IFO Provides PA Impact Fee Estimates for 2018

This is an 18% increase from the 2017 year of $209.6 million and a 10.5% increase from the previous record year of 2014. 

The Commonwealth's impact fee is based on unconventional natural gas wells drilled and operating in the past year. It is determined on the first 15 years of operation, as long as wells produce more than 90 thousand cubic feet (Mcf) per day, and the price of natural gas. The fees collected benefit county and municipal governments, Commonwealth agencies, conservation districts and a Marcellus Legacy Fund that provides infrastructure, emergency services, environmental initiatives and other programs.

The IFO report indicates the primary reasons for the fee increase was due to 779 new wells offsetting aging wells, collections from previously disputed wells and outstanding payments. Payments disputed due to the pending litigation regarding stripper wells was resolved with the recent Pennsylvania Supreme Court decision. IFO estimates the net impact from the collections was approximately $22 million.

View the full IFO Research Brief and other releases.