Routt County digs into socioeconomic impacts of energy exploration
October 18, 2012
Steamboat Springs — If a full-fledged energy boom were to take place in the Yampa Valley, would the community be prepared to handle it? And could local governments be taking steps in advance that would soften the adverse impacts should a boom go bust?
Those questions form the basis of a public meeting to be conducted by Routt County Planning Director Chad Phillips with the Routt County Planning Commission on Tuesday night to take a look at what has transpired in other Western communities where oil and gas plays have come and gone. Also taking part will be consultant George Blankenship, who spoke at a Steamboat Springs Chamber Resort Association business forum Aug. 31.
"Although the county has been issuing oil and gas well permits since the 1970s, the recent activity (due in part to new technology) could result in a drastic increase in approved oil wells over historic numbers," Phillips said.
He observed that most of the attention locally has been focused on issues related to potential impacts to county roads, environmental quality and the role of the Colorado Oil and Gas Conservation Commission in permitting and monitoring new wells.
Tuesday's meeting, at the direction of the Routt County Board of Commissioners, will begin the process of looking at the impacts that oil development could have on the community, Phillips said. The purpose of the meeting is not to contemplate placing new restrictions on the energy industry, he added. Instead, it's intended to be focused on anticipating possible impacts that would be felt by social institutions and the local economy so that plans can be made in advance to soften the blow for local residents should an energy boom suddenly fade from the local picture.
County Commissioner Nancy Stahoviak said Thursday that it was after hearing former county Commissioner Ben Beall repeatedly urge the board to look into the potential for socioeconomic impacts from an oil boom that the commissioners decided to begin the process. However, Stahoviak said the first thing she hopes to learn is the point at which other communities had begun to feel the impact.
"I think we all have a different view of where we need to be heading, but I think the first things we need to decide is what the trigger point is," Stahoviak said. "To me, I look at the number of wells in Routt County compared to Garfield County or Rio Blanco County or up in Wyoming in Sublette County; they had like 500 wells. So, when I say, 'What are the trigger points?' I mean, when do you really have to look at having socioeconomic impacts?"
Tuesday night's meeting will offer case studies based on local government and media reports from other Western communities. They include Pinedale, Wyo., in Sublette County, where a natural gas boom led to a 20 percent increase in the permanent population from 2000 to 2005 with the addition of more than 500 new homes, according to the county's socioeconomic analyst. Jeffrey Jacquet concluded that when nonresident workers were factored into the total, the growth rate reached nearly 75 percent during that five-year span.
In the town of Meeker in neighboring Rio Blanco County, the current low prices for natural gas have sapped the strength of an energy boom that has shifted elsewhere in pursuit of oil. As detailed in a Feb. 3 article in The New York Times, businesses in Meeker, from construction companies to gift stores that once thrived on the influx of new workers, now are struggling to stay afloat. And schools built to accommodate the children of energy workers are seeing severe drops in enrollment.
Blankenship, who has his own consulting company, and colleague Ron Dutton, with Sammons/Dutton in Denver, worked on socioeconomic and transportation aspects of the BLM's environmental assessment of the 1,080-well ExxonMobil Piceance Project in 2006.
Blankenship told the Chamber audience that it's important for community leaders to take the step of contacting oil companies early in the exploratory phase to form a collaborative relationship.
"If you have a regional oil and gas play, you'll have multiple operators and contractors coming from different places," Blankenship said. "It's possible they'll have different approaches for dealing with communities. It's important to form a working group of community leaders, businesses and industry representatives to share information on an informal level."
In the economic arena, Blankenship said that one of the challenges for local governments, even in oil fields that generate significant revenues, is that the greatest demands on government budgets come well in advance of the return revenue stream.
"Production revenues can take a year or more to flow, and they don't always flow to the local government agency that provides the services. The big bonanza is fairly short lived — assume a five- to six-year period — then it continues for a long time at a much lower level," he told his Chamber audience.
To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com