Shale coalition hosts gathering
BUTLER TWP — Natural gas industry representatives and elected officials rallied around one existing gas drilling fee while railing against another proposed tax on Tuesday.
At Alameda Park Tuesday morning, the Marcellus Shale Coalition hosted Butler County commissioners, four state representatives, a state senator and various township officials for a series of speeches discussing how impact fees on natural gas drilling have funded county business.
David Spigelmyer, president of the Marcellus Shale Coalition, said the group picked Butler County specifically because of its usage of such fee revenues. The coalition represents various players in the natural gas industry and does some political lobbying. “I think it's fair to say that Butler County, and the way they've invested those funds in a multitude of ways, has been a shining example of how these funds were meant to be used,” Spigelmyer said.
While the event focused heavily on the benefits of impact fees specifically, many negative comments were directed toward Gov. Tom Wolf's ongoing efforts to implement a severance tax. Discussion focused on the economics of those taxation models — not environmental impacts of natural gas drilling.
Butler County had 579 gas wells as of 2018, according to the Pennsylvania Public Utility Coalition (PUC).
The PUC reports that Butler County received about $3.1 million from the fee in 2018, and that municipalities within the county got a combined $5.1 million.
Since 2012, PUC figures show, the county government and smaller governments within the county have received about $40 million.
Impact fees began with a 2012 law known as Act 13. The law allows for local and state government entities to collect fees in exchange for the imposition of gas drilling sites. Those dollars largely go to local governments that are affected by the drills.
Other states with such drilling commonly have something known as a severance tax instead. The tax would be applied to the amounts of natural gas actually being removed. Wolf points to various budget shortfalls, such as rising education costs, as needing a revenue source like a severance tax.
In an interview after the event, Spigelmyer specified exactly why he doesn't like that plan.“If we upset the balance for capital investment in Pennsylvania, operators leave to locations where they can invest more profitably than they can in Western Pennsylvania,” he said.His words echoed speeches from various county representatives. State Sen. Scott Hutchinson, R-21st, said that adding a severance tax would “kill the golden goose.” State Reps. Marci Mustello, R-11th, Jeff Pyle, R-60th, Jim Marshall, R-14th, and Tedd Nesbit, R-8th, also spoke. All three county commissioners took turns explaining how impact fees have been spent in Butler County.Leslie Osche spoke at length about infrastructure and parks spending. Kim Geyer explained the farmland preservation projects funded by the fees. And Kevin Boozel spoke generally in support of the fees.Boozel, the only Democrat among the speakers, said after the event that he has concerns about the severance tax because he isn't sure of its details, if implemented. He said he recently heard Wolf say that a severance tax wouldn't affect Act 13 funds, a condition Boozel would need to support it.“We obviously need money in Pennsylvania,” Boozel said. “Where is it going to come from, my pocket or big businesses?”Chuck Stowe, a supervisor for Allegheny Township and former president of the Butler County Association of Township Officials, listed ways that townships have used their cash, such as bridge repairs and park improvements.Stowe also drew comparisons to the region's old petroleum industry, calling gas drilling its successor.The oil industry left stretches of Butler County with contaminated groundwater. Spigelmyer said the comparisons shouldn't be drawn when it comes those environmental issues.“Today, for a shale well, there's five layers of steel all encased in concrete to protect our fresh groundwater aquifers,” Spigelmyer said.He said he believes natural gas production in Western Pennsylvania still is in the earliest stages of its life span. Asked about the bankruptcies of gas companies, such as EdgeMarc and Rex Energy, Spigelmyer seemed unphased.“The biggest issue there has been (is) inadequate pipeline capacity to move their gas,” Spigelmyer said.
