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Pennsylvania Environmental Defense Foundation v. Commonwealth

Supreme Court of Pennsylvania

June 20, 2017

PENNSYLVANIA ENVIRONMENTAL DEFENSE FOUNDATION, Appellant
v.
COMMONWEALTH OF PENNSYLVANIA, AND GOVERNOR OF PENNSYLVANIA, TOM WOLF, IN HIS OFFICIAL CAPACITY AS GOVERNOR, Appellees

          ARGUED: March 9, 2016

         Appeal from the Order of the Commonwealth Court at No. 228 MD 2012 dated January 7, 2015

          SAYLOR, C.J., EAKIN, BAER, TODD, DONOHUE, DOUGHERTY, WECHT, JJ.

          OPINION

          DONOHUE, JUSTICE

         In 1971, by a margin of nearly four to one, the people of Pennsylvania ratified a proposed amendment to the Pennsylvania Constitution's Declaration of Rights, formally and forcefully recognizing their environmental rights as commensurate with their most sacred political and individual rights. Article I, Section 27 of the Pennsylvania Constitution provides:

The people have a right to clean air, pure water, and to the preservation of the natural, scenic, historic and esthetic values of the environment. Pennsylvania's public natural resources are the common property of all the people, including generations yet to come. As trustee of these resources, the Commonwealth shall conserve and maintain them for the benefit of all the people.

Pa. Const. art. I, § 27. In this case, we examine the contours of the Environmental Rights Amendment in light of a declaratory judgment action brought by the Pennsylvania Environmental Defense Foundation ("Foundation"), an environmental advocacy entity, challenging, inter alia, the constitutionality of statutory enactments relating to funds generated from the leasing of state forest and park lands for oil and gas exploration and extraction. Because state parks and forests, including the oil and gas minerals therein, are part of the corpus of Pennsylvania's environmental public trust, we hold that the Commonwealth, as trustee, must manage them according to the plain language of Section 27, which imposes fiduciary duties consistent with Pennsylvania trust law. We further find that the constitutional language controls how the Commonwealth may dispose of any proceeds generated from the sale of its public natural resources. After review, we reverse in part, and vacate and remand in part, the Commonwealth Court's order granting summary relief to the Commonwealth and denying the Foundation's application for summary relief.

         I. History and Enactment of the Environmental Rights Amendment

         Section 27 contains an express statement of the rights of the people and the obligations of the Commonwealth with respect to the conservation and maintenance of our public natural resources. In Robinson Township v. Commonwealth, 83 A.3d 901 (Pa. 2013) (plurality), a plurality of this Court carefully reviewed the reasons why the Environmental Rights Amendment was necessary, the history of its enactment and ratification, and the mischief to be remedied and the object to be attained. At the outset of this opinion, we reiterate this historical background, which serves as an important reminder as we address the issues presented in the present case:

