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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| HOUSE BILL |
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| INTRODUCED BY HANNA, DERMODY, DeLUCA, BRENNAN, BRIGGS, BROWNLEE, CALTAGIRONE, CARROLL, D. COSTA, DAVIS, FABRIZIO, GEORGE, GOODMAN, HALUSKA, HARKINS, HORNAMAN, JOSEPHS, KIRKLAND, MARKOSEK, MIRABITO, MULLERY, MUNDY, MURPHY, M. O'BRIEN, SANTARSIERO, STABACK, STURLA, WATERS, YOUNGBLOOD AND KULA, MAY 31, 2012 |
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| REFERRED TO COMMITTEE ON ENVIRONMENTAL RESOURCES AND ENERGY, MAY 31, 2012 |
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| AN ACT |
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1 | Amending Title 58 (Oil and Gas) of the Pennsylvania Consolidated |
2 | Statutes, in unconventional gas well fee, further providing |
3 | for definitions, for fee, for administration, for well |
4 | information, for duties of the Department of Environmental |
5 | Protection and the Pennsylvania Public Utility Commission, |
6 | for enforcement, for enforcement orders, for administrative |
7 | penalties, for recordkeeping, for examinations, for |
8 | distribution of fee and for Statewide initiatives; providing |
9 | for duties of the Department of Revenue; and making editorial |
10 | changes. |
11 | The General Assembly of the Commonwealth of Pennsylvania |
12 | hereby enacts as follows: |
13 | Section 1. The definitions of "commission" and "number of |
14 | spud unconventional gas wells" in section 2301 of Title 58 of |
15 | the Pennsylvania Consolidated Statutes, added February 14, 2012 |
16 | (P.L.87, No.13), are amended and the section is amended by |
17 | adding a definition to read: |
18 | § 2301. Definitions. |
19 | The following words and phrases when used in this chapter |
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1 | shall have the meanings given to them in this section unless the |
2 | context clearly indicates otherwise: |
3 | * * * |
4 | ["Commission." The Pennsylvania Public Utility Commission.] |
5 | * * * |
6 | "Number of spud unconventional gas wells." The most recent |
7 | numerical count of spud unconventional gas wells on the |
8 | inventory maintained and provided to the [commission] Department |
9 | of Revenue by the department as of the last day of each month. |
10 | * * * |
11 | "Price adjustment factor." One of a range of numerical |
12 | values used to compute the adjusted fee under section 2302(c) |
13 | (relating to unconventional gas well fee). |
14 | * * * |
15 | Section 2. Sections 2302, 2303, 2304, 2305(b) and (c), |
16 | 2307(a), (b) and (d), 2308(a) and (c), 2309, 2310(a), 2312, |
17 | 2313, 2314(a), (c.1), (d), (e), (h) and (i), 2315(a.1) |
18 | introductory paragraph and 3211(e.1)(6) of Title 58, added |
19 | February 14, 2012 (P.L.87, No.13), are amended to read: |
20 | § 2302. Unconventional gas well fee. |
21 | [(a) General rule.--The governing body of a county that has |
22 | a spud unconventional gas well located within its borders may |
23 | elect whether to impose a fee on unconventional gas wells that |
24 | have been spud in the county. |
25 | (a.1) Passage of ordinance.--Within 60 days after the |
26 | effective date of this section, the governing body of a county |
27 | under subsection (a) may adopt an ordinance to impose an |
28 | unconventional gas well fee. The governing body of a county must |
29 | notify the commission and give public notice of its intent to |
30 | adopt the ordinance. |
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1 | (a.2) County ordinance.--The ordinance imposing a fee under |
2 | subsection (a.1) shall be clear and in language that is readily |
3 | understandable by a layperson and shall be in the following |
4 | form: |
5 | The county of (insert name) hereby imposes an |
6 | unconventional gas well fee on each unconventional gas |
7 | well spud in this county. |
8 | (a.3) Prohibition.-- |
9 | (1) A county subject to this section, in which the |
10 | governing body does not adopt an ordinance imposing an |
11 | unconventional gas well fee within 60 days of the effective |
12 | date of this section, shall be prohibited from receiving |
13 | funds under sections 2314(d)(1) (relating to distribution of |
14 | fee) and 2315(a.1)(3) and (5) (relating to Statewide |
15 | initiatives). |
16 | (2) The prohibition on receiving funds shall remain in |
17 | effect until the county adopts an ordinance imposing an |
18 | unconventional gas well fee. The prohibition shall expire and |
19 | funds may be received for the calendar year following the |
20 | adoption of an ordinance imposing the fee under this section. |
21 | (a.4) Alternate imposition.-- |
22 | (1) If the governing body of a county does not impose an |
23 | unconventional gas well fee under subsection (a), the |
24 | municipalities in the county may compel the imposition of an |
25 | unconventional gas well fee on each unconventional gas well |
26 | spud in the county by adopting resolutions under paragraphs |
27 | (2), (3) and (4). |
28 | (2) Following 60 days but not more than 120 days after |
29 | the effective date of this section, if the governing bodies |
30 | of at least half of the municipalities located in a county or |
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1 | municipalities representing at least 50% of the population of |
2 | the county adopt resolutions to impose unconventional gas |
3 | well fees on all unconventional gas wells spud in the county, |
4 | the fee shall take effect. If a resolution is adopted, a copy |
