With the adoption of its $29.1 billion budget for 2014-2015, Pennsylvania cut its share of funding to the Delaware River Basin Commission (DRBC) by more than half, a move environmentalists and Democrats say is retaliation for the commission's failure to enact rules governing oil and gas development in the basin.
According to the 2014-2015 budget that Gov. Tom Corbett signed on July 10 (see Shale Daily, July 10), Pennsylvania will allocate $434,000 to the DRBC. That includes a $500,000 cut in funding, which Corbett had suggested last February.
By comparison, Pennsylvania has kept the same level of funding from the 2013-2014 budget for four other multi-state regulatory entities. During both years, the state gave $573,000 to the Susquehanna River Basin Commission; $227,000 to the Chesapeake Bay Commission; $136,000 to the Ohio River Valley Water Sanitation Commission; and $46,000 to the Interstate Commission on the Potomac River Basin.
"This cut seems clearly retaliatory because the DRBC did not promulgate regulations relating to drilling and the Delaware River Basin," state Rep. Greg Vitali (D-Havertown), ranking Democrat on the House Environmental Resources and Energy Committee, told NGI's Shale Daily on Monday.
John Hanger, former secretary of the state Department of Environmental Protection and a former Democratic candidate for governor, agreed that the cut amounted to retaliation.
"How do you say 'yes' in 200 languages?" Hanger said Monday. "No matter what language you want to use, this is pure retaliation."
Hanger added that although he was not intimately familiar with the DRBC's budget, "I would imagine that this is a relatively significant part of their overall funding, and would necessitate some reduction in effort.
"Gov. Corbett sees this kind of a cut as another gift to the gas industry. Unfortunately for the gas industry, it violates that old rule of being careful about what your friends to do for you. This is counterproductive activity by the governor."
Delaware Riverkeeper Maya van Rossum said the Corbett administration has tried, and so far failed, to strong arm the DRBC into enacting rules favorable for gas drilling in the basin.
"They're angry because their bullying tactics have not succeeded," van Rossum told NGI's Shale Daily on Monday. "It's very clear to us -- from the statements that have been made and the amount of funding that's being cut -- that as much as Gov. Corbett denies it, the reality is this is retribution for the DRBC failing to pass regulations that would open up the barn gates to shale gas development.
"Pennsylvania is cutting their nose off to spite their face. The DRBC carries on an incredible amount of work that benefits the state -- scientific analyses, permitting reviews and the implementation of critical environmental protections benefit Pennsylvania and all Pennsylvanians. Gov. Corbett taking this step is really doing harm to the residents of Pennsylvania, just because his ego is bruised."
But Patrick Henderson, Corbett's energy adviser, disagreed.
"This is about equity for taxpayers," Henderson told the Times-Tribune of Scranton, PA. "This is about the other jurisdictions paying their fair share, and Pennsylvania ensuring that its taxpayers are not on the hook to underwrite the DRBC's operations, because other states that are partners have not fully contributed their 'fair share' and the federal government has paid nothing."
The DRBC is led by the governors of Delaware, New Jersey, New York and Pennsylvania. The commander of the U.S. Army Corps of Engineers' North Atlantic division is also a commission member. According to the compact creating the DRBC, New Jersey and Pennsylvania each are to contribute 25% of the organization's budget, while New York is to contribute 17.5%, Delaware 12.5% and the federal government the remaining 20%. The commission's fiscal year (FY) begins on July 1.
On June 11, the DRBC adopted a budget for FY2014-2015 totaling more than $5.45 million, with signatory members to contribute more than $2.64 million. DRBC said the budget includes the $434,000 from Pennsylvania, plus $693,000 from New Jersey, $447,000 from Delaware, $359,500 from New York and $715,000 from the federal government.
"The cut from Pennsylvania makes for a challenging year ahead for us," DRBC spokeswoman Katherine Schmitt told NGI's Shale Daily on Monday. "It's really too early in our fiscal process to say what that impact will be on programs or staff."
Schmitt declined to characterize Pennsylvania's cut in funding as retaliation.
"That's a question honestly for the governor; I'm not a mind reader," Schmitt said. "It's been widely reported that Pennsylvania has had some problems where their revenues have been lower than their estimated revenues. Our hope is that next year the Commonwealth will be in better financial position on its own, which will allow them to restore funding to us."
The DRBC was near a vote to revise its water quality regulations in November 2011, but the meeting was canceled and the proposal postponed indefinitely after Delaware Gov. Jack Markell said he opposed it (see Shale Daily, Nov. 21, 2011).
Before the November 2011 meeting was canceled, New York officials said they would have joined Delaware in opposing the plan, but Pennsylvania was ready to vote in favor of it. New Jersey was undecided.