Natural gas impact fee checks smaller this year
Lower energy prices and the presence of more wells in the state contributed to the decline.
Checks distributed to Mon Valley communities — and hundreds of others across the state — from Marcellus Shale wells through the state’s natural gas impact fee will be significantly smaller this year.
Pennsylvania’s Public Utility Commission collected $179.6 million from the Act 13 gas well impact fee levied on production in 2023, about $100 million less than it received in 2022.
Since the state enacted the fee on producers of unconventional wells — those drilled into the Marcellus Shale — the PUC has distributed more than $2.7 billion since 2012.
The decrease in revenue collected from the impact fee is a result of a 2023 drop in natural gas prices, which fell to $2.74 per metric million Btu compared to $6.64 metric million Btu in 2022.
There were 423 new wells drilled in the state last year, which also could be attributed to the decrease because the impact fee also is based on how many wells are drilled and their age.
All Pennsylvania counties receive a percentage of the revenue from the gas impact fee, but counties and municipalities where drilling occurs are given more to compensate for the wear and tear on roads and infrastructure used by trucks involved in the operations.
Communities typically use the funds for road repairs, maintenance, emergency services and other big-ticket items.
County and municipal governments directly affected by drilling will receive a total of $100,302,825 for the 2023 reporting year.
Additionally, $63,791,090 will be transferred to the Marcellus Legacy Fund, which provides financial support for environmental, highway, water and sewer projects, rehabilitation of greenways and other projects throughout the state.
Another $15,540,804 will be distributed to state agencies, as specified by Act 13.
Carroll and Fallowfield townships in Washington County and Forward Township in Allegheny County will see some of the biggest differences in funds this year.
Carroll Township will receive $242,904, which is about $167,992 less than last year.
Fallowfield will see a $129,710 decline, bringing in $189,216.
“We are certainly disappointed, but we’ve gotten very gotten very generous allocations in the past and hopes it goes back to what it was,” said Bruce Smith, chairman of the Fallowfield Township supervisors.
The township hasn’t decided how to spend this year’s disbursement.
“We use it for different things, and we don’t have a plan in place right now for the money will we soon receive,” Smith said, “but that’s because there are things that come up that are not covered by the tax base, and we try to use it for those projects.
“Right now have a project going on along Fox Stop Road, and we have some other things coming up, but at least the money is staying here. That’s the most important thing.”
Forward Township will receive $167,623 this year, which is $124,949 less than it got in 2023.
Supervisor Chairman Tom DeRosa said while they are disappointed, they will gladly accept whatever is provided.
“Truthfully, we were kind of expecting this to happen,” DeRosa said. “It happened to everyone. We knew when gas started to come down that it would affect this. It just keeps going down and down and that means this goes down. At some point, you are just thankful for what you get.”
Forward Township also hasn’t decided how to spend its allocation.
“We have an oil and gas fund and that is where this money will go until something comes up and we need it,” DeRosa said. “There’s not a time limit you have to spend it by, but there are certain stipulations on how you can spend it. That’s the only thing.”
Other communities in the Mon Valley will get notably smaller disbursements.
California will receive $74,167 ($54,448 less), followed by Charleroi at $57,996 ($38,387 less), Donora, $75,370 ($49,542 less) and Monongahela, $63,901 ($42,109 less).
Here is a breakdown by county of what other municipalities will receive this year. The figure in parenthesis is the amount each community received in 2023.
Allegheny County
Allegheny County will receive $1,408,973 in 2023 impact funds. It contains 185 of 11,829 spud unconventional wells subject to the impact fee statewide. The following Mon Valley communities will receive: • Dravosburg, $261($418)
• East McKeesport, $319 ($510)
• Elizabeth Borough, $767 ($1,254)
• Elizabeth Township, $63,154 ($78,588)
• Glassport, $2,046 ($3,347)
• Liberty Borough, $1,238 ($2,022)
• Lincoln Borough, $518 ($848)
• McKeesport, $9,317 ($15,211)
• North Versailles, $1,715 ($2,741)
• Port Vue, $628 ($1,004)
• Versailles, $714 ($1,167)
• West Elizabeth, $343 ($561)
• White Oak, $3,970 ($6,490)
Fayette County
Fayette County will receive $687,753 in distributions. It contains 216 of 11,829 spud unconventional wells subject to the impact fee statewide. Communities located in the Mon Valley will receive:
• Belle Vernon, $2,474 ($4,231)
• Brownsville, $6,896 ($11,789)
• Fayette City, $1,457 ($2,489)
• Perryopolis, $5,012 ($8,581)
• Washington Township, $38,737 ($71,451)
Washington County
Washington County will receive $5,499,238 in 2023 impact funds. It contains 1,937 of 11,829 spud unconventional wells subject to the impact fee statewide. It is the highest receiving county for 2023 allocations.
“Out of all 67 counties in the state, Washington and Greene counties are both in the top five for the amount of impact fee tax dollars received,” Sen. Camera Bartolotta said. “Our communities will have significant support that doesn’t burden taxpayers for public infrastructure needs, like stormwater systems, emergency preparedness, environmental programs, tax reductions and social services.”
The following Mon Valley communities will receive:
• Allenport, $9,720 ($16,100)
• Coal Center, $2,098 ($3,456)
• Dunlevy, $5,893 ($9,787)
• Elco, $5,170 ($8,555)
• Finleyville, $5,644 ($9,362)
• New Eagle, $31,961 ($53,013)
• North Charleroi, $18,676 ($31,092)
• Roscoe, $12,033 ($19,982)
• Speers, $18,007 ($29,841)
• Stockdale, $6,207 ($10,319)
• Twilight, $5,434 ($9,180)
• West Brownsville, $20,749 ($34,265)
Westmoreland County
Westmoreland County will receive $1,095,480 in distributions. It contains 304 of 11,829 spud unconventional wells subject to the impact fee statewide. Communities located in the Mon Valley will receive:
• Arnold City, $7,261 ($11,304)
• Monessen, $11,981 ($18,678)
• North Belle Vernon, $2,779 ($4,329)
• Rostraver Township, $29,401 ($46,958)
• West Newton, $4,207 ($6,555) Checks for the counties and municipalities should be in the mail sometime in mid-July, the PUC said.