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The committee held a budget hearing with the Department of Conservation and Natural Resources (DCNR). DCNR Secretary Michael DiBerardinis, along with James Grace, Deputy Secretary for Parks and Forestry, Cindy Dunn, Deputy Secretary for Conservation, and Rita Calvin, Deputy Secretary for Administration, fielded questions from committee members. Committee members in attendance included Chairman Dwight Evans (D-Philadelphia), Minority Chairman Mario Civera (R-Delaware), Rep. William Keller (D-Philadelphia), Rep. Kathy Manderino (D-Philadelphia), Rep. Jake Wheatley (D-Allegheny), Rep. Deberah Kula (D-Fayette), Rep. Tim Briggs (D-Montgomery), Rep. Scott Conklin (D-Centre), Rep. Eugene DePasquale (D-York), Rep. Bill Kortz (D-Allegheny), Rep. John Siptroth (D-Monroe), Rep. Greg Vitali (D-Delaware), Rep. Brian Ellis (R-Butler), Rep. David Millard (R-Millard), Rep. Ron Miller (R-York), Rep. Dave Reed (R-Indiana), Rep. Doug Reichley (R-Lehigh), Rep. Dick Stevenson (R-Mercer), Rep. Mario Scavello (R-Monroe) and Rep. John Evans (R-Erie). Chairman Dwight Evans asked Secretary DiBerardinis how his department plans to use federal stimulus dollars. Secretary DiBerardinis responded DCNR is still trying to understand its participation in the federal stimulus package. "Looking at the bill, there is no direct allocation to DCNR", he explained. However, the Forest Service is set to receive those funds and DCNR should receive some funds for forestry and flood plain land protection programs. DCNR will work with the Department of Environmental Protection (DEP) and the Fish and Boat Commission for dam repair and construction projects. Additionally, the Army Corps of Engineers will be receiving stimulus money and we are hoping to work with them as well as the other state agencies to use those federal dollars, Secretary DiBerardinis added. Thanking the two citizen participants, Bob Griffith, Executive Director of the Pennsylvania Recreation and Park Society (PRPS), and Linda McKenna Boxx, President of the Allegheny Trail Alliance, for testifying in the budget hearing, Chairman Evans asked for their comments and perspectives on the budget process as it pertains to DCNR. He commented that these two testifiers "put a face on what the Department does". In her response, Boxx explained that she represents several different organizations that are both recipients and co-funders of DCNR grants. She thanked the Department for providing the funding in 2007 that leveraged a dollar for dollar match during the Allegheny Trail Alliance's successful push to complete the trail. The Allegheny Trail is an "engine for economic and community revitalization," Boxx emphasized. This is an example of a program that DCNR supports, which generates a significant return on investment. Another organization, the Pennsylvania Parks & Forests Foundation, provides a "fantastic legacy," Boxx noted. Commenting that PA has a wealth of outdoor recreation opportunities and waterways, Griffith stated that DCNR is the "key" for organizing all of those resources. Heinz Field in Pittsburgh and Citizens Park in Philadelphia are both examples of recreation resources. He offered a list of items the Department is involved with, including: the passing of bond issues to support county recreation programs, keeping up with a high demand for soccer fields, assisting older communities update their recreational programs, pursuing economic opportunities along waterways and waterfronts, providing close to home travel opportunities, reaching those with disabilities and educating the young to get them to the outdoors. Griffith noted that there should not be a decrease in funding for parks. He added that the Oil and Gas Lease Fund dollars should keep going back to DCNR. Minority Chairman Civera inquired if the proposed 4.5% decrease for park funding would result in park closings. No, but there would be noticeable cuts in services and operations of state parks, Secretary DiBerardinis replied. That would include the cleaning of restrooms and the curtailing of pavilion activities and other program opportunities. Park managers would make those decisions. Core functions would be maintained but services would be reduced, he concluded. Would the federal stimulus help, Minority Chairman Civera asked. Secretary DiBerardinis answered that he has not seen any real opportunities except for the possibility for the Americorps program. Rep. Vitali asked for an explanation of the "landscape approach". Secretary DiBerardinis responded that the landscape approach is used for large land holdings for the purpose of connecting the large parks with the local communities. The Laurel Highlands, Ohiopyle State Park and PA Wilds are examples of this "exciting approach" that DCNR is implementing to revitalize and grow sustainable communities, Secretary DiBerardinis stated. Noting that Moraine State Park is in his legislative district, Rep. Stevenson questioned why DCNR is spending money for projects such as the construction of a lodge at the Bald Eagle State Park at a time when there is a proposed 4.5% decrease in the state budget line item for parks. He asked