5 | of the resolution shall be transmitted to the governing body |
6 | of the county and the commission. The governing body of a |
7 | municipality that is located in more than one county shall |
8 | transmit a copy of a resolution adopted under this paragraph |
9 | to the governing body of each county in which the |
10 | municipality is located. |
11 | (3) The transmittal of resolutions by governing bodies |
12 | under paragraph (2) shall constitute an imposition of the fee |
13 | in that county. The population of a municipality that is |
14 | located in more than one county shall be determined |
15 | separately for each county on the basis of the municipality's |
16 | population within each county. |
17 | (4) Resolutions adopted under this subsection must be |
18 | framed in the following form: |
19 | The (insert name) in the county of (insert name) |
20 | hereby resolves to have the county impose an |
21 | unconventional gas well fee on each unconventional |
22 | gas well spud in the county. |
23 | (5) A municipality which is located in a county that |
24 | does not adopt an ordinance imposing an unconventional gas |
25 | well fee and which does not adopt a resolution under |
26 | paragraphs (2), (3) and (4) shall be prohibited from |
27 | receiving funds under section 2314(d). |
28 | (b) Components.--The fee adopted under subsection (a), (a.1) |
29 | or (a.4) is imposed on every producer and shall apply to |
30 | unconventional gas wells spud in this Commonwealth regardless of |
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1 | when spudding occurred. Unconventional gas wells spud before |
2 | the fee is imposed shall be considered to be spud in the |
3 | calendar year prior to the imposition of the fee for purposes of |
4 | determining the fee under this subsection. Prior to adjustment |
5 | under subsection (c), the fee for each unconventional gas well |
6 | shall be determined as follows: |
7 | (1) Year one: |
8 | (i) If the average annual price of natural gas is |
9 | not more than $2.25, the fee shall be $40,000 for the |
10 | calendar year in which the unconventional gas well is |
11 | spud. |
12 | (ii) If the average annual price of natural gas is |
13 | greater than $2.25 and less than $3.00, the fee shall be |
14 | $45,000 for the calendar year in which the unconventional |
15 | gas well is spud. |
16 | (iii) If the average annual price of natural gas is |
17 | greater than $2.99 and less than $5.00, the fee shall be |
18 | $50,000 for the calendar year in which the unconventional |
19 | gas well is spud. |
20 | (iv) If the average annual price of natural gas is |
21 | greater than $4.99 and less than $6.00, the fee shall be |
22 | $55,000 for the calendar year in which the unconventional |
23 | gas well is spud. |
24 | (v) If the average annual price of natural gas is |
25 | more than $5.99, the fee shall be $60,000 for the |
26 | calendar year in which the unconventional gas well is |
27 | spud. |
28 | (2) Year two: |
29 | (i) If the average annual price of natural gas is |
30 | not more than $2.25, the fee shall be $30,000 for the |
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1 | calendar year following the year in which the |
2 | unconventional gas well is spud. |
3 | (ii) If the average annual price of natural gas is |
4 | greater than $2.25 and less than $3.00, the fee shall be |
5 | $35,000 for the calendar year following the year in which |
6 | the unconventional gas well is spud. |
7 | (iii) If the average annual price of natural gas is |
8 | greater than $2.99 and less than $5.00, the fee shall be |
9 | $40,000 for the calendar year following the year in which |
10 | the unconventional gas well is spud. |
11 | (iv) If the average annual price of natural gas is |
12 | greater than $4.99 and less than $6.00, the fee shall be |
13 | $45,000 for the calendar year following the year in which |
14 | the unconventional gas well is spud. |
15 | (v) If the average annual price of natural gas is |
16 | more than $5.99, the fee shall be $55,000 for the |
17 | calendar year following the year in which the |
18 | unconventional gas well is spud. |
19 | (3) Year three: |
20 | (i) If the average annual price of natural gas is |
21 | not more than $2.25, the fee shall be $25,000 for the |
22 | second calendar year following the year in which the |
23 | unconventional gas well is spud. |
24 | (ii) If the average annual price of natural gas is |
25 | greater than $2.25 and less than $3.00, the fee shall be |
26 | $30,000 for the second calendar year following the year |
27 | in which the unconventional gas well is spud. |
28 | (iii) If the average annual price of natural gas is |
29 | greater than $2.99 and less than $5.00, the fee shall be |
30 | $30,000 for the second calendar year following the year |
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1 | in which the unconventional gas well is spud. |
2 | (iv) If the average annual price of natural gas is |
3 | greater than $4.99 and less than $6.00, the fee shall be |
4 | $40,000 for the second calendar year following the year |
5 | in which the unconventional gas well is spud. |
6 | (v) If the average annual price of natural gas is |
7 | more than $5.99, the fee shall be $50,000 for the second |
8 | calendar year following the year in which the |
9 | unconventional gas well is spud. |
10 | (4) Years 4, 5, 6, 7, 8, 9 and 10: |
11 | (i) If the average annual price of natural gas is |
12 | not more than $2.25, the fee shall be $10,000 for the |
13 | third through ninth calendar years following the year in |
