FOR IMMEDIATE RELEASE
State Rep. Phyllis Mundy
Marcellus Shale bill fails Pennsylvanians
HARRISBURG, Nov. 2 – A Marcellus Shale drilling bill reported out of the House Finance Committee today would strip local government of its power to regulate where the industry can drill, place compressor stations, transmission lines and other structures, according to state Rep. Phyllis Mundy, D-Luzerne.
Mundy, the Democratic chairman of the committee, also said H.B. 1950 would fail to set a drilling fee that is sufficient to address air and water pollution and other impacts caused by natural gas drilling. She pointed out that Luzerne County, which does not have active drilling but is affected by the industry due to heavy truck traffic and the building of compressor stations and pipelines, would not receive any revenue under the bill.
"This is an extremely weak, ill-conceived bill," Mundy said. "The consequences for local residents could be terrible. Not only do local governments lose local control, but there is little in place to protect residents, the environment and property values. And to make matters worse, the proposed fee is structured to create winners and losers. Unfortunately, Luzerne County would be one of the losers."
Mundy said she fears that local governments would be dealing with similar scenarios such as one that happened near her legislative district, where an oil and gas company proposed building a natural gas metering station near the Dallas Area School District campus.
"A combination of zoning regulations and public outcry prompted the project to be moved further away from the campus," Mundy said. "But if this bill becomes law, the drilling industry could dictate to local government where it will do business."
Mundy said H.B. 1950 would set a fee that equates to a 1 percent tax on drillers. She said it would generate $160,000 from a well that makes $16 million over its life for a gas company.
"The natural gas industry has a large, expensive impact on our commonwealth, and that's simply not enough," Mundy said. "Taxpayers have been footing the bill for the coal industry for years, and that shouldn't happen again with the gas industry."
While Pennsylvania would have an effective tax rate of 1 percent, Arkansas has a severance tax of 3.5 percent, Texas has a 5.5 percent rate and West Virginia has a 6 percent rate.
Democratic members of the committee also raised concerns that the bill leaves it to already overworked and underfunded counties to assess and collect the fee. They said it would be better to assess and collect at the state level, instead of having as many as 40 counties doing that work.
Despite the objections, the bill was voted out of committee on a party-line vote. It is now in a position to be considered by the full House of Representatives.