Chamber Expresses Support for Natural Gas Pipeline Project

Last week, the Federal Energy Regulatory Commission (FERC) held four public meetings to collect input on the draft Environmental Impact Statement (DEIS) for the Atlantic Sunrise natural gas pipeline project. The Chamber of Commerce submitted comments at Wednesday’s meeting in Bloomsburg in support of the expansion of Pennsylvania’s pipeline infrastructure. Public comments on the DEIS are being accepted until June 27th.

The Atlantic Sunrise project includes construction of 195 miles of 30 and 42-inch pipeline in Pennsylvania for the transmission of natural gas. The proposed route runs south through Columbia County. A compressor station is also proposed to be built in the county. Details about the project including maps are available here.

In early 2015, the Chamber Board solicited input from members on two natural gas pipeline projects in the region, the Atlantic Sunrise project, and the Sunbury Pipeline project. The Sunbury Pipeline consists of a 35-mile pipeline being constructed primarily to supply the Hummel Station power plant in Shamokin Dam, Snyder County. A portion of that pipeline will go through Montour County after being approved by FERC this spring. Following member input, the Board approved a resolution supporting “the expansion of Pennsylvania’s natural gas transportation and distribution pipeline infrastructure through responsible collaboration with property owners for the benefit of the citizenry and economy of the Commonwealth.”

The Draft Environmental Impact Statement, as well as links to electronically submit comments, are available through FERC’s website. Comments must be received by June 27, 2016.

PA Chamber Applauds Gov. for Signing Historic Liquor Reform Bill

From PA Chamber of Business & Industry

Last week, the House passed historic liquor reform legislation that Gov. Tom Wolf publicly signed on Wednesday, June 8. On Tuesday, the House voted 157-31 on concurrence in favor of H.B. 1690, which provides for the private sector sale of wine in grocery stores with a restaurant license; allows takeout wine sales in licensed restaurants, bars, hotels, supermarkets and delis; and lets about 14,000 holders of takeout beer licenses to sell up to four bottles of wine; among other improvements to the current state store system.

The new law makes no changes to the current sale of liquor and does not close any state stores.   Governor Wolf issued a statement calling the bipartisan effort “the most significant step the commonwealth has taken to reform our liquor system in 80 years.” For its part, the PA Chamber has long advocated moving Pennsylvania’s antiquated liquor sales system into the 21st century to give consumers the convenience and choice they overwhelmingly want; and make the state competitive in alcohol sales, in order to keep critical sales revenue in the Commonwealth’s borders each year.

Following the governor’s action, PA Chamber President Gene Barr released a statement thanking elected officials for enacting the popular reform legislation and allowing the private sector to responsibly sell wine. “We applaud the governor for signing this important reform legislation into law – which will help keep revenue within our borders and will expand private sector opportunities to responsibly sell alcohol and compete on equal ground with neighboring states,” Barr said. “This effort – which had bipartisan support – shows how the spirit of compromise can bring about positive change in Pennsylvania.”

New Overtime Rules Increase Salary Threshold

It has been over 12 years since the Fair Labor Standards Act (FLSA) was last amended. In 2004, a Final Rule increased the salary level an employee must be paid to come within the standard test for an Executive, Administrative or Professional exemption (EAP, also known as the white collar exemption) from minimum wage and overtime requirements to $455 per week. At that time the Department of Labor (DOL) also modified required duties tests for meeting the exempt from overtime status and created an exemption for highly compensated employees (HCEs).

After issuing proposed rules in 2015, the DOL recently released its 2016 Final Rule, which is aimed at expanding overtime eligibility for millions of American workers. The Final Rule increases the minimum salary employers must pay white collar workers to maintain their exempt status to $913 per week, but does not make any changes to the job duties test. Employers have until December 1, 2016 to comply.   The Chamber’s member benefits provider, ChamberChoice, has provided a summary of the key provisions of the new overtime rule. The U.S. Department of Labor has held several webinars explaining the changes, which are archived for viewing.  If employers have any remaining questions, they are advised to contact an attorney for clarification.

Budget Deal Expected Soon

Leaders in the PA House and Senate from both parties are optimistic that the 2016-17 budget will be passed on or near the June 30th deadline this year. A major motivator is that the entire House and half of the Senate members are up for reelection this fall. Details on how to close a $2 billion deficit have not yet been finalized.

The expectation of a budget deal was echoed by House Speaker Mike Turzai, House Appropriations Committee Chairs Bill Adolph and Joseph Markosek, Senate Appropriations Chair Pat Browne and Senator Jake Corman on Tuesday. All stated that this year’s negotiations are going much better than last year’s. The legislators met with chambers of commerce from across the state at the annual Chamber Day at the Capitol. The event was organized by the PA Chamber of Business and Industry and the Pennsylvania Association of Chamber Professionals. Republican leaders and the PA Chamber continue to push for reform of the state pension system, a major cost driver in the budget. The Commonwealth’s obligation for the coming fiscal year increases $500 million to $2 billion. Speaker Turzai stated that pension reform legislation currently in the House was agreed to by Governor Wolf last year. Any of the reforms being considered would not result in immediate savings for Pennsylvania taxpayers.

To help generate the additional revenue needed to meet this obligation, the expansion of gaming and the expansion of items and services subject to sales tax are being considered. Also on Tuesday, the House passed reforms to the state liquor system that will allow grocery stores to sell wine and expand beer sales at convenience stores. The reforms, which House leaders hope will lead to the eventual complete privatization of the liquor sales in Pennsylvania, is expected to generate an additional $150 million in revenue annually. Governor Wolf did not immediately indicate if he would sign the bill. Increases in the sales tax rate and personal income tax rates are off the table in the negotiations, according to legislators. Budget Secretary Randy Albright expects that some “gimmicks” and “one-time fixes” will be utilized by the legislature to bridge any remaining budget shortfall.

Talen Energy to Co-fire Montour Plant

Talen Energy Corporation has completed a feasibility assessment related to bringing natural gas to the power plant located near Washingtonville in Montour County and installing boiler modifications to enable a dual-fuel, also known as co-firing, capability. The company’s Board of Directors approved the project, which will enable the Montour plant to operate on coal, natural gas or in combination. Engineering and design work is already in progress and, based on obtaining all necessary permitting and regulatory approval, the anticipated completion date is the second quarter of 2018.

Based on the results of a competitive RFP process, the company is currently in the process of selecting a qualified third party to construct, own and operate a 15 mile lateral pipeline to bring natural gas to the 1,500 megawatt Montour plant. The estimated capital expenditure for plant modifications is approximately $70 million with additional pipeline expenses and payments to be made to the third party constructing the pipeline and regulating and metering station.

“Montour is a significant asset in the Talen Energy fleet and we are making the necessary investments to improve its competitive position in the market,” said Paul Farr, Talen Energy President and Chief Executive Officer. “The Montour plant is located in close proximity to one of the largest natural gas formations in the world, the Marcellus Shale.  Co-firing the plant to burn natural gas, produced in Pennsylvania, enables Talen Energy to leverage the strategic location of the plant.”

The pipeline company selected by Talen Energy will be responsible for obtaining all necessary environmental and construction permitting from the appropriate federal, state and local agencies. Talen Energy expects to announce additional details related to the pipeline, contractor and next steps as part of its typical quarterly reporting as those details become available. Last week’s announcement that private investment firm Riverstone Holdings LLC will acquire Talen Energy is not expected to impact this decision. That transaction is expected to be completed by the end of 2016.