StateImpact Texas
12:01 pm
Mon June 30, 2014

Rising Oil and Gas Boom Does Little for Poor in Texas

From StateImpact Texas: 

When it comes to the oil and gas drilling boom in the country, Texas is king. Actually, make that crown a global one: over a quarter of all the active drilling rigs in the worldare right here in the Lone Star State.

The boom – taking place thanks to hydraulic fracturing, or “fracking,” and horizontal drilling – has brought jobs, money and more energy security to Texas and the country. It’s also damaged roads, increased traffic and accidents, strained local governments and caused housing prices to skyrocket in parts of the state. How the boom is leaving some communities behind is the subject of an in-depth report today in The New York Times.

“Though the boom has helped produce fortunes for some and comfortable lives for many, for others it exists within a rural landscape of unpaved streets without garbage pickup, where few dare to drink the tap water because it tastes and smells like chlorine,” Manny Fernandez and Clifford Kraus write.

“Not all tides raise all ships,” Libby Campbell, director of the West Texas Food Bank in Midland-Odessa, told StateImpact Texas when we visited her last fall. Campbell showed us how her operation is struggling to meet with increased demand for their services. People are showing up to the region broke, with the hopes of finding a job in the oilfield – or they already live in the area and have seen their rent double or triple since the latest boom began.

In a video accompanying the story in today’s Times (above), you can see how an influx of industry and profit has caused more hardship for those already stuck in poverty. 

All the money coming in to Texas may be helping it address some of its infrastructure issues, but very little of it is helping those who need it most, the Times reports:

“Texas has reaped tremendous financial benefits from oil and gas. But the poor in the colonias seldom own the leasing rights for the natural resources that lie under the ground they live on. One-third of Texas’ $48 billion in tax revenue last year came directly or indirectly from the oil and gas industry, said Bernard Weinstein of the Maguire Energy Institute at Southern Methodist University in Dallas. Portions of the revenues go into the state’s general fund as well as its so-called Rainy Day Fund, but very little of it is spent on social services and programs to assist the poor, although some helps finance public schools and universities.

So, despite the boom, Texas has some of the highest rates of poverty in the nation and ranks first in the percentage of residents without health insurance. Republican leaders have supported tapping the Rainy Day Fund for one-time investments in water and transportation infrastructure, but they have blocked attempts to use the fund for education and other services, arguing that it was designed to cover emergencies and not recurring expenses.”

You can read the full story, ‘Boom Meets Bust in Texas: Atop Sea of Oil, Poverty Digs In,’ over at the Times.