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The Leaflet: Bans and Regulations: Two Sides of the Same Coin

November 17, 2017

This week's leaflet looks at fracking bans and regulations across the states.

Officially, Vermont, New York, and Maryland, in that order, are the only states to have passed legislation banning hydraulic fracturing, also known as “fracking.” Illinois’ 2013 Hydraulic Fracturing Regulatory Act (HFRA), which grants permits allowing for high-volume hydraulic fracturing in the state, has ironically acted as a de facto ban – so much so that the first permit to be granted was two months ago, in September, four years after HFRA went into effect.

Wichita, Kansas-based Woolsey Operating Co. was slated to be the first oil and natural gas company to begin its fracking operations in the New Albany Shale formation, located in southeastern Illinois. But alas, not even two months later, Woolsey requested the state’s Office of Oil and Gas Resource Management withdraw its injection well permit, explaining the company would consider reapplying for a permit in the future once “it is economical to pursue the projects contemplated …”

Mark Sooter, Woolsey’s vice president for business development, revealed to Natural Gas Intel’s Shale Daily the primary reason for his company’s quick suspension of fracking production. “The process we have gone through to receive a permit was burdensome, time consuming and costly due to the current rules and regulations of the State of Illinois … Also, the drilling and completion requirements under the HFRA are stringent, which will make future development costs of the New Albany Shale excessive and the obligations for compliance on our staff demanding.”

HFRA was a compromise passed as an alternative to a drilling moratorium and to appease environmentalists who believe fracking induces earthquakes and pollutes groundwater. Regarding the former criticism, researchers at the University of Alberta released a study in June 2017 in which they found no correlation between increased hydrocarbon production (mostly due to large-scale hydraulic fracturing) and increased seismicity rates from 1965 through 2014 in North Dakota, Ohio, Pennsylvania, Texas, and West Virginia, as well as the Canadian provinces of Alberta, British Columbia, and Saskatchewan.

Policy Analyst Timothy Benson wrote in a new Research & Commentary that evidence of groundwater pollution has been scant: “The existing peer-reviewed evidence shows hydraulic fracturing processes do not pose a systemic impact on groundwater. Since 2010, at least 19 of these studies have been produced. These studies are reinforced by the Environmental Protection Agency’s own $29-million, six-year study of fracking’s impact on groundwater sources, which failed to find any systemic impact caused by the 110,000 oil and natural gas wells that have been in use across the country since 2011.”

The economic costs of regulations and bans cannot be understated. In 2012, the Illinois Chamber of Commerce estimated fracking in the New Albany Shale could create $9.5 billion of investment and 47,000 jobs. In a 2016 study, researchers at the University of Chicago, Princeton University, and the Massachusetts Institute of Technology estimate the average household in nine U.S. shale basins has benefited up to $1,900 per year and enjoyed a 7 percent increase in average income, a 10 percent increase in employment, and a 6 percent increase in housing prices.

There still remains no fracking in the Land of Lincoln. Lawmakers in other states should consider scrapping or revising their fracking-permitting bills if they include harsh rules and strict regulations that discourage production. Moratoriums on legitimate business activity are typically not based on scientific literature, economic consequences, or personal liberties. Illinois should revisit its de facto moratorium on hydraulic fracturing.

 

WHAT WE'RE WORKING ON:
Health Care
Research & Commentary: Dental Therapists Could Help Solve Arizona’s Dental Shortage
In this Research & Commentary, Senior Policy Analyst Matthew Glans examines a proposal that would improve access to dental services for all Arizonans by allowing dental therapists to provide needed care. “Allowing dental therapists to practice in more states would help to close gaps in dental care access and ensure patients receive preventive and restorative treatments when and where they need them,” wrote Glans.

Energy & Environment
Research & Commentary: Land Subsidence, Not Climate Change, Is the Cause of Water Intrusion in and Around Chesapeake Bay
In this Research & Commentary, Policy Analyst Tim Benson writes about a new Nongovernmental International Panel on Climate Change report in which the authors argue the available research indicates water intrusion problems in the Chesapeake Bay area are not due to sea-level rise induced by anthropogenic (man-caused) global warming. Instead, they are a result of land subsidence caused by groundwater depletion and, to a lesser extent, subsidence from glacial isostatic adjustment. Land subsidence is the sinking or lowering of the land surface, mostly because of human activity. It can increase flooding, alter wetland and coastal ecosystems, and damage infrastructure and historical sites, as well as contribute to water intrusion and shoreline retreat. The study claims data indicate this land subsidence is responsible for most of the sea-level rise measured in the Chesapeake area during the past 50 years. 

Education
Poll: Millennials Strongly Support School Choice
In this article for School Reform News, Ashley Bateman writes about the results of a new poll conducted by GenForward and published by USA Today,finding among Millennials, 79 percent of blacks, 77 percent of Latinos, 76 percent of Asian Americans, and 66 percent of whites support vouchers. In addition, 65 percent of Millennial-aged blacks, 61 percent of Asian Americans, 58 percent of Latinos, and 55 percent of whites support policies to allow charter schools. These results back up an earlier Beck Research/American Federation for Children poll released in 2017 that found 75 percent of Millennials support school choice. 

From Our Free-Market Friends
Chicago Finances in Peril
Truth In Accounting has just released its new annual report on the financial condition of the Windy City. Chicago earns an “F” grade, primarily because of the city’s $35.8 billion unfunded pension obligation and $715.5 million retiree health care benefits debt. Chicago has a financial hole of $37.4 billion. With the cash-strapped city only owning $7.1 billion of assets, taxpayers must shoulder a $41,700 per-person burden. Other “F” grade cities include New York City and Philadelphia.

Author
Arianna Wilkerson is a government relations speciialist with The Heartland Institute.
awilkerson@heartland.org