Since the mid-2000s, technological advances have led to a dramatic increase in natural gas and oil production from shale formations in the United States (see figures 1 and 2 below). Along with this increased production comes new revenues and costs for local and state governments.
The Shale Public Finance project seeks to identify the key public finance issues facing local governments experiencing this new oil and natural gas development.
Identify key fiscal issues faced by local governments experiencing new or increased oil and gas development. Identify and describe policy approaches for managing these issues.
The project will seek to answer the following specific research questions:
- What are the fiscal impacts to local governments from new or increased oil and gas development in the shale gas and shale oil era, and how have these impacts varied from region to region?
- Have varying state and local policies provided sufficient funding to manage these impacts?
- What lessons can be learned from local government responses to fiscal impacts related to oil and gas development?
- Analyze local and state budgets to identify effects of oil and gas development on local government revenues and outlays.
- Analyze existing state fiscal policies relevant to oil and gas development in a variety of states and local governments.
- Conduct structured interviews with local government officials, industry stakeholders, and some state government officials in a variety of states with active shale oil or gas development.
- Hold a stakeholder workshop to share information and discuss potential solutions.
- A series of 2-3 publications describing the issues noted above, along with several case studies of specific communities and their approaches to dealing with the relevant fiscal issues.
- Publications will present findings and -- if warranted -- identify best practices and recommendations.
Richard G. Newell
Founding Director, Duke University Energy Initiative
Gendell Professor of Energy and Environmental Economics
Associate in Research, Duke University Energy Initiative