How Community Bank Can Help

Community Bank Commercial Lenders' Profiles

ICBA and Community Bank: Switch To a Local Safe Haven—Your Community Bank

What To Consider Before Leasing Your Land

Highlighted Marcellus Drilling Companies

Marcellus Shale terms you need to know

How to Protect Your Gas Royalties

What Should I Do To Avoid Becoming A Victim Of Identity Theft?

9 Credit Score Myths Do More Harm Than Good

Demystifying Merchant Card Processing Fees   

Business Owners – Do you know your Earnings Credit Rate?   

Business Strategies for Historically Low Interest Rates  

Commercial Loans: What Type of Business Loan is Best for You? 

Electronic Banking is Here to Stay!          




ICBA and Community Bank: Switch To a Local Safe Haven—Your Community Bank

Carmichaels, PA  (November 8, 2011)—As many of America’s consumers consider switching to a new banking relationship closer to home, the Independent Community Bankers of America (ICBA) and Community Bank are reminding them that their local community bank is a safe haven from impersonal bank practices that can leave many banking customers feeling overwhelmed and taken advantage of.  As local small businesses themselves, our nation’s more than 7,000 community banks only thrive when their customers and communities do the same. Community bank customers are rewarded with lifelong financial relationships by people who care about them and look out for the best interest of their community. It’s just the way they do business.   

“By going local with your community bank, you can rest assured that your banking needs will be taken care of and that your money will be put to work where it belongs—in your community in the form of loans to local residents and small business owners.  It’s a hometown investment you can be proud of,” said Sal Marranca, ICBA chairman and president and CEO of Cattaraugus County Bank, Little Valley, N.Y.  

Consumers should treat themselves to what a community bank offers:
• Service. Community banks are relationship lenders that focus on the needs of local families, businesses and farmers.  Because they know their customers and their customers know them, they are able to provide superior, personal customer service. When consumers call their local community bank, they’ll be reassured to know that they won’t be talking to someone halfway across the globe.  Instead, they will be talking with their community banker who lives and works in the same community they do.   
• Deposits. Community banks lend locally where their depositors live and work, keeping local communities vibrant and growing.  By choosing a community bank, you’ll be putting money where it belongs— back into the community you call home.  And since community banks pay federal, state, and local taxes, they are also a key supporter of their community’s local infrastructure, making it a better place for all residents to reside. Some tax-subsidized credit unions masquerade as community banks but do not pay any taxes to support their local communities.  
• Expertise. Because community bankers live and work in the same communities as their local customers, they understand their local marketplace and the ups and downs of economic cycles in their community.  This is especially helpful in allowing them to serve the needs of their small business customers who rely on them as strategic partners in their small business endeavors. Community banks rely on the health of the local marketplace so they stick with their customers through good times and in bad.
• Local Decision-Making. Instead of being headquartered hundreds of miles away, community bankers are accessible to their customers on site, where they can talk to a real human being -- not a robot.  Since many community banks are willing to consider character, family history and discretionary spending, they are often able to be more nimble in their decision-making when it comes to loan needs and qualification and in the selection of financial products and services.
• Trust. Community banks are a relationship you can bank on for years to come.  Because many community banks have been around for over a hundred years, and are often family-owned and operated, you’ll know that the financial needs of you and your family are being met by local residents running the financial institution that has your best interest in mind.  They wouldn’t be in business if they didn’t.  
• Civic Loyalty. Community bankers are typically deeply involved and committed to making their local communities a better place to live. In fact, many community banks across the country donate service hours and money to important local causes.

“At Community Bank, we’re dedicated to offering our customers the best banking experience we possibly can,” Pat McCune, President and CEO said.  “By going local and banking with us, you’ll realize the vast benefits that come from working with a community bank. You’ll also feel good about keeping your money in the community where it will be put to work and used to better the lives of your friends and neighbors and the small business owners that serve our community.”

Whether located in small towns, suburbia or big-city neighborhoods, community banks improve America’s communities.   Despite challenging economic times, community banks continue to fund nearly 60 percent of all small businesses under $1 million.  They also use local dollars to help families purchase homes, buy a car, finance college and build financial security.  Of the more than 7,000 community banks across the country, nearly 5,000 are ICBA members.  Representing more than 23,000 locations nationwide and employing more than 280,000 Americans, ICBA members hold more than $1 trillion in assets, $900 billion in deposits, and $700 billion in loans to consumers, small businesses and the agricultural community.  

To find your local community bank, visit ICBA’s community bank locator at  Simply type in your zip code and the app will show you all the community banks in your area.  You can even download free ICBA locator apps for your iPhone, Android or Blackberry. 

About ICBA
The Independent Community Bankers of America, the nation’s voice for community banks, represents nearly 5,000 community banks of all sizes and charter types throughout the United States and is dedicated exclusively to representing the interests of the community banking industry and the communities and customers we serve. For more information, visit



What To Consider Before Leasing Your Land

The Marcellus Shale Play spans many states in our region. While permits and leases may vary from state to state, Ohio’s Attorney General Mike DeWine provides some tried and true considerations when approaching a lease to natural gas developers.

