1. Pennsylvania’s Severance Tax: The Impact Fee
MARCELLUSCOALITION.ORG | @MARCELLUSGAS

2. PA Oil & Gas Act What is Act 13 of 2012?
First comprehensive re-write of Pennsylvania oil and gas act in nearly 30 years
Three major components:
Enhanced environmental standards Setbacks, permitting standards, bonding, chemical disclosure, water protection, public notice, penalties
Uniformity of local ordinances
Imposition and distribution of impact fee

3. Paying Their Fair Share
Other Taxes and Fees Imposed on Industry:
Corporate Net or Personal Income Taxes
Sales and Use Tax
Liquid Fuels Tax
More than $2.1 billion since 2007 (not including impact fee)
$5,000 per drilling permit ($10 million in 2015)
Other fees:
$200/permit for orphan well plugging
$50/permit for abandoned well plugging
$50/well to PA PUC for administration

4. Effective Severance Tax Rate
PA Impact Fee: Effective Severance Tax Rate
Assumes 15% average royalty for landowner (landowner does not pay impact fee) Does not factor in gathering costs that must be paid by producer $0.77/MCF IFO Estimate) No capital recovery for operator

5. Paying Their Fair Share
Impact Fee Revenues to Date
Year Distributed
Amount
2012
$204.2 m
2013
$202.5 m
2014
$225.8 m
2015
$223.5 m
2016
$187.7 m
TOTAL:
$1.043 B

6. Benefiting PA Communities
Where does the money go?
60% - Host counties and municipalities Based upon drilling activity as determined by DEP
40% - Statewide programs Marcellus Legacy Fund
25% to all counties for at-risk bridges
25% Water & Sewer projects (H2O and Pennvest)
20% CFA for competitive environmental grants
15% to all counties for recreation & greenways
10% to Growing Greener
5% to HSCA

7. Impact Fee Distributions