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Muskingum Watershed Conservancy District Cuts Assessment Fee in Half Thanks to Shale Money
Property owners will see their assessments paid to the Muskingum Watershed Conservancy District (MWCD) cut in half beginning next year. Official action to reduce the assessment was taken by the MWCD Board of Directors at its regularly scheduled meeting, Friday, September 26, 2014 in New Philadelphia.
Members of the MWCD Board of Directors have approved a plan to provide for a 50-percent reduction in all assessment payments from property owners beginning in 2015 by using funds generated from the conservancy district’s recent oil and gas leases of its property in the Utica Shale development to cover project costs normally paid for by the assessment funds. MWCD officials also have pledged that they will continue to review periodic financial reports to determine if the reductions will be warranted in succeeding years or if further reductions could be enacted due to revenues produced from the oil and gas leases. “As we become more certain of revenue projections, our goal is to use these funds to systematically reduce the collection of the assessment, and eventually, suspend collection entirely,” said Richard Pryce, President of the Board of Directors.
The assessment reduction will result in an estimated $5.5-million overall cut in the amount of assessments collected in 2015 by the MWCD. The conservancy district instead will use oil and gas funds to fill that gap and ensure that projects to protect and improve the system of reservoirs and dams constructed in the 1930s continue as planned.
“Through the wise guidance of the MWCD’s Board of Directors, the oil and gas management on the district’s properties have permitted the MWCD to invest in our public-use facilities and recreational areas, and now it is possible to extend those benefits to the property owners in our watershed by enacting this 50-percent reduction in the assessment collection,” said John M. Hoopingarner, MWCD executive director/secretary. “It has been and will continue to be our goal to maximize the public benefits that have been created by the responsible stewardship of the MWCD’s natural resources.”
The approved assessment reduction also will mean that the owners of commercial and industrial parcels of property who pay the assessment will see an overall reduction of nearly $2.3 million in their property tax statements next year. The MWCD collects about $11 million annually in assessments from property owners in the Muskingum River Watershed.
Hoopingarner said the MWCD has committed about $450 million over the next two decades for its obligations related to upgrades and maintenance for the system of reservoirs and dams in the Muskingum River Watershed and for updates to its recreational facilities. With that in mind, routine financial reviews will be very important and any major cuts in oil and gas revenues could result in corresponding assessment adjustments, he said.
The MWCD has collected more than $173 million worth in signing bonus funds from four leases it has signed in the Utica Shale development for its properties at Clendening, Leesville, Piedmont and Seneca reservoirs.
The MWCD has managed oil and gas leases on its properties for its entire 80-year history as a part of its overall natural resources stewardship program. Oil and gas leases developed by the conservancy district have served as a model for other owners of public property considering strategies for management of leases that provide for revenues to enhance public benefit and services while ensuring the highest level of environmental protections.
Assessments are collected through landowners’ county property tax statements, and the funds legally must be used to pay for projects and programs that protect the operation of the system of 16 dams and reservoirs that were constructed nearly 80 years ago for flood reduction and water conservation benefits in the Muskingum River Watershed. Nearly 95 percent of all property owners subject to the assessment pay the minimum annual amount of $12 per year.
The MWCD serves as the federally required local cost-share sponsor for the work that has been identified at several of the system’s dams owned and operated by the U.S. Army Corps of Engineers (USACE). Projects are under way at both Dover and Bolivar dams in northern Tuscarawas County, others are planned and the entire project plan at the dams is projected to cost more than $600 million and the MWCD share is estimated to be up to $137 million.
In addition, the MWCD has spent assessment funds on shoreline stabilization projects at the MWCD lakes, planning for dredging of the lakes that will begin later this year, grant funding for area communities for projects that encourage flood reduction and water quality improvements and other programs. Assessment revenues by law cannot be used to pay for projects that enhance or improve the MWCD’s recreational programs and facilities, and all expenditures must be covered by guidelines stipulated in the Amendment to the Official Plan of the MWCD that was approved in 2005 by the Conservancy Court and the Board of Directors.
The MWCD collects assessments from owners of property in all or portions of the following counties: Ashland, Belmont, Carroll, Coshocton, Guernsey, Harrison, Holmes, Knox, Licking, Morgan, Muskingum, Noble, Richland, Stark, Summit, Tuscarawas, Washington and Wayne.
For more information about the MWCD, visit www.mwcd.org and follow the MWCD on Facebook and Twitter.
Chesapeake Energy continues to see its legal battles compound over its royalty-payment practices. Already facing lawsuits in several different states and having been subpoenaed by the U.S. Department of Justice, StateImpact Pennsylvania reports that another government outfit is taking a legal interest in the company's royalty payment strategies: Chesapeake Energy has been subpoenaed by the U.S. Postal service, seeking information on its royalty practices, according to a regulatory filing. As StateImpact Pennsylvania has previously reported , the Oklahoma City-based driller faces a slew of disputes and complaints over how it pays royalties. We've posted articles in the past that looked at some of the questionable practices that Chesapeake has employed to reduce the amount of royalties it pays out to landowners. As a quick refresher, note how ProPublica reporter Abrahm Lustgarten shared some of the details in an article which we shared here on The Daily Digger in March