What’s the fuss about?

January 7, 2014

The local media has been filled with information on the projected increase of oil and gas activity in our area. Previously vacant buildings are showing signs of occupancy; traffic is increasing, and many of us are seeing folk we don’t recognize around town. The impact of the Cline Shale on Nolan County is not necessarily something that can be quantified at this point, but we know – from watching the development of the Eagle Shale, if from nothing else – that there will be an impact.
Counties caught up in the Eagle Shale development found themselves in a bad position with regard to their roads. As a general rule, county roads are the ones used to get to drill sites or for exploration. This means that there is an increase in heavy truck traffic on roads that were designed to help rural folk get from where they are to a state road. County roads are not designed for constant traffic, and county budgets are not prepared to handle major repair of the roads without some help. Overweight permits are issued out of Austin, and the funds from them do not return to the county – nor can a county, even with weight limits – stop a properly permitted vehicle from travelling county roads. Because of the laws limiting actions of counties, no fee or permit could be used to help defray the cost of fixing roads rendered impassable as a result of oil and gas exploration or drilling traffic.
The officials of these counties went to Austin in the last session, and asked for help. What they got was a designation of roughly $225 million to be used state wide on an application basis to repair (NOT replace) county roads which have been significantly damaged by oil and gas industry traffic. The State created a complex formula involving a comparison of county well completions, injection wells, oil/gas production taxes and overweight permits as compared to the state wide numbers. Based on the computations performed by TxDOT and released in late November, if Nolan County is successful in applying for its share of the allocated funds, we could see a little over $600,000 coming to the county. As with most state funds, there are strings attached.
The Commissioners Court must start by identifying roads abused by oil and gas traffic. From these, they will create “county energy transportation reinvestment zones”. These zones exist for ten years. If the appraised value of land in the zone increases, a set percentage of the tax on the increase must be set aside for use on other (new?) road issues within the zone. At the end of ten years, the Commissioners may extend the life of the zone for another five, or let it lapse. If the land does not increase in value, but either maintains or drops, then no funds are added to the account.
As with anything involving tax or reinvestment zones, the Commissioners are required to hold a public hearing; this one is set for Thursday at 9:00 AM. While the overall process can be explained at that time,, it is doubtful that there will be enough data to show the likely drawing of the zones. For the most part, the zones will follow roads, connecting project to project but not impinging much on private property. The Commissioners are in the process of creating “road reports” which will list each county road, the condition of the road, culverts and bridges, and – if the condition is deteriorated – the probable cause of that deterioration.
Before submitting the application to TxDOT, the Commissioners will have to create an advisory board to help with the administration of the zone or zones. When the drawing of the zone(s) is completed, the board will meet, (hopefully) approve the drawing and the submission of the grant. If we receive the money, it can be used to cover up to 80% of the cost of each project. Should there be insufficient funding to cover all the projects in the zone(s), the board may help prioritize them. As funds accrue in the reinvestment zone account, the board could be used to help select projects for repair.
It is doubtful that, when County Judges of counties whose roads were ruined because of this traffic went to Austin for help, they anticipated a “grant” process which would take many manhours to complete. In fact, many counties that are entitled to funding have chosen not to even try, as the applications are due by February 14, 2014. The $600,000 possibly available to Nolan County presumes that all Texas counties participate; should some fail to do so, our share of the money could increase.
If you happen to see your County Commissioner over the next weeks, and he is looking somewhat drawn and harried, it is probably a result of trying to get this money for Nolan County. The sad fact is that, despite the best efforts of all involved, there is a chance that TxDOT will reject the application. Knowing that spurs each person working on the project to insure that the application will not only be timely but also as well put together as can be done. So – when you see one of them out and about, or if you decide to come by on Thursday morning – thank them for the extra hours they are putting in!

Lisa Peterson is the County Attorney for Nolan County. Comments about this column may be e-mailed to editor@sweetwaterreporter.com.

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