It is not a historical accident that the Pennsylvania Constitution now places citizens' environmental rights on par with their political rights. Approximately three and a half centuries ago, white pine, Eastern hemlock, and mixed hardwood forests covered about 90 percent of the Commonwealth's surface of over 20 million acres. Two centuries later, the state experienced a lumber harvesting industry boom that, by 1920, had left much of Pennsylvania barren. "Loggers moved to West Virginia and to the lake states, leaving behind thousands of devastated treeless acres, " abandoning sawmills and sounding the death knell for once vibrant towns. Regeneration of our forests (less the diversity of species) has taken decades.
Similarly, by 1890, "game" wildlife had dwindled "as a result of deforestation, pollution and unregulated hunting and trapping." As conservationist John M. Phillips wrote, "In 1890, the game had practically disappeared from our state.... We had but few game laws and those were supposed to be enforced by township constables, most of whom were politicians willing to trade with their friends the lives of our beasts and birds in exchange for votes." In 1895, the General Assembly created the Pennsylvania Game Commission and, two years later, adopted a package of new game laws to protect endangered populations of deer, elk, waterfowl, and other game birds. Over the following decades, the Game Commission sought to restore populations of wildlife, by managing and restocking species endangered or extinct in Pennsylvania, establishing game preserves in state forests, and purchasing state game lands. Sustained efforts of the Game Commission over more than a century (coupled with restoration of Pennsylvania's forests) returned a bounty of wildlife to the Commonwealth.
The third environmental event of great note was the industrial exploitation of Pennsylvania's coalfields from the middle of the nineteenth well into the twentieth century. During that time, the coal industry and the steel industry it powered were the keystone of Pennsylvania's increasingly industrialized economy. The two industries provided employment for large numbers of people and delivered tremendous opportunities for small and large investors. "[W]hen coal was a reigning monarch, " the industry operated "virtually unrestricted" by either the state or federal government. The result, in the opinion of many, was devastating to the natural environment of the coal-rich regions of the Commonwealth, with long-lasting effects on human health and safety, and on the esthetic beauty of nature. These negative effects include banks of burning or non-burning soft sooty coal and refuse; underground mine fires; pollution of waters from acid mine drainage; subsidence of the soil; and landscapes scarred with strip mining pits and acid water impoundments. In the mid- 1960s, the Commonwealth began a massive undertaking to reclaim over 250, 000 acres of abandoned surface mines and about 2, 400 miles of streams contaminated with acid mine drainage, which did not meet water quality standards. The cost of projects to date has been in the hundreds of millions of dollars, and the Department of Environmental Protection has predicted that an estimated 15 billion dollars is in fact necessary to resolve the problem of abandoned mine reclamation alone. Id.
The overwhelming tasks of reclamation and regeneration of the Commonwealth's natural resources, along with localized environmental incidents (such as the 1948 Donora smog tragedy in which twenty persons died of asphyxiation and 7, 000 persons were hospitalized because of corrosive industrial smoke; the 1959 Knox Mine disaster in which the Susquehanna River disappeared into the Pittston Coal Vein; the 1961 Glen Alden mine water discharge that killed more than 300, 000 fish; and the Centralia mine fire that started in 1962, is still burning, and led to the relocation of all residents in 1984) has led to the gradual enactment of statutes protecting our environment. The drafters of the Environmental Rights Amendment recognized and acknowledged the shocks to our environment and quality of life:
We seared and scarred our once green and pleasant land with mining operations. We polluted our rivers and our streams with acid mine drainage, with industrial waste, with sewage. We poisoned our 'delicate, pleasant and wholesome' air with the smoke of steel mills and coke ovens and with the fumes of millions of automobiles. We smashed our highways through fertile fields and thriving city neighborhoods. We cut down our trees and erected eyesores along our roads. We uglified our land and we called it progress. 1970 Pa. Legislative Journal-House at 2270 (quoting anonymous 1698 description of Penn's Woods air).
With these events in the recent collective memory of the General Assembly, the proposed Environmental Rights Amendment received the unanimous assent of both chambers during both the 1969-1970 and 1971-1972 legislative sessions. Pennsylvania voters ratified the proposed amendment of the citizens' Declaration of Rights on May 18, 1971, with a margin of nearly four to one, receiving 1, 021, 342 votes in favor and 259, 979 opposed.
The decision to affirm the people's environmental rights in a Declaration or Bill of Rights, alongside political rights, is relatively rare in American constitutional law. In addition to Pennsylvania, Montana and Rhode Island are the only other states of the Union to do so. See Pa. Const. art. I, § 27 (1971); Mt. Const. art. II, § 3 (1889); R.I. Const. art. I, § 17 (1970). Three other states-Hawaii, Illinois, and Massachusetts-articulate and protect their citizens' environmental rights in separate articles of their charters. See Hi. Const. art. XI, §§ 1, 9 (1978); Ill. Const. art. XI, §§ 1, 2 (1971-72); Ma. Const. amend. 49 (1972). Of these three states, Hawaii and Illinois, unlike Pennsylvania, expressly require further legislative action to vindicate the rights of the people. By comparison, other state charters articulate a "public policy" and attendant directions to the state legislatures to pass laws for the conservation or protection of either all or enumerated natural resources. See, e.g., Ak. Const. art. VIII, §§ 1-18 (1959); Colo. Const. art. XXVII, § 1 (1993); La. Const. art. IX, § 1 (1974); N.M. Const. art. XX, § 21 (1971); N.Y. Const. art. XIV, §§ 1-5 (1941); Tx. Const. art. XVI, § 59 (1917); Va. Const. art. XI, §§ 1-4 (1971). Some charters address the people's rights to fish and hunt, often qualified by the government's right to regulate these activities for the purposes of conservation. See, e.g., Ky. Const. § 255A (2012); Vt. Const. Ch. II, § 67 (1777); Wi. Const. art. I, § 26 (2003). Still other state constitutions simply authorize the expenditure of public money for the purposes of targeted conservation efforts. See, e.g., Or. Const. art. IX- H, §§ 1-6 (1970); W.V. Const. art. VI, §§ 55, 56 (1996). Finally, many of the remaining states do not address natural resources in their organic charters at all. See, e.g., Nv. Const. art. I, § 1 et seq.
That Pennsylvania deliberately chose a course different from virtually all of its sister states speaks to the Commonwealth's experience of having the benefit of vast natural resources whose virtually unrestrained exploitation, while initially a boon to investors, industry, and citizens, led to destructive and lasting consequences not only for the environment but also for the citizens' quality of life. Later generations paid and continue to pay a tribute to early uncontrolled and unsustainable development financially, in health and quality of life consequences, and with the relegation to history books of valuable natural and esthetic aspects of our environmental inheritance. The drafters and the citizens of the Commonwealth who ratified the Environmental Rights Amendment, aware of this history, articulated the people's rights and the government's duties to the people in broad and flexible terms that would permit not only reactive but also anticipatory protection of the environment for the benefit of current and future generations. Moreover, public trustee duties were delegated concomitantly to all branches and levels of government in recognition that the quality of the environment is a task with both local and statewide implications, and to ensure that all government neither infringed upon the people's rights nor failed to act for the benefit of the people in this area crucial to the well-being of all Pennsylvanians.

