New York's Fracking Math Problems

It's puzzling for some of us to reconcile the continuing rise of gasoline prices with the current boom in domestic oil and natural gas production. We were promised "drill baby drill" was the answer to cheap gas. But as economist Paul Krugman has pointed out, the emptiness of that promise is really no surprise -- so too, the anemic response of employment from all that enhanced domestic production, at least at national and state levels.

But when facts like these prove troublesome, there's the fall-back argument that things will play out better at the regional and local levels, right? After all, here in Sullivan County, like elsewhere along the Marcellus Shale in New York, we're holding our collective breath, waiting for the New York State Department of Environmental Conservation to render a decision on whether, or how, to permit high volume hydraulic fracturing here.

Surely our dreams of prosperity for all will be realized, if only fracking can proceed.

That's the message from Ecology and Environment, Inc. You know them; they're the folks, Working together. Finding solutions.

And they're the folks our DEC chose to contract with for the long-awaited socio-economic impact analysis that was to lay out, once and for all without passion or prejudice, fracking's social and economic pros and cons to assist policy makers with the clear-headed decisions they need to make on behalf of all of us.

But troublesome matters persist.

One of them is the glaring deficiency of E & E's socio-economic analysis. It's a matter that isn't very complicated, at least not to this arm-chair economist; you just need to be able to read and count in order to recognize that weighing the pros and cons requires, well, including the cons -- if you want the analysis to be, well, an analysis, rather than something other than marketing. "Why believe me?," you say. OK, fair enough; don't take my word for it. But real economists have expressed similar concerns, and Janette Barth, Edward C. Kokkelenberg, and Timothy Mount are reported to have said as much in their letter last December to Governor Cuomo.

And as Dr. Barth also reportedly pointed out, our friends at E & E have been the contractor of choice for other industry outfits in need of environmental evaluations of their operations -- it's a service E & E vendors out. No harm there -- unless you're concerned that evaluations of such a sort should be conducted at an arm's length longer than that between E & E and their sources of funding.

But it's not just who's paying E & E; it's also who E & E is paying (and for what), that determines the length of that arm, and perhaps helps explain why an experienced team like E & E would produce
something in lieu of the socio-economic analysis New York State taxpayers paid them to produce.

According to client and lobbying records compiled by JCOPE (the New York State Joint Commission On Public Ethics) and information listed on the website for The Business Council of New York State, E & E funds, through its membership in BCNYS, substantial lobbying activity in Albany. No harm there either -- unless you're concerned that that lobbying activity has been directed at opposing a range of legislation over the past year or so intended to regulate fracking. According to BCNYS's Legislative Memos, that's precisely what's been going on -- BCNYS has lobbied against each of the following bills.

Assembly bill A.7400 would impose a time-out, postponing the issuance of fracking permits until June 1, 2013 in order to "... afford the state and its residents the opportunity to continue the review and analysis of the effects of hydraulic fracturing on water and air quality, environmental safety and public health..."

Assembly bill A.2922 would regulate the use of fracking fluid.

And according to Assembly bill A.2108:

... The legislature further finds that landowners who, subsequent to the effective date of this act, enter into or extend leases with natural gas exploration, operation, transportation or extraction entities share responsibility with such entities for all damages shown to be caused by such activities and that all responsible parties be held strictly liable for damages resulting from such activities...

The list goes on, and includes legislation intended to treat waste from fracking as a hazardous material, A.7013; and establishes the natural gas production contamination response and compensation program and creates the New York natural gas production contamination damage recovery and remediation fund, A.8572.

So why might E & E, through its membership in BCNYS, fund lobbyists to oppose legislation mentioned above? After all, it isn't realistic to believe their business interests permit them to be ignorant of where their membership dollars flow. But the answer isn't terribly important -- unless you're E & E.

What is important is to understand how it can be that a great many New York taxpayers can, as a result of funding DEC, fund lobbying efforts against our own interests. And to understand that we need to know why DEC selected E & E as their consultant instead of competent practitioners without a dog in the fracking fight. Most importantly, we need to demand answers.