PRIOR PRINTER'S NOS. 352, 1162

PRINTER'S NO.  1581

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

SENATE BILL

 

No.

367

Session of

2011

  

  

INTRODUCED BY D. WHITE, BROWNE, TOMLINSON, WAUGH, M. WHITE, WOZNIAK, EARLL, GREENLEAF AND SCARNATI, FEBRUARY 1, 2011

  

  

SENATOR CORMAN, APPROPRIATIONS, RE-REPORTED AS AMENDED, SEPTEMBER 26, 2011   

  

  

  

AN ACT

  

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Providing for indigenous mineral resource development; and

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imposing powers and duties on the Department of General

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Services and the State System of Higher Education.

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The General Assembly of the Commonwealth of Pennsylvania

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hereby enacts as follows:

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Section 1.  Short title.

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This act shall be known and may be cited as the Indigenous

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Mineral Resources Development Act.

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Section 2.  Definitions.

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The following words and phrases when used in this act shall

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have the meanings given to them in this section unless the

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context clearly indicates otherwise:

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"Department."  The Department of General Services of the

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Commonwealth.

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"Mineral resources."  Coal, oil, natural gas, coal bed

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methane, limestone and other valuable minerals.

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"Right-of-way."  Includes:

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(1)  a right of passage and haulage for a lawful purpose;

 


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(2)  a right of flowage or transmission for a lawful

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purpose; or

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(3)  the construction, operation and maintenance of

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infrastructure necessary to facilitate a lawful purpose.

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"State-owned land."  Land owned by the Commonwealth. The term

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does not include land owned and administered by the Department

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of Conservation and Natural Resources, the Pennsylvania Fish and

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Boat Commission or the Pennsylvania Game Commission.

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"State system land."  Land owned by the State System of

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Higher Education or controlled by the State System of Higher

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Education pursuant to a memorandum of understanding approved by

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the Department of General Services.

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"System."  The State System of Higher Education of the

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Commonwealth.

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Section 3.  Development of mineral resources on State-owned

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land.

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(a)  Authority.--The department has the following powers:

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(1)  To make and execute contracts or leases in the name

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of the Commonwealth for the mining or removal of valuable

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mineral resources which may be found in or beneath State-

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owned land and to convey Commonwealth rights to mineral

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resources.

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(2)  To grant a right-of-way through State-owned land to

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any individual or corporation that applies if the department

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determines that:

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(i)  the grant will not so adversely affect the land

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as to interfere with its usual and orderly

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administration; and

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(ii)  the interests of the Commonwealth or its

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citizens will be promoted by the grant.

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(3)  To cooperate with, consult with or delegate to the

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Department of Conservation and Natural Resources in carrying

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out the provisions of this act.

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(b)  Advertising.--

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(1)  A proposed contract, lease or conveyance of mineral 

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resources exceeding $1,000 in value must be advertised once a

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week for three weeks, in at least two newspapers of general

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circulation published nearest the locality indicated, in

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advance of awarding the contract or lease.

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(2)  If the proposed conveyance of the mineral resources

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is included in the proposed conveyance of the real property

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to which it is attached, the department shall comply with the

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advertising requirements for the conveyance of the real

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property.

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(c)  Bidding.--

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(1)  Except as set forth in paragraphs (2) and (3),

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contracts, leases and conveyances shall be awarded to the

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highest and best bidder. If title to the property has already

<--

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been conveyed, but the Commonwealth has reserved the right to

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mineral resources, the Commonwealth may convey the mineral

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resources to the owner of the fee without bidding.

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(2)  The requirement for competitive bidding may be

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waived if the Commonwealth owns a fractional interest in the

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mineral resources in or beneath State-owned land; and the

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department may enter into a contract to lease that fractional

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interest, with the approval of the Governor and upon terms

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and conditions the department deems to be in the best

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interest of the Commonwealth.

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(3)  If a proposed conveyance of the mineral resources is

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included in the proposed conveyance of the real property to

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which it is attached, the award shall be made to the selected

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buyer of the real property.

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(d)  Bond.--A party that enters into a contract or lease

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under this section must provide a bond satisfactory to the

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department for the proper performance of the contract or lease.

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Section 4.  Development of mineral resources on State system

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land.

