Bill S6325-2009

Authorizes counties to lease county land for natural gas exploration, development and production for 5 years or as long as gas is produced

Authorizes counties to lease county land for natural gas exploration, development and production for five years or as long as gas is produced in commercially paying quantities.

Details

Actions

  • Jun 9, 2010: REPORTED AND COMMITTED TO FINANCE
  • Jan 6, 2010: REFERRED TO LOCAL GOVERNMENT
  • Dec 4, 2009: REFERRED TO RULES

Votes

VOTE: COMMITTEE VOTE: - Local Government - Jun 9, 2010
Ayes (3): Valesky, Little, Bonacic
Ayes W/R (4): Stewart-Cousins, Oppenheimer, Thompson, Johnson C
Excused (1): Morahan

Memo

 BILL NUMBER:  S6325              REVISED 03/23/10

TITLE OF BILL : An act to amend the county law, in relation to leases for the exploration and drilling for and extraction of natural gas and liquefied natural gas

PURPOSE : The purpose of this bill is to allow non-charter counties to enter into leases for a period exceeding 5 years in order to put them in the same position as charter counties.

SUMMARY OF PROVISIONS :

§ 1 proposes to amend county Law §215 by adding a new subdivision to allow a board of supervisors or other county legislative body to lease, upon such terms and conditions the board or body shall determine, county land for the purposes of exploration, development and production of natural gas and liquefied natural gas, for not more than five years and, if gas is produced the lease shall continue until the production is no longer being produced in commercially paying quantities.

§2 Sets the effective date of the act as immediately.

JUSTIFICATION : Currently, §215 of County Law restricts the lease term Counties may enter into to a period not to exceed five years. At the same time § 2(b) of County Law allows Charter Counties to adopt local law, by amending their Charter to allow the County to enter into a lease term they see fit. This legislation aims to give Non-Charter Counties and Charter counties the same opportunities when drilling for Natural Gas in New York State.

Under the current system, the length of leases and rate in the natural gas industry are determined by the market. Non-Charter Counties are severely handicapped in their negotiations with natural gas companies because of the five year limitation placed on them by § 215 of County Law. As a result, Counties fear that they will simply be integrated under compulsory integration and lose control of county-owned lands.

The proposal to allow for a primary term not exceeding a five year term for exploration and the commencement of drilling, which either lapses if drilling fails to commence, or extends the lease until drilling terminates is consistent with the practice employed by the New York state Department of Environmental Conservation, when the state of New York contracts with a private company to produce natural gas.

This legislation has been requested by Chenango County, to allow them to enjoy the same benefits the Charter Counties are entitled to.

LEGISLATIVE HISTORY : New bill.

FISCAL IMPLICATIONS : None.

EFFECTIVE DATE : This act shall take effect immediately.

Text

STATE OF NEW YORK ________________________________________________________________________ 6325 2009-2010 Regular Sessions IN SENATE December 4, 2009 ___________
Introduced by Sen. LIBOUS -- read twice and ordered printed, and when printed to be committed to the Committee on Rules AN ACT to amend the county law, in relation to leases for the explora- tion and drilling for and extraction of natural gas and liquefied natural gas THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 215 of the county law is amended by adding a new subdivision 4-a to read as follows: 4-A. NOTWITHSTANDING THE PROVISIONS OF SUBDIVISIONS THREE AND FOUR OF THIS SECTION, A BOARD OF SUPERVISORS OR OTHER COUNTY LEGISLATIVE BODY MAY LEASE, UPON SUCH TERMS AND CONDITIONS AS THE BOARD OR BODY SHALL DETERMINE, COUNTY LAND FOR THE PURPOSES OF THE EXPLORATION, DEVELOPMENT AND PRODUCTION OF NATURAL GAS AND LIQUEFIED NATURAL GAS, AS SUCH TERMS ARE DEFINED IN SECTION 23-1705 OF THE ENVIRONMENTAL CONSERVATION LAW, FOR NOT MORE THAN FIVE YEARS AND, IF ANY SUCH GAS IS PRODUCED UPON THE COUNTY LAND PRIOR TO THE EXPIRATION OF SUCH FIVE YEAR LEASE, THE LEASE SHALL BE EXTENDED FOR AS LONG AS NATURAL GAS OR LIQUEFIED NATURAL GAS IS PRODUCED IN COMMERCIALLY PAYING QUANTITIES. S 2. This act shall take effect immediately.

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