Id. at 960-63 (footnotes and some citations omitted).

         II. Factual and Procedural Background of the Present Case

         While the issues in this case arise from the recent leasing of Commonwealth forest and park lands for Marcellus Shale gas extraction, the Commonwealth has a history of leasing its land to private parties for oil and gas exploration dating back to 1947. Pa. Envtl. Def. Found. v. Com., 108 A.3d 140, 143 (Pa. Cmwlth. 2015) ("PEDF"); see also Prelim. Inj. Hr'g Ex. R-8 at 35 (Governor's Marcellus Shale Advisory Commission Report dated July 22, 2011). In 1955, the Legislature enacted the Oil and Gas Lease Fund Act ("Lease Fund Act"), 71 P.S. §§ 1331-1333, requiring "[a]ll rents and royalties from oil and gas leases" of Commonwealth land to be deposited in the "Oil and Gas Lease Fund" ("Lease Fund") to be "exclusively used for conservation, recreation, dams, or flood control or to match any Federal grants which may be made for any of the aforementioned purposes." 71 P.S. § 1331.[1] When enacted, the Lease Fund Act further provided the Secretary of Forests and Waters with the discretion "to determine the need for and the location of any project authorized." 71 P.S. § 1332. Additionally, the Lease Fund Act provided that "[a]ll the moneys from time to time paid" into the Fund "are specifically appropriated to the Department of Forests and Waters to carry out the purposes of this act." 71 P.S. § 1333.

         In 1995, the Legislature enacted the Conservation and Natural Resources Act ("CNRA"), which created the Pennsylvania Department of Conservation and Natural Resources ("DCNR") as a "cabinet-level advocate" for the State parks, forests, and other natural resources. 71 P.S. § 1340.101(b)(1). Referencing the Environmental Rights Amendment, Article I, Section 27, of the Pennsylvania Constitution, the CNRA indicates that the prior "structure of the Department of Environmental Resources impede[d] the Secretary of Environmental Resources from devoting enough time, energy and money to solving the problems facing our State parks and forests, " such that the state parks and forests had "taken a back seat to other environmental issues . . . ." 71 P.S. § 1340.101(a)(7), (8).

         The CNRA sets forth the DCNR's primary mission as follows:

[T]o maintain, improve and preserve State parks, to manage State forest lands to assure their long-term health, sustainability and economic use, to provide information on Pennsylvania's ecological and geologic resources and to administer grant and technical assistance programs that will benefit rivers conservation, trails and greenways, local recreation, regional heritage conservation and environmental education programs across Pennsylvania.

71 P.S. § 1340.101(b)(1). To pursue this mission, the DCNR is "empowered to make and execute contracts or leases in the name of the Commonwealth for the mining or removal of any valuable minerals that may be found in State forests" if the DCNR determines that it "would be for the best interests of this Commonwealth." 71 P.S. § 1340.302(a)(6). Moreover, the DCNR replaced the Department of Forests and Waters as the relevant entity for purposes of the Lease Fund. 71 P.S. § 1340.304. Accordingly, the CNRA altered the Lease Fund to provide that "all moneys" paid in to the Lease Fund were "specifically appropriated to" the DCNR. 71 P.S. § 1333.