Consider these landowner tips about leasing land for gas and oil drilling:

  • Get to know the company. Request credentials, contact information and references from the representative of the company who contacts you. Remember that the person talking to you may not be from the oil and gas company itself. Make sure you know what company will do the actual oil and gas exploration.
    • Ask for names of other landowners where the company has drilled wells or sought leases and check them out.
    • Research the company and check for lawsuits or other problems.
  • Check with neighbors. Find out if your neighbors have been contacted and presented with similar proposals.
  • Get everything in writing and review everything before signing. It’s best not to sign anything on the day it is presented to you by the company representative. Take the proposed lease, read it and think about it before signing.
  • Consult with an attorney knowledgeable in oil and gas law. You may want to pool resources with your neighbors if you don’t think you can afford one. If you don’t know of an attorney, contact your local bar association for the name of one in your area.
  • Understand what you are leasing. Make sure you are clear about what rights the company wishes to lease. Are they asking for oil rights, gas rights, coal rights or other rights? You do not have to lease them all of your mineral rights if you do not want to do so.
  • Understand all the other terms. Make sure you understand if the well itself, or any of the other equipment used to conduct the drilling — including above ground or underground storage tanks, storage ponds or pipelines –are going to be actually located on your property, and for how long they will be there. Know where the access roads are to be located. Discuss and be clear on all of these issues, and get a location approval clause incorporated into the agreement.
  • Discuss the lease payments. If your property is part of the active drilling activities, a higher rental, royalty payment and/or spud fee are reasonable requests.
  • Know exactly when payments will be made. Some payments may be contingent on certain events occurring or may change in amount if certain events happen. Also check closely for expiration dates and renewal clauses.
  • Discuss potential damages. In the event crops, fences, trees, buildings or other assets on your property have to be removed or are damaged during drilling operations, understand what the drilling company will do. Also discuss potential damage to or impact on your drinking water and/or your septic system. Make sure the terms of who will pay for those damages are in any lease you sign. Do not agree to be provided with a second document or “a side letter” to address those concerns. Make sure any agreements to pay you for damage to your property are not qualified with terms like “direct harm” or “proximately caused.” You should be protected from any damages to your property.
  • Don’t get pressured into any deal. Don’t sign the proposed lease just because the company representative tells you it is “a standard lease.”


*Attorney General Mike DeWine Blog (Jun 21, 2011)


Highlighted Marcellus Drilling Companies

Information courtesy of

Highlighted below are a few of the lease holding, active organizations in the Marcellus Shale Play.


Stock Symbol: BHI


Baker Hughes, Inc was created when Baker International and Hughes Tool Co merged in 1987. Their histories date back over a century, marked in part by a 1909 US patent granted for a new drill bit invented by Sharp and Hughes.  

Baker-Hughes is one of the world's top three oilfield services companies, along with competitors Schlumberger and Halliburton. Baker Hughes operates globally in more than 90 countries and provides reservoir consulting, formation evaluation, drilling, completion and production services.

Baker-Hughes Reservoir Technology and Consulting Group includes three consulting firms: Gaffney, Cline & Associates, GeoMechanics International and RDS.

Baker Hughes has seven Product Line Groups including: Baker Atlas, Baker Hughes Drilling Fluids, Baker Oil Tools, Baker Petrolite, Centrilift, Hughes Christensen and INTEQ.

ProductionQuest is part of the more recent Baker Hughes Production Optimization group. On August 31, 2009, Baker-Hughes purchased BJServices Company in a $5.5 billion stock and cash deal.

Acquisitions over the years have included:

Completions: Brown Oil Tools, CTC, EDECO, Elder Oil Tools

Well monitoring: ProductionQuest

Drilling Fluids: Milchem, Newpark, Aquaness

Mud logging: EXLOG

Directional Drilling & Diamond Drill Bits: Eastman Christensen, Drilex

Measurement while drilling: Teleco

Fishing tools and services: Tri-State, Wilson

Specialty chemicals: Petrolite

Wireline logging & perforating / Geophysical exploration: Acutec, Birdwell, Canadian Perforator, Dialog, Dresser Atlas, Du-Al Well Services, Elgen Corporation, Heartland Kingfisher, Lane Wells, NL McCullogh, Pacific Oil Tool, Ltd., PGAC, PML, RIS, SIE and Western Atlas.



Stock Symbol: CHK


Chesapeake Energy Corporation is the top independent producer of natural gas, as well as the most active driller of new wells in the United States. Chesapeake's corporate headquarters is in Oklahoma City, and has seven subsidiaries across the U.S.
Chesapeake explores, acquires and develops natural gas reserves in the top four natural gas shale plays: Barnett, Fayetteville, Haynesville, and Marcellus Shales.
Chesapeake has the largest leasehold in the Marcellus Shale.  Chesapeake plans to drill over 80 wells in 2009, while doubling that to 160 wells in 2010, as they develop 1.3 million net acres of Marcellus leaseholds.
Chesapeake Appalachia, LLC has a joint venture on Marcellus Shale with Norwegian partner StatoilHydro who is paying 75% of drilling costs in 2009 and 2010. StatoilHydro resulted from a 2007 merger between the oil and gas division of Statoil and Hydro.
Dale Property Services (DPS Penn) is leasing gas rights in six southwestern Pennsylvania counties for Chesapeake Energy.


CHEVRON CORP. (formerly Atlas Energy Inc and Chief Oil & Gas LLC)

Stock Symbol: CVX


Headquartered in San Ramon, California, Chevron Corporation is involved in every aspect of the energy industry, including oil, gas, biofuels and geothermal. Chevron’s activities in over 180 countries include refining, exploration and production, marketing and transportation, power generation, and petrochemical manufacturing and sales.

Chevron’s global work force numbers approximately 58,000.

Chevron traces its roots to the formation of the Pacific Coast Oil Company following an 1879 oil discovery north of Los Angeles. Pacific Coast Oil Company later became Standard Oil Company of California. The name changed to Chevron following the acquisition of Gulf Oil Corporation in 1984. Chevron merged with Texaco in 2001, and acquired Unocal Corporation in 2005.

Chevron North America Exploration and Production Company is engaged in Marcellus Shale exploration and production with a Pennsylvania office in Smithfield, Fayette County, Pennsylvania.



