PA Municipalities that Ban Drilling Will Not See any Revenue from Impact Fee

Municipalities in Pennsylvania that ban drilling will not get any share of a coming “impact fee” from Marcellus Shale drilling under a new proposed law by Republican State Senator Joe Scarnati:

The proposal by Senate President Pro Tempore Joseph Scarnati, R-25, Jefferson County, would levy a fee on each producing Marcellus well to help local governments offset the impact of drilling activities.

For affected municipalities to receive a share of that revenue, they could not adopt a drilling zoning ordinance more restrictive than a model zoning ordinance that will be developed by a state agency. Under the proposal, the state Public Utility Commission would collect the per-well impact fee, distribute the revenue and draw up the model ordinance.

Mr. Scarnati is expected to introduce his bill this week.

The model ordinance is a way to make sure impact fees go to towns affected by drilling, said top Scarnati aide Drew Crompton.

"If the local municipality wants to ban drilling, then it refuses to be impacted," he added. "It seems immensely reasonable that none of the impact fee flows to that municipality."*

*Scranton Times-Tribune (May 8, 2011) – Impact fee proposal addresses zoning