Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

Shale development generally helps local government coffers

21.05.2014

Revenue gains usually offset cost of new roads, utilities

Oil and gas development from shale fields has generally helped the public finances of local communities, providing new revenues and resources that usually -- but not always -- outweigh the increased demand for public services and other costs, according to a new analysis from two Duke University researchers.


A still image from an interactive map built by the research team which enables viewers to explore the study's findings about shale gas revenue and demand for public services around the country. The interactive map can be found here: http://energy.duke.edu/shalepublicfinance.

Credit: Duke University Energy Initiative

Daniel Raimi and Richard Newell gathered data from communities surrounding 10 oil and gas "plays" from September 2013 through February 2014, traveling to Arkansas, Colorado, Louisiana, Montana, North Dakota, Pennsylvania, Texas and Wyoming to interview local officials and collect information firsthand.

The report, which appears online, describes major revenue sources for local governments, which can include property taxes, sales taxes and state-collected severance taxes or fees that are sent back to the local level. Some local governments also partner with oil and gas companies to help maintain roads, an approach that helped reduce expenses associated with heavy truck traffic in states including Arkansas, Colorado and Pennsylvania.

New costs for local governments associated with oil and gas development, include damage to roads from heavy truck traffic, water and sewer service expansion, government staffing and other needs brought on by rapid population growth.

The researchers found that the net impact of recent oil and gas development has generally been positive for local public finances. However, many local governments in western North Dakota and eastern Montana, near the Bakken shale formation, have thus far experienced net negative fiscal effects. Also, some municipalities in rural parts of Colorado and Wyoming struggled to manage rapid population growth as natural gas production accelerated in the mid-to-late 2000s.

"The fiscal effects for local governments tend to vary from state to state, but we found that for most of them new revenues were outweighing new demand for services," said Newell, director of the Duke University Energy Initiative and Gendell Professor of Energy and Environmental Economics at Duke's Nicholas School of the Environment.

The research is a snapshot of the fiscal impact to date in the eight states and does not examine the long-term economic impact to governments and the communities they serve, a question the authors say is important and needs additional study.

Newell and Raimi found net positive fiscal effects in regions where oil and gas booms were ongoing or had slowed in recent years, as well as in regions that experienced different scales of activity. This includes local governments in diverse regions where population density and government capacity vary substantially.

"One of the key questions is how these fiscal effects change over time," said Raimi, an associate in research with Duke's Energy Initiative. "In very rural areas, some local governments have faced challenges when development first surges. In many cases, those challenges faded over time. In most other areas, we found net positive or at least roughly neutral financial effects on local government."

"In some parts of North Dakota, populations have doubled, tripled or even quadrupled just in the past few years," Raimi said. "For local governments in these areas, it's hard to keep up with the demand for services, especially costly infrastructure projects such as sewer and water treatment plants."

###

The report is the first of a series of publications to be produced by the Shale Public Finance Project, an effort led by Newell with support from the Alfred P. Sloan Foundation. The project's website provides additional information, including interactive maps and a blog about sites visited during the research.

Margaret Lillard | Eurek Alert!
Further information:
http://www.duke.edu

Further reports about: Arkansas Energy Montana Shale Wyoming environmental economics neutral roads truck traffic

More articles from Business and Finance:

nachricht Blockchain Set to Transform the Financial Services Market
28.09.2016 | HHL Leipzig Graduate School of Management

nachricht Paper or plastic?
08.07.2016 | University of Toronto

All articles from Business and Finance >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: First-Ever 3D Printed Excavator Project Advances Large-Scale Additive Manufacturing R&D

Heavy construction machinery is the focus of Oak Ridge National Laboratory’s latest advance in additive manufacturing research. With industry partners and university students, ORNL researchers are designing and producing the world’s first 3D printed excavator, a prototype that will leverage large-scale AM technologies and explore the feasibility of printing with metal alloys.

Increasing the size and speed of metal-based 3D printing techniques, using low-cost alloys like steel and aluminum, could create new industrial applications...

Im Focus: New welding process joins dissimilar sheets better

Friction stir welding is a still-young and thus often unfamiliar pressure welding process for joining flat components and semi-finished components made of light metals.
Scientists at the University of Stuttgart have now developed two new process variants that will considerably expand the areas of application for friction stir welding.
Technologie-Lizenz-Büro (TLB) GmbH supports the University of Stuttgart in patenting and marketing its innovations.

Friction stir welding is a still-young and thus often unfamiliar pressure welding process for joining flat components and semi-finished components made of...

Im Focus: First quantum photonic circuit with electrically driven light source

Optical quantum computers can revolutionize computer technology. A team of researchers led by scientists from Münster University and KIT now succeeded in putting a quantum optical experimental set-up onto a chip. In doing so, they have met one of the requirements for making it possible to use photonic circuits for optical quantum computers.

Optical quantum computers are what people are pinning their hopes on for tomorrow’s computer technology – whether for tap-proof data encryption, ultrafast...

Im Focus: OLED microdisplays in data glasses for improved human-machine interaction

The Fraunhofer Institute for Organic Electronics, Electron Beam and Plasma Technology FEP has been developing various applications for OLED microdisplays based on organic semiconductors. By integrating the capabilities of an image sensor directly into the microdisplay, eye movements can be recorded by the smart glasses and utilized for guidance and control functions, as one example. The new design will be debuted at Augmented World Expo Europe (AWE) in Berlin at Booth B25, October 18th – 19th.

“Augmented-reality” and “wearables” have become terms we encounter almost daily. Both can make daily life a little simpler and provide valuable assistance for...

Im Focus: Artificial Intelligence Helps in the Discovery of New Materials

With the help of artificial intelligence, chemists from the University of Basel in Switzerland have computed the characteristics of about two million crystals made up of four chemical elements. The researchers were able to identify 90 previously unknown thermodynamically stable crystals that can be regarded as new materials. They report on their findings in the scientific journal Physical Review Letters.

Elpasolite is a glassy, transparent, shiny and soft mineral with a cubic crystal structure. First discovered in El Paso County (Colorado, USA), it can also be...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

Event News

Call for Paper – Panacea Green Infrastructure?

30.09.2016 | Event News

HLF: From an experiment to an establishment

29.09.2016 | Event News

European Health Forum Gastein 2016 kicks off today

28.09.2016 | Event News

 
Latest News

First-Ever 3D Printed Excavator Project Advances Large-Scale Additive Manufacturing R&D

30.09.2016 | Materials Sciences

New Technique for Finding Weakness in Earth’s Crust

30.09.2016 | Earth Sciences

Cells migrate collectively by intermittent bursts of activity

30.09.2016 | Life Sciences

VideoLinks
B2B-VideoLinks
More VideoLinks >>>