14 | which the unconventional gas well is spud. |
15 | (ii) If the average annual price of natural gas is |
16 | greater than $2.25 and less than $3.00, the fee shall be |
17 | $15,000 for the third through ninth calendar years |
18 | following the year in which the unconventional gas well |
19 | is spud. |
20 | (iii) If the average annual price of natural gas is |
21 | greater than $2.99, the fee shall be $20,000 for the |
22 | third through ninth calendar years following the year in |
23 | which the unconventional gas well is spud. |
24 | (5) Years 11, 12, 13, 14 and 15: |
25 | (i) If the average annual price of natural gas is |
26 | less than $3.00, the fee shall be $5,000 for the 10th |
27 | through 14th calendar years following the year in which |
28 | the unconventional well is spud. |
29 | (ii) If the average annual price of natural gas is |
30 | greater than $2.99, the fee shall be $10,000 for the 10th |
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1 | through 14th calendar years following the year in which |
2 | the unconventional well is spud. |
3 | (6) For purposes of this subsection, the fee shall be |
4 | determined using the average annual price of natural gas for |
5 | the calendar year in which the fee is imposed.] |
6 | (a) Imposition.--Beginning January 1, 2011, there shall be |
7 | imposed a shale impact fee on each unconventional well that has |
8 | been spud in this Commonwealth. The fee under this section shall |
9 | not apply to a stripper well. |
10 | (b) Annual base fees.--Prior to the adjustment under |
11 | subsection (c), the fee shall consist of an annual base fee for |
12 | each unconventional well as follows: |
13 | (1) For the first year of production, the fee shall be |
14 | $75,000. |
15 | (2) For the second year of production, the fee shall be |
16 | $70,000. |
17 | (3) For the third year of production, the fee shall be |
18 | $65,000. |
19 | (4) For the fourth year of production, the fee shall be |
20 | $60,000. |
21 | (5) For the fifth year of production, the fee shall be |
22 | $55,000. |
23 | (6) For the sixth year of production, the fee shall be |
24 | $50,000. |
25 | (7) For the seventh year of production, the fee shall be |
26 | $45,000. |
27 | (8) For the eighth year of production, the fee shall be |
28 | $40,000. |
29 | (9) For the ninth year of production, the fee shall be |
30 | $35,000. |
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1 | (10) For the tenth year of production, the fee shall be |
2 | $30,000. |
3 | (11) For the eleventh year of production, the fee shall |
4 | be $25,000. |
5 | (12) For the twelfth year of production, the fee shall |
6 | be $20,000. |
7 | (13) For the thirteenth year of production, the fee |
8 | shall be $15,000. |
9 | (14) For the fourteenth year of production and each year |
10 | thereafter, the fee shall be $10,000. |
11 | (b.1) Nonproducing unconventional gas wells.--If a spud |
12 | unconventional gas well begins paying the fee imposed under this |
13 | section and is subsequently capped or does not produce natural |
14 | gas in quantities greater than that of a stripper well within |
15 | two years after paying the initial fee, then the fee shall be |
16 | suspended: |
17 | (1) The fee shall be reinstated for a calendar year |
18 | during which the unconventional gas well produces natural gas |
19 | in quantities greater than that of a stripper well. |
20 | (2) Each calendar year during which a fee is suspended |
21 | shall not be considered a calendar year following spud for |
22 | purposes of determining the amount of the fee under |
23 | subsection (b). |
24 | [(c) Annual adjustment.--Beginning January 1, 2013, the |
25 | commission shall annually adjust the fee amounts under |
26 | subsection (b) to reflect any upward changes in the Consumer |
27 | Price Index for all Urban Consumers for the Pennsylvania, New |
28 | Jersey, Delaware and Maryland area in the preceding 12 months |
29 | and shall immediately submit the adjusted fee amount to the |
30 | Legislative Reference Bureau for publication as a notice in the |
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1 | Pennsylvania Bulletin. The fee shall be adjusted by multiplying |
2 | the annual fee amount by any percentage increase to the Consumer |
3 | Price Index for all Urban Consumers for the Pennsylvania, New |
4 | Jersey, Delaware and Maryland area, rounded to the nearest $100. |
5 | The resultant product shall be added to the fee amount, and the |
6 | sum shall become the new annual fee amount under subsection (b). |
7 | The annual adjustment under this subsection shall take effect if |
8 | the total number of unconventional gas wells spud in the |
9 | adjustment year exceeds the total number of unconventional gas |
10 | wells spud in the prior year.] |
11 | (c) Annual adjustment.-- |
12 | (1) The fee shall be adjusted by multiplying the base |
13 | fee amount times the price adjustment factor rounded to the |
14 | nearest $100. The price adjustment factor shall be determined |
15 | as follows: |
16 | (i) If the average annual price of natural gas is |
17 | less than $5.01, the price adjustment factor shall be |
18 | 1.0. |
19 | (ii) If the average annual price of natural gas is |
20 | $5.01 to $6, the price adjustment factor shall be 1.25. |
21 | (iii) If the average annual price of natural gas is |
22 | $6.01 to $7, the price adjustment factor shall be 1.75. |
23 | (iv) If the average annual price of natural gas is |
24 | $7.01 to $8, the price adjustment factor shall be 2.25. |
25 | (v) If the average annual price of natural gas is |
