Fracking: The Science, Statistics and Myths Robert Nied Board of Directors Center for Sustainable Rural Communities This presentation is not offered nor.

Fracking:The Science, Statistics and Myths

Robert NiedBoard of Directors

Center for Sustainable Rural Communities

This presentation is not offered nor intended as legal advice.

The Center for Sustainable Rural Communities

A 501 (C)3 non-profit NY corporation

296 Main StreetRichmondville, NY518-872-3903www.ruralcommunities.org

Serving:Albany SchenectadySchoharie DelawareOtsegoGreenandOnondagaCounties.

Fracking:The Science, Statistics and Myths

Don AireyChair- Blenheim Long-Term Community

Recovery Committee (BLTCRC)Chair- Blenheim Comprehensive Plan

CommitteeLocal Business Owner

“Fracking Creates Jobs”

Pennsylvania as a litmus test for fracking-related job growth.

Fracking site, Dimock, PA

“Fracking Creates Jobs”

Between December 2011 and December 2012The national unemployment rate fell from 8.2% to

7.8% as the economy began to recover. -US Bureau of Labor Statistics

In Pennsylvania during the same period the unemployment rate rose from 7.7% to 7.9%.

- US Bureau of Labor Statistics

“Fracking Creates Jobs”

Between December 2011 and December 2012 Pennsylvania had a net loss of jobs in tourism and

agriculture.-US Bureau of Labor Statistics

“Fracking Creates Jobs”

The largest growth sectors associated with fracking in Pennsylvania in 2011 were hospitality (hotels) and low-

wage retail (convenience stores) with some small growth in construction. – US Bureau of labor Statistics

Fracking related industries accounted

for just 2% of new jobs in 2011.

“Fracking Creates Jobs”

A survey of gas companies in Pennsylvania showed that 70% to 80% of workers were from out of state (primarily

Texas and Oklahoma). - Marcellus Shale Education & Training Center (ShaleTEC)

“Fracking Creates Jobs”

From June 2012 through December 2012 the number unemployment claims in Pennsylvania rose by 39.9%.

- US Bureau of Labor Statistics

(Fracking is not seasonal so seasonal rise in

unemployment claims should have been offset by

fracking “job boom.”)

“Fracking Creates Jobs”

All construction, extraction and maintenance jobs combined make up just 8.9% of the Pennsylvania

workforce.- US Census Bureau

“Fracking helps troubled local economies”

Shale Gas extraction has followed a classic 2-3 year boom and bust cycle in 26

Western counties. – Headwaters Economic Institute

“Fracking helps troubled local economies”

Initially, fracking brings a spike in local housing demand which drives up rental costs, displacing

some local residents.– Headwaters Economic Institute

As the number of new wells declines so does rental market resulting in a “correction” which slows home sales and

decreases values (and assessments).

“Fracking helps troubled local economies”

During fracking boom communities struggle to respond to demand for services:

PoliceFire

Emergency ServicesHospital

HighwaysFracking proponents rarely talk about Cost of

Community Services (CoCS)

“Fracking helps troubled local economies”

During fracking boom temporary workers may be housed in so-called “man camps”

which increase the need for law enforcement response.

The State of North Dakota reported a 16.1% increase in violent crime and a 10.3% increase in property

crime during the initial fracking boom. –North Dakota Attorney General’s Office

20% of gas field workers have no permanent address-Headwaters Economics Institute

“Fracking helps troubled local economies”

The fracking boom brings transient workers. Some workers bring their families. Children of transient

workers have less educational consistency and stability and statistically require more special/

remedial services. Demand for remedial/special services increases operational costs of local schools ad ultimately increase school taxes.

“Fracking helps troubled local economies”

Fracking royalties are only paid when a well is producing.

Fracking royalties to individuals have declined as natural gas prices have fell to $3.00 per unit.

To counter falling prices, gas companies have been “adjusting” royalty payments using loopholes and fine print.

Gas royalties are “not going to have a big impact on the overall vitality of the overall economy" -Robert Inman, professor of economics and public policy at the University of Pennsylvania's

Wharton business school.

“Fracking helps troubled local economies”

Road damage from fracking can be catastrophic in scale.

Each lateral frack requires 800+ truck loads. That is 1600 truck

trips. Wells can have as many as 12 lateral fracks. That is 19,000 potential truck trips per well.

