Dec 13, 2015 3 min read

The old adage of “following the money” in politics is useful for voters as they try to find out for whom their elected officials really work.

Unfortunately, in Pennsylvania, the same can’t be said for the millions of dollars in Act 13 impact fee money given to communities across the state.

The Act 13 legislation passed in 2012 was designed to set regulations for the Marcellus shale industry and also set up a “user fee” for drillers that work in the area. The state courts eventually stripped a controversial zoning provision of the law that took local control away from community leaders, but the impact fee remained. And it has been bountiful for communities in this area.

In fact, more than $35 million in impact fee money has been distributed to municipalities in Washington and Greene counties since the disbursements began in 2012. There are 13 specific categories for how that money can be spent, some of which include fixing public infrastructure, improving emergency service or setting aside funds to a rainy day account.

However, an official with the state Public Utility Commission, which is charged with overseeing how the money is distributed and spent by local municipalities and counties, admitted the agency does not perform independent audits on the funds to ensure it’s being spent properly.

“We don’t have enforcement authority,” PUC spokesman Nils Hagen-Frederiksen said in Sunday’s story in the Observer-Reporter about the lack of oversight. “Enforcement is not spelled out in the regulations.”

Instead, the burden is on the municipalities to demonstrate to the PUC that they are spending the money in accordance with Act 13 guidelines. The communities must file a spending report with the PUC each year listing the uses, although it’s clear those 13 spending categories are flexible and basically open to interpretation by local officials.

Even Washington-based attorney Gary Sweat who works as a solicitor for several communities in Washington County where drilling is prevalent, admitted the accounts are “a black hole.”

That’s unacceptable, considering the amount of money flowing into small communities that have never had such influxes of cash.

Four of the top seven grossing communities in the state are in Greene and Washington counties.

Cumberland Township received $918,147 in drilling money this year, the most of any municipality in the state. It was followed closely by Morris Township in Greene with $865,695 and Morgan Township with $739,826, according to statistics provided by the commonwealth. Amwell Township received the seventh-highest allotment with $725,380.

There’s no denying that the impact fee money has been a boon for this area – although it should be noted that the school districts get nothing – and so it’s understandable why local officials so despise potential changes to the system. Mention a “severance tax” in this area at your own peril.

But it’s becoming increasingly clear there need to be some changes with how the money is accounted for by the state.

State legislators will have that opportunity next year when they renegotiate the multiyear fee schedule assessed to drillers.

It would be wise for them to seriously consider placing better safeguards on the impact fee spending. The stakes are just too high not to follow this pile of money.