Five Key Takeaways From Gov. Corbett’s Budget

Yesterday, Gov. Tom Corbett addressed a joint session of the general assembly, where he laid out his annual budgetary and spending priorities for the Commonwealth. Here are key experts from his address:

In the space of a few years, our state has also become the nation’s second-largest producer of natural gas. Shale gas offers our country a chance at energy independence and greater economic security – and it’s part of the all-of-the-above strategy we’ve put in place.

We are very fortunate, and we can be very proud, that the shale-gas revolution is happening right here in Pennsylvania. Go to Williamsport, and you won’t doubt the difference that this industry is making for our state. Talk to our local businesses – the dry cleaner and the diner owner – who are remaking Main Street. Talk to the folks at Allison Crane, NuWeld and Albert’s Spray Solutions. These companies are seizing this opportunity, hiring local citizens for jobs, and helping to maximize our energy resources – responsibly.

Shale gas has made that region one of the top ten fastest-growing local economies in the country. It’s lifting up entire communities, creating and supporting many thousands of jobs well beyond gas production. The revival extends to manufacturing, as leading companies put Pennsylvania back on the map for investment and growth. And it’s reducing home energy costs, right now, for Pennsylvanians. Big things are in motion, and shale gas is the power behind it all. It’s great for Pennsylvania, and even greater for the United States.

And here are five key takeaways from the 1,000-plus page budget document specific to safe, job-creating shale development:

  • MARCELLUS MULTIPLIER EXPANDS JOBS: Home of the second largest energy field in the world, Pennsylvania’s vast energy portfoliohas positioned the commonwealth as the Keystone to our nation’s domestic energy future. An energy independent state and nation means supporting jobs here, and utilizing our resources here rather than sending them abroad. … The construction sector will also benefit from renewed growth in natural gas drilling in response to moderately higher prices. … Going forward, Pennsylvania will benefit from the continued development of the Marcellus shale natural gas deposit which will provide jobs in the mining industry. The state may also attract jobs in industries that can benefit from the increase in natural gas supplies, either for low-cost energy or for inputs into chemical products. (pgs. 51, 64)
  • SHALE DEVELOMENT BOOSTS SAFETY TRAINING: Act 13 of 2012 establishes the development, delivery and sustainment of training and grant programs for first responders and the acquisition of specialized equipment for response to emergencies relating to natural gas production from unconventional wells. (pg. 496)
  • INSPECTIONS UP, VIOLATIONS DOWN: Significant increases in natural gas production have occurred in Pennsylvania since 2008 as a result of the use of horizontal drilling and hydraulic fracturing techniques that are now commonly used by oil and gas operators throughout the shale plays in Pennsylvania. The department permits and inspects oil and gas sites and natural gas gathering pipelines. The department conducted 12,660 unconventional well inspections in 2012, up from 1,310 in 2008. At the same time, violations and enforcements have steadily declined with the introduction of better technology and more rigorous regulations that industry is complying with and in many cases, exceeding. (pg. 511)
  • EXPANDING THE USE OF CLEAN, AMERICAN NATURAL GAS: Act 13 of 2012 imposed an impact fee on unconventional gas drilling in Pennsylvania and which has helped develop alternative energy opportunities across the commonwealth, the nation, and the world. The impact fee has produced $407 million in state revenue to date, and the department has been allocated a portion of the funds to support oil and gas inspections and permitting. In the 2012-13 fiscal year, the Natural Gas Energy Development Fund dispersed more than $6.7 million to assist businesses and transit organizations convert vehicle fleets to operate on natural gas. This program helps to spur the development of natural gas fueling infrastructure for public and private interests. Another $1.5 million was awarded through the Alternative Fuel Incentive Grant rebate program. (pg. 511)
  • HUGE AMOUNTS OF REVENUE FOR ALL OF PENNSYLVANIA: Tightly-regulated shale development is projected to generate $260 million in royalty revenues — an annual increase of $50 million — and $216 million in impact fees in the coming year alone. (pgs. 938, 972)