RULES AND REGULATIONS
Title 58--RECREATION
FISH AND BOAT COMMISSION
[58 PA. CODE CH. 51]
Administration
[27 Pa.B. 6570] The Fish and Boat Commission (Commission) by this order amends Chapter 51 (relating to administrative provisions). The Commission is publishing these amendments under the authority of 30 Pa.C.S. (relating to Fish and Boat Code) (code). The amendments deal with adjustments to the royalty rates for merchantable sand and gravel extracted from Commonwealth waters.
A. Effective Date
These regulations will go into effect on January 1, 1998.
B. Contact Person
For further information on the regulations, contact Laurie E. Shepler, Assistant Counsel, (717) 657-4546, P. O. Box 67000, Harrisburg, PA 17106-7000. This final rulemaking is available electronically through the Commission's Web site (http://www.fish.state.pa.us).
C. Statutory Authority
The regulations are published under the statutory authority of section 503(c) of the Conservation and Natural Resources Act (CNRA) (71 P. S. § 1340.503(c)).
D. Purpose and Background
There are six companies that currently dredge material from the navigable waters of this Commonwealth and pay royalties under section 1808(d) of The Administrative Code of 1929 (71 P. S. § 468(d)). Royalties from sand and gravel extracted from Commonwealth waters are paid to the Fish Fund, which is administered under Chapter 5 of the code.
Current royalty rates for merchantable sand and gravel extracted from Commonwealth waters were set in 1970 at 10¢ per adjusted dry ton of 2,000 pounds, or alternatively, 15¢ per cubic yard based on 3,000 pounds per adjusted dry weight for usable and merchantable sand or gravel or other minerals extracted, but in any event an amount of not less than $1,000 per year. When the royalty rates were established in 1970, the royalty payment of 10¢ per adjusted dry ton or 15¢ per cubic yard was about 6% of the selling price of the dredged material. Section 503(c) of the CNRA provides that the Commission may by regulation, with the concurrence of the Department of Environmental Protection (DEP), adjust the amount of the royalty payments per ton or cubic yard of usable or merchantable sand or gravel extracted from Commonwealth waters.
Last year, the Commission proposed regulations, with DEP's concurrence, that would increase the sand and gravel royalties to 6% of the average Free On Board (FOB) price of the material or 25¢ per dry ton/37.5¢ per cubic yard, whichever is greater (but not less than $1,000 per year). A notice of proposed rulemaking containing the proposed changes was published at 26 Pa.B. 2792 (June 15, 1996). At its July 1996 meeting, the Commission deferred action on final rulemaking on the proposed changes to the royalty rates to permit staff further opportunities to meet with representatives of the industry and explore their views. Meetings were held and correspondence exchanged in the fall and winter of 1996. At the request of industry representatives, the Commission deferred action on the sand and gravel royalty rates. The Commission, at its October 1997 meeting, adopted the amendments on final rulemaking, as described in greater detail under the summary of changes. The Commission is currently seeking DEP's concurrence with regard to the revised royalty schedule.
E. Summary of Changes
The Commission approved the following schedule for imposition of the new sand and gravel royalty rates:
a) 1998--15¢ per dry ton or 25¢ per cubic yard or $1,000 (whichever is greater)
b) January 1, 1999 through June 30, 2000--20¢ per dry ton or 30¢ per cubic yard or $1,000 (whichever is greater)
c) July 1, 2000 through December 31, 2001--25¢ per dry ton or 37.5¢ per cubic yard or $1,000 (whichever is greater)
d) January 1, 2002 through December 31, 2002--30¢ per dry ton or 40¢ per cubic yard or $1,000 (whichever is greater)
e) January 1, 2002 through December 31, 2010--30¢ per dry ton or 40¢ per cubic yard plus or minus an amount equal to the change in the producer price index (PPI) for sand and gravel from the base year (2002), provided that the rate per dry ton will never go lower than 25¢.
