3.2.26 - House DEP/DCNR Budget Hearing

Hearing setup and opening context

DCNR opening / framing

• DCNR leadership referenced sustainable forestry production and tied it to Pennsylvania’s forest-products industry (“$24 billion”) and said the Governor’s proposed FY 2026–27 budget “from all sources includes $665 million for DCNR.”
• DCNR invited collaboration, including a callout to the Pennsylvania Outdoor Corps, and thanked the committee for support.

DEP opening / framing

• DEP Secretary Jessica Shirley introduced DEP leadership present, including Energy Director David Altoff and Deputy Secretary John Ryder.
• Shirley described DEP’s scope (streams/rivers, oil & gas wells, coal mines/quarries, drinking-water facilities serving ~11.6M residents).
• Shirley summarized key elements of DEP’s budget request, including:
  • ~$2.5M increase for environmental program management and ~$3.1M for Environmental Protection Operations
  • $530K for Chesapeake Bay agricultural source abatement
  • $227K for Black Fly Control and Research and $181K for insect-borne disease management
  • a $20M one-time transfer for hazardous sites cleanup funds

Major issue areas and exchanges (what the transcript shows)

1) Energy, battery storage, affordability, grid reliability

• Chair (identified in the transcript as “Chair Feedler”) raised rising energy demand, concerns about blackouts/brownouts, and asked specifically about battery storage (noting Rep. Rivera working on legislation).
• Energy Director David Altoff described storage as “most important but least thought about,” and offered comparative figures:
  • Texas: >14 GW storage
  • PJM: ~328 MW
  • Pennsylvania: ~35 MW
• Altoff referenced DEP’s 2021 Pennsylvania Energy Storage Assessment, said it informed the PUC’s energy-storage policy statement, and argued it’s time to update it based on current price signals.
• He also cited queued projects:
  • “about five gigawatts” of PA projects in PJM queue (storage / solar+storage / wind+storage)
  • “about 68 gigawatts” total in PJM queue
• Altoff discussed both utility-scale (“front of the meter”) and behind-the-meter storage, including “virtual power plant” concepts.

2) Fiscal Code Act 45 of 2025: SPEED + public permit tracker + IT funding

• A member asked for a status update on Act 45 initiatives: expansion of SPEED, authorization of a public tracker/database, and accelerated review timeframes.
• Shirley said DEP had a beta permit tracker (from the prior fiscal code) that overlays DEP’s system and pulls permits “since October 2024,” showing status/issuance, and that Act 45 expanded it to other agencies; DEP is working with CodePA over “the next couple of weeks.”
• On SPEED: Shirley said implementation began in August; DEP issued three initial permits (two air quality, one NPDES) and said there were 13 currently in the queue; Act 45 added additional permit types (mining, storage tanks, and another).
• On the Governor’s proposed $3.7M increase through CodePA: Shirley indicated (with caveats that OA would confirm) that it is in addition to the $21M permitting/licensing/certification IT effort (“PLC”), and suggested the $3.7M is for the tracker.
• Shirley described IT procurement as complex, acknowledged delays tied to a budget impasse affecting consultant onboarding, and said DEP expects to roll out the “very first program” soon (the excerpt cuts off as she starts naming it).

3) Wildlife corridors + outdoor recreation business alliance

• Chairwoman Daly asked DCNR Secretary Dunn about implementation following House Resolution 87 and about the Outdoor Recreation Business Alliance.
• Dunn described coordination with policy offices across PennDOT, DEP, Game Commission, Fish & Boat to convene a study on “wildlife connectivity/corridors,” emphasizing it’s broader than big-game crossings and includes amphibians/turtles and “pollinator corridors.”
• Dunn said the Outdoor Recreation Office / Business Alliance had talked to “over a thousand” businesses and described a DCED partnership to use modern tools (she explicitly mentioned AI) to understand travel/spending patterns and help businesses—especially rural communities—thrive.
• Dunn also noted Nathan Rigner’s national leadership role (volunteer chair) in a multi-state effort (“confluence of states”).