26 | greater than $8, the price adjustment factor shall be |
27 | 2.75. |
28 | (2) The fee for a vertical gas well shall not be subject |
29 | to adjustment under paragraph (1) and shall be computed as |
30 | follows: |
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1 | (i) The fee for a vertical gas well capable of |
2 | producing more than 180,000 cubic feet of gas per day |
3 | during a calendar month shall be one-half of the amounts |
4 | under subsection (b). |
5 | (ii) The fee for a vertical gas well capable of |
6 | producing more than 90,000 but less than 180,000 cubic |
7 | feet of gas per day during a calendar month shall be one- |
8 | fourth of the amounts under subsection (b). |
9 | (c.1) Components.--The fee adopted under subsection (b) is |
10 | imposed on every producer and shall apply to unconventional gas |
11 | wells spud in this Commonwealth regardless of when spudding |
12 | occurred. Unconventional gas wells spud before the fee is |
13 | imposed shall be considered to be spud in 2011 for purposes of |
14 | determining the fee under this subsection. |
15 | (d) Restimulated unconventional gas wells.-- |
16 | (1) An unconventional gas well which after restimulation |
17 | qualifies as a stripper well shall not be subject to this |
18 | subsection. |
19 | (2) The year in which the restimulation occurs shall be |
20 | considered the first year of spudding for purposes of |
21 | imposing the fee under this section if: |
22 | (i) a producer restimulates a previously stimulated |
23 | unconventional gas well following the tenth year after |
24 | being spud by: |
25 | (A) hydraulic fracture treatments; |
26 | (B) using additional multilateral well bores; |
27 | (C) drilling deeper into an unconventional |
28 | formation; or |
29 | (D) other techniques to expose more of the |
30 | formation to the well bore; and |
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1 | (ii) the restimulation results in a substantial |
2 | increase in production. |
3 | (3) As used in this subsection, the term "substantial |
4 | increase in production" means an increase in production |
5 | amounting to more than 90,000 cubic feet of gas per day |
6 | during a calendar month. |
7 | (e) Cessation.--Payments of the fee shall cease upon |
8 | certification to the department by the producer that the |
9 | unconventional gas well has ceased production and has been |
10 | plugged according to the regulations established by the |
11 | department. |
12 | (f) Vertical unconventional gas well fee.--The fee for a |
13 | vertical unconventional gas well shall be 20% of the fee |
14 | established in subsections (b) and (c)[, except that the fee |
15 | under subsection (b)(5) shall not apply]. |
16 | § 2303. Administration. |
17 | [(a) Fee due date.-- |
18 | (1) Except as provided under paragraph (2), the fee |
19 | imposed under this chapter shall be due by April 1, 2013, and |
20 | each April 1 thereafter. The fee shall become delinquent if |
21 | not remitted to the commission on the reporting date. |
22 | (2) For wells spud before January 1, 2012, a fee imposed |
23 | under this chapter shall be due by September 1, 2012. |
24 | (b) Report.--By September 1, 2012, and April 1 of each year |
25 | thereafter, each producer shall submit payment of the fee to the |
26 | commission and a report on a form prescribed by the commission |
27 | for the previous calendar year. The report shall include the |
28 | following: |
29 | (1) The number of spud unconventional gas wells of a |
30 | producer in each municipality within each county that has |
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1 | imposed a fee under this chapter. |
2 | (2) The date that each unconventional gas well |
3 | identified under paragraph (1) was spud or ceased the |
4 | production of natural gas. |
5 | (c) Costs of commission.-- |
6 | (1) The commission may impose an annual administrative |
7 | charge not to exceed $50 per spud unconventional gas well on |
8 | each producer, to be paid with the submission under |
9 | subsection (a), to pay for the actual costs of the commission |
10 | to administer and enforce this chapter. |
11 | (2) Within 30 days of the effective date of this |
12 | subsection, the commission shall estimate its expenditures |
13 | through June 30, 2012, that will be directly attributable to |
14 | the administration and enforcement of this chapter. The |
15 | commission shall subtract the amount of the administrative |
16 | charges imposed under paragraph (1) and assess any remaining |
17 | balance on all producers subject to the administrative charge |
18 | in proportion to the number of wells owned by each producer. |
19 | Producers shall pay the assessments within 30 days of receipt |
20 | of notice from the commission. The amount of the assessment |
21 | may be challenged by a producer consistent with 66 Pa.C.S. § |
22 | 510(c), (d) and (e) (relating to assessment for regulatory |
23 | expenses upon public utilities). Any collections that exceed |
24 | any of the following shall be used to offset the |
25 | administrative charges or other funds received for fiscal |
26 | year 2012-2013: |
27 | (i) The budget amount approved by the General |
28 | Assembly and the Governor for administration and |
29 | enforcement of this chapter and Chapter 33 (relating to |
30 | local ordinances relating to oil and gas operations). |
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1 | (ii) The actual expenditures directly attributable |
2 | to the administration and enforcement of this chapter and |
