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Anyone in Pa heard of HB 1410? regarding upping min. royalties?

http://www.empoweredmunicipality.com/pa-house-considering-minimum-r...

 

from 12.5 percent to 15 percent with even more good stuff?  especially defining point of sale and stating it as gross (rather than net).

http://www.legis.state.pa.us/CFDOCS/Legis/PN/Public/btCheck.cfm?txt...

 

Just wonder if that would mean we could redefine our present leases if it passes?  for some that have leases at net and less than 15percent?  because the new bill requires NO post production costs from the Lessor's royalty amount.

PLS READ THE ENTIRE BILL IN PROCESS AS THIS COULD BE VERY GOOD NEWS FOR YOU AND YOUR FAMILY IF IT APPLIES TO YOUR PRESENT EXISTING GAS LEASE CONTRACT.

 

I just added a post that shows that this bill was first introduced in 2010 under another HB # and since it is still not passed ...how about writing your state rep or senator about getting this very important bill thru?  and post what you think about it on this discussion cause the link can be sent to those generating the bill to help them have some feedback about it.   thanks

 

 

 

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Permalink Reply by USA Landowner on February 4, 2012 at 7:39pm

actually if you read thru the house bill info it does state that some leases will be able to be amended/modified so guys let's hope this bill passes...and pls do read about if your lease could be also amended...that is great for some people.   Yet it doesn't really state whether the amending/modifying would include the entire bill which would really be super.  You lawyers out there you probably can tell if it means the entire modification of the royalties and how they are dispursed when you read the HB content...pls add to this with your opinion if you will.

(why is it taking so long...they started last spring)

Permalink Reply by Fang on February 4, 2012 at 7:40pm

VG,

Not being an attorney I could be wrong, but oil & gas leases are contracts I doubt any legislation could retroactively affect signed and recorded leases.

Although I believe royalty payments are to low, I do not believe the government should be involved. It interferes with the property rights of individuals. I know the intent is well meant, but if the government can get involved in a transaction on your property in this manner then they can tell you what you can do with it also. We already have to much of that now.

The fix for this situation is already occurring, sites such as this and landowner groups are educating people. We do not want the government in our lives anymore than necessary. Besides what about personal responsibility ? I'll take care of myself.

Mark

Permalink Reply by USA Landowner on February 4, 2012 at 7:54pm

thanks Mark for the reply...

It does read that a lease that does not have at least a 1/8 royalty (the present min. in Pa) can be escalated /amended to this new bill.   Now what it doesn't say is if someone with a lease at 13%, 14% or thereabouts should also be amended to 15%.  And I really think it isn't fair for any lessor to be receiving less than 15% with no post production costs if this bill really passes cause it wouldn't apply to that many under 1/8 compared to how many there are with post prod. costs (net) and under 15%..    

I know you state that you would prefer the government not intervene...but I tell you there are quite a few of folks in Pa that were/are ignorant of the tactics of the oil companies and any knowledge of the future of the area and the value of the resources that I am glad that we have a government (some in the government that is) that is being the watchdog over the oil companies in how fair they deal with the individual landowners.  If that royalty minimum had not been there they would have offered the people much lower prices in royalties.   My take on that.    If there was a special board of trust that the people could rely on as a public association to help represent them then ok...but there isn't yet.    such as in real estate one can deal locally with their local branch of NAR (national assoc. of realtors) who have teamed up because of unfair real estate practices.

Permalink Reply by Linda A on February 9, 2012 at 7:32pm

Totally agree Mark!  The govt has it's nose in way too much of our business.  It's another nasty attempt as 'sharing the wealth'.  What about applying it to property sold?  You sell for $50k and a month later, the new owner sells for $200k - gheeze, wouldn't it be fair if I could get some of that too?  Could insert any product/property/asset in that same 'what if'...

Permalink Reply by Fang on February 9, 2012 at 8:03pm

Linda A,

Exactly right, where does it end ? As I said understand that the intent is well meant but they never think of unintended consequences. Or some sleazy politician that uses this as a precedent to assert control of your property. Also, where is personal responsibility ? The reason that many people have bad leases is that they jumped at the easy money. They didn't do their homework and now they want the government to save them.

I have said over & over on this site, the landman is not your friend do not believe anything he/she says. If you have questions go to an oil & gas attorney. I speak with landowners everyday who ask my opinion, it never ceases to amaze me that they don't listen and sign a lousy lease. Then when I see them again they're all PO'd.

Yeah I like the property sale example. No one should be allowed to property for more than they paid for it. If they do they have to share the profit with the previous owner. Or how about car sales?  Why not have the government pass a law that everyone pays the same for a car ? As you said it can be applied to so many situations.

