Bill Summary for S 786 (2013-2014)

Summary date: 

May 21 2014

Bill Information:

View NCGA Bill Details2013-2014 Session
Senate Bill 786 (Public) Filed Thursday, May 15, 2014
A BILL TO BE ENTITLED AN ACT TO (1) EXTEND THE DEADLINE FOR DEVELOPMENT OF A MODERN REGULATORY PROGRAM FOR THE MANAGEMENT OF OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION IN THE STATE AND THE USE OF HORIZONTAL DRILLING AND HYDRAULIC FRACTURING TREATMENTS FOR THAT PURPOSE; (2) ENACT OR MODIFY CERTAIN EXEMPTIONS FROM REQUIREMENTS OF THE ADMINISTRATIVE PROCEDURE ACT APPLICABLE TO RULES FOR THE MANAGEMENT OF OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION IN THE STATE AND THE USE OF HORIZONTAL DRILLING AND HYDRAULIC FRACTURING TREATMENTS FOR THAT PURPOSE; (3) AUTHORIZE ISSUANCE OF PERMITS FOR OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION ACTIVITIES SIXTY DAYS AFTER APPLICABLE RULES BECOME EFFECTIVE; (4) CREATE THE NORTH CAROLINA OIL AND GAS COMMISSION AND RECONSTITUTE THE NORTH CAROLINA MINING COMMISSION; (5) AMEND MISCELLANEOUS STATUTES GOVERNING OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION ACTIVITIES; (6) ESTABLISH A SEVERANCE TAX APPLICABLE TO OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION ACTIVITIES; (7) AMEND MISCELLANEOUS STATUTES UNRELATED TO OIL AND GAS EXPLORATION, DEVELOPMENT, AND PRODUCTION ACTIVITIES; AND (8) DIRECT STUDIES ON VARIOUS ISSUES, AS RECOMMENDED BY THE JOINT LEGISLATIVE COMMISSION ON ENERGY POLICY.
Intro. by Rucho, Newton, Brock.

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Bill summary

The Senate committee substitute to the 1st edition makes the following changes.

Deletes the proposed changes to SL 2013-365, Section 1(b), and instead amends that section to update the provision to exempt the Mining and Energy Commission, the Environmental Management Commission, and the Commission for Public Health from provisions of GS Chapter 150B that require the preparation of fiscal notes for any rule proposed that pertains to the management of oil and gas exploration and development activities. Adds a section to the bill exempting those same entities from provisions of GS Chapter 150B that require that a certification be obtained from the Office of State Budget and Management (OSBM), and any requirements for preliminary review by the OSBM for any rule proposed for the creation of a modern regulatory program for the management of oil and gas exploration and development activities.

Adds a new Part III to the bill, authorizing DENR and the Mining and Energy Commission to issue permits for oil and gas exploration, development, and production activities using horizontal drilling and hydraulic fracturing treatments. Repeals SL 2012-143, Section 3(d), and SL 2013-365, Section 1(c), which prohibited the issuance of the permits in order to give the Commission time to establish a regulatory program.

Deletes proposed changes to GS 113-391(a2) and instead adds (a5) to GS 113-391 to require that entry of rules in the NC Administrative Code that address the areas identified in (a) (concerning regulatory program for the management of oil and gas exploration and development) and (a3) (concerning EMC adoption of rules concerning stormwater controls and toxic air emissions related to oil and gas exploration and development) by July 1, 2015, create a rebuttable presumption that the rules are sufficient to meet the requirements for development of a modern regulatory program under the statute.

Makes Section 8 of the bill, concerning trade secrets and confidential information, effective when the act becomes law, but specifies that GS 113-391A(d) (penalties for unlawful disclosure) becomes effective December 1, 2014.

Amends proposed GS 113-395C, environmental compliance review requirements for applicants and permit holders, as follows. Provides that the environmental compliance review may (was, shall) evaluate the applicant's environmental compliance history for five years before the application date. Adds that the applicant must provide environmental compliance history information for specified entities when requested by DENR (was, no request needed). Also requires a permit holder to notify DENR of any significant change in its environmental compliances history or significant changes in specified operations, upon request (was, no request needed). Also requires the permit holder to notify DENR within 30 days of a significant change, if requested by DENR (was, no request needed). Makes Section 15 of the bill effective when it becomes law, but provides that GS 113-395D(b), making it a Class 1 misdemeanor to conduct seismic or geophysical data collection activities by going onto another's land without written consent, effective December 1, 2014.

Deletes proposed changes to GS 153A-149 and GS 160A-209, which capped local property tax revenue inreases at no more than 8 percent.

Amends the issues to be studied by the State Energy Office to remove studying the impact of the elimination of natural gas franchise areas in order to allow competition in the provision of piped natural gas service. Makes additional changes to the other issues to be studied by the Office. Changes the report due date to December 1, 2014 (was, January 1, 2015.

Makes conforming changes to the act's long title.

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