City of Williamsport and Lycoming County officials say they are keeping an eye on the amount of natural gas impact fee to be announced in the summer and it could be higher than recent infusions.

The cash installments used for eligible projects have, unfortunately, shown considerable ebb and tide, with fewer impact fee dollars due to several various factors, not the least of which is the COVID-19 pandemic, said state Rep. Jeff Wheeland, R-Loyalsock Township.

The impact fee dollar amounts are expected to be released in June or July by the Pennsylvania Utility Commission, said Shannon Rossman, executive director of the Lycoming County Department of Planning and Community Development.

The city last year was awarded $309,337, with the county receiving more than $2 million in gas drilling impact fees, she said.

Williamsport, however, used to receive figures closer to $675,000-plus before the pandemic, according to its prior-year budgets.

This year’s placeholder by the city administration that City Council approved in the budget was $250,000.

“The decrease is an ongoing trend that hopefully reverses,” said Council President Adam Yoder.

“Nonetheless, it’s a prime example of the importance of increasing as many revenue streams as possible through economic development.

“Doing so will minimize the impact of future years where outside sources of revenue may be down, such as Act 13 funds, and enable the city to continue making headway on projects that we normally use those funds for rather than slow down or stall those projects,” Yoder continued.

By design, the impact fee empowers municipalities to budget and appropriate funds as they see fit, said Ava Luliucci, a spokesperson with the Marcellus Shale Coalition.

“Some may choose to put the revenue in a reserve bank or into capital improvement projects, but again it’s entirely up to local officials to determine how these dollars are managed,” she said.

While last year’s were somewhat of an anomaly given the pandemic, the next allotment will likely be similar to previous years as revenues are expected to rebound significantly, Luliucci said.

The state’s Independent Fiscal Office actually recently projected impact fee dollars to reach the $234 million mark and the impact fee is likely to increase by nearly $88 million this year, according to the Coalition.

Beyond cash sent directly to local governments, revenue from impact fees fund a wide variety of projects across the state, from environmental initiatives to affordable housing and local community and recreation projects in the areas affected by drilling.

Several factors come into play as to the fee and “2020 was a weird year,” Wheeland said.

The gas industry had to account for the shut downs, interruptions and the lack of new wells drilled, if any, he said.

Impact fees are based on a 15-year sliding scale.

The first year is the higher fee because gas production is at the maximum, Wheeland said.

The second year is less fee per well and the average well has a lifespan of 15 years.

Currently, natural gas prices are “creeping back up . . . it is a matter of supply and demand,” Wheeland said.

The state needs to be cautious that it does not place too stringent regulation on the industry, while at the same time ensuring oversight for health and safety of operators and property owners and neighbors, Wheeland said.

If it becomes too onerous for the industry, it will choose to dig wells in nearby Ohio and/or West Virginia, and some companies do that depending on their own decisions, he said.

The other factor is the gas line transmission, Wheeland said.

The region can see more gas drilling and production, he said, but how does it get that gas to the market?

As an example, the gas is removed and goes to a gathering line to a compressor station. But if the station is booked the gas line owner sits and waits, Wheeland said.

Legislation aimed at ensuring landowners are afforded a clear and distinct assessment of royalties paid to them through lease agreements with oil and natural gas operators cleared the state Senate, according to prime sponsor Sen. Gene Yaw, R-Loyalsock Township.

Senate Bill 806 was supported by the Pennsylvania Farm Bureau, Pennsylvania Oil and Gas Landowner Alliance, Marcellus Shale Coalition, Bounty Minerals, Pennsylvania Independent Oil & Gas Association (PIOGA), Pennsylvania Grade Crude Oil Coalition (PGCC) and others.

“Concerns have been expressed by land and mineral owners for some time now centered on the lack of transparency that can come with deductions from their royalty payments,” Yaw noted.

“In some cases, general deductions with little to no description are subtracted from landowner’s checks, leaving them with a fraction of what was promised.”

“My legislation would not impact lease agreements, but it would require entities making payments to landowners to provide more description, clarity and uniformity on their royalty check statements. This proposal is designed to help ensure all parties feel their lease agreements are executed as intended, and it will help mitigate concerns that have developed in recent years. It also provides for summary statements, should a landowner choose to receive one, as well as timely payment requirements.”

Senate Bill 806 now moves to the House of Representatives for consideration.