Bill Text: PA HB1650 | 2011-2012 | Regular Session | Introduced

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Bill Title: Imposing a natural gas impact fee; establishing the Shale Impact Account; and providing for the powers and duties of the Department of Environmental Protection and the Pennsylvania Public Utility Commission and for a model zoning ordinance.

Spectrum: Slight Partisan Bill (Republican 11-6)

Status: (Introduced - Dead) 2011-06-08 - Referred to ENVIRONMENTAL RESOURCES AND ENERGY [HB1650 Detail]

Download: Pennsylvania-2011-HB1650-Introduced.html

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PRINTER'S NO. 2066
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1650 Session of2011
INTRODUCED BY MARSHALL, CALTAGIRONE, CREIGHTON, DALEY, DeLUCA, DeWEESE, EVERETT, FLECK, GINGRICH, HESS, MAHONEY, PEIFER, READSHAW, SCAVELLO, SWANGER, TAYLOR, TOBASH AND WATSON, JUNE 8, 2011
REFERRED TO COMMITTEE ON ENVIRONMENTAL RESOURCES AND ENERGY, JUNE 8, 2011
AN ACT
Amending Title 58 (Oil and Gas) of the Pennsylvania Consolidated
Statutes, imposing a natural gas impact fee; establishing the
Shale Impact Account; and providing for the powers and duties
of the Department of Environmental Protection and the
Pennsylvania Public Utility Commission and for a model zoning
ordinance.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 58 of the Pennsylvania Consolidated
Statutes is amended by adding a part to read:
PART I
UNCONVENTIONAL GAS WELLS
Chapter
23. Impact Fee
25. Model Ordinance
CHAPTER 23
IMPACT FEE
Sec.
2301. Definitions.
2302. Shale Impact Fee.
2303. Administration.
2304. Well information.
2305. Duties of department.
2306. Meters.
2307. Commission.
2308. Enforcement.
2309. Criminal penalties.
2310. Criminal grading.
2311. Enforcement orders.
2312. Administrative penalties.
2313. Regulations.
2314. Recordkeeping.
2315. Examinations.
2316. Local distribution of fee.
2317. Statewide environmental initiatives.
§ 2301. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Account." The Shale Impact Account established under
section 2316 (relating to local distribution of fee).
"Average annual price of natural gas." The arithmetic mean
of the New York Mercantile Exchange (NYMEX) Henry Hub settled
price on the last trading day of each month of a calendar year
as reported by the Wall Street Journal for the 12-month period
ending December 31.
"Barrel." A barrel of 42 U.S. gallons of natural gas
liquids.
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"Commission." The Pennsylvania Public Utility Commission.
"Department." The Department of Environmental Protection of
the Commonwealth.
"Eligible applicants." A county, municipality, council of
governments, watershed organization, institution of higher
education, nonprofit organization, Pennsylvania Fish and Boat
Commission or an authorized organization as defined in 27
Pa.C.S. § 6103 (relating to definitions).
"Fee." The Shale Impact Fee imposed under section 2302
(relating to Shale Impact Fee).
"Highway mileage." The number of miles of public roads and
streets most recently certified by the Department of
Transportation as eligible for distribution of liquid fuels
funds under the act of June 1, 1956 (1955 P.L.1944, No.655),
referred to as the Liquid Fuels Tax Municipal Allocation Law.
"Marginal gas well." An unconventional gas well capable of
severing more than 60,000 cubic feet of gas per day during a
calendar month, but incapable of severing more than 90,000 cubic
feet of gas per day during a calendar month, including
production from the zones and multilateral well bores at a
single well, regardless of whether the production is metered
separately.
"Municipality." A borough, city, town or township.
"Natural gas." A fossil fuel consisting of a mixture of
hydrocarbon gases, primarily methane, and possibly including
ethane, propane, butane, pentane, carbon dioxide, oxygen,
nitrogen and hydrogen sulfide and other gas species. The term
includes natural gas from oil fields known as associated gas or
casing head gas, natural gas fields known as nonassociated gas,
coal beds, shale beds and other formations. The term does not
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include coal bed methane.
"Natural gas liquids." Hydrocarbons in natural gas which are
separated from the gas as liquids through the process of
absorption, condensation, adsorption or other methods in gas
processing of cycling plants.
