While many of us were busy doing last-minute Christmas shopping, making final touches to our decorating or adding to our holiday cookie selection, the Pennsylvania Supreme Court handed down a landmark environmental decision. The court’s 4-2-vote on Dec. 19 affirmed a 2012 Commonwealth Court decision striking down significant portions of Act 13 — Pennsylvania’s oil and gas law.
Act 13 is a relatively new law. Before we continue, let’s turn the calendar back 23 months and review how this act came into existence.
Act 13, passed primarily by the Republican majority, was signed into law by Gov. Tom Corbett in February 2012. Among other things, the 173-page bill established a very low 2 percent impact fee on drilling for natural gas and restricted local governments from regulating drilling. It authorized the annual transfer of millions of dollars from the state’s Oil and Gas Lease Fund — a fund created in 1955 to mitigate environmental degradation caused by the extraction of oil and gas from our state forests. It established new environmental setbacks — the minimum distance allowed from drilling to an occupied structure or waterway. However, it also ordered the Pennsylvania Department of Environmental Protection to waive the setback requirements from buildings, streams and wetlands if they hindered the extraction of natural gas.
In essence, this legislation treated the Marcellus shale gas industry differently from any other industry in Pennsylvania.
After over a year of negotiations, the very pro-industry bill appeared quickly and was passed by both houses in less than two days. It established Pennsylvania’s “impact fee” at a significantly lower rate than any major gas-producing states’ extraction tax. Neighboring states have a 4 to 5 percent tax. According to reports, the compromise bill was presented to the General Assembly before the conference committee even met, causing some more knowledgeable about Harrisburg politics than this writer to speculate about who had actually authored the pro-gas industry legislation.
At the time, Minority Whip Rep. Mike Hanna (D - Clinton & Centre) commented, “We (the Democrats) have been basically left in the dark this entire process.”
Left in the dark? Maybe, — or maybe it was just the industry’s investment in Pennsylvania politics paying off.
According to Common Cause and the Conservation Voters of Pennsylvania, the natural gas industry has spent over $29 million dollars in campaign contributions and lobbying efforts in this state during the past dozen years. Top recipients of industry money given between 2000 and April 2012 included Gov. Corbett with $1,813,205.59, Senate President Joseph Scarnati (R-northcentral PA) with $359,145.72, Rep. Dave Reed (R-Indiana) with $137,532.33, House Majority Leader Rep. Mike Turzai (R-Allegheny) with $98,600, and Sen. Don White (R-Indiana & parts of 4 other counties) with $94,150. Jake Corman (R-Centre) accepted $91,290. Of the top 50 political recipients, 34 were Republicans and 16 were Democrats.
Shortly after passage of Act 13, former Department of Natural Resources secretary John Quigley blogged, “I’ll say upfront that I think that the fee and the new rules are grossly inadequate - but so was the process by which they were enacted.”
Now back to the present.
The Supreme Court ruling struck down three sections of Act 13. Section 3215(b)(4) required the Department of Environmental Protection to waive setbacks for drilling activities from streams, lakes and wetlands as long as a driller submitted a plan purportedly showing that those waters would be protected. Section 3303 established statewide rules for oil and gas activities irrespective of existing or future local zoning rules. Section 3304 required municipalities to allow oil and gas development activities in all zoning areas.
The court’s ruling is significant in that it nullified these three provisions of Act 13, but even more so because of the court’s reason for doing so. In the 162-page decision, Chief Justice Ronald D. Castille referred many times to Article 1, Section 27, of the Pennsylvania Constitution — often called the Environmental Rights Amendment.
As an example, Castille wrote, “Development of the natural gas industry in the Commonwealth unquestionably has and will have a lasting, and undeniably detrimental, impact on the quality of these core aspects (life, health, and liberty; surface and ground water, ambient air, etc.) of Pennsylvania’s environment, which are part of the public trust.”
Castille noted that Pennsylvania “has a notable history of what appears retrospectively to have been a shortsighted exploitation of its bounteous environment.” He did not want to see that repeated.
In a phone interview late last week, John Quigley commented about the importance of the court’s ruling.
“The court’s decision contained an extraordinary discussion about the Environmental Rights Amendment,” he said. “To see the court really expand on and breathe life into the amendment is very important.”
Pennsylvania Environmental Defense Foundation attorney John Childe noted, “It is significant that the court placed our right to clean air and water on an equal par with our other rights, such as due process, free speech or privacy. Also significant was his affirmation of the public trust doctrine. [The public trust doctrine is the principle that certain resources are preserved for public use, and that the government is required to maintain them for the public’s reasonable use.] Justice Castille upheld that the Commonwealth, as the trustee of those public resources, must act to conserve and maintain them.”
The gas industry was quick to blast the high court’s late December decision. Marcellus Shale Coalition president Dave Spigelmyer issued a statement in reaction to the ruling.
“Although we will continue to collaborate with communities across the Commonwealth, today’s decision is a disappointment and represents a missed opportunity to establish a standard set of rules governing the responsible development and operation of shale gas wells in Pennsylvania.
“This outcome should also serve as a stark reminder to policymakers of Pennsylvania’s business climate challenges. If we are to remain competitive and our focus is truly more job creation and economic prosperity, we must commit to working together toward common sense proposals that encourage — rather than discourage — investment into the Commonwealth,” Spigelmyer said.
Quigley praised the court’s decision.
“Act 13 was clearly a overreach by government,” he said. “The court’s decision rebalances the scales. We can have responsible development and protect Pennsylvania’s environment. This should not be looked upon as a defeat for the gas industry, but instead it is a course correction.”
In a phone interview last week, Childe said, “The opinion is broad, far reaching and extensive, and is, without doubt, the single most important document in the history of Pennsylvania’s environment. It is an amazing forward-looking action — a major paradigm shift in State law, politics, economics and social justice.”
The court’s decision was an early Christmas present for anyone who enjoys hunting, fishing or just being outdoors.