Original Article:  shalehub.org

The County Commissioners Association of Pennsylvania recently rolled out their legislative agenda for 2017. Among the top priorities from the group is the maintenance of the impact fee structure introduced into law by Act 13 in 2012. Impact fees have generated $160 million for counties from 2012 to 2015 while municipalities have seen $267 million in revenue. Much of this money gets directed to areas impacted the most from drilling activity. With the added revenue, counties have the flexibility to mitigate some of the negative effects of drilling and spend more to improve safety and emergency response resources. Since the impact fee is structured to get much of the money directly to the county and municipal level, the CCAP is committed to keeping this direct line of funding in place.

The CCAP maintains its support for impact fees even as some in Harrisburg such as Governor Tom Wolf would prefer to see a severance tax. It is likely that the severance tax would result in higher amounts of revenue than an impact fee, but it is also likely that these dollars would flow directly to the state coffers before any redistribution to county and local governments. However, the CCAP position is not necessarily against instituting a severance tax. Rather the group states its preference that an impact fee structure remain in place even if a severance tax was also adopted. By having this position, the CCAP hopes to maintain direct local access to drilling revenue no matter how the political situation in Harrisburg changes. The CCAP indicates that both an impact fee and severance tax could exist in the state at the same time.

The county commissioner support for the continuance of the impact fee comes as the state has finished an audit of Act 13 money and the Pennsylvania Public Utility Commission. Lack of clarity from Act 13 significantly contributed to questionable spending by counties and municipalities of nearly a quarter of impact fee money reviewed. Oversight of how impact fee money is spent is difficult because guidelines of how to spend the money are unclear as well as jurisdiction in oversight. A finding like this audit suggests that the current impact fee is difficult to administer and further fuels calls for a simpler severance tax structure.

Sources:

Miller, Barbara. 2017. “Local Commissioner to Harrisburg: Keep Act 13 Impact Fee on Marcellus Shale Gas Wells.” Observer-Reporter. January 26. http://www.observer-reporter.com/apps/pbcs.dll/article?avis=OR&date=20170126&category=NEWS01&lopenr=170129679&Ref=AR&profile=1333.

Legere, Laura. 2016. “Audit: Vague Guidelines Led to Improper Spending of Pa.’s Impact Fees.” Pittsburgh Post-Gazette. December 6. http://powersource.post-gazette.com/powersource/policy-powersource/2016/12/06/Auditor-Eugene-DePasquale-s-report-finds-weak-impact-fee-oversight-in-Pennsylvania-allowed-misspending/stories/201612060175.

Swift, Robert. 2017. “Gas Impact Fee Draws Scrutiny.” The Times-Tribune. January 2. http://www.thetimes-tribune.com/news/gas-impact-fee-draws-scrutiny-1.2137502.