"Number of producing unconventional wells." The most recent
numerical count of producing unconventional wells on the
inventory maintained and provided to the commission by the
department as of the last day of each month.
"Price adjustment factor." One of a range of numerical
values used to compute the adjusted fee under section 2302
(relating to Shale Impact Fee). The price adjustment factor
shall be determined as follows:
(1) If the average annual price of natural gas is less
than $5.01, the price adjustment factor shall be five.
(2) If the average annual price of natural gas is $5.01
to $6.00, the price adjustment factor shall be equal to the
sum of the average annual price plus one.
(3) If the average annual price of natural gas is $6.01
to $7.00, the price adjustment factor shall be equal to the
sum of the average annual price plus two.
(4) If the average annual price of natural gas is $7.01
to $8.00, the price adjustment factor shall be equal to the
sum of the average annual price plus three.
(5) If the average annual price of natural gas is
greater than $8.00, the price adjustment factor shall be
equal to the sum of the average annual price plus five.
"Producer." A person or its subsidiary, affiliate or holding
company that holds a permit or other authorization to engage in
the business of severing natural gas for sale, profit or
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commercial use from an unconventional well in this Commonwealth.
The term shall not include a producer that severs natural gas
from a site used to store natural gas that did not originate
from the site.
"Unconventional well." A bore hole drilled or being drilled
for the purpose of or to be used for producing oil or gas from a
geological formation existing below the base of the Elk
Sandstone or its geologic equivalent stratigraphic interval
where oil or gas generally cannot be produced at economic flow
rates or in economic volumes except by vertical or horizontal
well bores stimulated by hydraulic fracture treatments or by
using multilateral well bores or other techniques to expose more
of the formation of the well bore.
"Unit."
(1) A thousand cubic feet of natural gas measured at the
wellhead at a temperature of 60 degrees Fahrenheit and an
absolute pressure of 14.73 pounds per square inch in
accordance with American Gas Association Standards and
according to Boyle's Law for the measurement of gas under
varying pressures with deviations as follows:
(i) The average absolute atmospheric pressure shall
be assumed to be 14.4 pounds to the square inch,
regardless of elevation or location of point of delivery
above sea level or variations in atmospheric pressure
from time to time.
(ii) The temperature of the gas passing the meters
shall be determined by the continuous use of a recording
thermometer installed to properly record the temperature
of gas flowing through the meters. The arithmetic average
of the temperature recorded each 24-hour day shall be
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used in computing gas volumes. If a recording thermometer
is not installed, or is installed and not operating
properly, an average flowing temperature of 60 degrees
Fahrenheit shall be used in computing gas volume.
(iii) The specific gravity of the gas shall be
determined annually by tests made by the use of an
Edwards of Acme gravity balance, or at intervals as
necessary. Specific gravity determinations shall be used
in computing gas volumes.
(iv) The deviation of the natural gas from Boyle's
Law shall be determined by annual tests or at other
shorter intervals as necessary. The apparatus and method
used in making the test shall be in accordance with
recommendations of the National Bureau of Standards or
Report No. 3 of the Gas Measurement Committee of the
American Gas Association. The results of the test shall
be used in computing the volume of gas delivered under
this chapter.
(2) In the case of natural gas produced in liquid form,
a unit shall be measured on a 1,000 cubic feet equivalent
basis, determined using the ratio of 6,000 cubic feet of
natural gas to one barrel of natural gas liquids.
"Vertical gas well." An unconventional well which begins as
a vertical linear bore and is not intentionally deviated from
the vertical.
"Volume adjustment factor." One of a range of numerical
values used to compute the adjusted fee under section 2302
(relating to Shale Impact Fee). The volume adjustment factor
shall be determined as follows:
(1) If the annual units of production are less than
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21,901, the volume adjustment factor shall be zero.
(2) If the annual units of production are 21,901 to
90,000, the volume adjustment factor shall be 0.2.
(3) If the annual units of production are 90,001 to
180,000, the volume adjustment factor shall be 0.3.
(4) If the annual units of production are 180,001 to
360,000, the volume adjustment factor is 0.4.
(5) If the annual units of production are 360,001 to
750,000, the volume adjustment factor is 0.5.
(6) If the annual units of production are 750,001 to
1,000,000, the volume adjustment factor is 0.6.
(7) If the annual units of production are 1,000,001 to
1,350,000, the volume adjustment factor is 0.7.
