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Fracking Lifts Remote Texas Town From Poverty to Riches

By Cheryl K. Chumley   |   Thursday, 30 Jan 2014 11:32 AM

Image: Fracking Lifts Remote Texas Town From Poverty to Riches
Thanks to fracking, the small town of Cotulla, Texas has moved from near-poverty status to overnight wealth, tripling the amount of revenues it collects in just a few years.

Nearly every student in the community's elementary schools now has an iPad. Students ride to school in brand new buses. And their parents aren't required to pay money to the schools to help with supplies.

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It's gone "crazy," said Mariane Hall, Commerce Manager for the Cotulla-LaSalle County Chamber of Commerce. "And it's all related to the shale industry. This was what woke us up and put us on the map."

Hall was referring to the booming oil business that's been revitalized by advances in hydraulic fracturing technology at the nearby Eagle Ford Shale.

The town in south Texas, halfway between San Antonio and the Mexican border, has two elementary schools, one middle school, and one high school. The school system, which is funded largely by property taxes, has seen its revenues increase as property values have soared, from $550 million to 2011 to $5 billion last year.

"The economic benefits associated with shale oil and shale gas production are undeniable. The boom over the past few years is lowering families' energy bills, creating jobs and revitalizing America's manufacturing base," Nicolas Loris, the Herbert and Joyce Morgan Fellow at The Heritage Foundation in Washington, D.C., told Newsmax.

"The revenue collected by states, as well as the additional sales tax revenue from an improved economic outlook, has generated funds for infrastructure and schools and rejuvenated communities," Loris said.

For the first time in the county's history, Cotulla's local government was required to return a percentage of its revenues to the state, in accordance with a law that requires wealthier areas to spread some of their tax collections to poorer counties.

"Originally, we had four hotels," said Larry Dovalina, city administrator for Cotulla. "Now we have 23 either built or being built. Our population tripled in the same period. We're estimated now north of about 10,000."

The schools, meanwhile, have been major beneficiaries of the recent boom.

In addition to iPads for 1,300 students, the two elementary facilities "have done upgrades, the stadium got new upgrades, the office is being remodeled," said Rafael Denivdez, who works in the technology department at Ramirez-Burks Elementary School, part of the Cotulla Independent School District.

"We were once the poorest district. Now we went to being one of the richest districts. And it's not just schools. We have a new housing complex. We used to have McDonald's, Dairy Queen. Now we have a billion more restaurants, gas stations, a whole lot of hotels," Denivdez told Newsmax.

Not all the growth is seen as favorable. Traffic has become a nightmare at times, Denivdez said. But Hall said the local government has been working hard to keep up with the necessary infrastructure improvements, like water and sewer lines.

But all in all, the fracking boom is regarded as a massive godsend to the locale, and to many other communities as well.

In 2013, North Dakota experienced an oil boom of such an extent that more residents than ever claimed millionaire status. In 2012, the state ranked 43rd in the nation for millionaires. A year later — and after the Bakken shale region reported boom production levels — North Dakota came in on the millionaires list at No. 29, besting even Florida.

The Manhattan Institute's influential City Journal reported that shale production has grown by leaps and bounds in recent years, enriching communities that embrace the technology.

In 2000, only 2 percent of the nation's domestic natural gas supply came from fracking. But now, federal energy statistics show that the nation derives more than 50 percent of its gas supplies from shale.

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Related stories:
Environmentalists Lash Out at Obama Administration Over Fracking

EPA Unlikely to Step up Fracking Enforcement Efforts

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