3 | Chapter 33. |
4 | (3) By June 30, 2012, and each June 30 thereafter, the |
5 | commission shall estimate its expenditures for the next |
6 | fiscal year that will be directly attributable to the |
7 | administration and enforcement of this chapter. After |
8 | subtracting any annual administrative charges imposed under |
9 | paragraph (1), amounts received by the commission under |
10 | section 2314(c.1)(2) (relating to distribution of fee) and |
11 | any amounts collected during the prior fiscal year that |
12 | exceeded actual expenditures directly attributable to the |
13 | administration and enforcement of this chapter, the |
14 | commission shall assess the remaining balance on all |
15 | producers subject to the unconventional gas well fee in |
16 | proportion to the number of wells owned by each producer. |
17 | Producers shall pay the assessments within 30 days of the |
18 | receipt of notice from the commission. The amount of the |
19 | assessment may be challenged by a producer consistent with 66 |
20 | Pa.C.S. § 510(c), (d) and (e). Any collections that exceed |
21 | any of the following shall be used to offset administrative |
22 | charges or assessments for the next fiscal year: |
23 | (i) The budget amount approved by the General |
24 | Assembly and the Governor for administration and |
25 | enforcement of this chapter and Chapter 33. |
26 | (ii) Actual expenditures directly attributable to |
27 | the administration and enforcement of this chapter and |
28 | Chapter 33.] |
29 | (a) Calculation.--On or before January 31 of each year, the |
30 | Department of Revenue shall calculate and determine the average |
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1 | annual price of natural gas for the previous calendar year. |
2 | (b) Notice.--Notice of the average annual price and the |
3 | annual fee schedule per well shall be provided to producers |
4 | operating unconventional wells and shall be published on the |
5 | Department of Revenue's Internet website. |
6 | (c) Method.--If publication of the New York Mercantile |
7 | Exchange (NYMEX) Henry Hub settled price is discontinued, the |
8 | average annual price of natural gas then in effect shall not be |
9 | adjusted until a comparable method to determine the average |
10 | annual price of natural gas is adopted by Department of Revenue |
11 | rule. If the base data of the NYMEX Henry Hub settled price is |
12 | substantially revised, the Department of Revenue shall make |
13 | appropriate changes to ensure that the average annual price of |
14 | natural gas is reasonably consistent with the result that would |
15 | have been attained had the substantial revision not been made. |
16 | (d) Report.--By March 1, 2013, and each March 1 thereafter, |
17 | each producer shall submit a production report to the Department |
18 | of Revenue on a form prescribed by the Department of Revenue for |
19 | the previous calendar year. The report shall include the |
20 | following: |
21 | (1) Annual units of production severed by the producer |
22 | for each unconventional well for the reporting period. |
23 | (2) The number of producing unconventional wells of a |
24 | producer in each county and municipality. |
25 | (e) Fee for 2011.--For calendar year 2011, the fee due shall |
26 | be paid as follows: |
27 | (1) Fifty percent of the fee shall be paid by September |
28 | 1, 2012. |
29 | (2) Fifty percent of the fee shall be paid by November |
30 | 1, 2012. |
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1 | (f) Fee due date.--Except as provided under subsection (e), |
2 | the fee shall be due on March 1 and each year thereafter. The |
3 | fee shall become delinquent if not remitted to the Department of |
4 | Revenue by the due date. |
5 | (g) Costs of revenue.-- |
6 | (1) Within 30 days of the effective date of this |
7 | subsection, and each year thereafter, the Department of |
8 | Revenue may impose an annual fee not to exceed $100 per well |
9 | on each reporting producer to pay for the actual costs of the |
10 | Department of Revenue to administer and enforce this chapter |
11 | and Chapter 27 (relating to natural gas energy development |
12 | program). |
13 | (2) By March 31, 2013, and each year thereafter, the |
14 | Department of Revenue shall determine for the preceding |
15 | calendar year the amount of its actual expenditures directly |
16 | attributable to the administration and enforcement of this |
17 | chapter and Chapter 27. The Department of Revenue shall |
18 | subtract the amount of fees collected under paragraph (1) in |
19 | that calendar year and assess any remaining balance on all |
20 | producers subject to the impact fee in proportion to the |
21 | number of wells owned by each producer. |
22 | (3) Each producer shall be assessed for and shall pay to |
23 | the Department of Revenue that proportion of the amount |
24 | determined under paragraph (2) and allocated to the producer |
25 | for that year. |
26 | § 2304. Well information. |
27 | (a) List.--Within 14 days of the effective date of this |
28 | section, the department shall provide the [commission and, upon |
29 | request, a county,] Department of Revenue with a list of all |
30 | spud unconventional gas wells from the department. The |
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1 | department shall update the list and provide it to the |
2 | [commission] Department of Revenue on a monthly basis. |
3 | (b) Updates.--A producer subject to the fee shall notify the |
4 | [commission] Department of Revenue of the following within 30 |