         In August 2008, after conducting an environmental review, [2] DCNR began its first foray into the Marcellus Shale natural gas play[3] by approving a lease sale of 74, 000 acres ("2008 Leases"). PEDF, 108 A.3d at 143-44. The leases generated funds in the form of rents and royalties. The rents were comprised of annual rental fees, an example of which ranged from $20-35 per acre, in addition to large initial "bonus payments" ranging in the millions of dollars. Id. at 144 (citing Prelim. Inj. Hr'g Ex. R-1). In addition, the leases further provided for royalties when gas is extracted, with the payment based upon the amount of marketable gas extracted. Id. The Marcellus Shale leases dramatically increased the money flowing into the Lease Fund. Indeed, the cumulative proceeds from Commonwealth oil and gas leases from 1947-2008 totaled $165 million, where the oil and gas proceeds in 2009 alone exceeded $167 million, the bulk of which derived from the initial bonus payments (which are categorized under the lease terms as rental payments) from the 2008 Leases. Prelim. Inj. Hr'g Ex. R-14 at 200-201 ("2014 Shale Gas Monitoring Report").

         Following the 2008 Leases, the DCNR "decided not to enter into further leases for natural gas extraction on State lands pending study of the 'Marcellus play' and development within the 660, 000 acres of land already leased within the Marcellus Shale region, " which included previously leased mineral rights and lands that were not owned by the Commonwealth.[4] PEDF, 108 A.3d at 144. The former head of the DCNR testified that "we felt strongly that[, ] until we could further develop and monitor what was going on[, ] … we believed there should be no further gas leasing because we were going to be watching a tremendous amount of gas activity on the state forest for the next 50 years." Prelim. Inj. Hr'g. Notes of Testimony, 5/28/2015, at 36. Notwithstanding this concern, the DCNR received substantial pressure, as described below, between 2008 and 2014 from the executive and legislative branches to lease more state land as a means to reduce the substantial shortfalls in Pennsylvania's general budgets.

         During the 2009-10 budget process, the Legislature added Article XVI-E to the Fiscal Code addressing Marcellus Shale leasing ("2009 Fiscal Code Amendments"). Following a definitional section, the article addresses appropriations to the Lease Fund:

Notwithstanding any other provision of law and except as provided in section 1603-E [providing for an annual appropriation to DCNR of up to $50 million of royalties], no money in the [Lease Fund] from royalties may be expended unless appropriated or transferred to the General Fund by the General Assembly from the fund. In making appropriations, the General Assembly shall consider the adoption of an allocation to municipalities impacted by a Marcellus well.

72 P.S. § 1602-E. This provision wrought a dramatic change in the flow of royalties from the Lease Fund. While Section 1333 of the Lease Fund Act previously provided for the automatic appropriation of "all moneys" (which would include both rents and royalties) paid into the Lease Fund to be appropriated to the DCNR, the newly enacted Section 1602-E granted the General Assembly authority over the royalties in the Lease Fund (other than Section 1603-E's $50 million annual appropriation to the DCNR) by providing that the "royalties may not be expended unless appropriated or transferred to the General Fund by the General Assembly." Id.

         The next provision of the 2009 Fiscal Code Amendments, Section 1603-E, [5] limits the DCNR's annual allocation of royalties to an amount "up to $50 million." While $50 million was substantially greater that any pre-2009 royalty receipts, it was not guaranteed and also functions to limit the percentage of the Lease Fund royalties directed to the DCNR, which is particularly relevant as the DCNR had anticipated receiving the full amount of the rents and royalties to allow it to oversee the rapid expansion of drilling on state land when it decided to enter into the 2008 Leases. Additionally, while the Lease Fund Act requires that the funds generated by leasing be "exclusively used for conservation, recreation, dams, or flood control or to match [related] Federal grants, " 71 P.S. § 1331, the newly-enacted Section 1603-E designates that preference be given instead "to the operation and maintenance of State parks and forests." 72 P.S. § 1603-E.

         Section 1604-E of the 2009 Fiscal Code Amendments also required a transfer of $60 million in fiscal year 2009-2010 from the Lease Fund to the General Fund, which was not restricted to conservation purposes. 72 P.S. § 1604-E.[6] Finally, the Supplemental General Appropriations Act of 2009 directed a transfer of $143 million from the Lease Fund to the General Fund. Act of Oct. 9, 2009, P.L. 779, No. 10A, § 1912.

