House Bill 1712, establishing the Pennsylvania Private Dam Financial Assurance Program and the Private Dam Financial Assurance Fund, passed the state House of Representatives by a vote of 195-1 on Monday, February 8, 2016. The Bill now moves to the Senate for consideration in that chamber.
Early in 2014, the Pennsylvania Department of Environmental Protection (DEP) issued new regulations requiring private dam owners to provide a mechanism for financial responsibility over their dams, in the event of a dam breach. The deadline for the financial responsibility tool was January 1, 2016. This new requirement was in addition to new registration and dam project fees in the thousands of dollars. For the many community associations throughout Pennsylvania that own a private dam, this meant that by January 1, 2016, the community needed to have surety or collateral bonds in place. However, it has been found that adequate insurance products are simply not available, requiring community associations in some cases to put up tens of thousands of dollars in bonds. These sums are simply beyond the financial ability of many community associations who depend on their lakes for recreational amenities for owners and visitors alike. House Bill 1712 would offer financial assurance for the owners of private dams to meet the financial obligations imposed under the Dam Safety and Encroachment Act.
The Private Dam Assurance Fund program is self-funded with dam owners paying a one-time registration fee of $1,000 in addition to an annual fee equal to 1% of the bond amount required by DEP. In addition, as this fund grows to reach $1.5 million, DCED shall use it to establish a loan program to help these dam owners make necessary repairs to prevent breaching in the future.
CAI has been working with Representative Rosemary Brown (R-189) to move this legislation, which is important to community associations with private dams that are critical to the maintenance of amenities such as lakes, which provide recreational opportunities for residents. This is not just a community association issue, however. Private dams that create recreational lakes contribute immensely to the economic development of many areas in Pennsylvania like the Pocono Mountains which depend on tourism for jobs and economic development. CAI will continue to monitor this legislation and advocate for its passage in the Senate. Please visit our legislative page for up to date information on this and other legislative priorities.