by Abrahm Lustgarten, Nicholas Kusnetz and Joaquin Sapien
ProPublica, March 9, 2011, 10:50 p.m.
Pennsylvania has come under fire lately as pollution from drilling in the Marcellus Shale threatens water resources across the state. But instead of ratcheting up oversight, Gov. Tom Corbett wants to hand authority over some of the state's most critical environmental decisions to C. Alan Walker, a Pennsylvania energy executive with his own track record of running up against the state's environmental regulations.
Walker, who has contributed $184,000 to Corbett's campaign efforts since 2004, is CEO and owner of Bradford Energy Company and Bradford Coal, which was once among Pennsylvania's largest coal mining companies. He also owns or has an interest in 12 other companies, including a trucking business and a central Pennsylvania oil and gas company.
Walker was Corbett's first appointee--he chose him to lead the Department of Community and Economic Development in December, before taking office. Now, as Corbett stakes much of the state's economy on Marcellus Shale gas drilling, a paragraph tucked into the 1,184-page budget gives Walker unprecedented authority to "expedite any permit or action pending in any agency where the creation of jobs may be impacted." That includes, presumably, coal, oil, gas and trucking.
It's not clear how Corbett can delegate such sweeping authority to the economic development office, which would be reorganized to focus on coordinating with corporate interests and creating job growth. It also isn't clear how the state would address the legal conflicts that could arise if, for example, Walker pushed for approval of a permit that conflicted with the Clean Water Act or other federal laws. The governor's office did not respond to repeated requests to clarify Walker's role, and other state agencies deferred to the governor.
Environmental groups think Corbett will need to issue an executive order or some other legal clarification to allow Walker's office to wield so much influence over regulations.
"I have never seen anybody give an economic development director the authority to tell every other agency in the state what to do with regard to its statutory responsibilities," said Deborah Goldberg, an attorney with Earthjustice, an environmental group active on drilling issues. "The law requires that you not pollute the waters of Pennsylvania, and if he tries to speed up an application that makes it possible that that is going to happen then I think he is clearly operating outside of his authority."
A spokesman for the economic development office said Walker will not speak publicly until his confirmation. But Walker did post a statement on the department’s website.
"The budget introduced today represents a completely new way of doing business for DCED and its economic development partners," the statement said. "In a tough economic climate, we need to send a powerful message to the Pennsylvania Business Community that Pennsylvania is open for business."
Walker's ties to the energy industry are deep. He is listed on state disclosure forms as an executive of the Pennsylvania Coal Association and he has served as chairman of the Pennsylvania Chamber of Business and Industry. He also has firsthand experience with the state's environmental regulations, because his companies would likely have applied for permits similar to those the oil and gas industry is now pursuing in the Marcellus. And like many energy companies, his, too, have run into problems with the state.
In 2002, three of Walker’s coal companies notified Pennsylvania’s Department of Environmental Protection that they had run out of money and were going to stop treating the 173 million gallons of polluted water they produced each year and released into tributaries of the Susquehanna River. The state eventually got a court injunction to force them to continue treating the wastewater as required by state and federal law.
Corbett's budget, which was introduced Tuesday, emphasizes job creation and proposes eliminating economic development hurdles by streamlining permitting processes in the DEP and the Department of Transportation.
"To address the length of time agencies take to act on permits and eliminate permit backlogs, PennDOT and DEP have begun auditing and assessing all of their permit processes to make them more responsive to the needs of job creators," the budget says.
In the budget Corbett says drilling will bring Pennsylvania 200,000 jobs and $18 billion in economic benefit by the end of the decade. But the drilling industry’s explosive growth has also caused environmental problems and the budget raises questions about whether the DEP—which could lose nearly 20 percent of its funding—will be able to address them.
Private water wells have been contaminated with methane gas and other pollutants across the state, and in many cases the DEP has found that hasty or insufficient gas well construction was to blame. Several drilling site accidents have led to spills where wastewater, including from hydraulic fracturing, contaminated streams.
A 2009 ProPublica investigation  revealed that Pennsylvania's sewage treatment plants were accepting millions of gallons of drilling wastewater, but lacked the technology to remove or treat many of the chemicals and pollutants the water contained. In 2008 people along one stretch of the Monongahela River were advised  to drink bottled water because the level of dissolved minerals and salts in the river was almost twice as high as the DEP considers safe.
The state has since more than doubled its workforce of inspectors and strengthened regulations for how gas wells are drilled, permitted and constructed. The DEP has installed additional water-quality monitors along the Monongahela and required drillers to report where they will take their wastewater after a well has been hydraulically fractured. The agency has also required that wastewater treatment plants be equipped to remove the minerals and salts. And it has received proposals for 24 new waste treatment plants that are now in permitting or review processes—the type of projects Walker could conceivably influence.
In January, the Associated Press found  that about 150 million gallons of Marcellus Shale wastewater—the majority of the wastewater for the period examined—had been dumped into rivers and streams after only partial treatment. A subsequent story  from the New York Times revealed that much of that wastewater was dangerously radioactive, and that drinking water facilities have not been testing their intake for this radioactivity.
On Monday the EPA leaned on Pennsylvania’s DEP to tighten its oversight of drilling waste disposal. The next day, Gov. Corbett released his budget, reducing DEP funding and stating that job creation should trump lengthy permitting delays.
"It's an expression of a philosophy that doesn’t value environmental regulation," said Jan Jarrett, president of PennFuture. "It seems to be the desire of the governor to have this guy be able to pick up the phone and expedite any program that might impact jobs."
The Governor’s office did not respond to repeated requests for comment about the policy shift, the role of the economic development office, or funding for the DEP. Spokespeople for both the DEP and the state Attorney General’s office also declined to comment, saying that only the Governor’s office could speak to the issue.
ProPublica Director of Research Lisa Schwartz and researcher Liz Day contributed to this report.