Mark

Permalink Reply by Fang on February 4, 2012 at 7:54pm

VG,

Yes I saw that section but it says escalated to 1/8 it doesn't mention the  15%, plus I think the wording is confusing. Maybe you shouls write your legislator an get it to say escalated to 15 %.

Mark

Permalink Reply by USA Landowner on February 4, 2012 at 8:02pm

It is not worded exactly but why would a person having a lease (and some leases are under the 1/8% written years before the requirement of 1/8) be able to amend to the new bill as long as the following conditions they listed haven't happened yet ...but not someone who has a lease under 15% and has a net royalty clause?   doesn't sound fair for all that way.

The words amended and escalate must mean to the new bill?

Permalink Reply by Fang on February 4, 2012 at 8:38pm

VG,

I agree it doesn't sound fair but that's the way I read it. I see it that way because the changes to the original legislation are underlined. It would seem to me that if they wanted the lease to increase to 15% they would have added wording to that effect and underlined it.

Again, it's just how I read it.

Mark

Permalink Reply by USA Landowner on February 5, 2012 at 12:07am

Section 2 is a good area for some gas and oil attorneys to watch closely...as it could open the door to some bringing forth their contracts to also be modified.  As I read it  lines 3and 4 say that the bill is introducing an escalation of royalties  to those that have not the minimum presently required (an 1/8) and I read it that it will escalate to the new minimum of 15percent as long as certain requirements take place...such as new drilling, fracking, etc.

I see a problem with giving lessors an escalation to the new min. and rules of no post production costs that have leases under the present 1/8 and not identifying and giving the same opportunity to those with leases that have less than 15percent and are in net royalty clauses that include post production costs for the Lessor.    I think some attorneys may get involved in such if there is a passing of this bill in its present wording.   Cause if you allow a lease that is even older to catch up to a better lease conditions and required by law then you must include the others that are under the minimum of the new royalty minimum as well to be fair to the citizens of the state.   They should not be only stating those under the 1/8 percentage gets the better deal  is what I am saying....they should reword that to those that receive less than the newly required royalty minimum of 15percent can be modified and escalate to the new min. with new regulations.   Most likely that will include quite a few lessors and by not including all under the new min. royalty then they, the legislators  are still showing favor to the oil companies by trying to keep the dollars low for the oil companies expense for this change (which is the reason they had to raise it and create new clauses regarding the payment of royalties because of the unfair and unjust royalties being created in these leases).

Pls people that read this and would benefit....pls write your legislators about this bill.   For those that have above the 15percent royalty min. they may be doing better with the percentile but some may be involved in 'net' instead of gross payment at the point of sale compared to what HB 1410 presents. 

  I truly like the new bill's interpretation of point of sale and fair market value and even further defining that the oil company cannot sell to its own companies or even relatives as fair market value at the point of sale.

Permalink Reply by USA Landowner on February 5, 2012 at 12:45am

Just went online to see more about this bill and looked at the rep listed first on the bill's website...GEORGE

and I see that the bill was under another HB #2214 from May 2010

http://www.legis.state.pa.us/cfdocs/legis/RCC/PUBLIC/listVoteSummar...

I also see that it has been voted on in a motion to committ the bill (whatever that means) Does it mean it already passed?  don't know, or is this a former bill before the new one?   why didn't they work it out back in 2010 ...we sure needed it then also.

http://www.legis.state.pa.us/cfdocs/legis/RCC/PUBLIC/listVoteSummar...

 

 But I did find a concensus that is rare on all agreeing....take  a look at this bill and an all in favor agreement (those are rare).  didn't even know they voted on such things...good thing though...but I wonder if they asked GOD first?  I wonder sometimes if any asked GOD if He wanted to be the one named as the 'one nation under GOD'...as I am not sure everyone knows what that means and is willing to accept Him as over them.

http://www.legis.state.pa.us/cfdocs/legis/RCC/PUBLIC/listVoteSummar...

Permalink Reply by Fang on February 5, 2012 at 8:12am

VG,

Committed could mean it was sent to the general assembly for consideration.

I do like the "In God We Trust" legislation for license plates. Unfortunately someone who puts that on their car will get ridiculed.

Mark

Mark

Permalink Reply by Chartist on February 5, 2012 at 10:04am

I always find it amusing when people want more.   A 1/8 royalty has been the traditional starting point for decades and folks happily signed them.  Now today, greed seems rampant.  I do agree that terms need to be better defined, if not standardized so folks know what they're signing.  But as far as percentages go, the government shouldn't get involved any further.  The gas drillers assume the risk and spend the dough.  Without them, the landowners would get nothing.

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