why private funds were not being used. In his response, Secretary DiBerardinis thanked the legislature, which has been very generous to DCNR for past funding for infrastructure investment, he said. DCNR received $250 million for roads, bridges, trails, restrooms, offices and new construction. That funding was separate from operating dollars, the Secretary explained. "The reduction in state funds will represent operational hardships", he said and he added that "we have spread the pain". He noted that he went on the trip to the Stonewall Jackson Inn, which "bleeds red ink" and uses public funding. PA needs new overnight accommodations. This new construction is one small step forward and the attraction should not be the resort, but rather the park itself, Secretary DiBerardinis stressed. Specifically mentioning oil and gas drilling in parks, Rep. Stevenson inquired if there are other ways that DCNR can raise revenue. Yes, we are considering and evaluating future leases as part of a nine-month process that Governor Rendell has encouraged us to begin now, Secretary DiBerardinis responded. Rep. Kula noted that the American Heritage tourism organizations are set to receive zero funds and she asked how that lack of funding would impact those organizations. Secretary DiBerardinis replied that the Heritage organizations have other sources of funding, but, he acknowledged, DCNR grants are an investment and have a significant impact. They are eligible for the grant program, he noted, stating "we are not totally abandoning them," he added. In this budget year, we have choices, Secretary DiBerardinis said. There are declining timber sales and declining park funding. "How do we keep all the balls in the air", he asked. Rep. Kula voiced her opinion that economic development contributions should be considered and she added that she was looking forward to the impact that the Allegheny Trail efforts would have in her area. Rep. Millard noted that there is a proposed $6.7 million increase for the Bureau of Forestry in the Governor's budget, at a time that there is an $8 million decrease in timber sales. Secretary DiBerardinis responded that the Bureau of Forestry generates significant yearly revenue for the state - $35 million per year. Timber sales have tumbled downward in this tough economic time, which has resulted in a net operating loss of $1.2 or $1.3 million for the Bureau. Secretary DiBerardinis assured the committee that DCNR has a good relationship with the Hardwood Council and is working with all groups to promote the use of PA timber. Griffith added that the state is selling the same amount of timber. It has just declined in value. Even with reduced prices, it is crucial to carry out the operations of the timber industry, he emphasized. Rep. Kortz congratulated DCNR for the McKeesport bridge project and for the work at Shawnee State Park. He then asked how many communities would be impacted by the lack of funding for the twelve Heritage areas. Secretary DiBerardinis explained that the total number of communities would be difficult to count. He said that he would provide a geographical breakdown to the committee as soon as possible. Rep. Kortz asked if the Heritage groups could still leverage funds without state funds. Those groups use those funds on a five-to-one ratio and "if we don't fund them, they will not make it", Rep. Kortz said. Secretary DiBerardinis stressed that DCNR wants to help those groups. He offered the grant program as a possible solution. Rep. Kortz offered his opinion that some forestry money should be shifted to those groups. How much money did the state make as a result of the sale of 74,000 acres for natural gas leases, Rep. Dave Reed questioned. Secretary DiBerardinis replied that PA has over 1.5 million acres of state forest within the Marcellus Shale, with 660,000 of those acres open to drilling. Four or five months ago, the lease sale generated $190 million. This "amazing one-time sale" was timed just right, he said. The land was leased when prices were at the highest point. Do we have the entire $190 million, Rep. Reed asked. We have $160 million, with the remaining amount expected within 30 to 60 days, Secretary DiBerardinis answered. When does the Governor plan to transfer that money out of the fund and does that transfer require legislative approval, Rep. Reed inquired. Yes, Secretary DiBerardinis replied. That transfer of $174 million is part of the proposed budget and would be authorized once the legislature approves the budget. Rep. Reed asked what impact a severance tax would have on the per acre amount royalty. Deputy Secretary Grace noted that an estimate on the impact is hard to ascertain. He explained that the royalty would be on the gas produced in that area. There will be no gas produced for at least another year, he added. Rep. Reed voiced his opinion that the future severance tax issue should be considered. Rep. Miller stated that the Governor is proposing to shift money out of the Oil and Gas Fund in order to fund the state's operating budget. "Shouldn't this be the other way around", he asked. DCNR needs to support the Commonwealth, Secretary DiBerardinis stated. How do