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Pennsylvania PUC Recalculates Some Impact Fee Payments

The Pennsylvania Public Utility Commission (PUC) last week had taken down from its website a list of how impact fee revenue generated by Act 13, the state's omnibus Marcellus Shale law, was distributed to county and municipal governments.

Meanwhile, officials in Lycoming County and the City of Williamsport are trying to figure out how the city was shorted more than a quarter million dollars in impact fee revenue.

"The Impact Fee County/Municipal distribution list has been temporarily removed," the PUC said in a message posted on its website Friday. "We found a miscalculation in some of the impact fee disbursements related to the municipalities within five linear miles of a well, which will result in adjustments to the payments to affected municipalities. We apologize for any delay and inconvenience. All impact fee disbursements will still be made prior to the legislative deadline of Dec. 1.

"After publishing the numbers, a few entities reached out to the PUC to verify their information and double-check their distribution. While reviewing the payments to these entities, we came across an issue in how the five-linear-mile input was applied. As a result, we are conducting a wholesale review of the distribution amounts."

The PUC announced Oct. 15 that localities would receive $108.7 million in impact fee revenue (see NGI, Oct. 22). It had calculated that counties with producing unconventional wells would receive $38.2 million, municipalities with producing unconventional wells would receive $39.3 million and municipalities that are contiguous or within five linear miles of municipalities with producing wells would receive $28.7 million.

Lycoming County Department of Planning and Community Development Deputy Director William Kelly said Williamsport doesn't have any wells within its city limits and isn't contiguous to municipalities that have wells. But he said the city is within five linear miles of two wells.

"When we did the analysis here in our organization -- we have some pretty sophisticated geographic equipment -- we determined that they were within five miles," Kelly told NGI Friday. "As a result, we provided our information back to the PUC for them to consider. They are actively considering our information and we'll learn what their decision is soon."

According to the Pennsylvania Department of Environmental Protection (DEP), Anadarko E&P Co. LP is operating a horizontal well (Douglas Kinley 6H) in Lycoming Township. Also, Rice Drilling LLC is operating a vertical well (Ultimate Warrior 1) in Upper Fairfield Township. Both are unconventional wells.

Kelly said the county had determined that Anadarko's Kinley well was 4.5 miles from the Williamsport city limits and that Rice's Ultimate Warrior well was 4.7 miles away.

"Both of them are well within the five-mile range provided for in the law," Kelly said, adding that county and city officials had originally figured the city would get $538,000 in impact fee revenue but was told by the PUC that it would get $259,000. "We wanted to understand what would cause that," Kelly said. "We have not heard back from them yet. But unless there's something we don't understand, it looks like the city should be entitled to the funds that were withheld."

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