Senate bill could cut impact fee funding from communities that restrict oil, gas activity

May 30, 2025 By Karen Mansfield 3 min read

A gas well in South Franklin Township

A bill in the Pennsylvania Senate could result in a loss of funding for communities that restrict oil and gas drilling in Pennsylvania.

Senate Bill 102, co-sponsored by Sen. Camera Bartolotta (R-Washington) and Sen. Gene Yaw (R-Lycoming), would prohibit municipalities that “unreasonably” restrict oil and gas drilling from receiving Act 13 drilling impact fees.

“The impact fee was carefully constructed to compensate municipalities that hosted or were in proximity to natural gas development for any impacts they experienced. Impact fee dollars were never intended to go to municipalities that prevent harnessing Pennsylvania’s natural resources for our benefit,” Bartolotta said. “My bill would stop this unfair practice.”

The bill would also require the state agency to withhold funds while any litigation challenging the validity of a local zoning ordinance is pending.

Impact fee payments, distributed by the Pennsylvania Public Utility Commission, can be used for road and bridge repairs, housing and other infrastructure needs.

The Pennsylvania Senate Environmental Resources and Energy Committee advanced the bill in a 7-4 vote on May 7. The bill is now moving to the full Senate for consideration..

The bill was introduced months after Cecil Township, in Washington County, approved a proposal to increase its well pad setback distance from 500 feet from homes – the state minimum – to 2,500 feet, the number of feet recommended in a 2020 Office of Attorney General grand jury report to provide a greater buffer zone between fracking operations and residential areas, schools, and hospitals.

Critics argue the bill punishes local governments for enacting stricter zoning regulations to protect their residents from potential health and environmental impacts that have been associated with oil and gas activity.

One point of contention is determining what constitutes an “unreasonable” restriction on oil and gas development.

Cecil Township, for example, increased its setbacks from shale gas well pads to 2,500 feet from homes and businesses — more than the established 500-feet setback distance – and 5,000 feet from schools and hospitals.

One point of contention is determining what constitutes an “unreasonable” restriction on oil and gas development.

“I’m wondering, is the intent of this legislation to punish communities that go beyond the minimum 500-foot setback?” said Lisa Graves Marcucci, Pennsylvania coordinator of community outreach for the Environmental Integrity Project. “We have communities that are saying we’ve had a front row seat to fracking and we don’t feel 500 feet is far enough away, so Cecil, for example, did everything proper they needed to do and set a 2,500-foot minimum setback, and now they’re being told by their own state senator they might be punished for going against a state minimum – and it’s a minimum setback, not a maximum.”

According to the PUC, Pennsylvania counties received an estimated $179 million from the impact fee in 2023.

Bartolotta and Yaw also co-sponsored Senate Bill 712, which would improve the process of plugging abandoned and orphaned wells in Pennsylvania. The bill would provide consistency in determining what a reasonable effort is when plugging to the attainable bottom, which they believe would lead to increased predictability and improved use of orphaned and abandoned well-plugging funds.

“The lack of current clarity has discouraged plugging companies from pursuing opportunities in Pennsylvania in favor of undertaking work in Ohio and West Virginia, which have more predictable processes for obtaining state agency approval,” Bartolotta said. “As Pennsylvania is in line to receive nearly $400 million in federal funds dedicated to plugging legacy wells, we need to take action now so funds are used as efficiently as possible.”