we defend a budget plan that proposes a freeze on the hiring of lifeguards and transfers millions of dollars, Rep. Miller queried. The open swim program, Secretary DiBerardinis explained, is not a budgetary decision. "That program was in place before I got here, six years ago", he emphasized. The ten-year program was put into place because the state could not attract enough qualified lifeguards to run a consistent program. "I am not happy with the transfer, but I understand", he said. There is a balance, he concluded. Rep. Evans asked if revenue would be increased by higher state park user fees or by increased attendance. Increased user fees, Secretary DiBerardinis responded. There will be small, annual increases in user fees such as those for renting a cabin or boat. Rep. Evans asked if there is any truth to the rumor that Presque Isle would incorporate user fees. No, Secretary DiBerardinis said. What role do managers play, Rep. Evans questioned. Managers get the budgets and make their programs, which are reviewed by DCNR, the Secretary replied. They have flexibility, he added. Citing an audit of ATV and snowmobile fees, Rep. Ellis asked for a discussion on the proposed 5% transfer to DEP. Secretary DiBerardinis replied that he is not equipped to answer that question right now, but he promised to respond with the answer within one day. Rep. Ellis stated his belief that more trails are needed. Secretary DiBerardinis replied that one area is open - Rock Run in Cambria County. DCNR is having trouble finding land suitable for another run, he explained. Formerly closed ATV trails at five locations are being opened up to connect existing trails, which is making hundreds of miles available for riding. DCNR is balancing the increase in riding opportunities while maintaining the beauty of the land. Rep. Ellis noted that he was present at the Stonewall trip and he asked for further discussion on public/private partnerships. Secretary DiBerardinis commented that "baby steps" need to be taken on this subject. A market study has been done on fifteen to twenty room lodges. The balance is expanding overnight accommodations while keeping the park as the center of attraction. "I am not willing to do that now", Secretary DiBerardinis said in response to the idea of large, one hundred bed facilities. Griffith replied that the economic feasibility of the plan would have to be considered. DCNR currently has many partnerships with private companies, especially with restaurants, he said. Rep. Ellis said that this is a good opportunity and he urged the groups to meet with the House Tourism Committee on the issue. Why do past storm events have specific line items in the proposed budget, Rep. Mario Scavello asked. Grace replied that the funds are being used now and he explained that the funds would be entirely used in the near future. Rep. Scavello asked for clarification on the Laurel Mountain State Park sale. Secretary DiBerardinis noted that the sale is a complicated issue as he briefly explained the restrictive lease agreement between the state and the private company ski resort. He said DCNR would provide a current report on the status of that sale to the committee. Rep. Reichley asked for comment on PNDI's, which he said has been criticized as being a "bottleneck or sticking point" for developers. Those are funded by specialty licenses, Secretary DiBerardinis replied. The project has lost some effectiveness and the proposed budget does have decreased funding for those, he acknowledged and he asked the legislator to let him know of any backups. Grace offered Marcellus Shale as an example of how the state can bring in more wildlife experts to keep up with permitting. Rep. Reichley stated that he would like to see DCNR coordinate with PennDOT on those efforts. He then asked for more discussion on the Department of Revenue's proposed transfer of $150 million from the Oil and Gas Fund. Grace stated that it is his understanding that the Department of Revenue's income is from severance taxes. Secretary DiBerardinis promised to check into the issue. How much money for the Bald Eagle project, Rep. Reichley asked. Five or six million, Secretary DiBerardinis replied. How much money has been spent now, the Representative questioned. Grace replied that it is still early in the process and little money has been spent. Noting that DCNR was probably expecting this question, Rep. Reichley asked for an explanation into the justification of the appointment of former Rep. Dan Surra to a position paying $95,000 per year at a time when the Governor is talking about laying state workers off. He noted that it was not a competitive interview process. In response, Secretary DiBerardinis explained that DCNR has, for the past three years, asked the Governor's Office for extra help with the large, regional landscape programs. This year they responded and Governor Rendell exercised his authority to appoint someone to the position. Surra is "uniquely qualified to do the job", he stressed. "We needed the help and we got it. I have great expectations. This is a real job", Secretary DiBerardinis emphasized. DCNR is in need of his "skill sets", he concluded.