4) Federal funding: AML + “haircut” + proposed federal-response contingency

• A member asked about projected ~$3.355B in federal funding and whether DEP anticipates issues receiving authorized funds, especially for orphan wells/abandoned mine reclamation (~$1.065B bucket mentioned by the questioner).
• Shirley described AML funding increases under IIJA (2021) and said PA was receiving $245M/year (for a long duration), but said Congress recently reduced AML allocations by roughly 10% (“haircut”).
• She also stated PA estimates a $5B abandoned mine land obligation (in today’s dollars).
• The questioner pivoted to the Governor’s proposed “Federal Response Fund” concept (described as Rainy Day funds used to respond to reductions/lapses). Shirley confirmed she had spoken with the Governor about it and described a prior lapse involving DHS-funded programming, layoffs, and limits on moving special funds internally; she argued the fund is meant for both clawbacks and temporary lapses.
• There was a tense exchange where the questioner pressed for details (“under attack from whom?”) and Shirley asked to discuss specifics offline due to “national security.”

5) PFAS: standards, Haskell investigations, private wells, AFFF foam transition

• A member raised PFAS contamination concerns and asked how DEP is tracking statewide contamination and future plans.
• Shirley said PA has a “pretty large” PFAS contamination issue and referenced PA setting its first state MCL (and noted the federal MCL not being in place yet).
• Shirley described a process where treatment at a drinking-water system triggers an investigation on the “Haskell” side (cleanup/brownfields) to identify sources and remediation actions; she also described fish-consumption advisories, testing private wells, and installing “POET” (point-of-entry treatment) systems.
• She tied this to the request for $20M as a “stopgap,” and confirmed some of those dollars would support filtration/treatment-related work.
• On AFFF firefighting foam: Shirley noted education with the State Fire Commissioner, referenced pending Senate legislation restricting foam use in training, and encouraged fire departments to dispose of fluorinated foam and switch to fluorine-free alternatives.

6) Data centers + GRID + “menu” of higher benefits tied to stronger commitments

• A member asked about data centers, whether the Office of Transformation and Opportunity would lead for GRID, and how DEP would be involved.
• Shirley said DCED would have a big role for tax benefits, while DEP’s role is environmental permitting and ensuring higher standards for those seeking fast-tracking.
• She described GRID as effectively a “menu” where developers can earn higher state benefits by doing more (e.g., bringing their own energy, meaningful community outreach, enhanced remediation, siting on previously developed land), while baseline permitting standards remain the “floor.”

7) State park / forest infrastructure backlog + energy savings work

• A member referenced a report listing a $1B backlog and asked what strides DCNR has taken.
• DCNR thanked the House for HB 1331 and pointed to $112M authorized in the 2023 budget from oil & gas lease funds going into state park infrastructure repairs.
• DCNR staff cited major asset counts (e.g., dams, sewage treatment plants, water treatment plants, roads) and said they’ve been “knocking down” backlog projects—mentioning $118M on backlog-list projects and prioritizing by public health/safety, legal requirements, then service improvements.
• On energy savings: DCNR described Guaranteed Energy Savings Act (GESA) projects, said DCNR invested about $48M and projected reduced energy consumption over 20 years by “71 million” (unit not clear in the excerpt), and said savings would be about $1M/year.

8) Oil & gas lease fund variability + non-surface / streambed revenue questions

• A member asked about shifting operational funding from the oil & gas lease fund to the general fund and requested an update on the lease fund’s status.
• DCNR described revenue as highly variable, citing a multi-year average of about $95M, estimating $104M this year, and describing the prior year as unusually high ($145M) tied to global market factors.
• The member then asked for royalty revenue from “non-surface impact” unconventional development including under streambeds; DCNR said they were not prepared to slice that out on the spot but would provide details later.
• DCNR offered some scale figures: “almost 670 non-conventional wells” on DCNR lands across 74 leases; about two-thirds developed; about 37% of leases not yet developed; about 160 well pads on their property.

Quick takeaway

• DEP centered its testimony on capacity + modernization (SPEED, permit tracker since Oct 2024, coordination with CodePA, IT procurement), plus public health/environmental legacy priorities (PFAS/Haskell, hazardous sites cleanup, AML funding volatility, contingency planning for federal funding lapses).
• DCNR emphasized forestry/outdoor economy, wildlife connectivity, business alliance growth, and ongoing work to reduce the parks/forests infrastructure backlog, including oil & gas lease fund-supported repairs and energy savings projects.