         Thereafter, the DCNR abandoned its self-imposed moratorium on leasing additional state land for Marcellus Shale development "as a direct result of certain line items contained within the budget agreement and fiscal code for FY 2009-10." Prelim. Inj. Hr'g Ex. R-6 at 5 (unnumbered) (FY 2009-2010 Oil & Gas Lease Sale State Forest Environmental Review). After again conducting an environmental review, [7] the DCNR leased approximately 32, 000 acres of state forest land in January 2010 ("January 2010 Leases"). Although, prior to the lease sale, the DCNR Secretary expressed significant concern regarding further leasing, [8] the DCNR, in its published environmental review, concluded that "the impending [lease] sale still meets the Bureau's management guidelines and protocols." Id.

         Again, following the January 2010 leases, the DCNR intended to halt any further leasing to allow study of the current leases and to avoid overextending its ability to manage them. Nevertheless, due to pressure from the Governor and pending budget transfers, the DCNR leased an additional 33, 000 acres in May 2010 ("May 2010 Leases") to generate funds after conducting an environmental review.[9] A few months later, the General Assembly enacted an appropriation for Fiscal Year 2010-2011 transferring $180 million from the Lease Fund to the General Fund.[10]

         Just before leaving office in January 2011, Governor Rendell signed an executive order imposing a moratorium on future leasing of state forest and park lands for oil and gas development, finding that further leasing would "jeopardize DCNR's ability to fulfill its duty to conserve and maintain this public natural resource." Prelim. Inj. Hr'g Ex. P-8 at 2.

         For the first three years of Governor Corbett's administration, the Fiscal Code was not amended to provide transfers from the Lease Fund to the General Fund. Instead, the General Appropriations Act for 2011 and 2012 provided appropriations to the DCNR from both the General Fund and the Lease Fund (specifically from royalties), in addition to the up to $50 million in royalties provided annually by Section 1603-E of the 2009 Fiscal Code Amendments and the continued flow of all rental fees from oil and gas leases pursuant to Section 1333 of the Lease Fund Act. PEDF, 108 A.3d at 148-49. The 2013 General Appropriations Act decreased the appropriation to the DCNR from the General Fund and increased the appropriation from the Lease Fund to the DCNR, resulting in a larger portion of monies from the Lease Fund being used to pay for the DCNR's operational expenses, which had previously been funded by the General Fund, and thus reduced the amount of monies available for the DCNR's conservation activities. Id. at 149.

         Although the first few years of the Corbett administration did not witness appropriations from the Lease Fund directly to the General Fund, Act 13 of 2012, which amended the Lease Fund Act, required other transfers from the Lease Fund. Specifically, Act 13 created the Marcellus Legacy Fund, which was funded in part by fees on unconventional wells but also by annual appropriations from the Lease Fund in increasing amounts beginning with $20 million in 2013 and rising to $50 million for all years after 2015. 58 Pa.C.S. §§ 2315(a.1), 2505.[11] The monies in the Marcellus Legacy Fund are earmarked for the Environmental Stewardship Fund and the Hazardous Sites Cleanup Fund, providing capital for projects not controlled by the DCNR. Id.

         In May 2014, Governor Corbett modified the moratorium banning the leasing of State lands and instead forbade any leasing that "would result in additional surface disturbances on state forest or state park lands." Prelim. Inj. Hr'g Ex. P-8 at 3. The order further provided that the royalties from the additional leasing would be used to repair the infrastructure of the forest and park lands, to acquire lands of "high conservation value or ecological importance, " and to acquire private oil, gas, and mineral rights currently owned by private parties under state surface lands. Id.