The duration of the period in which 25¢ per dry ton will be charged (July 2000 through December 2001) may be extended until completion of permitting and license processes. If this occurs, the commencement of the base year of 30¢ per dry ton will be delayed, and the Commission will undertake the necessary rulemaking at that time.
F. Fiscal Impact
The regulations adopted will have no adverse fiscal impact on the Commonwealth or its political subdivisions. The regulations, however, will impose new costs on the private sector. These costs will total approximately $150,000 to $400,000 per year for all businesses engaged in dredging.
G. Paperwork
The regulations adopted will not increase paperwork and will create no new paperwork requirements.
H. Public Involvement
A notice of proposed rulemaking containing the proposed changes was published at 26 Pa.B. 2792 (June 15, 1996). The notice of proposed rulemaking attracted no public comment except from representatives of the sand and gravel industry who indicated that they would be seeking a phased implementation of the new royalty rates.
Findings
The Commission finds that:
(1) Public notice of intention to adopt the regulations adopted by this order has been given under sections 201 and 202 of the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. §§ 1201 and 1202) and the regulations promulgated thereunder 1 Pa. Code §§ 7.1 and 7.2.
(2) A public comment period was provided and that all comments received were considered.
(3) The adoption of the regulations of the Commission in the manner provided in this order is necessary and appropriate for administration and enforcement of the authorizing statutes.
Order
The Commission, acting under the authorizing statutes, orders that:
(a) The regulations of the Commission, 58 Pa. Code Chapter 51, are amended by adding §§ 51.91 and 51.92 to read as set forth in Annex A.
(b) The Executive Director will submit this order and Annex A to the Office of Attorney General for approval as to legality as required by law.
(c) The Executive Director shall certify this order and Annex A and deposit them with the Legislative Reference Bureau as required by law.
(d) This order shall take effect immediately upon publication in the Pennsylvania Bulletin.
PETER A. COLANGELO,
Executive DirectorFiscal Note: Fiscal Note 48A-56 remains valid for the final adoption of the subject regulations.
Annex A
TITLE 58. RECREATION
PART II. FISH AND BOAT COMMISSION
Subpart A. GENERAL PROVISIONS
CHAPTER 51. ADMINISTRATIVE PROVISIONS
Subchapter J. ROYALTIES FOR SAND AND GRAVEL PERMITS § 51.91. Authority.
Under section 503(c) of the Conservation and Natural Resources Act (71 P. S. § 1340.503(c)), the Commission with the concurrence of the Department of Environmental Protection, is authorized to adjust the amount of royalty payments per ton or cubic yard of usable or merchantable, or both, sand or gravel, or both, extracted from Commonwealth waters.
§ 51.92. Royalty rates.
Persons holding permits granting them nonexclusive rights and privileges of dredging, excavating, removing and carrying away merchantable sand and gravel under agreements between the permittees and the Department of Environmental Protection shall pay royalties in accordance with the following schedule:
(1) During the period, January 1 through December 31, 1998--15¢ per dry ton or 25¢ per cubic yard; or $1,000, whichever is greater.
(2) During the period, January 1, 1999 through June 30, 2000--20¢ per dry ton or 30¢ per cubic yard; or $1,000, whichever is greater.
(3) During the period, July 1, 2000 through December 31, 2001--25¢ per dry ton or 37.5¢ per cubic yard; or $1,000, whichever is greater.
(4) During the period, January 1, 2002 through December 31, 2002--30¢ per dry ton or 40¢ per cubic yard; or $1,000, whichever is greater.
(5) During the period, January 1, 2002 through December 31, 2010--30¢ per dry ton or 40¢ per cubic yard plus or minus an amount equal to the change in the producer price index (PPI) for sand and gravel from the base year (2002), provided that the rate per dry ton may not be less than 25¢.
[Pa.B. Doc. No. 97-2036. Filed for public inspection December 19, 1997, 9:00 a.m.]
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