Is New York's Budget Deficit Leading it to Adopt Natural Gas Drilling Practices That Threaten Drinking Water?

Is New York hoping to quell its mounting deficit by approving a risky environmental practice that may cost the state its revered drinking water? That’s what many residents and environmental agencies fear.

On Dec. 31, New Yorkers had their last chance to comment publicly on the state’s tentative environmental template for natural gas drilling. The 804-page document, which is known formally as the draft Supplemental Generic Environmental Impact Statement (dSGEIS), was released by the New York Department of Environmental Conservation (DEC) in late September. It lays out a series of guidelines for gas companies, including some specifics on the controversial drilling technique known as hydraulic fracturing.

Three months ago, policymakers in Albany were hoping that the dSGEIS would pave the way for wide-scale drilling in New York’s share of the Marcellus Shale. (The Marcellus is an enormous rock formation that’s believed to contain around 500 trillion cubic feet of natural gas; it runs under sections of New York, Ohio, Pennsylvania Tennessee and Virginia.) The Empire State, which is saddled with a $3.2 billion deficit and an 8.7 percent unemployment rate, stands to benefit significantly from the influx of jobs and tax revenue that gas exploration could generate.

But as more public attention was focused on the dSGEIS, numerous flaws became glaringly evident -- flaws that hold significant implications for New York’s economic and environmental future.

For starters, portions of the dSGEIS violate an executive order handed down by Governor David Paterson last April. According to Paterson’s order, "No state agency shall recommend, propose, publish or submit any legislation or regulation containing a mandate without an accounting of the impact of such mandate on local governments…." Such a ban on “unfunded mandates” essentially means that if the state wants to assign specific tasks to local governments, it must first make necessary budgetary adjustments at the state level; it can’t simply pass the buck down.

But in Chapter 7 of its impact statement, the DEC proposes several drilling-related tasks without any explanation of how New York will help pay for them. An example: If an accident occurs on a drill rig after it has been operating for more than a year, the responsibility falls on local health departments to conduct an investigation. Though such agencies are normally in charge of incidents involving water contamination, they don’t have the wherewithal to test for the cocktail of chemicals and naturally occurring radioactive materials hydraulic fracturing produces.

Nor do they have the staff in many areas. Broome County, a portion of Central New York that could see between 2,000 and 4,000 wells constructed in the near future, has only two groundwater management specialists, according to Anthony Masterangelo, a representative from the county health department.

Insufficient staffing is not just limited to local governments, either. According to a recent study, New York’s entire DEC had only 19 people enforcing drilling regulations for 13,684 wells in 2008. If the state were to approve new drilling in the Marcellus, thousands of wells would be constructed without any plan for increasing state personnel accordingly.

“Knowing the state’s budget situation -- it’s promising to be worse this next fiscal year -- the state just doesn’t have the resources to hire additional staff without major negative consequences for other agencies," Wayne Bayer, a DEC environmental program specialist, told me. “Since the agency was created, we’ve normally had new statutory, regulatory responsibilities added every year, both federally and state. We’ve never had any taken away. And we’ve never been given a commensurate increase in staff for the additional responsibilities."

Bayer, the head of a DEC union that represents more than 2,000 employees, recently issued a letter to Governor Paterson urging him to postpone drilling operations for another year. "Although the Marcellus Shale natural gas formation is a valuable resource, public safety and the protection of all of our natural/environmental resources demand that NYSDEC take the time to do a complete evaluation and adequate planning before allowing its use," it states.

Pressure on Paterson and New York's DEC is not just coming from environmentalists. On Jan. 7 Chesapeake Energy, one of the nation’s leading natural gas companies, issued a statement warning New York state that its slow legislative progress could drive drillers to focus their efforts elsewhere. “The measures proposed ... will be more burdensome than any of those placed on our industry throughout the United States,” Chesapeake said in public comments. Its sentiments echo those of Fortuna Energy, which last year announced it would redirect the majority of its Marcellus efforts away from New York.

Chesapeake’s accusations may be true (New York’s regulations are considerably stronger than those in Pennsylvania, for example). But they also point to another significant problem with the state’s dSGEIS: It’s cut from a legislative cloth custom-tailored to the gas industry’s needs.

