Response to 'Corbett Plan'

We are saddened, but not surprised, to see the October 3, 2011, Press Release from Governor Corbett’s office. ‘Not surprised’, because Mr. Corbett’s commitment to the interests of the natural gas extraction industry has been a hallmark of his administration from its beginning. ‘Saddened,’ because his policies continue to promote the destruction of Pennsylvania’s natural and human resources, while echoing empty promises of prosperity.

The Governor points to three components of his plan: ‘environmental standards’, ‘impact fee’ and ‘energy independence’. We find that none of those components address the real needs of Pennsylvanian citizens and communities.

First, the proposed measures which the Governor characterizes as ‘prudent standards’ will have a trivial impact on the profits and operating practices of the gas extraction industry, and will wrap the mantle of legality around full-scale industrialization of the Pennsylvania landscape. For example, the very concept of ‘setbacks’ presumes that industrialization is to be uncontested; and the proposed size of the setbacks is insignificant compared to the scale of drilling’s impact on the environment and on human health. Whether an unconventional gas well is 100 feet or 300 feet from a stream, river or pond is a distinction without a meaningful difference, either to the driller or to the affected body of water. Similarly, the (carefully weasel-worded) increases in possible bonding levels and ‘penalties for violations’ will have negligible financial consequences for drillers -- even presupposing that the measures are passed into law and enforced, in defiance of the inevitable vigorous efforts of industry lobbyists.

Second, as to the ‘impact fee’ proposal, we note that it presents a completely one-sided bargain: local governments will have to demonstrate an ‘impact’ in order to receive the ‘fee’, while tacitly stipulating that the established formula is adequate compensation. That is, industry will pay no more but possibly far, far less than the direct cost which it imposes on the public, and nothing for the indirect and long-term costs.

• The funds from these fees appear to be earmarked entirely for alleviation of the direct and immediately demonstrable impacts of drilling on local communities, such as roads and other infrastructure, emergency response, and other costs which municipalities will incur as drilling progresses. None of these funds will be available to pay for the ‘boom and bust’ impact when drilling activity subsides, nor for indirect costs such as the departure of other industries (farming, hunting/fishing, tourism, etc.) and erosion of the tax base (as leaseholders move away with their bonus money, and local businesses are squeezed out by spiking prices);
• The proposed ‘strings’ on the impact fee funds are numerous and complicated (and likely to become much more so during the legislative process), with ample opportunity for political machination by current and future administrations;
• The burden of enacting the fees is apparently to be delegated to county governments, even for that portion which will support state-wide activities (including critical oversight and maintenance necessitated by the gas extraction -- such as the Commonwealth’s responsibilities for roads, pipelines, and public health, as well as the gas wells themselves). This approach is an open invitation for the high-pressure, divide-and-conquer tactics which the industry has already used against local initiatives: ‘If you stand up to us, we’ll take our business elsewhere.'
• All the proposed dollar values are prefaced with phrases such as ‘up to’ and ‘as much as’ -- so what might be (and is certainly meant to be) read as a ‘charge’ upon the industry is actually establishing a cap on the impact fees which counties and municipalities may try to enact.

The third component, which the Governor dresses up as ‘energy independence’ and ‘reduc[ing] reliance on foreign oil,’ is nothing more or less than a state-funded market-development initiative for the natural gas industry. Not content with opening state lands to drilling, legalizing environmental contamination, and tying the hands of local government, the Governor goes on to propose spending Pennsylvania tax revenues to build natural gas refueling stations , to convert fleets of school buses and mass transit vehicles to natural gas, and to ‘encourage’ the use of natural gas for electrical generation and manufacturing applications. These investments will boost the revenues of gas companies, but have no significant impact on ‘energy independence’ of the Commonwealth or of the Nation.

So far, of course, all these proposals are no more than talking points in a press release. The real decisions will be made in legislative committees and cabinet meetings. Experience with the current regime suggests that the eventual law and regulation will be even more favorable to the special interests of gas extraction. Meanwhile, the industry continues to enjoy an ‘open season’ on drilling in Pennsylvania.

Finally, let us point out -- once again -- that none of the Governor’s current actions, or proposed future actions, demonstrate any logical connection to the grandiose (and unsupportable) claims for the future of natural gas with which he prefaces his announcement. He gives us no reason to believe -- and there is much evidence to deny -- that natural gas extraction will supply Pennsylvania ‘for generations to come’ or ‘provide new career opportunities’ for our children. The Governor is fast-talking and slow-walking Pennsylvania down a dead-end road filled with stranded costs and environmental devastation.