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Fracking and the Revolving Door in Pennsylvania

An interesting report about the faces that lobbying has in the USA. Published by the Public Accountability Initiative.

Executive Summary

The oil and gas industry frequently argues that fracking means jobs. This appears to be especially true for former regulators and other public officials in Pennsylvania, many of whom have taken lucrative jobs working for the industry.

This report documents the revolving door between government and the gas industry in Pennsylvania, where numerous top government officials and environmental regulators have either left their public jobs for careers in the oil and gas industry or come to government from the private sector.

The report is based on extensive research on the career trajectories of dozens of public officials, with a focus on the executive branch and the Department of Environmental Protection (DEP) in particular.1 The revolving door trend in Pennsylvania raises questions about whether regulators are serving the public interest or private industry interests in their oversight of fracking.

The following are major findings from the report:

● Pennsylvania’s previous three governors have strong ties to the natural gas industry. Tom Ridge’s firms benefited from a $900,000 contract to lobby for the Marcellus Shale Coalition, Mark Schweiker joined a lobbying firm with a Marcellus Shale practice, and Ed Rendell is a partner in a
private equity firm invested in fracking services companies and recently lobbied on behalf of driller Range Resources. Current governor Tom Corbett also has strong ties to the industry – he received more than $1 million in campaign contributions from the oil and gas industry and previously worked as a lawyer for Waste Management, which is active in the Marcellus Shale.

● Every Secretary of Environmental Protection since the DEP was created has had ties to the natural gas industry. Jim Seif is now a principal and energy consultant at Ridge Global LLC, one of former governor Ridge’s firms that lobbied for the Marcellus Shale Coalition; David Hess is now a lobbyist at Crisci Associates and has gas industry clients; Kathleen McGinty has served on the boards of two energy companies, is managing director of a consulting firm that is part of the Marcellus Shale Coalition, and is a partner in former Governor Rendell’s private equity firm; John Hanger is now special counsel to a law firm that represents every segment of the natural resources industry; and Michael Krancer is former general counsel at a utility that relies on natural gas and a former partner at a law firm member of the Marcellus Shale Coalition.

● Twenty Department of Environmental Protection employees have held jobs in the energy industry either before or after their agency jobs. Former high-level staffers include Terry Bossert, who has worked for three law firms that represent the energy industry before being hired as a vice president at Chief Oil & Gas; John Hines, a former Executive Deputy Secretary, who is now a government relations advisor to Shell; and Barbara Sexton, a former Executive Deputy Secretary who is now a government affairs director at Chesapeake Energy. While media outlets have written about some of these connections independently, such as Gov. Ridge’s Marcellus Shale Coalition lobbying, this report is the first extensive look at the revolving door between the gas industry and all of the Pennsylvania government entities responsible for its regulation.

In preparing this report, PAI found several striking revolving door connections that have previously gone unreported:

• Former Gov. Ed Rendell and his Environmental Protection Secretary Kathleen McGinty have a financial stake in companies servicing the fracking industry. Rendell and McGinty are operating partners in Element Partners, a private equity firm that invests in the energy sector. Several of the companies serve the natural gas industry, such as 212 Resources, Agility Fuel Systems, and Environmental Drilling Solutions.

• Secretary of Environmental Protection Michael Krancer’s Executive Deputy Secretary for programs is now a lobbyist for Shell. John T. Hines, the author of a 2011 leaked e-mail revealing a new DEP policy requiring Krancer’s approval of all notices of violation in the Marcellus Shale, is now a government relations advisor for Shell Oil Company.

• Husband and wife Eric and Sarah Battisti left the Rendell administration to lobby for the gas industry. While Sarah Battisti’s departure for BG Group was noted in the press, it was not reported that her husband, Eric Battisti, a senior deputy secretary to Rendell, left to work for Buchanan Ingersoll & Rooney where he lobbies for EQT and Williams Companies.

• Several prominent law firms that are destinations for regulators and public officers after they leave government are members of the Marcellus Shale Coalition. Buchanan Ingersoll Rooney, K&L Gates, and Blank Rome are three of the most renowned law firms in Pennsylvania, and many regulators and public officers are hired after leaving government or come to government from one of the three firms. All three also lobby for companies engaged in fracking and are members of the gas industry advocacy group, the Marcellus Shale Coalition.

The revolving door data in this report raises troubling questions about the incentives that may be guiding public officials’ oversight of fracking in Pennsylvania, from governors to DEP secretaries to well inspectors.


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