(8) If the annual units of production are greater than
1,350,001, the volume adjustment factor is 0.8.
§ 2302. Shale Impact Fee.
(a) Imposition.--There shall be imposed a Shale Impact Fee
on each unconventional well existing on or after January 1,
2010, and producing gas in this Commonwealth.
(b) Fee.--The fee shall consist of a base fee of $10,000 for
each unconventional well subject to the following adjustments:
(1) The fee shall be adjusted by multiplying the base
fee amount times the volume adjustment factor times the price
adjustment factor rounded to the nearest $100.
(2) If the natural gas severed from more than one
unconventional well is measured by a single wellhead meter,
the combined volumes of gas produced shall be divided by the
number of unconventional wells and each producer of an
unconventional well shall use this quotient in determining
its volume adjustment factor.
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(3) The fee for a marginal gas well or vertical gas well
shall be $10,000 and shall not be subject to adjustment under
paragraph (1).
§ 2303. Administration.
(a) Commission.--On or before January 31 of each year, the
commission shall calculate and determine the average annual
price of natural gas for the previous calendar year.
(b) Notice.--Notice of the average annual price shall be
provided to producers of unconventional wells and shall be
published on the commission's Internet website.
(c) Method.--If publication of the New York Mercantile
Exchange (NYMEX) Henry Hub settled price is discontinued, the
average annual price of natural gas then in effect shall not be
adjusted until a comparable method to determine the average
annual price of natural gas is adopted by commission rule. If
the base data of the NYMEX Henry Hub settled price is
substantially revised, the commission shall make appropriate
changes to ensure that the average annual price of natural gas
is reasonably consistent with the result that would have been
attained had the substantial revision not been made.
(d) Report.--By March 1, 2012, and each March 1 thereafter,
each producer shall submit a report and payment of the fee with
the commission on a form prescribed by the commission for the
previous calendar year. The report shall include the following:
(1) Annual units of production severed by the producer
for each unconventional well for the reporting period.
(2) The number of producing unconventional wells of a
producer in each county and municipality.
(e) Report and fee for 2010.--For calendar year 2010, a
report pursuant to subsection (d)(1) and (2) shall be filed by
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August 1, 2011, and the fee due shall be paid as follows:
(1) Fifty percent of the fee shall be paid by August 1,
2011.
(2) Fifty percent of the fee shall be paid by November
1, 2011.
(f) Fee due date.--Except as provided under subsection
(e)(2), the fee shall be due on the day the report is required
to be filed. The fee shall become delinquent if not remitted to
the commission on the reporting date.
(g) Cost.--Beginning March 2, 2012, and each March 2
thereafter, the commission shall determine the reasonable annual
cost to collect and distribute the fee in accordance with this
chapter and shall deduct that amount from the total amount of
fees collected under this chapter. On August 1, 2011, the amount
to collect and distribute the fee may be deducted from the total
amount of fees collected for 2010. Fees collected under this
section are hereby annually appropriated to the commission to
carry out its duties under this chapter.
§ 2304. Well information.
(a) List.--The department shall provide the commission with
a list of all unconventional wells that have received a drilling
permit from the department. The list shall be updated on a
monthly basis.
(b) Updates.--A producer subject to the fee shall notify the
commission of the following within 30 days after a calendar
month in which the change occurs:
(1) The initiation of production at a well or the
removal of a well from production.
(2) The use of a different accredited laboratory to
issue a wellhead meter certification.
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§ 2305. Duties of department.
(a) Confirmation of payment.--Prior to issuing a permit to
drill an unconventional well in this Commonwealth, the
department shall determine whether the producer has paid all
fees owed under section 2302 (relating to Shale Impact Fee).
(b) Prohibition.--The department shall not issue a permit to
drill an unconventional well until all fees owed under section
2302 that are not in dispute have been paid to the commission.
§ 2306. Meters.
A producer who drills an unconventional well in this
Commonwealth shall provide and maintain a wellhead meter at the
unconventional well that is tested, calibrated and maintained in
accordance with industry standards approved by the commission. A
wellhead meter installed after the effective date of this
section shall be a digital meter. Wellhead meters shall not be
subject to 3 Pa.C.S. Ch. 41 (relating to weights and measures).