Stock Symbol: CNX


With corporate headquarters near Pittsburgh, PA, CNX Gas was established in 2005 from the gas assets of CONSOL Energy Inc., with CONSOL retaining an 81.5% ownership interest.
Among other gas ventures, CNX is a major player in southwestern Pennsylvania and northern West Virginia Marcellus Shale, as well as CBM (coal bed methane). CNX is one of the leading producers of CBM in the Appalachian Basin, and holds the most CBM acreage in Northern Appalachia, Central Appalachia and the Illinois Basin.
In southwestern Pennsylvania and northern West Virginia, 15 wells were drilled in 2006, 62 wells were drilled in 2007, and another 116 wells were planned for 2008. In central Pennsylvania, 14 wells were drilled in 2007 with 100 wells planned for 2008.



Stock Symbol: EQT


EQT Corporation, also known as Equitable Resources, is the largest exploration and production company in the Appalachian Basin. Divisions include EQT Production, and EQT Midstream with subdivision EQT Energy.
With a corporate history that dates back to the 19th Century, Equitable is now developing 3 trillion cubic feet of proven natural gas reserves in Pennsylvania, West Virginia, Kentucky and Virginia with nearly 13,000 gross productive wells in tight sands, shale, and coal bed methane (CBM).



Stock Symbol: HAL


Halliburton was founded in 1919. Ninety years later, Halliburton had 50,000 employees in 70 countries, and served the oil and gas industry with formation evaluation, location of hydrocarbons, management of geological data, well construction and completion, drilling, and production optimization. Halliburton's main competitors are Schlumberger and Baker-Hughes.
In 2007, Halliburton split into two divisions: Drilling & Evaluation and Completion & Production.
Drilling & Evaluation consists of Baroid Fluid Services, Landmark, Security Drill Bits & Services (DBS) Drill Bits, Sperry Drilling Services, and Wireline & Perforating Services.
Completion & Production consists of Completion Tools & Services, Production Enhancement Services and WellDynamics.
Since Halliburton’s first commercial fracturing in 1949, more than 1 million wells have been fraced by the oil and gas industry in the U.S. 
North America accounted for 46% of Halliburton’s 2008 revenues.



Stock Symbol: RRC


Range Resources Corporation was incorporated in Ohio in 1980 as Lomak Petroleum Inc.  Lomak was acquired by Snyder Oil Company in 1988. In 1997 Lomak increased its Pennsylvania holdings, buying properties from Cabot Oil & Gas Corporation. Range Resources was created in 1998, the result of a merger between Lomak Petroleum Inc. and Domain Energy Corporation.
In 1999, Range Resources formed Great Lakes Energy Partners, a joint venture with FirstEnergy Corporation that lasted until Range Resources acquired all of Great Lakes Energy Partners, LLC in June 2004, in a deal worth approximately $290 million.

In 2004-2005, Fort Worth Texas based Range Resources drilled the first Marcellus Shale gas wells. These three wells were located in Washington County, Pennsylvania. Hence their nickname with locals: "The Mothers of Marcellus."

By the end of 2006, Range had 314,00 acres leased in the Marcellus Shale gas play with 3 horizontal wells and 14 vertical wells already drilled. Range Resources had plans for another 40 horizontal wells in 2008.
The Pittsburgh office at Southpointe opened in early 2007 with one former Halliburton employee, V.P. Ray Walker, Jr. and has expanded to a 120 person operation, according to Range's early 2009 reports.
Range Resources is the third-largest natural gas driller in the US, and the parent company of Range Production Co.
Range Resources closed its Houston, Texas office Nov. 1, 2009.



Stock Symbol: REXX


Incorporated in March 2007, Rex Energy Corporation is an independent energy company engaged in the acquisition, exploration, development and production of oil and gas. Rex’s primary properties are in the Illinois Basin and the Appalachian Basin of Pennsylvania. Appalachian Basin development targets shallow conventional gas and the Devonian Shales.
In August 2008, Rex Energy’s wholly owned subsidiary, Rex Energy I, LLC, completed the sale of approximately 79,000 net undeveloped acres in Indiana and certain related non-producing wells. The proceeds were used in part to fund Rex Energy's Marcellus Shale exploration projects in the Appalachian Basin and Alkali-Surfactant-Polymer (ASP) projects in the Illinois Basin.
In June 2009, Rex Energy sold a 50% share of leaseholds (44,000 net acres) in Westmoreland, Clearfield and Centre Counties in Pennsylvania to a subsidiary of Williams Companies, which will be paid through a drill to earn structure.
In December 2009, Rex Energy completed their first Marcellus Shale horizontal well in Clearfield County, Pa. The well was drilled to a depth of 8,200 feet with another 2,700 foot lateral extension. Rex was also nearing completion of its fifth horizontal well in Westmoreland County, Pa.



Stock Symbol: SLB


Founded in 1926, Schlumberger Limited employs more than 79,000 people in about 80 countries. Schlumberger has its main offices in Houston Texas, Paris France, and The Hague. As the world’s leading oilfield services company, Schlumberger supplies technology, information solutions and integrated project management to optimize reservoir performance. Schlumberger's main competitors are Baker-Hughes and Halliburton.
Schlumberger serves the following areas: CIS & Africa, Europe, Middle East & Asia, North America, and Latin America, comprising two business segments:
Schlumberger Oilfield Services supplies a wide range of products and that support core industry operational processes. Services include: Artificial Lift, Cementing, Coiled Tube Services, Completions, Consulting, Data Services, Drilling, Formation Evaluation, Integrated Project Management, Production Optimization, Seismic Services, Software, Stimulation, Subsea, and Well Testing.
WesternGeco is the world's largest seismic company. Services range from 3D and time-lapse (4D) seismic surveys to multicomponent surveys. Solutions include proprietary Q-Technology* and the Omega* Seismic Processing System.



