Gas drilling uncertainty takes toll on small businesses

Over at Breathing Is Political, Liz Bucar has an account of a recent Delaware River Basin Commission hearing on proposed gas drilling, in which several Pennsylvania business owners said their plans were on hold because of the uncertainty surrounding drilling.

Susan Blenkensap  stated,   “My neighbor is  a  lifelong  resident. She had  a real estate agency  for   30 years.  She closed her doors because she couldn’t, in conscience,  sell property  to people when the land is under threat of drilling.”

Ryan Wood-Beauchamp  was concerned about property values.  “What if we can’t sell our homes?  And what about the  FHA [Federal Housing Administration]?”  (It was an allusion to FHA rules which state,   “No existing home may be located closer than  300 feet from an active or planned drilling site.  If an operating well is located in a single family subdivision, no new or proposed house may be built within 75 feet of the operating well.”)

Jessica Corrigan owns an outdoor experience business.   “Our house burnt down,” she said.   “We don’t know what to do.   Should we rebuild  under this threat?"

Bucar's account also includes some thoughts on a proposal by NY state senator John Bonacic, who has called on New York City to buy mineral rights from upstate landowners if the city wants gas drilling banned in its watershed.

Opponents of compensation believe Bonacic’s idea is an open-ended scheme with a wide range of unintended consequences. For instance,  Cliff Westfall asks in a reply to Ms. Schweighofer, “What if I decided to burn down the woods on my land, claiming it was the cheapest way to clear a field, with no concern for preventing its spread to my neighbor’s house?  Of course the government could regulate that. The bottom line is this: the government may prevent you from doing things on your property when those actions would harm public welfare.”

The article points out that in order for a regulation to be considered a "regulatory taking" worthy of compensation to landholders by the government, it is not enough that the regulation decreases the value of the land. If the state's actions benefit the "health, safety, morals or general welfare" of the community, the state may act without compensating landowners.