Multiple wells located on the same drilling pad may utilize the
same meter subject to section 2302(b)(2) (relating to Shale
Impact Fee).
§ 2307. Commission.
(a) Powers.--The commission shall have the authority to make
all inquiries and determinations necessary to calculate and
collect the fee imposed under this chapter, including, if
applicable, interest and penalties.
(b) Notice.--If the commission determines that the fee has
not been paid in full, it may issue a notice of the amount due
and demand for payment and shall set forth the basis for the
determination.
(c) Address.--Notice of failure to pay the correct fee shall
be sent to the producer at its registered address via certified
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mail.
(d) Time period.--The commission may challenge the amount of
a fee paid under this chapter within three years after the date
the report under section 2303(d) (relating to administration) is
filed.
(e) Intent.--If no report is filed or a producer files a
false or fraudulent return with the intent to evade the fee, an
assessment of the amount owed may be made at any time.
§ 2308. Enforcement.
(a) Assessment.--The commission shall assess interest on any
delinquent fee at the rate prescribed under section 806 of the
act of April 9, 1929 (P.L.343, No.176), known as The Fiscal
Code.
(b) Penalty.--In addition to the interest under subsection
(a), if a producer fails to make timely payment of the fee,
there shall be added to the amount of the fee due a penalty of
5% of the amount of the fee if failure to file a timely payment
is for not more than one month, with an additional 5% penalty
for each additional month or fraction of a month during which
the failure continues, not to exceed 25% in the aggregate.
(c) Timely payment.--If the commission determines that a
producer has not made a timely payment of the fee, the
commission shall send a written notice of the amount of the
deficiency to the producer within 30 days from the date of
determining the deficiency. If the producer has not provided a
complete and accurate statement of the volume of gas extracted
for the payment period, the commission may estimate the volume
in its deficiency notice.
(d) Remedies.--The remedies provided under this chapter are
in addition to any other remedies provided at law or in equity.
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(e) Lien.--Fines, fees, interest and penalties shall be
collectible in the manner provided by law for the collection of
debts. If the producer liable to pay any amount neglects or
refuses to pay the amount after demand, the amount, together
with costs which may accrue, shall be a judgment in favor of the
Commonwealth upon the property of the producer, but only after
the judgment has been entered and docketed of record by the
prothonotary of the county where the property is situated. The
Commonwealth may transmit to the prothonotaries of the
respective counties certified copies of the judgments, and it
shall be the duty of each prothonotary to enter and docket the
same of record in his office and to index each judgment, without
requiring the payment of costs as a condition precedent to the
entry of the judgment.
§ 2309. Criminal penalties.
(a) Offense defined.--It shall be unlawful for any producer
to:
(1) Intentionally make or cause to be made a false or
fraudulent report under this chapter with the intent to
defraud the Commonwealth.
(2) Refuse to permit the commission or its authorized
agents to examine books, records or papers or hinder or
obstruct the commission in the performance of a duty under
this chapter.
(3) Violate 18 Pa.C.S. § 4903 (relating to false
swearing) or 4904 (relating to unsworn falsification to
authorities), including a violation in providing or preparing
information required by this chapter.
(4) Intentionally fail to make timely payment of the
fee.
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(b) Probable cause.--If the commission believes that
probable cause of a violation under this section exists, the
commission shall refer the case to the Attorney General for
investigation.
§ 2310. Criminal grading.
(a) Summary offense.--Except as set forth in subsection (b),
a producer that willfully violates this chapter or an order
issued under this chapter commits a summary offense and shall,
upon conviction, be sentenced to pay a fine of not less than
$100 nor more than $1,000 and costs or to a term of imprisonment
for not more than 30 days, or both.
(b) Misdemeanor offense.--A producer that commits a second
or subsequent violation of this chapter or an order of the
commission commits a misdemeanor and shall, upon conviction, be
sentenced to pay a fine of not less than $1,000 but not more
than $10,000 per day for each violation or to imprisonment for a
period of not more than one year, or both.
(c) Violations.--Each violation for each separate day and
each violation of this chapter or order issued under this
chapter shall constitute a separate offense under subsection (a)
or (b).
§ 2311. Enforcement orders.
(a) Issuance.--The commission may issue an order as
necessary to enforce this chapter. An order issued under this
section shall take effect upon notice, unless the order
specifies otherwise. An appeal of the order must be in
accordance with 66 Pa.C.S. Ch. 3 Subch. B (relating to
investigations and hearings).
