Then again, Fracking may come soon anyway

A report this morning that the Governor himself has canceled a trip to Aspen in order to stick around for the end of the legislative session, and to personally push SB 127 with a provision in there to open fracking sooner than the compromised date of July 2015. Here’s the report from John Murawski in the N&O:

A complex fracking policy has unexpectedly emerged in the waning days of the state legislative session, giving rise to fears that lawmakers are making a last-ditch push to repeal North Carolina’s moratorium on shale gas exploration.

The move comes after a recent attempt to lift the moratorium failed to get past House lawmakers who said they intended to keep their pledge to citizens not to allow shale gas exploration until all safety regulations were in place.

But now the state House and Senate are poised to take up the complicated fracking bill that has not been reviewed by a committee or studied at length by lawmakers. The legislation, added into Senate Bill 127 which deals with changes to the Department of Commerce, surfaced Wednesday, the result of eleventh-hour negotiations with lawmakers and the environmental regulators who would oversee fracking here.

Gov. Pat McCrory unexpectedly visited the legislature for an hour on Wednesday and met with Republicans in a legislative strategy session. On his way out of the building, McCrory said he wanted to get an update on key legislation, adding: “I’m interested in energy. Energy development is what’s going to get us moving on the economy.”

The measure includes new provisions that would repeal a key feature in last year’s energy law that expressly prohibits issuing fracking permits to drilling companies until the N.C. Mining and Energy Commission writes safety rules and the legislature approves those rules. Instead of a prohibition, the bill says the state could issue drilling permits as of July 1, 2015, provided that fracking rules “have become effective.”

The chairman of the Mining and Energy Commission, James Womack, a Republican commissioner in Lee County, was surprised by the legislation.

“We didn’t know about it,” said Womack. “All it does is introduce confusion.”

Rep. Pricey Harrison, a Democratic from Guilford County, said the new language is an open door to issue permits by a specific date, whether the state is ready or not to oversee shale gas exploration.

“They continue to go back on their word,” Harrison said of Republican lawmakers who want to take steps to encourage the energy industry to drill here.

Rep. Mike Hager, a Rutherfordton Republican who has been active in the negotiations, said Senate Bill 127 would not undo the protections in the current law.

He acknowledged the bill may not come to a vote if it remains divisive among Republicans, but he’s confident his colleagues’ anxieties will by assuaged by the time the vote is scheduled Thursday. Hager said some Republicans are wary of last-minute legislation that alters the fracking bill passed last year. The bill, which passed by a single vote, contained explicit language to prohibit the issuance of fracking permits.

“Anything to do with fracking is going to be controversial,” he said. “We don’t want to create the appearance that we’re speeding this up, that we’re recklessly going into this.”

The most complex fracking parts in Senate Bill 127 relate to a severance tax program on the oil and gas industry, based on the grade and quantity of fossil fuel extracted. The money raised by taxing drilling operations would go to local governments, emergency funds and other uses.

Hager said the Mining and Energy Commission will also review severance taxes in the coming year, and the commission’s advice could help modify state law, but this legislation sets a direction.

“We want to attract business, so we don’t want to have the highest severance tax,” Hager said. He said bargain-basement taxes are also a bad idea but said North Carolina should have lower taxes as a matter of public policy.


One thought on “Then again, Fracking may come soon anyway

  1. rgt7670 Post author

    The measure did not pass. As quoted from the @NCCaptial page of

    Lawmakers dealt Gov. Pat McCrory’s plan to reorganize much of the Commerce Department into a public-private partnership a setback in the early hours of Friday morning.

    The state Senate adjourned for the year without taking up Senate Bill 127, a bill aimed at streamlining the state’s job retention and recruitment process.

    Although the Commerce Department provisions were not very controversial, lawmakers attached a controversial environmental provision during the waning days of session. That measure would have lifted a key safeguard on hydraulic fracturing in the state, ending a moratorium on the procedure used to extract natural gas before rules were fully in place.

    Lawmakers have been battling over that moratorium provision for months. In the end, House lawmakers were not ready to accept the measure and there was no time left to redraft the bill without the controversial measure.

    The public private partnership is meant to allow the state to more effectively recruit businesses by responding more quickly to inquiries from out of state companies. Efforts to brand and market the state would also be part of the job turned over to a private nonprofit that contracts with the state.

    “I think the Commerce Secretary can do quite a bit,” said Sen. Harry Brown, R-Onslow.

    Brown pointed to a provision in the recently-passed state budget that allows the Secretary of the Department of Commerce to “reorganize positions and related operational costs within the Department to establish a public-private partnership which includes cost containment measures.” That provision only runs over two paragraphs, and lack the specific direction given in the SB 127.

    The budget also begins to draw funding away existing regional economic development partnerships in anticipation of moving to a new statewide job recruitment system. However, it was SB 127 that detailed how the work of those regional entities would be taken up by the bigger public-private partnership.

    “I feel pretty confident the Commerce Secretary will do some of that,” Brown said.

    Even if Commerce Sec. Sharon Decker didn’t have all the authorization she needed, Brown said she could certain start working to streamline field operations between the Commerce Department, Department of Transportation and Department of Environment and Natural Resources. The objective, he said, would be to give both existing and new businesses easy access to all the permitting and other government services they needed in one place.

    “I like what is in that bill,” said Senate Leader Phil Berger, R-Rockingham. Despite the budget provisions, Berger said, “There are some other things in the bill that would fit in place and help and there are some things that would be beneficial for other economic development reasons.”

    Both Berger and Brown raised the possibility that McCrory could call the legislature back in session to handle the bill, particularly if his administration began its reorganization efforts but found it needed more legal authority.

    “If we don’t have a special session, it’s always something that will be eligible in the short session,” Berger said.


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