Stock Symbol: NFG


Seneca Resources Corporation is a wholly owned subsidiary of National Fuel which was incorporated in 1902. Seneca was formed as a successor to the former Mars Corporation in 1976. The oil and gas properties of the National Fuel Gas Supply Corporation and Empire Exploration were merged into Seneca Resources in 1994, centralizing all the oil and gas operations into one company.
Seneca operates about 2,500 wells in northwestern Pennsylvania and western New York. Seneca's oldest producing well was drilled in the 1800’s and many wells in the East Region have been producing over 50 years.
Seneca is also involved in a joint venture with EOG Resources on Marcellus Shale. Seneca operated 10 vertical wells and a few horizontals in 2009, and participated in another 10 wells operated by EOG Resources.
Seneca Resources develops, explores and purchases natural gas and oil reserves in California, the Gulf Coast of Texas and Louisiana, the Southwest, the Appalachian Basin and the western provinces of Canada.



Stock Symbol: XOM


XTO Energy, Inc. was founded in 1986 and went public in 1993.  XTO is the fourth largest owner of US gas reserves among the independents, made up of 85% natural gas and 15% liquids. 

XTO is one of the Top 10 natural gas producers in the United States. XTO entered the Marcellus Shale gas play in 2008 with the purchase of Linn Energy leaseholds and wells in Pennsylvania and West Virginia, along with a pipeline collection and distribution system.

XTO is targeting 80 to 100 acre well spacing that would create up to 1,900 new natural gas wells. XTO Energy operates in these 6 regions covering 17 states and offshore:

Appalachia Region – Kentucky, West Virginia, Pennsylvania, New York (mid-2008 entry with acquisition from Linn Energy)

XTO Energy is a subsidiary of ExxonMobile


Marcellus Shale terms you need to know

Appalachian Basin: A geographic/geologic area stretching from Canada to Alabama and containing the Marcellus and Utica shale formations.

Blowout: An uncontrolled release of natural gas from a well after pressure control systems have failed.

Brine: Brine is salty water that gas drillers encounter when drilling deep into Pennsylvania’s ground. Formed out of ancient shells of sea creatures that, over time, formed a layer of rock, brine is up to 10 times as salty as seawater.

Brine can also contain other elements that occur naturally beneath the earth in Pennsylvania, such as strontium, barium and manganese. Brine can come back up the drilled hole during the fracking process, mixed with fracking fluids that also contain chemicals in what’s called “flowback.”

BTU: A British thermal unit is a unit of measurement for energy, equal to the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit.

Casing: Casing, made of steel and/or cement, lines the outside of a drilled well to keep it open and sealed. Proper casing prevents materials inside the well from escaping into the surrounding environs.

Christmas tree: The term used to describe the pipes and valves that sit on top of a completed and producing gas well.

Compression: Natural gas is compressed (at compressor stations along transmission lines) to save space during transportation and storage. It is typically compressed at a range of 400 to 1,000 psi.

Containment pits: Manmade pools used to capture and store either fresh water to be used in drilling, or flowback wastewater that has come to the surface through the fracking process.

Cutting(s): Debris removed from the well during the drilling process.

Drilling mud: Also known as drilling fluid, drilling mud is a slurry used in the process of drilling gas wells. The “mud” contains oil, lime, calcium carbonate, barite and other additives which lubricate the drill bit and help remove cuttings to the surface.

Dry/wet gas: There are two types of natural gas coming out of the Marcellus Shale: dry gas and wet gas. Dry gas comes to the surface nearly ready for market, needing little or no additional treatment. Wet gas contains other liquid compounds, such as propane and butane, which require separation but offer added value because those separated gases can be sold separately. Typically, the eastern part of Marcellus contains dry gas and the western part of the play contains wet gas.

Flowback: The liquid, containing brine and fracking fluids, that returns up and out of the well following a fracking.

Fracturing (fracking): A method used by drillers that allows extraction of gas tightly held in rock formations such as the Marcellus Shale. Two common methods of fracturing involve the use of hydraulic or explosive force.

Horizontal drilling: A drilling technique where the well hole is curved upon reaching the rich gas formation, allowing drillers to retrieve greater amounts of gas. It is a breakthrough process that made tapping the Marcellus Shale financially viable.

Hydro-fracking: A mixture of water, sand and chemicals is forced at high pressure into a well, widening the natural fractures in the bedrock to allow gas to flow freely out of the formation.

Marcellus Shale: A layer of sedimentary rock, 4,000 to 8,000 feet underground, containing high amounts of natural gas trapped in a tight rock formation. Most of the Marcellus Shale lies underneath Pennsylvania, West Virginia, New York and Ohio. Geologists estimate the Marcellus holds more than 500 trillion cubic feet of natural gas.

Mcf/Bcf: Mcf stands for 1,000 cubic feet, and Bcf stands for one billion cubic feet; both are units of measurement for natural gas. There is a little more than one million BTU of gas in one Mcf. Texas, the largest gas-producing state in the U.S., produced 6.9 Tcf (trillion cubic feet) of gas in 2008. The Marcellus is estimated to hold around 500 Tcf of natural gas.

Midstream: Pipelines used in the transportation of gas to transmission lines, which then takes the gas to storage facilities or to market.

Natural gas: A hydrocarbon, mainly methane, naturally occurring and used in power generation around the world. Natural gas is trapped in high concentrations in the Marcellus Shale formation.