(b) Compliance.--A producer has the duty to proceed
diligently to comply with an order issued under subsection (a).
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If a producer fails to proceed diligently or to comply with an
order within the time required, the producer shall be guilty of
contempt and shall be punished by the court in an appropriate
manner. The commission shall apply to the Commonwealth Court,
which shall have jurisdiction over matters relating to contempt.
§ 2312. Administrative penalties.
(a) Civil penalties.--In addition to any other proceeding
authorized by law, the commission may assess a civil penalty
upon a producer for the violation of this chapter. In
determining the amount of the penalty, the commission shall
consider the willfulness of the violation and other relevant
factors.
(b) Separate offense.--Each violation for each separate day
and each violation of this chapter shall constitute a separate
offense.
(c) Limitation of actions.--Notwithstanding any limitation
in 42 Pa.C.S. Ch. 55 Subch. B (relating to civil actions and
proceedings), an action under this section must be brought
within three years of the violation.
(d) Procedure.--A penalty under this chapter is subject to
66 Pa.C.S. Ch. 3 Subch. B (relating to investigations and
hearings).
§ 2313. Regulations.
The commission shall promulgate regulations necessary to
enforce this chapter.
§ 2314. Recordkeeping.
A producer liable for the fee imposed under this chapter
shall keep records, make reports and comply with regulations of
the commission. If necessary, the commission may require a
producer to make reports, render statements or keep records as
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the commission deems sufficient to determine liability for the
fee.
§ 2315. Examinations.
(a) Access.--The commission or its authorized agents or
representatives shall:
(1) Have access to the books, papers and records of any
producer in order to verify the accuracy and completeness of
a report filed or fee paid under this chapter.
(2) Require the preservation of all books, papers and
records for any period deemed proper not to exceed three
years from the end of the calendar year to which the records
relate.
(3) Examine any employee of a producer under oath
concerning the severing of natural gas subject to a fee or
any matter relating to the enforcement of this chapter.
(4) Compel the production of books, papers and records
and the attendance of all individuals who the commission
believes to have knowledge of relevant matters in accordance
with 66 Pa.C.S. (relating to public utilities).
(b) Unauthorized disclosure.--Any information obtained by
the commission as a result of any report, examination,
investigation or hearing under this chapter shall be
confidential, except for official purposes, in accordance with
judicial order or as otherwise provided by law. An individual
unlawfully divulging the information commits a misdemeanor and
shall, upon conviction, be sentenced to pay a fine of not more
than $1,000 and costs of prosecution or to imprisonment for not
more than one year, or both.
§ 2316. Local distribution of fee.
(a) Establishment.--There is established in the State
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Treasury a restricted receipts account to be known as the Shale
Impact Account to be administered by the commission.
(b) Deposit.--All fees imposed shall be deposited into the
account.
(c) Conservation districts.--
(1) On an annual basis, $7,500,000 shall be transferred
from the account to the Conservation District Fund for
distribution to county conservation districts pursuant to
guidelines established by the State Conservation Commission.
(2) Funds under paragraph (1) shall be distributed in
accordance with the following:
(i) One-half shall be distributed using a formula
developed by the State Conservation Commission consistent
with the act of May 15, 1945 (P.L.547, No.217), known as
the Conservation District Law, and the State Conservation
Commission statement of policy.
(ii) One-half shall be distributed using a formula
that divides the annual amount appropriated to each
county conservation district by the county from the
county general fund, special fund and grant sources by
the amount appropriated to county conservation districts
by counties from the county general fund, special fund
and grant sources and multiplying the resulting
percentage by the funds available.
(d) Distribution.--Following distribution under subsection
(c), 60% of the revenues remaining in the account are
appropriated for the purposes authorized under this section.
Local governments are encouraged, where appropriate, to jointly
fund projects that cross jurisdictional lines. The commission
shall distribute the funds appropriated under this subsection as
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follows within 45 days after the date the fee is remitted:
(1) Thirty-six percent shall be distributed to counties
in which producing unconventional gas wells are located. The
amount for each county shall be determined using a formula
that divides the number of producing unconventional gas wells
in the county by the number of producing unconventional gas
wells in this Commonwealth and multiplies the resulting
percentage by the amount available for distribution under
this paragraph.
