance website.

Rep. Greg Vitali (D- Delaware) says updating the site would go a long way toward transparency. Vitali recently published a report on the natural gas industry, showing what he describes as its outsized political influence in Harrisburg. He blames the lobbying expenditures and campaign contributions for stymieing efforts to enact a gas severance tax and new drilling regulations. He estimates the gas industry spent more than $7 million last year on lobbying and over $62 million since 2007.

Vitali notes it’s incredibly time-consuming to wade through the campaign finance reports online. The website discourages journalists from doing real-time analysis, he says, which could show links between the money and lawmakers’ votes. Unlike federal data, Pennsylvania’s campaign finance information is not available in a machine-readable format, like an Excel file, which can be easily downloaded and analyzed.

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Local governments hurt by declining impact fees, says Moody’s

Moody's says local governments budgets are taking a hit from the slower pace of drilling in Pennsylvania.

Marie Cusick/ StateImpact Pennsylvania

Moody's says local governments budgets are taking a hit from the slower pace of drilling in Pennsylvania.

Declining impact fee revenue from Pennsylvania’s Marcellus Shale natural gas industry is hurting many local governments’ budgets, according to a new report from Moody’s Investors Service.

“The data show that hydraulic fracturing has been very important to these towns,” says Moody’s analyst Michael Higgins.

But he points out that as natural gas production has risen over the past three years, the impact fee distributions to local governments declined. Pennsylvania is the only major energy-producing state that doesn’t tax gas production. Instead, an impact fee is levied on each well.

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Wolf renews call for natural gas tax

Gov. Tom Wolf delivers his budget address for the 2017-18 fiscal year to a joint session of the Pennsylvania House and Senate in Harrisburg, Pa., Tuesday, Feb. 7, 2017. Speaker of the House of Representatives, Rep. Mike Turzai, R-Allegheny, is at left, and Lt. Gov. Michael Stack, is at right.

AP Photo/Matt Rourke

Gov. Tom Wolf delivers his budget address for the 2017-18 fiscal year to a joint session of the Pennsylvania House and Senate in Harrisburg, Pa., Tuesday, Feb. 7, 2017. Speaker of the House of Representatives, Rep. Mike Turzai, R-Allegheny, is at left, and Lt. Gov. Michael Stack, is at right.

Governor Tom Wolf is renewing his call for a severance tax on Pennsylvania’s natural gas industry. It was among his central campaign pledges three years ago, but so far he’s been unsuccessful getting it through the Republican-led legislature.

In his annual budget address Tuesday, Wolf didn’t mention the tax at all– instead focusing on efforts to streamline government.

“By identifying specific programs that could be working more efficiently – and others that are no longer working at all – this budget proposes reforms that, altogether, will save taxpayers more than $2 billion,” says Wolf.

The 6.5 percent tax rate is the same level he sought last year. The administration predicts it will bring in an additional $293.8 million, which would help plug a $3 billion projected budget deficit. It’s a far cry from two years ago, when Wolf projected a gas severance tax could raise $1 billion and help fund public education.

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Report: gas impact fee revenue will hit record low this year

Fewer new wells being drilled means there is less revenue being generated by Pennsylvania's gas impact fees.

Joe Ulrich/ WITF

Fewer new wells being drilled means there is less revenue being generated by Pennsylvania's gas impact fees.

Revenue from Pennsylvania’s natural gas drilling impact fee is expected to hit a record low this year, according to a report from the state’s Independent Fiscal Office.

The IFO projects the fees will bring in $174.6 million–down 7 percent compared to last year. It’s a 23 percent decline since peaking at $225 million three years ago.

The drop is largely driven by a decline in new drilling, due to depressed gas prices. Pennsylvania is the only major energy-producing state that doesn’t tax gas production. Instead, a so-called “impact fee” is levied on each well drilled. The fees are highest in the first year of a well’s life and can range from $40,000 to $60,000. As time goes by, the fees decline– ending completely after 15 years.

So without new drilling, older wells generate dwindling amounts of revenue.

“The aging wells and declining revenues– that’s a normal occurrence,” says IFO deputy director Mark Ryan. “Production can extend for a while, but it does tail off significantly after the first five or so years.”

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