5 | days after a calendar month in which the change occurs: |
6 | (1) The spudding of an unconventional gas well. |
7 | (1.1) The initiation of production at an unconventional |
8 | gas well. |
9 | (2) The removal of an unconventional gas well from |
10 | production. |
11 | § 2305. Duties of department. |
12 | * * * |
13 | (b) Prohibition.--The department shall not issue a permit to |
14 | drill an unconventional gas well until all unconventional gas |
15 | well fees owed under section 2302 that are not in dispute have |
16 | been paid to the [commission] Department of Revenue. |
17 | (c) Payment of fees.--The [commission] Department of Revenue |
18 | shall provide the department with information necessary to |
19 | determine that the producer has paid all unconventional gas well |
20 | fees owed for an unconventional gas well under section 2302. |
21 | § 2307. [Commission] Department of Revenue. |
22 | (a) Powers.--The [commission] Department of Revenue shall |
23 | have the authority to make all inquiries and determinations |
24 | necessary to calculate and collect the fee, administrative |
25 | charges or assessments imposed under this chapter, including, if |
26 | applicable, interest and penalties. |
27 | (b) Notice.--If the [commission] Department of Revenue |
28 | determines that the unconventional gas well fee has not been |
29 | paid in full, it may issue a notice of the amount due and demand |
30 | for payment and shall set forth the basis for the determination. |
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1 | * * * |
2 | (d) Time period.--Except as set forth in subsection (e), the |
3 | [commission] Department of Revenue may challenge the amount of a |
4 | fee paid within three years after the date the report under |
5 | section [2303(b)] 2303(d) (relating to administration) is filed. |
6 | * * * |
7 | § 2308. Enforcement. |
8 | (a) Assessment.--The [commission] Department of Revenue |
9 | shall assess interest on any delinquent fee at the rate |
10 | determined under section 2307(a) (relating to [commission] |
11 | Department of Revenue). |
12 | * * * |
13 | (c) Timely payment.--If the [commission] Department of |
14 | Revenue determines that a producer has not made a timely payment |
15 | of the fee, the [commission] Department of Revenue shall send |
16 | written notice of the amount of the deficiency to the producer |
17 | within 30 days from the date of determining the deficiency. The |
18 | [commission] Department of Revenue shall notify the department |
19 | of a producer that has failed to pay the fee for any |
20 | unconventional gas well under section 2302 (relating to |
21 | unconventional gas well fee). If the producer does not have a |
22 | pending appeal related to payment of the fee in process, the |
23 | department shall suspend the permit for that well until the fee |
24 | has been paid. |
25 | * * * |
26 | § 2309. Enforcement orders. |
27 | (a) Issuance.--The [commission] Department of Revenue may |
28 | issue an order as necessary to enforce this chapter. An order |
29 | issued under this section shall take effect upon notice, unless |
30 | the order specifies otherwise. A person aggrieved by an order |
|
1 | under this section may appeal to Commonwealth Court under 42 |
2 | Pa.C.S. § 763 (relating to direct appeals from government |
3 | agencies). |
4 | (b) Compliance.--A producer has the duty to comply with an |
5 | order issued under subsection (a). If a producer fails to |
6 | proceed diligently to comply with an order within the time |
7 | required, the producer shall be guilty of contempt and shall be |
8 | punished by the court in an appropriate manner. The [commission] |
9 | Department of Revenue shall apply to Commonwealth Court, which |
10 | shall have jurisdiction over matters relating to contempt. |
11 | § 2310. Administrative penalties. |
12 | (a) Civil penalties.--In addition to any other proceeding |
13 | authorized by law, the [commission] Department of Revenue may |
14 | assess a civil penalty not to exceed $2,500 per violation upon a |
15 | producer for the violation of this chapter. In determining the |
16 | amount of the penalty, the [commission] Department of Revenue |
17 | shall consider the willfulness of the violation and other |
18 | relevant factors. |
19 | * * * |
20 | § 2312. Recordkeeping. |
21 | A producer liable for the fee under this chapter shall keep |
22 | records, make reports and comply with regulations of the |
23 | [commission] Department of Revenue. The [commission] Department |
24 | of Revenue may require a producer to make reports, render |
25 | statements or keep records as the [commission] Department of |
26 | Revenue deems sufficient to determine liability for the fee. |
27 | § 2313. Examinations. |
28 | (a) Access.--The [commission] Department of Revenue or its |
29 | authorized agents or representatives shall: |
30 | (1) Have access to the relevant books, papers and |
|
1 | records of any producer in order to verify the accuracy and |
2 | completeness of a report filed or fee paid under this |
3 | chapter. |
4 | (2) Require the preservation of all relevant books, |
5 | papers and records for an appropriate period not to exceed |
6 | three years from the end of the calendar year to which the |
7 | records relate. |
8 | (3) Examine any employee of a producer under oath |
9 | concerning the severing of natural gas subject to a fee or |
10 | any matter relating to the enforcement of this chapter. |
11 | (4) Compel the production of relevant books, papers and |
12 | records and the attendance of all individuals who the |