(2) Thirty-seven percent shall be distributed to
municipalities in which producing unconventional gas wells
are located. The amount for each municipality shall be
determined using a formula that divides the number of
producing unconventional gas wells in the municipality by the
number of producing unconventional gas wells in this
Commonwealth and multiplies the resulting percentage by the
amount available for distribution under this paragraph.
(3) Twenty-seven percent shall be distributed to
municipalities located in a county in which producing
unconventional gas wells are located. The amount available
for distribution in each county shall be determined by
dividing the number of producing unconventional gas wells in
the county by the number of producing unconventional gas
wells in this Commonwealth and multiplying the resulting
percentage by the amount available for distribution under
this paragraph. The resulting amount available for
distribution in each county in which producing unconventional
gas wells are located shall be distributed to each
municipality in the county regardless of whether an
unconventional gas well is located in the municipality as
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follows:
(i) One-half shall be distributed to each
municipality using a formula that divides the population
of the municipality within the county by the total
population of the county and multiplies the resulting
percentage by the amount available for distribution to
the county under this subparagraph.
(ii) One-half shall be distributed to each
municipality using a formula that divides the highway
mileage of the municipality within the county by the
total highway mileage of the county and multiplies the
resulting percentage by the amount available for
distribution to the county under this subparagraph.
(e) Use of funds.--A county or municipality receiving funds
under this subsection shall make use of funds received only for
the following purposes:
(1) Construction, reconstruction, maintenance and repair
of roadways, bridges and public infrastructure.
(2) Water, storm water and sewer systems, including
construction, reconstruction, maintenance and repair.
(3) Emergency preparedness and public safety, including
police and fire services.
(4) Environmental programs, including trails, parks and
recreation, open space, flood plain management, conservation
districts and agricultural preservation.
(5) Preservation and reclamation of surface and
subsurface waters and water supplies.
(6) Tax reductions, including homestead exclusions.
(7) Records management, geographic information systems
and information technology.
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(8) To provide safe and affordable housing to residents.
§ 2317. Statewide environmental initiatives.
(a) Deposit and distribution.--Following distribution under
section 2316(c), 40% of the revenues in the account are
appropriated for distribution by the commission as follows:
(1) Eighty percent to the Commonwealth Financing
Authority to be utilized for grants to eligible applicants
for the following purposes:
(i) To implement acid mine drainage abatement and
cleanup efforts, mine reclamation and to plug abandoned
and orphaned oil and gas wells.
(ii) Grants for watershed protection as defined in
27 Pa.C.S. § 6103 (relating to definitions).
(iii) Planning and enforcement authorized under
section 6 of the act of January 24, 1966 (1965 P.L.1535,
No.537), known as the Pennsylvania Sewage Facilities Act.
(iv) Water, storm water and sewer systems, including
construction, reconstruction, maintenance and repair.
(v) The planning, acquisition, development,
rehabilitation and repair of greenways, recreational
trails, open space, natural areas, community conservation
and beautification projects, community and heritage parks
and forest conservation.
(vi) Flood control and dam safety projects,
including the removal of dams where appropriate.
(2) Ten percent to the Motor License Fund.
(3) Ten percent to the Hazardous Sites Cleanup Fund.
(b) Restriction on use of proceeds.--
(1) Funds shall not be granted to an eligible applicant
for the purpose of public relations, outreach,
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communications, lobbying or litigation.
(2) No property purchased using revenue generated under
this section may be conveyed or resold to another entity
without approval from the Department of Conservation and
Natural Resources.
(3) Grants may not be used by an authorized organization
as defined in 27 Pa.C.S. § 6103 for land acquisition unless
the authorized organization has obtained the written consent
of the county and municipality in which the land is situated.
(c) Coordination with other agencies.--The department and
the Department of Conservation and Natural Resources shall
review applications for funding as requested by the Commonwealth
Financing Authority and provide recommendations on priority of
projects and project approval for consideration by the
Commonwealth Financing Authority.
CHAPTER 25
MODEL ORDINANCE
Sec.
2501. Model municipal ordinance.
2502. Local ordinance.
§ 2501. Model municipal ordinance.
(a) Purposes.--The purposes of this section are as follows:
(1) To optimize the development and use of this
Commonwealth's oil and gas reserves by increasing reasonable
consistency in zoning and other municipal regulation.