         The 2014-2015 General Appropriations Act again included increased appropriations of royalties from the Lease Fund to the DCNR that were mirrored by decreased appropriations from the General Fund to the DCNR. PEDF, 108 A.3d at 151. In 2014, the Fiscal Code was amended again to address Marcellus Shale leasing ("2014 Fiscal Code Amendments"). Specifically, Section 1605-E of the Fiscal Code was amended to provide for an appropriation of $95 million from the Lease Fund to the General Fund. 72 P.S. § 1605-E(b).[12]

         The 2014 Fiscal Code Amendments also added specific legislative findings in support of the increased leasing of state land and the transfers of capital from the Lease Fund. These findings postulate that Marcellus Shale leasing "is necessary to obtain the revenue necessary to effectuate the . . . General Appropriations Act of 2014." 72 P.S. § 1601.1-E (1). Additionally, the findings state that "[t]he fund is not a constitutional trust." 72 P.S. § 1601.1-E (6). After recognizing that the increase in the Fund was due to the Marcellus Shale development, the Legislature indicates that "[t]he Commonwealth's role as trustee of the public's natural resources is broader and more comprehensive than just conserving the State forest and parks." 72 P.S. § 1601.1-E (7), (8). It further affirmatively instructs that "it is in the best interest of the Commonwealth to lease oil and gas rights in State forests and parks" if the DCNR employs lease protections and best management practices and "maintains a balance of money in the [Lease Fund] to carry out [DCNR's] obligation to protect State forest and park land and other environmental activities." 72 P.S. § 1601.1-E (9)(iii). Finally, the statute provides that transfers from the Fund to the General Fund are permissible if the balance of money in the Fund is "adequate to achieve the purposes" of paragraph nine, 72 P.S. § 1601.1-E (10), which directs the DCNR to make state forest and park land leasing decisions based on all the Commonwealth's interests.[13] 72 P.S. § 1601.1-E (9).

         Distinguished Professor John C. Dernbach of the Widener University Law School Environmental Law and Sustainability Center[14] recently summarized the significance of Fiscal Code amendments for purposes of the claims at bar:

Three legislative amendments to the state fiscal code between 2008 and 2014 redirected a total of $335 million that would have been used for conservation purposes under the [Lease Fund Act] to the general fund, where it is appropriated for a variety of state government purposes. In addition, the Legislature prevented DCNR from spending any [Lease Fund Act] royalties without prior legislative authorization. Finally, the Legislature began using [Lease Fund] revenue to support the overall budget of DCNR, rather than obtaining that budget money from the general fund and using [Lease Fund] money for conservation purposes related to oil and gas extraction

John C. Dernbach, The Potential Meanings of a Constitutional Public Trust, 45 Envtl. L. 463, 488 (2015) (footnotes omitted)).

         Acknowledging the structural changes in the source of the funding, the Commonwealth nevertheless emphasizes that the total annual appropriations to the DCNR from the various sources ranged between $69 million in 2012-2013 to $122 million in 2014-2015 and further observes that the DCNR received approximately fifty percent of the over $926 million in total oil and gas lease revenues accumulated from Fiscal Year 2008-2009 through Fiscal Year 2014-2015 (then-projected). Commonwealth's Brief at 18 (citing Respondent's Cross-Motion for Summary Relief, Exhibit M (Governor's Budget Office Oil and Gas Leasing Revenue and Uses Information dated August 21, 2014)).

         III. Commonwealth Court Proceedings

         Appellant, the Foundation, brought a claim in the Commonwealth Court under the fiduciary provisions of the Declaratory Judgment Act against the Commonwealth of Pennsylvania and the Governor, in his official capacity (collectively, "the Commonwealth") regarding the 2009-2015 budget related decisions that resulted in the additional lease sales.[15] The Foundation contends that these decisions violated the rights of all Commonwealth citizens conferred by the Environmental Rights Amendment, the CNRA, and the Lease Fund Act. PEDF, 108 A.3d at 154. The Foundation filed the initial action in March 2012 and amended the action with regard to subsequent legislation. The case at bar addresses cross-applications for summary relief, which allow a court to grant relief only if a party's "right to judgment is clear and no material issues of fact are in dispute." Jubelirer v. Rendell, 953 A.2d 514, 521 (Pa. 2008) (citations omitted).[16]

         The Commonwealth Court observed that the Foundation filed a brief in excess of 100 pages raising over twenty issues focused primarily on Section 27's protection of the Commonwealth's natural resources. The court found that some of the issues were inappropriate for decision under the Declaratory Judgment Act (such as issues relating to budget proposals rather than enactments) and dismissed others for failure to join the lessees of the leases, whom the court deemed indispensable parties.[17]

         The court narrowed the remaining issues before it to three questions:

(1) Whether Sections 1602-E and 1603-E of the Fiscal Code, which respectively provide that the General Assembly shall appropriate all royalty monies [of] the Lease Fund and that, subject to availability, up to $50 million of the Lease Fund royalties shall be appropriated to [the] DCNR, violate Article I, § 27;
(2)Whether the General Assembly's transfers/appropriations from the Lease Fund violate Article I, § 27; and
(3) Who within the Commonwealth has the duty and thus bears the responsibility to make determinations with respect to the leasing of State lands for oil and natural gas extraction.

