The Pennsylvania Public Utility Commission’s (PUC) revision of distribution figures for impact fee revenue generated by Act 13 is mixed news for municipalities, with a bigger pot of revenue to divvy up, but most will get a smaller share.
The agency had to recalculate the distributions after determining that an error occurred over how it applied the five-linear-mile rule for calculating impact fee revenue under Act 13, the state’s omnibus Marcellus Shale law. The PUC had originally published a distribution list on Oct. 15 but rescinded it in late October (see Shale Daily, Oct. 29; Oct. 16).
“After publishing the numbers, a few entities reached out to [us] to verify their information and double-check their distribution,” the PUC said. “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] conducted a wholesale review of the distribution amounts and made the necessary corrections.”
According to the PUC, there were 1,388 municipalities that received impact fee revenue. The revised figures show that 652 of them will receive less money after the recalculation, 138 will receive more money and 598 were unchanged.
By far the biggest beneficiary of the recalculation is the City of Williamsport, which saw its distribution increase by $300,145.26, for a total distribution of $559,742.98. In comparison, the municipality that saw the second-highest increase in its distribution was Lycoming’s Jersey Shore Borough, which will get an additional $44,769.74 ($83,499.88 total).
“Getting it right sets the template for the next set of checks, which are to be distributed in July,” Lycoming County Department of Planning and Community Development Deputy Director William Kelly told the Williamsport Sun-Gazette. He later added, “You know what’s amazing? The adjusted PUC list is almost spot on, within a few percentage points, of our original estimates in April.”
Lycoming’s Loyalsock Township saw the biggest decrease in distribution, but it still stands to receive a big share of revenue. It will lose $56,499.69, for a total distribution of $244,000.34.
Overall, municipalities will receive $111,673,038.74, an increase of $104,887.14.
PUC spokeswoman Jennifer Kocher stressed that oil and gas operators weren’t charged additional impact fees; the added revenue would come from the share previously allocated to the state’s Housing Affordability and Rehabilitation Enhancement Fund.
“The fund itself it didn’t change,” Kocher told NGI’s Shale Daily on Tuesday. “The pot of money stayed the same, it was just how it was being distributed changed.”
Lycoming and Williamsport officials had calculated that the city, which has no oil or natural gas wells within its own city limits, is still within five linear miles of two wells: Anadarko E&P Co. LP’s Douglas Kinley 6H well in Lycoming Township, and Rice Drilling LLC’s Ultimate Warrior 1 well in Upper Fairfield Township.
The PUC reports municipalities will receive $108.7 million in impact fee revenue, with $38.2 million going to counties with producing unconventional wells, $39.3 million to municipalities with producing unconventional wells, and $28.7 million to municipalities that are contiguous or within five linear miles of municipalities with producing wells.
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