Platform: A cleared, flat space used as the base of drilling operations, hosting a rig and often the site of multiple wells.

Play: A term used for a natural gas or oil field being actively developed.

Pooling: Pooling combines multiple, separately leased but adjoining tracts of land to create one larger tract. The benefits of a pooling arrangement for landowners is a better chance of earning a share of royalties; for drillers, it provides a wider area on which to drill. Pooling units can be formed voluntarily but, in some states, forced pooling is legal. One drawback of forced pooling is that it may force holdout landowners to allow drilling underneath their land.

Propping agent: Also known as proppant, which is composed of sand, gravel or other minute particles forced into rock fractures to hold them open, allowing gas to seep out into a drilled well.

Pumping/compression station: These stations are used to raise the pressure of natural gas during its extraction, transportation and storage, minimizing the amount of room it takes up in the pipeline.

Rig: The machine used to drill holes into the Marcellus Shale formation. Usually these must be assembled on site, and disassembled to be moved to another drilling location, although some rigs can “walk” short distances to drill multiple wells from one platform.

Roughneck: A worker on a drilling rig.

Roustabout: A worker who performs manual labor around a drilling site.

Royalties: A percentage fee paid by gas companies to leaseholders on the land from which the gas is being extracted from, ranging in Pennsylvania from no less than 12 percent up to and potentially in excess of 20 percent of the value of all extracted gas.

Spud: The process of beginning a well.

Unconventional play: Extraction of oil or gas done by methods other than conventional vertical drilling into reservoirs. All shale gas plays, including the Marcellus (and the Utica), are deemed unconventional.

Utica Shale: Another layer of sedimentary rock, underneath the Marcellus Shale, that has recently been proven to hold large amounts of natural gas. Well bore: A hole drilled for the purpose of extracting natural gas.


How to Protect Your Gas Royalties

February 3, 2011 - By JEFFREY J. ROKISKY
Family limited partnerships can be extremely effective tools to achieve a variety of estate planning objectives as they pertain to royalties associated with gas wells. Many individuals feel quite fortunate that as a result of signing gas leases they will be receiving a significant amount of money over the next several years.

Many geologists feel that as the techniques used to drill the wells become more advanced, much more of the gas will be produced from horizontal wells resulting in a stream of royalty payments for 20 or 30 years. Thus, royalty owners will be faced with such questions as how can I minimize the estate taxes that I will have to pay? What income taxes will I owe? How can I avoid my royalties having to go toward long-term care yet still maintain the decision-making power on governance over the gas lease?

For most of our clients, the payments they will receive from a Marcellus Shale lease will be the single biggest income opportunity of their lifetime.

Many individuals establish a family limited partnership to address a variety of estate planning concerns. As a general rule, when family limited partnerships are established, Mom and Dad are typically both general partners and limited partners. Initially, there are limited partnership units that are also given to the children and grandchildren. The revenue generated by the gas leases can be allocated among the limited partnership units and therefore the tax burden may be spread among family members.

A word of caution: Most tax attorneys would tell you that for this plan to be effective, the family limited partnership should be established prior to a well being drilled and productive. Otherwise you may run afoul of the "assignment of income" principles.

The way most family limited partnerships are drafted, the general partners make all the decisions. These decisions include such matters as further lease negotiations and the timing of distributions to the limited partners. Thus, the children don't get their money until Mom and Dad believe it is appropriate for them to receive it.

Although the estate's tax credit allows up to $5 million for 2011 and 2012, it is uncertain what the credit will be for future years. One needs to be cognizant of the fact that when a person dies who is entitled to receive future royalty payments, the fair market value of the lease-hold interest is based on the present value of all future royalty payments to be made in the future. That is, if there is a projection of another 15 years of lease payments to be received following one's death, the IRS will calculate the value of that lease based on the 15 years of payments. Thus, many large landholders can still be facing estate taxes even if the credit on the $5 million for years beyond 2012.

By establishing a family partnership and transferring a limited partnership interest to your children, you have the capability to minimize your estate because the transferred partnership interest and the value attributed to them are treated as gifts to your children.

From the estate tax standpoint, this makes much more sense than allowing all the royalty payments to accumulate to Mom and Dad's estate and may be subject to estate taxes following 2012.

Another attribute of family limited partnerships is that if they are properly drafted they can provide some protection for children who may be going through a divorce or creditors of your children.

Finally, one needs to consider the ramifications of going into a nursing home. The value of the royalties to be received will be treated for Medicaid purposes as any other form of income and would need to go to the nursing home before one could be eligible for Medicaid. As a rule, the best way to protect the royalty payments from long-term care is to transfer all or a portion of them to your children or heirs well in advance of going into a nursing home.

Generally, setting up a family limited partnership is a relatively easy and inexpensive estate planning tool in light of the wealth that a limited partnership can protect. Transferring interest in this entity to children and grandchildren is unfortunately where things get complicated and the stakes can be costly. Furthermore, the timing of when interests are transferred can be critical to a good estate plan.

It is important to note that a family limited partnership may not be the best or only estate planning technique that is needed for a landowner. Often, family limited partnerships are combined with other estate planning tools such as trusts and limited liability companies to achieve further estate planning results.

Many landowners take the approach that they will wait and see when and how much money they will receive from their gas leases before they take steps to develop an estate plan. This wait-and-see approach, however, may result in lost opportunities when the most cautious and prudent approach is probably to more forward with an estate plan using the current uncertainties as an advantage.

If you would like to submit a question for publication, e-mail it to Jeffrey J. Rokisky is an elder law attorney with offices in Wheeling, Weirton, Elkins, Clarksburg and Robinson Township.