Indeed, gas exploration is exempt from portions of the Safe Drinking Water Act, the Clean Water Act, the Resource Conservation and Recovery Act, CERCLA (Superfund), the Clean Air Act and the National Environmental Policy Act.

Closely examined, many of these exemptions invoke some peculiar logic. In one portion of the Safe Drinking Water Act, the meaning of "Underground Injection" (the “subsurface emplacement of fluids by well injection”) seems to change magically when it applies to hydraulic fracturing: “Underground injection excludes (i) injection of natural gas for purposes of storage; and (ii) injection of fracturing fluids (other than diesel fuels) related to oil, gas, or geothermal production activities.” This accommodation has nothing to do with the process by which water is injected during hydraulic fracturing. Rather, the method is simply exempt by definition.

Similarly, in the Clean Water Act, the definition of “pollutant” has been adjusted to conveniently exclude fracking fluids. And descriptions of “hazardous waste" -- carefully outlined in the Resource Conservation and Recovery Act -- do not apply to “drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil or natural gas or geothermal energy….” New York’s impact statement, based largely on regulations from 1992, does not address these issues.

“You basically have this 300-pound beast running around, with very little in the way of control,” Helen Slottje, an environmental lawyer based in Upstate New York, told me. “The natural gas industry will tell you 'We follow every regulation.’ Well, it’s very easy to follow regulations when they say you’re exempt."

New York’s dSGEIS does not impose enough “musts" on the gas industry, Slottje added. This is mostly because state agencies often adopt their legal definitions from federal environmental laws -- in this case, laws that are already riddled with loopholes.

“[The DEC is] the parent every teenager would dream of,” Slottje said. “They encourage you. They suggest. They want you to do this. It really would be in your best interest to do this. But they’re not going to check up on you.”

Still, while many agree that its accommodations to industry represent a large problem with the dSGEIS, others think that the document’s failure to address drilling’s cumulative environmental impacts is far worse.

Such impacts, according to New York City’s Department of Environmental Protection (NYCDEP), include: a "high degree of invasive industrialization that carries inherent short-term and cumulative environmental risks"; the possibility that drilling will “contaminate water supplies” (New York’s DEC, along with a host of other environmental agencies across the country, has denied this charge); and the potential to “damage water supply infrastructure located within and outside the New York City watershed."

In a Rapid Impact Assessment Report published last September, the NYCDEP concluded that drilling in the Marcellus poses a significant threat to New York City’s watershed. “While the probability of contamination from any given well and fracture operation may be quite low," the document states, “the likelihood increases as more wells are drilled in the region....Even a relatively minor contamination incident could negatively impact the public confidence in the overall quality of NYC’s unfiltered water supply.”

There’s also the issue of wastewater disposal -- potentially an enormous strain on New York’s current infrastructure. Though the DEC attempted to address issues of disposal in its impact statement, a ProPublica investigation revealed that each of its solutions was insufficient to deal with the volume of wastewater (as much as three billion gallons annually) that drilling generates.

“Without estimates of the cumulative impacts, you don’t have an estimate here," said Cynthia Bowman, a law professor at Cornell University who has followed drilling’s legislative path closely. "You have a description of what happens when each particular operation separately occurs."

A few weeks back, Bowman and a collection of her students finished drafting a detailed critique of the dSGEIS. According to their findings, the document fails to address Noise Impacts (hydraulic fracturing is an extremely loud and potentially disruptive process), Road Use Impacts (trucks containing frack water can weigh as much as 100,000 pounds and make as many as 592 trips per day, per well), and Community Character Impacts, among many other things. In total, Bowman’s team proposed 187 tasks to remediate the dSGEIS's flaws.

But is the agency likely to listen to her team, the NYCDEP, or even the federal EPA, which recently slammed the DEC’s regulations? She’s not so sure.

“You’ve got a lot of smart people organizing and trying to do everything they can to stop it, but I can’t see [gas companies] giving up," Bowman said. "New York has this dysfunctional state government. I’ve spent my life being suspicious of big corporate wealth, and this has brought me up against it in a way that I never envisaged."


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