Pennsylvania: Municipalities say Marcellus shale impact fee legislation overreaching

••• As of the afternoon of April 11, Attorney John Smith who is representing some of the townships that filed the lawsuit, an injunction was granted by the judge in this case. The injunction only pertains to the zoning portion of the Marcellus shale impact fee. The rest of the legislation is still set to become law April 14.•••

SALEM, Ohio — Not every municipality is content with the Marcellus shale impact fee legislation passed by Pa. Governor Tom Corbett.

Court date

A judge is set to hear a lawsuit April 11 filed by seven townships including Robinson, Peters, Cecil and Mount Pleasant townships in Washington County, Nockamixon Township and the borough of Yardley in Bucks County, and South Fayette Township in Allegheny County, in addition to the Delaware Riverkeeper Network and Dr. Mehernosh Khan.

They are asking for an injunction in the appellate court to stop the law’s enactment April 14. If that does not occur, the attorneys will be asking for an expedited hearing to give clarity to the municipalities that will need to reverse ordinances.

The lawsuit was filed because the townships and other municipalities feel the language in the legislation limits the local governments’ ability to zone and regulate drilling.

One of the changes created by the Marcellus shale legislation is that it allows the drilling, waste pits and pipelines to be constructed in every zoning district, including residential areas, as long as certain buffers are observed.

Concerns

Robinson Township Supervisor Brian Coppola told the Farm and Dairy in February that his township was concerned about the legislation and gave some specific examples. They include:

• 500 feet setback between home and gas well was taken away in the legislation. The legislation mandates that township supervisors cannot zone against this. The legislation gives a mandatory waiver, meaning there is nothing that can be done.

• Compressor stations. There are no rules mandating where compressor stations can now be built. The township cannot zone where they can be placed.

• Density requirements. Coppola said gas wells can be placed at the industry’s whim. There are no rules as to where or how many wells can placed in a location.

One size fits all. The lawsuit contends that the legislation signed by Corbett establishes a one-size-fits-all zoning scheme for oil and gas development that applies to every zoning district in every political subdivision in Pennsylvania. They feel it takes away the municipality’s ability to regulate what goes on in their borders regarding oil and gas.

“As municipalities can expect hundreds of wells, numerous impoundments, miles of pipelines, several compressor and processing plants, all within borders, they (municipalities) will be left to plan around, rather than plan for orderly growth,” according to the lawsuit.

Marcellus shale impact fee

The bill will enact a impact fee on every well drilling for gas, retroactive to the first well drilled in the Marcellus formation.

In 2012, the drillers will pay $50,000 per well. Smaller vertical wells will be assessed $10,000. Legislators estimated the fee will generate around $180 million.

The fee will be different from year to year because it will be based on natural gas prices and the Consumer Price Index.