What Should I Do To Avoid Becoming A Victim Of Identity Theft?

Submitted 12/20/10

To reduce or minimize the risk of becoming a victim of identity theft or fraud, there are some basic steps you can take. For starters, just remember the word "SCAM":

S     Be stingy about giving out your personal information to others unless you have a reason to trust them, regardless of where you are:

At Home.

Start by adopting a "need to know" approach to your personal data. Your credit card company may need to know your mother's maiden name, so that it can verify your identity when you call to inquire about your account. A person who calls you and says he's from your bank, however, doesn't need to know that information if it's already on file with your bank; the only purpose of such a call is to acquire that information for that person's personal benefit. Also, the more information that you have printed on your personal bank checks -- such as your Social Security number or home telephone number -- the more personal data you are routinely handing out to people who may not need that information.
If someone you don't know calls you on the telephone and offers you the chance to receive a "major" credit card, a prize, or other valuable item, but asks you for personal data -- such as your Social Security number, credit card number or expiration date, or mother's maiden name -- ask them to send you a written application form.
If they won't do it, tell them you're not interested and hang up.
If they will, review the application carefully when you receive it and make sure it's going to a company or financial institution that's well-known and reputable. The Better Business Bureau can give you information about businesses that have been the subject of complaints.
On Travel.

If you're traveling, have your mail held at your local post office, or ask someone you know well and trust ­ another family member, a friend, or a neighbor ­ to collect and hold your mail while you're away.
If you have to telephone someone while you're traveling, and need to pass on personal financial information to the person you're calling, don't do it at an open telephone booth where passersby can listen in on what you're saying; use a telephone booth where you can close the door, or wait until you're at a less public location to call.

C    Check your financial information regularly, and look for what should be there and what shouldn't:

What Should Be There.

If you have bank or credit card accounts, you should be receiving monthly statements that list transactions for the most recent month or reporting period.
If you're not receiving monthly statements for the accounts you know you have, call the financial institution or credit card company immediately and ask about it.
If you're told that your statements are being mailed to another address that you haven't authorized, tell the financial institution or credit card representative immediately that you did not authorize the change of address and that someone may be improperly using your accounts. In that situation, you should also ask for copies of all statements and debit or charge transactions that have occurred since the last statement you received. Obtaining those copies will help you to work with the financial institution or credit card company in determining whether some or all of those debit or charge transactions were fraudulent.
What Shouldn't Be There.

If someone has gotten your financial data and made unauthorized debits or charges against your financial accounts, checking your monthly statements carefully may be the quickest way for you to find out. Too many of us give those statements, or the enclosed checks or credit transactions, only a quick glance, and don't review them closely to make sure there are no unauthorized withdrawals or charges.
If someone has managed to get access to your mail or other personal data, and opened any credit cards in your name or taken any funds from your bank account, contact your financial institution or credit card company immediately to report those transactions and to request further action.

A    Ask periodically for a copy of your credit report.

Your credit report should list all bank and financial accounts under your name, and will provide other indications of whether someone has wrongfully opened or used any accounts in your name.

M    Maintain careful records of your banking and financial accounts.

Even though financial institutions are required to maintain copies of your checks, debit transactions, and similar transactions for five years, you should retain your monthly statements and checks for at least one year, if not more. If you need to dispute a particular check or transaction ­ especially if they purport to bear your signatures ­ your original records will be more immediately accessible and useful to the institutions that you have contacted.

Even if you take all of these steps, however, it's still possible that you can become a victim of identity theft. Records containing your personal data -- credit-card receipts or car-rental agreements, for example -- may be found by or shared with someone who decides to use your data for fraudulent purposes.

9 Credit Score Myths Do More Harm Than Good



Submitted 9/23/2010

Dispute everything on your report? Freeze your cards in ice? Hmmm ...

In today's economy, a good credit score is more valuable than ever, and for many, improving your score has become a financial priority. Turn on the radio, flip on the TV or head to the company water cooler and you'll likely be bombarded with various credit-improving strategies. But not all advice is good advice. Here are nine credit score myths that could actually do more harm than good:

1. Closing out old, inactive accounts will help your score.
Your credit score is based, in part (15 percent), on the length of your credit history; and in part (30 percent) on your utilization rate -- your total balances versus the total amount of credit available to you. Canceling old accounts can make your credit history appear shorter and, as a result, actually lower your score, according to Heather Battison, consumer education director for TransUnion. It also reduces the total amount of your available credit, so you'll be utilizing a higher percentage of your credit, which can also affect your score.

2. Opening (but not using) accounts will help your score.
To improve their utilization rate and, theoretically, their credit scores, some people open as many accounts as they can. Rod Griffin, director of public education for the credit bureau Experian, says this strategy is more likely to raise eyebrows than your credit score. "Your score is affected by how well you manage the credit you do have over a period of time, not by how many credit cards you have or the available balances."

3. You should avoid using your credit cards at all.
Remember the advice that you should stick your credit cards in a bowl of water and freeze them, ausing them only for emergencies? If you're a financially responsible consumer, that approach could negatively impact your credit score. Bruce W. McClary with ClearPoint Credit Counseling Solutions explains that your score reflects the responsible use of credit. If you're not using your credit, you're not building credit history. He advises using your credit from time to time and then promptly paying off the balance.

4. Dispute letters can clean up your bad credit.
Errors on your credit report can and should be disputed, but don't expect to magically erase accurate but negative credit history. Disreputable credit repair firms will advise that if you send enough letters disputing legitimate but negative records on your credit report, eventually the lender will not be able to respond quickly enough and the credit bureau will have to remove the item permanently from your credit report. Griffin says that's not the case. Dispute letters may force the removal of negative items temporarily, but once the lender can prove the record's accuracy, it will reappear on your credit report.