13 | [commission] Department of Revenue believes to have knowledge |
14 | of relevant matters in accordance with 66 Pa.C.S. (relating |
15 | to public utilities). |
16 | (b) Unauthorized disclosure.--Any information obtained by |
17 | the [commission] Department of Revenue as a result of any |
18 | report, examination, investigation or hearing under this chapter |
19 | shall be confidential and shall not be disclosed, except for |
20 | official purposes, in accordance with judicial order or as |
21 | otherwise provided by law. [A commissioner or an] An employee of |
22 | the [commission] Department of Revenue who without authorization |
23 | divulges confidential information shall be subject to |
24 | disciplinary action by the [commission] Department of Revenue. |
25 | § 2314. Distribution of fee. |
26 | (a) Establishment.--There is established a fund in the State |
27 | Treasury to be known as the Unconventional Gas Well Fund to be |
28 | administered by the [commission] Department of Revenue. |
29 | * * * |
30 | (c.1) Additional distributions.--From fees collected under |
|
1 | this chapter and deposited in the fund for 2011 and each year |
2 | thereafter: |
3 | (1) One million dollars shall be distributed to the |
4 | Pennsylvania Fish and Boat Commission for costs relating to |
5 | the review of applications for permits to drill |
6 | unconventional gas wells. |
7 | (2) One million dollars shall be distributed to the |
8 | [commission] Department of Revenue for costs to administer |
9 | this chapter and Chapter 33 (relating to local ordinances |
10 | relating to oil and gas operations). |
11 | (3) Six million dollars to the department for the |
12 | administration of this act and the enforcement of acts |
13 | relating to clean air and clean water. |
14 | (4) Seven hundred fifty thousand dollars to the |
15 | Pennsylvania Emergency Management Agency for emergency |
16 | response planning, training and coordination related to |
17 | natural gas production from unconventional gas wells. |
18 | (5) Seven hundred fifty thousand dollars to the Office |
19 | of State Fire Commissioner for the development, delivery and |
20 | sustainment of training and grant programs for first |
21 | responders and the acquisition of specialized equipment for |
22 | response to emergencies relating to natural gas production |
23 | from unconventional gas wells. |
24 | (6) One million dollars to the Department of |
25 | Transportation for rail freight assistance. |
26 | * * * |
27 | (d) Distribution.--[Except as provided in section 2302(a.3) |
28 | and (a.4) (relating to unconventional gas well fee), following] |
29 | Following fee distribution under subsections (c), (c.1) and |
30 | (c.2), from fees collected for 2011 and each year thereafter, |
|
1 | 60% of the revenue remaining in the fund from fees collected for |
2 | the prior year are hereby appropriated to counties and |
3 | municipalities for purposes authorized under subsection (g). |
4 | Counties and municipalities are encouraged, where appropriate, |
5 | to jointly fund projects that cross jurisdictional lines. The |
6 | [commission] Department of Revenue, after making a disbursement |
7 | under subsection (f), shall distribute the remaining funds |
8 | appropriated as follows within three months after the date the |
9 | fee is due: |
10 | (1) [Except as provided in section 2302(a.3), 36%] |
11 | Thirty-six percent shall be distributed to counties in which |
12 | spud unconventional gas wells are located. The amount for |
13 | each county to which funds will be distributed shall be |
14 | determined using a formula that divides the number of spud |
15 | unconventional gas wells in the county by the number of spud |
16 | unconventional gas wells subject to the impact fee in this |
17 | Commonwealth and multiplies the resulting percentage by the |
18 | amount available for distribution under this paragraph. |
19 | (2) [Except as provided in section 2302(a.4), 37%] |
20 | Thirty-seven percent shall be distributed to municipalities |
21 | in which spud unconventional gas wells are located. The |
22 | amount for each municipality to which funds will be |
23 | distributed shall be determined using a formula that divides |
24 | the number of spud unconventional gas wells in the |
25 | municipality by the number of spud unconventional gas wells |
26 | subject to the impact fee in this Commonwealth and multiplies |
27 | the resulting percentage by the amount available for |
28 | distribution under this paragraph. |
29 | (3) [Except as provided in section 2302(a.4), 27%] |
30 | Twenty-seven percent shall be distributed to municipalities |
|
1 | located in a county in which spud unconventional gas wells |
2 | are located. The amount available for distribution in each |
3 | county shall be determined by dividing the number of spud |
4 | unconventional gas wells in the county by the number of spud |
5 | unconventional gas wells subject to the impact fee in this |
6 | Commonwealth and multiplying the resulting percentage by the |
7 | amount available for distribution under this paragraph. The |
8 | resulting amount available for distribution in each county in |
9 | which spud unconventional gas wells are located shall be |
10 | distributed to each municipality in the county to which funds |
11 | will be distributed as follows: |
12 | (i) [Except as provided in section 2302(a.4), 50%] |
13 | Fifty percent of the amount available under this |
14 | paragraph shall be distributed to municipalities in which |
15 | spud unconventional gas wells are located and to |