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(a)  Authority.--The system department has the following

<--

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powers:

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(1)  To make and execute contracts or leases in the name

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of the Commonwealth for the mining or removal of valuable

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mineral resources which may be found in or beneath State

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system land.

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(2)  To grant a right-of-way through State system land to

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any individual or corporation that applies if the system

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determines that:

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(i)  The grant will not so adversely affect the land

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as to interfere with its usual and orderly

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administration.

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(ii)  The interests of the Commonwealth or its

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citizens will be promoted by the grant.

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(3)  To cooperate with, consult with or delegate to the

<--

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Department of Conservation and Natural Resources in carrying

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out the provisions of this act.

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(b)  Advertising.--A proposed contract or lease of mineral

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resources exceeding $1,000 in value must be advertised for three

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weeks on the system's publicly accessible Internet website and

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at least once a week for three weeks, in at least two newspapers

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of general circulation published nearest the locality indicated,

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in advance of awarding the contract or lease.

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(c)  Bidding.--

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(1)  Except as set forth in paragraph (2), contracts and

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leases shall be awarded to the highest and best bidder.

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(2)  The requirement for competitive bidding may be

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waived if the Commonwealth owns a fractional interest in the

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mineral resources in or beneath State system land and the

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system department may enter into a contract to lease that

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fractional interest, with the approval of the Governor and

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upon terms and conditions the system department deems to be

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in the best interest of the Commonwealth.

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(d)  Bond.--A party that enters into a contract or lease

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under this section must provide a bond satisfactory to the

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system department for the proper performance of the contract or

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lease.

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Section 5.  Deposit of revenue.

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(a)  Payments received by department.--Not less than 50% of

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payments or royalties received by the department pursuant to a

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contract or lease under this act shall be deposited into the

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Environmental Stewardship Fund or the Keystone Recreation, Park

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and Conservation Fund. The remaining payments received by the

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department shall be deposited into the General Fund.

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(a)  Payments.--

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(1)  All payments or royalties received by the department

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pursuant to a contract or lease under this act, except for a

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contract or lease under section 4, in fiscal year 2011-2012

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through fiscal year 2013-2014 shall be deposited in the Oil

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and Gas Lease Fund.

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(2)  All payments or royalties received by the department

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pursuant to a contract or lease under this act, except for a

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contract or lease under section 4, in fiscal year 2014-2015

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and each fiscal year thereafter shall be deposited as

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follows:

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(i)  the first $50,000,000 of payments or royalties

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received by the department shall be deposited in the

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Hazardous Sites Cleanup Fund; and

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(ii)  all remaining payments or royalties shall be

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deposited in the Oil and Gas Lease Fund.

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(3)  The costs incurred by the department or the

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Department of Conservation and Natural Resources in

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advertising and contracting, leasing or conveying the mineral

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resources, including the fees of any survey, appraisal or

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report, shall be deducted from payments or royalties, and

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that amount shall be an executively authorized augmentation

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to the appropriation to the department or the Department of

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Conservation and Natural Resources.

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(b)  Payments derived by system.--All payments or royalties

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derived from any lease entered into by the system shall be

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deposited in the Keystone Recreation, Park and Conservation Fund 

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under section 4 shall be allocated as follows:

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(1)  Forty percent shall be retained by the university

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where the mineral resource is leased or extracted and shall

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be used by the university for deferred maintenance projects

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or energy efficiency or energy cost saving improvements.

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(2)  Sixty percent shall be allocated to the State System

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of Higher Education for distribution among those universities

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where no mineral resources have been leased or extracted. The

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distribution formula shall be determined by the Board of

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Governors of the State System of Higher Education. Funds

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distributed under this paragraph shall only be used for

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deferred maintenance or energy efficiency or energy cost

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saving improvements.

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Section 6.  Condition relating to surplus property.

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Notwithstanding the provisions of section 2405-A(6) of the

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act of April 9, 1929 (P.L.177, No.175), known as The

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Administrative Code of 1929, the department may convey all oil,

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gas and mineral rights to the purchaser of surplus Commonwealth

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real property along with the conveyance of the surplus real

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property when done so in accordance with this act.

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Section 7.  Effective date.

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This act shall take effect immediately.

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