Department of Environmental Conservation

The enacted budget makes the following changes to the Executive Budget:

• Decreases the Executive Budget’s All Funds appropriation by $2.26 million. The Department's SFY 2010-11 All Funds appropriation is an $864,400 decrease from its SFY 2009-10 enacted budget All Funds appropriation.

• The enacted budget’s $2.26 million decrease is entirely personal services as follows: Air & Water Quality Program -$645,000; Environmental Enforcement -$95,000; Forest & Land Resources Program -$925,000 and the elimination of a Maintenance Undistributed for personal services of -$479,000; Solid & Hazardous Waste Mgmt Program -$135,000.
• According to DEC management, rejects the Executive proposal to impose a three percent tax on certain natural gas production related to natural gas severed from a gas pool in the Marcellus or Utica Shale formation using a horizontal well.  $1million in revenues in 2011-12, and additional oversight and regulatory staff were associated with this proposal.
• Reduces the Environmental Protection Fund by reducing the amount of real estate transfer tax provided to the EPF from $199.3 million to $119.1 million. One time reductions of approximately 4.5% in nearly all EPF programs/categories in order to provide $6 million for State Park Operations.
• Extends and expands the Waste Tire Program through December 31, 2013.
• Establishes a statewide electronic equipment reuse and recycling program, requiring manufacturers to collect, recycle and reuse their own covered electronic equipment and setting statewide recycling and reuse goals for the period April 1, 2011 through April 14, 2014 and beyond.

The Senate makes the following changes to the Executives Budget proposal (analysis as of March 22, 2010):

• Rejects the Executive’s proposal to increase the State Operations appropriations for the DEC, by $2.95 million for the provision of additional oversight and regulatory staff associated with the Marcellus Shale at DEC, the DPS and the DOH.
• Rejects the Executive’s proposal to decrease funding for the EPF by $79 million and restores funding.
• Modifies the Executive’s proposal to reduce the amount of real estate transfer tax deposited into the EPF by providing for a repayment schedule that would direct General Fund reimbursements to the EPF beginning in 2013.
• Modifies the Executive’s proposal relating to the waste tire management and recycling fee by extending such fee until March 31, 2013 rather than permanently.
• Recommends new Article VII legislation which would: transfer $10 million from the Waste Tire Management and Recycling Fund to the General Fund for the support for the DEC staff.

The 21-day amendments propose the following changes (analysis as of February 10, 2010):

• Removes a $1 million Special Revenue Federal appropriation for the Great Lakes Restoration Initiative and adds a $1 million Special Revenue Other appropriation for the Great Lakes Restoration Initiative.

• Allows an Environmental Protection Fund $5 million appropriation for “alterations, rehabilitation, and improvements of various park facilities and historic sites” to be used for “personal service, non-personal service and fringe benefits”.

The Executive Budget recommends (analysis as of January 23, 2010):

A SFY 2010-11 workforce of 3,314 FTEs.  This is a decrease of 54 (105 through attrition offset by 51 new fills) FTEs from the adjusted FTE level for FY 2009-10.  The following chart identifies adjustments in current fiscal year’s FTEs along with the recommended differences in FY 2010-11 FTEs by program:

·         According to the Executive Budget  Briefing Book, the Department of Environmental Conservation, the Department of Health and the Department of Public Service would receive funding for additional staff to process potential increases in permits for natural gas extraction activities in the Marcellus Shale; inspect drilling sites; ensure the safety and integrity of water supplies; review associated pipeline applications; oversee the proper disposal of waste from the drilling procedures; and perform public health oversight. (2010-11 Cost: $2.95 million; 2011-12 Cost: $3.0 million) Clarification of this initiative and the number of associated positions should be clarified at statewide labor/management.