5. Paying off old debts and judgments will help your score.
Have a judgment or an account that went to collections? Don't expect to make that negative "disappear" by paying it off. Negative records -- judgments, collections accounts, bankruptcies or late payments -- remain on your credit report for seven to 10 years, regardless of any remedies you've made.

6. Credit inquiries hurt your score.
Inquiries alone have little impact on your score. Coupled with a history of bad credit, a hard inquiry, such as an inquiry for credit, could factor negatively into your score, but again, the effect would be minimal. Another myth? Pulling your own credit report, a soft inquiry, lowers your score. In fact, checking your credit report on a regular basis allows you to catch errors that could affect your score and identify those areas that need improvement.

7. Using a credit counseling service lowers your score.
Credit counseling services no longer figure into the FICO scoring system, so although your report might indicate you are receiving credit counseling, using those services won't lower your score. It could actually help your score, according to Todd Christensen, director of education at Debt Reduction Services Inc. "You're making your payments on time and paying down your debt, the top two factors in credit scoring," he says.

8. There's a set formula for obtaining good credit.
Be suspicious of any blanket statement about what people should or shouldn't be doing to improve their credit scores. "Credit is a very individual thing," says Griffin. "Credit scoring looks at everything and takes it all into account. If you are keeping your balances low and paying your bills on time, you'll have good credit and a good credit score."

9. You can get a perfect score.
Don't go to Herculean efforts trying to obtain that elusive 850 -- getting a perfect credit score is nearly impossible. Your credit score is a reflection of your credit risk, and regardless of your credit history, there's always a risk. Doug Minor, author of "Anatomy of Credit Scores," recommends working toward a score of at least 740. "It's more realistic and attainable than 850," he says.

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Electronic Banking is Here to Stay!

Submitted 9/17/2010

Do you remember the days when :

· You selected a bank that was close to your home or business because you’d need to visit their branch to do all of your business, including deposit checks from your customers?

· You mailed checks to billers as payment for whatever you owed them?

· You mailed checks to friends / associates to repay them for some obligation?

· You needed to receive a paper bill from a biller / supplier so you’d know how much you owed them and when it was due?

If you generally answered that those days were quite a while ago, that’s great. It says that you are adapting to the ground-swell of electronic alternatives that have been sweeping the world of banking over the past decade for both consumers and businesses.

On the other hand, if many of those activities sounded like something you have done recently, you are not alone but you likely may be faced with making some changes in the future. Here’s a snapshot of what is going on:

· Many banks – including Community Bank – offer a remote deposit capture solution which allows you to deposit your customers’ checks without ever leaving your place of business. Consulting firm Aite Group, LLC “estimates that between 300,000 and 350,000 accounts [businesses] are enabled with RDC capability today.”

· Overwhelmingly, more & more people pay their bills electronically at either the billers’ web sites or via their financial institution’s online bill pay service. In fact, a 2009 survey from Javelin Strategy showed that 54% of Americans paid at least one bill per month at a biller’s site and at least one bill per month via their bank’s bill pay service; obviously, some folks did both.

· If you owe someone a few bucks - suppose you forgot to bring your wallet to lunch - the trend today is to simply have your bank move the money from your account to theirs, even if the accounts are in different banks. In 2009, roughly 44 percent of U.S. consumers reported making at least one online person-to-person (P2P) funds transfer, up from 27 percent the previous year, according to Javelin Strategy. In fact, some providers are even beginning to allow users to initiate P2P payments via a mobile device.

· With electronic bill presentment – eBills – your biller electronically delivers a summary bill (date & amount due) to your computer, either as part of your bank’s online bill pay service or via email. This eliminates your dependence on the mail man and allows you to pay your bills from wherever you are (e.g., while on extended vacation). Current adoption has been disappointing - estimates often hover in the 10% range – but eBilling is getting renewed interest as national attention turns to ecology-friendly green initiatives.

The migration to electronic banking is exactly that. It will evolve over time as will its users. When you join the migration is up to you.

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Commercial Loans: What type of business loan is best for you?



Successfully managing a small business can be extremely challenging in any economy, but today's market requires companies to be very competitive and constantly evolving to meet multiple challenges. Many business owners often find that their most significant challenge involves cash flow and capital.


Successfully managing a small business can be extremely challenging in any economy, but today's market requires companies to be very competitive and constantly evolving to meet multiple challenges. Many business owners often find that their most significant challenge involves cash flow and capital.

What type of business loan is best for you? There are several options available depending on what the money will be used for. Here are some universal business loans defined:

  • Term loans. Fixed term business loans are used to provide a business with working capital to acquire assets. You will repay the loan monthly over a term, based on the expected lifespan of the assets you’re purchasing. This is the most common loan used for larger amounts.
  • Short term loans also known as Time Notes. These are almost always set up for a term of one year or less, then repaid in a lump sum. Usually for smaller amounts, these loans are best for seasonal inventory buildup or small investments with quick returns.
  • Lines of credit. Set up to ensure against cash flow problems, lines of credit are designed for temporary cash shortfalls, allowing you to borrow as you need it, up to a certain amount per year. If used properly the line of credit should be paid to a zero balance at least once a year.
  • Equipment financing. These loans are usually easier to secure than general lines of credit because the equipment purchased also serves as the collateral for the loan.
  • Commercial Mortgage. A commercial mortgage is a loan secured by commercial real estate and either used to purchase commercial real estate or refinance commercial real estate. Commercial Mortgages differ in many ways from residential mortgage loans. These are highly customized loans whereas the rate and payment terms are negotiated between the lender and the borrower
  • Letter of Credit. A letter of credit is a credit instrument issued by a bank guaranteeing payments on behalf of its customer to a beneficiary, normally to a third party but sometimes to the bank’s customer, for a stated period of time and when certain conditions are met.