(2) To foster expeditious and efficient handling of
municipal oil and gas permitting procedures.
(3) To allow municipalities to enact regulations under
the act of July 31, 1968 (P.L.805, No.247), known as the
Pennsylvania Municipalities Planning Code, and the act of
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October 4, 1978 (P.L.851, No.166), known as the Flood Plain
Management Act, insofar as the regulation is authorized by
section 2502 (relating to local ordinance) and this section.
(b) Authority.--The commission shall develop and adopt a
model ordinance to fulfill the purposes of this section.
(c) Adoption of provisions.--
(1) Within 120 days of the effective date of this
section, the commission shall, by majority vote, adopt a
model ordinance for counties and municipalities pertaining to
oil and gas drilling activities in accordance with the
Pennsylvania Municipalities Planning Code, as applicable, the
Flood Plain Management Act and this section.
(2) The model zoning ordinance shall do all of the
following:
(i) Authorize oil and gas development as a permitted
use by right in all zoning districts except residential
districts. The commission may develop a model zoning
ordinance that allows oil and gas development in
residential zoning districts by conditional use or
special exception with conditions dependent on the
density of existing uses within the district and the
isolation distances achievable in each residential
district.
(ii) Authorize natural gas compression stations:
(A) as a permitted use by right in all
agricultural, industrial and commercial districts;
and
(B) as a conditional use in all other zoning
districts.
(iii) Authorize natural gas processing plants:
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(A) as a permitted use by right in all
industrial districts; and
(B) as a conditional use or special exception in
agricultural districts.
(3) The model zoning ordinance shall not do any of the
following:
(i) Impose limitations on the hours of operation on
drilling operations.
(ii) Impose limitations on noise, light, height or
security or fencing on drilling operations, natural gas
compressor stations or natural gas processing plants if
the limitations are more stringent than limitations
imposed on construction activities for other similar land
uses. The model zoning ordinance may include limitations
on noise, light, height and security and fencing for
equipment or processes which are unique to the gas
industry and which are rational, nondiscriminatory and
reasonably defensible in the particular zone where they
apply.
(iii) Have a permit review period for uses by right
that exceeds 30 days for complete and responsive
submissions.
(iv) Impose restrictions on vehicular access routes
for overweight vehicles except as authorized under:
(A) 75 Pa.C.S. (relating to vehicles); or
(B) the Pennsylvania Municipalities Planning
Code.
(v) Regulate storm water, erosion and sedimentation
control or grading where the use is subject to regulation
by the department through an Erosion and Sedimentation
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Control General Permit or similar permit.
(4) Nothing in this subsection shall limit or preempt a
county or municipality from action under the act of October
4, 1978 (P.L.864, No.167), known as the Storm Water
Management Act.
(d) Effect of model ordinance.--An ordinance adopted by a
county or municipality to regulate oil and gas shall not contain
more stringent standards than the model ordinance adopted by the
commission.
(e) Timing.--The commission shall publish the adopted model
ordinance in the Pennsylvania Bulletin immediately after its
adoption and shall disseminate information about the model
ordinance through the Department of Community and Economic
Development, municipal associations and other means as the
commission shall deem appropriate. The costs of the notification
shall be borne by the Department of Community and Economic
Development.
(f) Miscellaneous.--The commission shall review the model
ordinance annually. Proposed amendments shall be published in
the Pennsylvania Bulletin within 30 days after their adoption.
(g) Ordinance.--If an ordinance adopted by a county or
municipality contains more stringent standards than the model
ordinance, the county or municipality shall be ineligible to
receive funding under sections 2316 (relating to local
distribution of fee) and 2317 (relating to environmental
initiatives).
(h) Effective date of model ordinance.--The model ordinance
shall take effect 70 days following the commission's publication
of the ordinance in the Pennsylvania Bulletin under this
section.
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§ 2502. Local ordinance.
Nothing in this chapter shall impair or infringe upon the
preemption or supersedure of the regulation of gas wells under
section 602 of the act of December 19, 1984 (P.L.1140, No.223),
known as the Oil and Gas Act.
Section 2. This act shall take effect as follows:
(1) This section shall take effect immediately.
(2) The addition of 58 Pa.C.S. § 2501 shall take effect
immediately.
(3) The remainder of this act shall take effect in 30
days.
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