·         Proposes an All Funds State Operations increase of $1.4 million, or .3%.  Decreases of $19.63 million in General Funds and $17.38 million in SRO are offset by a $38.41 million increase in SRF.   The increase in SRF is due to a $60 million appropriation for the Great Lakes Restoration Initiative (no personal services are associated with this appropriation).  These funds are partially offset by the loss of ARRA funds in the Air and Water Quality Program: Fed Env Con Air Resources -$1.73 million; Spills Mgmt Grant -$9.5 million; Fed ENCON Water Grants Acct -$3.2 million; and in the Forest and Land Resource Program: Fed ENCON Water Grants -$3.22 million; Land & Forests Land Grants -$10 million.

·         Proposes a personal services decrease of $10.86 million, or -4.3% and a contractual services decrease of $19.36 million, or 18%.

·         Significant reductions in personal services are as follows:  Administration Program, Conservation Fund SRO $249,600, or -100%; Air & Water Quality Program $2.71 million, or -19%; Environmental Enforcement Program, $1.26 million, or -4.2%; Mobile Source Acct $550,000, or -7.4%; Fish & Wildlife Resources Program,  $3.89 million or   -58.2%; Conservation SRO -$1.1 million, or -6.4%: Operations Program $3.49 million, or -17.9%; Solid & Hazardous Waste Management Program $5.46 million, or -55%.

·         Significant increases in personal services are as follows:  Air and Water Quality Program, Encon Administration SRO $1.1 million, or 42.8%, UST Trust Recovery Acct. $624,000, or +94%; Solid and Waste Hazardous Management Program, Waste Tire Mgmt & Recycling $7.645 million, or 100%.

• Contractual Services funding declines by $19.36 million, or 18.3%.  The bulk of these decreases are in the following programs:
  • Operations – Indirect Charges Acct. (-$1.6 million) or 22%.
  • Solid & Hazardous Waste Program – Waste Tire Mgmt SRO (-$5 million), or 22%.
  • Solid & Hazardous Waste Program – Environmental Monitoring (-$1.5 million), or 31%.
  • Forest & Land – Recreation Acct. (-$749,000), or 20%.
  • Air & Water Quality - Environmental Protection and Oil Spill Fund SRO (-$5 million), or 20%.

• DEC employed an estimated 4,097 consultant employees in SFY 2009-10 at an cost of $39 million.  Both of these figures will be unchanged for 2010-11.  It is important to note that the consultant employees are not reported on a FTE basis, therefore it is difficult to draw conclusions based on cost per employee.

• Proposes Article VII legislation to:

o   Part FF - Reduce Environmental Protection Fund. The Executive Budget recommends EPF appropriations of $143 million – a cumulative reduction of $79 million from the 2009-10 Enacted Budget level. Recommendations include a moratorium on forest preserve and open space land acquisition. EPF resources would focus on maintaining the State’s existing facilities, protecting water resources, continuing to revitalize waterfronts and municipal parks, and maintaining a quality agricultural system through farmland protection. The primary source of revenue for the EPF is the State’s Real Estate Transfer Tax (RETT). Consistent with the reduction in appropriations, RETT deposits to the EPF would be reduced by $67 million to $132.3 million. This deposit level, along with funding from other EPF revenue sources, would ensure that EPF appropriations are fully supported by projected revenues. The RETT reduction combined with other EPF actions would provide total financial plan savings of $77 million. (2010-11 Savings: $77 million; 2011-12 Savings: $77 million).

o   Part DD - Extend and Expand the Waste Tire Program. The existing $2.50 per tire disposal fee that is scheduled to expire on December 31, 2010 would be extended to fund environmental programs. This proposal would remove the sunset date for the fee and use the continuing revenues to pay for ongoing monitoring and enforcement of waste tire disposal activities, recycling programs and other existing DEC solid waste expenses. (2010-11 Savings: $10 million; 2011-12 Savings: $15 million)

o   Part A – Impose a three percent tax on certain natural gas production. The purpose of this bill is to impose a three percent tax on the market value of natural gas severed from a gas pool in the Marcellus or Utica Shale formation using a horizontal well.  Enactment of this bill is necessary to implement the 2010-2011 Executive Budget because this bill will increase revenues by $1M in 2011-12.