There are more options available now than ever before for small businesses needing funding and the most appropriate choice will obviously depend on your personal circumstances. Contact your Community Bank Business Development Officer to help assist you in choosing the product that is right for you.

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Demystifying Merchant Card Processing Fees


If your business accepts credit cards you have probably wondered just how your monthly processing fee is actually calculated. Well, you are not alone. Most business owners readily admit they do not understand how these costs are determined.

Merchant card fees are determined by a host of factors. Some of these are within your control, some are not. How you process your transactions may be just as important as the pricing you negotiated with your service provider. Below are some helpful tips to help “Demystify” these charges and help ensure your business is effectively controlling costs.

  • MasterCard and Visa has many industry classifications to determine the type of business as well as how the business will process transactions. For instance, retail merchants are looked at differently from utilities which are looked at differently from hotels. It is important to be enrolled correctly or you may not have the ability to access the most competitive price from MasterCard/Visa.
  • MasterCard and Visa have numerous pricing categories which a merchant may attain based on the type of card being presented as well as how the merchant processes the card. A good rule of thumb is to divide your processing charges by your volume. Remember to not include fixed monthly charges as these do not directly relate to transaction processing. The result of this equation is called the Effective Rate and is a good benchmark to how your provider has priced your merchant card relationship.
  • If you are a Card Not Present merchant, expect to see your qualified rate to be higher than if you were a Retail merchant. MasterCard and Visa price Card Not Present merchants higher due to the riskier nature of the transaction (i.e no signature, no card swipe.)
  • As a Retail merchant, you may consider accepting PIN debit versus processing the debit card as Signature based debit. Your processing charges for PIN based debit typically are lower than Signature based debit. All that is required is adding an external PIN Pad to your terminal or having select terminals injected with your processing banks key so you may use your terminal as a Pin Pad as well.
  • If you accept American Express, you will find it costs more to the merchant than MasterCard, Visa and Discover. Until recently, Discover cost more to process as well but most processors are now starting to fund Discover in the same funding batches with MasterCard and Visa.

For more information on accepting credit cards at your business or understanding your current merchant statement please contact Linda Moxley at 724-966-3222.

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Business Owners – Do you know your Earnings Credit Rate?

If your business checking account has a high volume of monthly activity chances are you are on account analysis. This means that your account is assessed a service charge based on the type of volume occurring monthly such as deposited items or number of checks written. The good news is these charges can be offset by your Earnings Credit Rate (ECR).

What is the ECR? Banks are prohibited by law to pay interest on most business checking accounts. They can, however, apply an ECR to business checking balances as a way to offset monthly services charges. This does not count as income to the business and typically cannot be carried over month to month. It is use it or lose it.

To demonstrate how the ECR works, if a business typically incurs service charges of $100 per month they would need approximately $60,000 in average monthly balances to offset these charges at an ECR of 2% (60,000 times 2% divided by 12 months). Changing the ECR to .50%, however, would require $243,000 in average monthly balances to cover the same service charge. That is a significant increase in balances. Clearly, the higher the ECR the better it is for the business owner.

How can a business owner use the ECR to their advantage? First, understand what ECR is being applied to your account. This can typically be found on your monthly account statement. Second, make sure you are fully utilizing the balances in your account. As the ECR is use it or lose it, you may be able to obtain additional bank services such as Remote Deposit Capture without increasing your balances. And if you have an overnight sweep account, a higher ECR on your business checking would enable you to transfer higher balances to this interest bearing sweep account and that means higher income for you.

If you have any questions on your current business account and the ECR or would like have one of our Cash Management Specialists review your account please contact Linda Moxley at 724-966-3222.

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Business Strategies for Historically Low Interest Rates 


Whether it is your business accounts or personal accounts you have probably realized that interest rates are at an all time low.   Businesses that typically carry excess balances to invest are earning little if anything on these funds and are wondering where to turn for higher yield.  The bad news…your options are limited.  Here are some strategies you can employ however to take advantage of the current rate environment.


Pay Down Debt


If you have excess funds to invest and you currently have a line of credit with an outstanding balance considering paying down the line.  Many business owners do not want to comingle investment funds with working capital funds but this type of thinking can cost you money.  If you are earning 1 percent on your investments and paying 4 percent on your line you are losing 3 percent.  Use this strategy to reduce revolving debt but use caution on reducing longer term borrowings if you think you may need the money in the near term.


Avoid the Urge to Chase Yield


A common mistake in a low interest rate environment is chasing yield.  This typically comes in two forms.  First, avoid the urge to tie up your business funds for a longer period in order to achieve a higher return.  Liquidity is the lifeblood of any business and you want to make sure you have access to your funds if needed.  Buying a long term CD may improve your yield but do so only if you are certain you will not need the money.  Second, do not buy or invest in anything you do not understand.  As the saying goes, “if it sounds too good to be true it probably is.”  There is typically enough risk in your business without introducing more risk with your investable funds.


Use Your Balances to Increase Your Bank Services


Instead of investing excess cash at a low rate consider using these balances to obtain additional bank services.  While banks are prohibited from paying interest on business checking, they can provide an earnings credit rate to offset services charges.  With a higher checking balance, the credit may enable you to get additional services for your business such as Internet banking or Remote Deposit Capture that will improve the overall efficiency of your company. 




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Community Bank is an independent, full service commercial bank serving Southwest Pennsylvania in Greene, Washington, Allegheny and Fayette counties.