16 | municipalities that are either contiguous with a |
17 | municipality in which spud unconventional gas wells are |
18 | located or are located within five linear miles of a spud |
19 | unconventional gas well. The distribution shall be made |
20 | as follows: |
21 | (A) One-half shall be distributed to each |
22 | municipality using a formula that divides the |
23 | population of the eligible municipality within the |
24 | county by the total population of all eligible |
25 | municipalities within the county and multiplies the |
26 | resulting percentage by the amount allocated to the |
27 | county under this subparagraph. |
28 | (B) One-half shall be distributed to each |
29 | municipality using a formula that divides the highway |
30 | mileage of the eligible municipality within the |
|
1 | county by the total highway mileage of all eligible |
2 | municipalities within the county and multiplies the |
3 | resulting percentage by the amount allocated to the |
4 | county under this subparagraph. |
5 | (ii) [Except as provided in section 2302(a.4), 50%] |
6 | Fifty percent of the amount available under this |
7 | paragraph shall be distributed to each municipality in |
8 | the county regardless of whether an unconventional gas |
9 | well is located in the municipality as follows: |
10 | (A) One-half shall be distributed to each |
11 | municipality using a formula that divides the |
12 | population of the municipality within the county by |
13 | the total population of the county and multiplies the |
14 | resulting percentage by the amount allocated to the |
15 | county under this subparagraph. |
16 | (B) One-half shall be distributed to each |
17 | municipality using a formula that divides the highway |
18 | mileage of the municipality within the county by the |
19 | total highway mileage of the county and multiplies |
20 | the resulting percentage by the amount allocated to |
21 | the county under this subparagraph. |
22 | (e) Restriction.--The amount allocated to each municipality |
23 | under subsection (d) shall not exceed the greater of $500,000 or |
24 | 50% of the total budget for the prior fiscal year beginning with |
25 | the 2010 budget year and continuing every year thereafter, |
26 | adjusted to reflect any upward changes in the Consumer Price |
27 | Index for all Urban Consumers for the Pennsylvania, New Jersey, |
28 | Delaware and Maryland area in the preceding 12 months. Any |
29 | remaining money shall be retained by the [commission] Department |
30 | of Revenue and deposited in the Housing Affordability and |
|
1 | Rehabilitation Enhancement Fund for the uses specified under |
2 | subsection (f). |
3 | * * * |
4 | (h) Reporting.-- |
5 | (1) The [commission] Department of Revenue shall submit |
6 | an annual report on all funds in the fund. The report shall |
7 | include a detailed listing of all deposits and expenditures |
8 | of the fund and be submitted to the chairman and the minority |
9 | chairman of the Appropriations Committee of the Senate, the |
10 | chairman and the minority chairman of the Environmental |
11 | Resources and Energy Committee of the Senate, the chairman |
12 | and the minority chairman of the Appropriations Committee of |
13 | the House of Representatives and the chairman and the |
14 | minority chairman of the Environmental Resources and Energy |
15 | Committee of the House of Representatives. The report shall |
16 | be submitted by December 30, 2012, and by September 30 of |
17 | each year thereafter. |
18 | (2) All counties and municipalities receiving funds from |
19 | the fund under this section shall submit information to the |
20 | [commission] Department of Revenue on a form prepared by the |
21 | [commission] Department of Revenue that sets forth the amount |
22 | and use of the funds received in the prior calendar year. The |
23 | form shall set forth that the funds received were committed |
24 | to a specific project or use as authorized in this section. |
25 | The reports shall be published annually on the county or |
26 | municipality's publicly accessible Internet website. |
27 | (i) Availability of funds.--Distribution of funds under this |
28 | section and section 2315 (relating to Statewide initiatives) are |
29 | contingent on availability of funds in the fund. If sufficient |
30 | funds are not available, the [commission] Department of Revenue |
|
1 | shall disburse funds on a pro rata basis. |
2 | § 2315. Statewide initiatives. |
3 | * * * |
4 | (a.1) Deposit and distribution.--Following distribution |
5 | under section 2314(c), (c.1) and (c.2) (relating to distribution |
6 | of fee) from fees collected for 2011 and each year thereafter, |
7 | 40% of the remaining revenue in the fund shall be deposited into |
8 | the Marcellus Legacy Fund and appropriated to the [commission] |
9 | Department of Revenue and distributed within three months after |
10 | the date the fee is due as follows: |
11 | * * * |
12 | § 3211. Well permits. |
13 | * * * |
14 | (e.1) Denial of permit.--The department may deny a permit |
15 | for any of the following reasons: |
16 | * * * |
17 | (6) The applicant failed to pay the fee or file a report |
18 | under section [2303(c)] 2303(d) (relating to administration), |
19 | unless an appeal is pending. The commission shall notify the |
20 | department of any applicant who has failed to pay the fee or |
21 | file a report and who does not have an appeal pending. |
22 | * * * |
23 | Section 3. This act shall take effect immediately. |
24 | |
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