PEDF, 108 A.3d at 155.

         The Commonwealth Court recognized that the Foundation's challenges to some extent overlapped with legislative policy decisions resulting from the need to balance the state budget. While observing that the review of legislative appropriation decisions is generally outside the authority of the courts, the court opined that the propriety of the use of special fund money, such as money from the Lease Fund, is a legal question subject to judicial review. It further concluded that "a decision to lease Commonwealth property protected by the Constitution and held in trust for the benefit of all current and future Pennsylvanians is an appropriate subject of judicial scrutiny." Id.

         Initially, the Commonwealth Court recognized that this Court recently addressed Section 27 in Robinson Township. The court properly observed that Robinson Township was a plurality decision in which former-Chief Justice Castille, joined by Justice Todd and former-Justice McCaffery, wrote expansively on Section 27. Justice Baer concurred on a wholly different ground, while Chief Justice Saylor and former-Justice Eakin wrote in dissent. The Commonwealth Court noted that none of the responsive opinions adopted the plurality's view of Section 27. Thus, the Commonwealth Court found "the plurality's construction of Section 27 persuasive only to the extent it is consistent with binding precedent from [the Commonwealth Court] and the Supreme Court on the same subject." PEDF, 108 A.3d at 156 n.37.

         The Commonwealth Court, therefore, determined that its prior decision in Payne v. Kassab, 312 A.2d 86 (Pa. Commw. 1973) (Payne I), controlled the questions presented in the case at bar, even though the plurality in Robinson Township criticized the test announced in Payne I as "lack[ing] foundation" in Section 27. PEDF, 108 A.3d at 159 (citing Robinson Twp., 83 A.3d 966-67). The Commonwealth Court in Payne I set forth a three-part test to determine whether a use of Commonwealth land violated Section 27:

(1) Was there compliance with all applicable statutes and regulations relevant to the protection of the Commonwealth's public natural resources?
(2) Does the record demonstrate a reasonable effort to reduce the environmental incursion to a minimum?
(3) Does the environmental harm which will result from the challenged decision or action so clearly outweigh the benefits to be derived therefrom that to proceed further would be an abuse of discretion?

Id. at 158 (quoting Payne I, 312 A.2d at 94).

         Notably, this Court affirmed the judgment in Payne I without adopting the three-part test, instead concluding that the "elaborate safeguards" of the challenged statute provided adequate protection such that breach of the trust created by Section 27 would not occur. Payne v. Kassab, 361 A.2d 263, 273 (Pa. 1976) (Payne II).

         A. Constitutionality of Sections 1602-E and 1603-E of the Fiscal Code under Article I, Section 27

         The Commonwealth Court first addressed the Foundation's challenge that Sections 1602-E and 1603-E of the 2009 Fiscal Code Amendments violated Section 27. As noted, these provisions altered the status quo which had previously appropriated to the DCNR all monies in the Lease Fund under the Lease Fund Act, 71 P.S. § 1333. The change, the Foundation argued, violated Section 27 because it (1) took away DCNR's ability to use the revenues to mitigate the damage from oil and gas exploration, (2) removed DCNR's ability to act as trustee because the funds were placed in the General Fund, potentially for non-conservation purposes, and (3) eliminated revenues that would otherwise have built the corpus of the Lease Fund to protect Pennsylvania's natural resources. PEDF, 108 A.3d at 160.

         Looking first to the plain language of Section 1602-E, the Commonwealth Court observed that the section merely transferred control over the royalties (but not the rents) from oil and gas leases from the DCNR to the General Assembly, which, as part of the Commonwealth, was also bound to safeguard the Commonwealth's natural resources under Article I, Section 27. Additionally, the court recognized that Section 1602-E did not change the DCNR's decision making authority regarding the granting of leases. The court held that the provision "does not by itself infringe upon the rights afforded the people" and does not "reflect a failure by the General Assembly to act consistent with its trustee obligations under Article I, Section 27." Id. at 161. It further highlighted that the Lease Fund is not a constitutional creation but rather is a special fund created by legislative enactment, which could be altered by subsequent legislative action. Id. at 160. Accordingly, the court concluded that the Foundation failed to demonstrate that Section 1602-E "clearly, plainly, and palpably" violated Section 27. Id. at 161.

