Oil/Gas Revs. Support Pa.’s State Park Budget
Revenue from oil and gas wells is now the primary funding source for the agency overseeing state parks and forests, according to a new legislative analysis, the Scranton Times-Tribune reported.
For the first time with the new state budget, revenue from the separate Oil and Gas Lease Fund contributes more to operate the Department of Conservation and Natural Resources (DCNR) than the taxpayer-supported General Fund, said the House Democratic Appropriations Committee.
“With the 2013-14 budget, a much greater share of personnel costs for DCNR’s park rangers, foresters, lifeguards, civil engineers, geologists and other professionals will be financed with drilling revenues in the years to come,” the analysis said.
This year, DCNR received $106 million from the oil and gas fund – more than one-third of its entire budget – and $72 million from the General Fund.
The Oil and Gas Fund transfer represents rentals and royalties from forest lands already under lease as well as carryovers from the existing fund balance.
DCNR’s increasing reliance on oil and gas revenue has occurred during just the past five years with the leasing of Marcellus gas wells on state forest land.
Prior to 2008, revenue from shallow oil and gas wells was about $4 million annually. The money was spent under terms of the 1955 law establishing the Oil and Gas Lease Fund to purchase state park land, acquire mineral rights, improve trails and infrastructure, develop recreational areas and provide some operational support.
Since 2008, when the Marcellus boom began, more than $227 million in rent and royalty payments and $417 million in bonus payments reflecting driller bids in three competitive auctions in 2009 and 2010 to lease forest land have gone into the Oil and Gas Fund, according to the analysis.
A moratorium on leasing additional state forest land for gas drilling has existed since 2010, but DCNR is considering a proposal by Anadarko Petroleum Corp. to drill on land where it owns subsurface mineral rights in the Loyalsock State Forest in Northeast Pennsylvania.
The first major transfers from the oil and gas fund to support DCNR started in 2009 during the Rendell administration when the recession was at its peak and continued when Gov. Tom Corbett took office in 2011.
Oil and gas fund revenue has kept state parks open and forests well-managed, DCNR officials say.
DCNR’s budget is level-funded, which will allow it to operate without cuts to services and programs, said Acting DCNR Secretary Ellen Ferretti in a recent agency newsletter.
“State parks will remain open and forest operations will continue their important work,” she added.
Using the Oil and Gas Fund revenue to support DCNR’s operations means less is available to tackle an estimated $1 billion worth of maintenance needed for roads, bridges, dams and water systems in the state parks and forests, said the Democratic committee analysis.