WEST CHESTER (June 19) – State Senator Andy Dinniman today introduced legislation to allow local municipalities and school districts to tax natural gas pipelines.

“It’s only right that pipeline companies pay a real estate tax just like property owners,” Dinniman said. “These corporations make a hefty profit by bringing their product to market and they do so by transmitting it right through our local communities, neighborhoods, parks and natural places. It is time for them to support the necessary local emergency response preparations and environmental protection and reclamation measures directly related to their operations.”

valve-164969_1280Senate Bill 905 calls for amending Title 53 of the Pennsylvania Consolidated Statutes to allow local governments and school districts to impose a real estate tax on natural gas and hazardous liquid pipelines. Currently, they are exempt from local taxation.

Dinniman said his bill reflects the impact the growing number of natural gas pipelines have on communities in southeastern Pennsylvania and the importance of pipeline companies supporting local property owners and taxpayers.

“Twenty other states allow for the local taxation of natural gas pipelines and this bill is very similar to existing laws in neighboring states like New Jersey, Ohio and West Virginia,” Dinniman said. “The Marcellus Shale is here to stay. The drilling boom continues and more pipelines are on the way. Let’s make sure that our local municipalities and school districts get their fair share to help relieve property taxes and ensure that our residents are safe and our environment is protected.”

In addition, Dinniman and state Senator John Rafferty Jr. have cosponsored Senate Bill 557, legislation that establishes a pipeline impact fee in Pennsylvania. That bill calls for creating an impact fee that is calculated based on the acreage of linear feet plus right-of way width of a pipeline using the county average land value in an affected area.

“Although the natural gas drilling itself is not occurring in our region, our communities continue to be directly impacted by its growth in the form of the ever-increasing network of pipelines. Pipelines crisscross nearly every municipality in Chester County and more are on the way,” Dinniman said. “As a result, our communities continue to experience potential threats to public safety, as well as environmental and quality-of-life impacts.”

The fees generated by Senate Bill 557 would be collected by the Pennsylvania Public Utility Commission and deposited into a Pipeline Impact Fund where they will be disbursed to affected areas. Fifty percent of the revenue in the fund would be used to make an annual payment to each county where an affected area is located. Forty percent would be paid to the municipality in an affected area. The remaining 10 percent would be used for the fund’s administration.

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