         Turning to Section 1603-E of the 2009 Fiscal Code Amendments, which transferred up to $50 million of royalties annually from the Lease Fund to the DCNR, the Commonwealth Court acknowledged the Foundation's argument that the transfer of the $50 million acted to limit the funding of the DCNR, as it had previously received all royalties from the Lease Fund. The court redefined this challenge as a claim that the transfer did not provide adequate funding for DCNR to protect the Commonwealth's natural resources, as opposed to addressing the Foundation's broader argument that the Commonwealth, specifically Governor Rendell, failed to abide by his various duties as trustee by limiting the funding of the DCNR. Id.

         The Commonwealth Court reviewed case law addressing constitutional challenges based on inadequate funding of a part of government. PEDF, 108 A.3d at 161-66. The Commonwealth Court observed that while this Court has been willing to act to protect the "independence of the judicial branch, " the Commonwealth Court has not been willing to intervene in regard to the Legislature's authority to determine the funding of Commonwealth agencies. Id. at 161-64 (citing, inter alia, County of Allegheny v. Commonwealth, 534 A.2d 760 (Pa. 1987) (holding legislative acts requiring counties to fund the local court system to be unconstitutional) and Commonwealth ex rel. Carroll v. Tate, 274 A.2d 193 (Pa. 1971) (addressing court funding in Philadelphia)), 164-66 (citing, inter alia, Mental Health Association in Pennsylvania v. Corbett, 54 A.3d 100 (Pa. Cmwlth. 2012) (dismissing challenge based on inadequacy of funding for Department of Public Welfare's mental health and intellectual disability services)).

         Reiterating its reluctance to "second guess" the amounts appropriated by the General Assembly to Commonwealth agencies, the Commonwealth Court applied what it viewed as this Court's requirement that a challenger demonstrate that "the amount funded is so inadequate that it impairs the proper functioning" of the DCNR. Id. at 166. It concluded that the Foundation "presented no evidence that the current funding appropriated to the DCNR from all sources is inadequate - i.e., that the funding is so deficient that the DCNR cannot conserve and maintain our State natural resources." Id. Accordingly, the court granted the Commonwealth's motion for summary relief, concluding that the Foundation failed to demonstrate that Sections 1602-E and 1603-E violate the Constitution.

         B. Constitutionality of Section 1604-E, Section 1605-E, and other transfers of money from the Lease Fund

         In regard to Sections 1604-E and 1605-E and the other budgetary transfers, see supra at 12-15, the Foundation argued that the money generated by oil and gas exploration "must be committed to furthering the purposes, rights, and protections afforded" under Section 27, rather than being intermingled with the General Fund. Id. at 167. Considering the constitutional language, the Commonwealth Court held that Section 27 "does not expressly command that all revenues derived from the sale or leasing of the Commonwealth's natural resources must be funneled to those purposes and those purposes only." Id. at 168.

         The court reiterated that the Lease Fund was merely a statutory special fund, rather than a trust fund, and opined that there was "no constitutional mandate that monies derived from the leasing of State lands for oil and natural gas development be reinvested into the conservation and maintenance of the Commonwealth's public natural resources." Id. at 169. Accordingly, the Commonwealth Court again held that the Foundation failed to demonstrate that the Fiscal Code Amendments, General Appropriations Act transfers, and Act 13 transfers from the Lease Fund to the General Fund violate the Environmental Rights Amendment, because funds appeared to be used for the general "benefit of all the people." Id. The court, therefore, denied summary relief to the Foundation, granting in substantial part the Commonwealth's cross-motion for summary relief.[18]

         IV. Analysis

         The Foundation filed a direct appeal as of right from the final order of the Commonwealth Court, pursuant to 42 Pa.C.S. § 723(a), raising ten issues. We entertained oral argument to examine the following two overarching issues:

1. The proper standards for judicial review of government actions and legislation challenged under the Environmental Rights Amendment, Article I, Section 27 of the Pennsylvania Constitution, in light of Robinson Township v. Commonwealth, 83 A.3d 901 (Pa. 2013) (plurality);
2. Constitutionality under Article I, [Section] 27 of Section 1602-E and 1603-E of the Fiscal Code and the General Assembly's ...

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