NY Comptroller Wants New Tax to Cover Gas Drilling Accidents

pickpocketEven though New York still has not adopted new drilling regulations, and likely won’t until late this year, and even though drilling will not begin until 2012 at the earliest, New York politicians are lining up to dip their hands into driller’s and landowners’ pockets. The latest example is New York State Comptroller Thomas DiNapoli who has proposed a bill to the state legislature to create a driller-funded pool of money (i.e. a new tax on drillers) to cover the cost of any future accidents that may (or may not) happen because of drilling.

The problem, of course, is that any pool of money in Albany—home of politicians with sticky fingers—has a half-life of about 30 minutes before it will be borrowed, moved from one side of the ledger to the other, or otherwise disappear.

The bill, proposed by Comptroller Thomas DiNapoli, would allow the state to create the fund by tacking on a surcharge to permit fees for natural gas companies and other production facilities.

The fund would then cover the cost of any cleanup work from accidents during gas drilling or hydraulic fracturing if the cause of the contamination couldn’t be immediately identified, or if the responsible party refused to pay. The state Attorney General’s Office would later determine who is responsible and sue for damages, with any money recovered going back into the cleanup fund.

DiNapoli said the proposal is modeled after the state’s oil spill fund. The bill would allow for leaseholders or other landowners to seek claims if drilling accidents were to occur, he said.

"Unlike protections for those who suffer from an oil spill, we don’t have a similar recovery and compensation fund for incidents involving natural gas extraction," DiNapoli said. "So we’re trying to provide a level playing field."

But the head of the state Independent Oil & Gas Association called the bill "premature" and said there is "simply no basis for such a fund at this time."

"The proposal does not take into account existing permit requirements, which address bonding for site reclamation, and it does not acknowledge existing environmental, criminal and civil law, which holds businesses accountable on many levels," IOGA Executive Director Brad Gill said in a statement.*

*Elmira Star-Gazette (Aug 9, 2011) – N.Y. plan promotes fund to cover gas-drilling accidents

  • Anonymous

    Here we Go with the NY State Government ( The Legal Mafia) finding anyway they can to pick pockets of the hard working slob, so they can line their millionaire pockets. With the 1000 page SGEIS rules that are in place this problem is clearly addressed. I’m sure that the drilling companies  who are putting all their resources and manpower in the two shale’s have this problem solved ( a simple Bond would suffice w/o Government intervention and possible corruption). If there is an accident (which is highly improbable anyway) and a drilling company refuses to clean up the mess, then the DEC can refuse to issue any additional drilling permits to that company, which would put a huge financial burden on them. It is so obvious with all the regulations in place in New York State and the proper DEC oversight that any company doing business here will be diligent to follow the rules and regulations safely in their drilling process. Our economy is tanking by the day, procrastination is ignorant. The Governments job is to look out for the best interest of ALL the people, not just the few anti’s that are screaming the loudest. Its time to let these companies drill responsibly and also watch the cash registers ring all around them. Whether your pro or against drilling we have a resource that must be tapped here, collected here and sold here.Its to late the discovery is made and we must act on it immediately. 

  • RJ

     DiNapoli, Will this ‘fund’ preclude any lawsuits from drilling/operational accidents?  If not, stick it in your canolli & smoke it.  Scamsters like DiNapoli will sink their meat hooks into this industry and kill it like they have done to every other industry.  Their should be a tax on every word that eminates from Albany, funds payable in equal part to every citizen of NY.

  • Pingback: NY Comptroller DiNapoli Editorial Defends Drilling Tax | Marcellus Drilling News()

  • Pingback: NYS Comptroller Threatens Chesapeake Energy | RefineryNews.com()