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Pike, Wayne undecided about impact fees; some communities may sue

March 14, 2012

MILFORD & HONESDALE, PA — County commissioners in both Wayne and Pike counties have not decided if they will participate in the enactment of the recently adopted Gas Drilling Impact Fee Law, which has been passed by the PA Legislature and signed by Governor Tom Corbett.

The state legislation allows the placement of an impact fee on every well drilled for gas. The levy will change from year to year based on natural gas prices and the Consumer Price Index, but in 2012 drillers will pay $50,000 per well. The bill’s authors estimate the fee will generate around $180 million. While the fee will be administered and collected at the state level, counties will decide whether or not to impose it.

County commissioners have until mid-April to choose.
“We are looking it over and will decide in the near future,” said Brian Smith, chairman of the Wayne County commissioners. “It’s a complex issue.”

“I think it’s unfair that Pike County may not qualify for the law since we don’t have drilling sites in our county,” said Rich Caridi, chairman of the Pike County Commissioners. “We will, however, have drilling traffic over our roads and pipelines crossing our lands. We should be compensated for these things; we should not be hindered from participating in the law. We will decide in the near future whether we will ask to be a part of it if we can.”

Several townships in western Pennsylvania are preparing to challenge the law. Their complaint is that the law limits local governments’ ability to zone and regulate drilling if they choose to impose the impact fees. South Fayette Township has joined several municipalities in considering legal action against the law, called House Bill 1950. In Washington County, officials in Peters, Robinson and Cecil townships also are considering legal action.

“They’re going to take a look at all potential legal action and if that involves—and could be more effective—a consortium of interested municipalities, that certainly could happen,” said Marshall Bond, counsel for South Fayette.

While Pike might not have wells, thousands of acres of land in Wayne have been leased for drilling, pending the release of gas drilling regulations by the Delaware River Basin Commission, which were put on hold last November. The commission, which oversees the water supply for Philadelphia and half the population of New York City, has imposed a moratorium on all Marcellus Shale drilling projects in the four-state basin until the rulemaking process is complete.