Pulverized blacktopSusquehanna County, PA

30 ton fracking tanker truck

“Fracking helps troubled local economies”

Road Preservation Laws are not always effective in forcing the recovery of road repairs costs.

Enforcement and recovery is difficult when dealing with multi-national companies and layers

of sub-contractors.

“Fracking helps troubled local economies”

Road Preservation laws may ultimately prove easier to challenge than fracking bans and moratoria.

“NY State has no statute expressly authorizing Impact Mitigation Fees (IMF) or Cost Recovery Schemes (CRS).”

“There is no case law upholding a municipality’s enactment of IMFs.”

-Whiteman Osterman & Hanna LLP

“Fracking helps troubled local economies”

Some people will make money:Gravel and stone companies

Large construction companies (land clearing, well pads)Motels (temporary workers)

Convenience Stores (temporary workers)Liquor Stores (temporary workers)A few large landowners (maybe)

At least for 2-3 years

“Fracking helps troubled local economies”

In the final analysis, fracking produces a temporary influx of money with an associated increase in costs goods and

services. The entire cycle lasts <5 years while leaving behind

potential long term negative community impacts such as loss of agriculture and tourism, increases in school

taxes, decreased property values, higher insurance costs and possible environmental contamination clean up

costs.

“Fracking helps troubled local economies”

“A boom in natural gas extraction does not result in long-term economic growth and

prosperity”-West Virginia Center on Budget & Policy

“Fracking in NY will be safe because we will have the toughest regulations in the country”

NY DEC’s draft regulations contain some of the weakest provisions in the

country.

NY DEC’s draft regulations contain some of the weakest provisions in the

country.• Setback distances from homes, schools, hospitals, etc. would be

shorter than in Texas and Oklahoma!• Open pits would be allowed for drilling muds and drill cuttings and

there is a loophole that would allow open pits for waste storage near some Marcellus Shale wells.

• Open pits may be filled to the brim (no freeboard requirement), even in flood prone areas.

• There would be no public disclosure required for any chemicals used for drilling or fracking.

• Diesel oil would be allowed as a fracking fluid, up to any amount short of becoming the primary fluid in the frack.

NY DEC’s draft regulations contain some of the weakest provisions in the

country.• Horizontal wells would be permitted to be drilled

under public park land, lakes and nature preserves.• Seismic testing would not be regulated.• Compressor stations, processing plants and gathering

lines would not be regulated.• Wells would be allowed to be vented/flared for 7

days 24 hours per day regardless of their setbacks from homes, schools, etc.

NY DEC’s draft regulations contain some of the weakest provisions in the

country.

The draft regulations do not protect the fragile Karst geological formations of Schoharie County

and the aquifers they support.(Ohio has stopped issuing drilling permits in

Karst areas.)

NY DEC’s draft regulations contain some of the weakest provisions in the

country.

“The unique geological formations underpinning much of Upstate NY will act as a vector for

contamination of private drinking water wells and entire aquifer systems if hydraulic fracturing is

allowed to be conducted in the region.” -Paul Rubin, Hydro-geologist, affidavit filed with the NY DEC, December 31, 2012

“If we pass a moratorium or a ban we may be sued”

You can sue a ham sandwich.

“If we pass a moratorium or a ban we may be sued”

“Land use moratoria are designed to preserve the status quo while planning or zoning changes are

made. These enactments are appropriate mechanisms for addressing long range

community planning and zoning objectives.” – Land Use Moratoria, NY State Department of State

“If we pass a moratorium or a ban we may be sued”

200 communities in NY State have passed moratoria or bans on fracking.

2 towns have been sued and the law suits rejected by the courts. Appeals are pending.

A third town has been sued on technical grounds (poorly written local law).

There are hundreds of law suits filed involving towns in NY every year having nothing to do with fracking.

Fracking does not create long-term economic opportunity.

Fracking does not create “career-level” local employment.

Fracking does not fix local economic problems.

DEC will not protect local communities.

Doing nothing out of fear of litigation is not governing.

It is a failure to govern.

What to do?

Enact a moratorium, study & strengthen land use protections, pass a road

protection law, fight pipeline proposals, support sustainable economic development opportunities.

This presentation is not offered nor intended as legal advice.

Bob Nied: [email protected]