Stepping Up to the Challenge: How Local Communities in the Utica Shale Play are Taking Advantage of the Boom

By now, all of us have heard about the far-reaching effect that shale fracking has had on our national energy policy. What is less clear is its impact on the many rural communities around the country that overlie the oil and gas-rich shale. Many of these areas have seen the shale boom as a sort of saving grace: one that promises good jobs and prosperity in regions where high poverty and unemployment have lingered for generations. Conversely, many shale communities are discovering that the shale boom is not without its challenges.

Shale communities are working hard to confront the stress that rapid oil and gas activity has placed on local infrastructure, educational, housing, and public safety resources. Simultaneously, they are striving to make the economic benefits of the play lasting and sustainable. Thanks to creative economic tools many of these communities are confident that the shale boom can be properly managed in the short term, and sustainable in the long term. And that is good news for many shale communities, which ironically have a history of natural resource-based economies that have resulted in boom-to-bust cycles.

For example, much of Eastern Ohio, which lies over the Utica Shale, is currently experiencing a rapid gas and oil boom. This boom is the latest in a long line of economic cycles founded in the extraction of natural resources. Many Eastern Ohio counties continue to pay the price for over-dependence on a once-booming coal industry. Most coal profits—during peak production—left the region, and were not invested in public infrastructure expansion. Moreover, apart from electrical generation facilities, there were no obvious downstream manufacturing markets for which the coal could be put to long-term use. A failure to promote economic diversification and build public infrastructure debilitated the region, which still reels decades after the coal boom peaked. Now, community leaders in the region are faced with the challenge of making the shale economy both robust and sustainable, and they appear up to the task.

Ohio law has created a number of creative economic development tools that allow county commissioners, mayors, and township trustees to leverage the shale economy for the creation of strong infrastructural build out: building new water and wastewater treatment and delivery systems, roads, schools, and industrial parks. Tax Incentive Financing and Joint Economic Development Districts are two such tools that are gaining in popularity among Eastern Ohio local governments.

Port Authority directors and other economic development professionals across the Eastern Ohio region are leading efforts to attract downstream manufacturers by developing industrial sites and aggressively marketing the region’s economic potential. What’s more, the Utica counties of Ohio have collaborated with one another in these efforts, demonstrating that a regional team is stronger than the sum of its individual parts.

Public-private partnerships are also working to promote sustainable growth. Communities have teamed with oil and gas developers and midstream companies to build and maintain roads, water and wastewater systems, broadband access and industrial parks. Educators—from secondary and vocational schools to higher-ed facilities—are working with the industry to create vigorous workforce development pipelines to ensure local workers have access to shale-related jobs.

Shale-based oil and gas production has presented both enormous challenges and incredible opportunities for the rural communities of shale country. Will this rural-based economic boom be different than those that preceded it? Early indications suggest that creative, collaborative actions on the part of local government officials and the industry, offer a chance to break the boom to bust cycle, making for long-lasting economic improvement.