Strengths and flaws of Act 13 assessed

WILKES-BARRE �?? A recent report by two local institutes points out strengths and weaknesses in the state�??s new regulations for the natural gas industry, but a co-sponsor of the legislation dismissed the report as �??an opinion piece.�?�

The Institute for Public Policy and Economic Development, in collaboration with the Institute for Energy and Environmental Research for Northeastern Pennsylvania, jointly released a 20-page report that comments on key provisions of Act 13, which was signed into law by Gov. Tom Corbett on Feb. 14.

Both institutes are affiliated with Wilkes University.

Stephen Miskin, a spokesman for House Majority Leader Mike Turzai, who co-sponsored the House version of the bill, said the report seems like �??more of an opinion piece than a study or a report by a university.�?�

�??They should read (or re-read) the local ordinance provisions because they�??re totally mischaracterized in the report,�?� Miskin said.

Among the strengths noted in the report are provisions that allow counties and municipalities in which gas drilling occurs to receive revenue from the industry to offset impacts.

The proceeds can be spent on infrastructure improvement and repair and can fund numerous programs and community enhancements such as environmental programs, trails, parks, recreation, open space, flood plain management, conservation districts, tax reductions, affordable housing, social services and schools for training workers in the oil and gas industry.

The report also notes that 30 percent of the state portion of impact fee revenue will go toward environmental uses such as conservation districts, additional money for enforcement of water and air regulations, open space and heritage parks.

But the law also runs counter to many principles supported by the institutes, the study notes.

�??For example, it strips municipalities of their power of local zoning and land use planning. It makes the tax optional and puts the burden of collecting, enforcing and allocation on the local government. This has the ability to create an uneven playing field with counties opting in or out and assessing the tax at different levels,�?� the report states.

The report also contends that the law discriminates against non-drilling communities that can be impacted by increased traffic and congestion, placement of pipelines and compressor stations, and population and cost of living increases related to drilling. The law provides no revenue to enhance the quality of life for those communities�?? residents.

And it notes that Arkansas, Colorado, Louisiana, Texas, West Virginia and Wyoming all have natural gas drilling taxes or fees that benefit all of residents either through education, community programs or tax reductions.

�??Based on this analysis, our Institutes do not support Act 13, as it falls short of its objective of providing local governments with revenue to mitigate the negative impacts of drilling and actually increases the potential for economic uncertainty and provides no recourse to mitigate impacts in non-drilling counties,�?� the report states.

Teri Ooms, executive director of the Institute for Public Policy and Economic Development, said the report is significant �??because it traces the evolution of both the House and Senate bills as well as provides the analysis of the final provisions and is presented in a way that everyone can understand it.�?�

Kenneth Klemow, associate director of the Institute for Energy and Environmental Research for Northeastern Pennsylvania, concurred, adding that the report provides �??a unique and timely analysis. We hope that it will prove useful to decision-makers and the public still trying to understand and deal with the complexities of Act 13.�?