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Southern Tier threatens to leave NY for PA: Everybody over the border has new cars, new roofs, new siding

Following a decision in December of last year to ban hydraulic fracturing in New York, several towns in New York’s Southern Tier are threatening to secede from the state in order to join Pennsylvania. The towns sit on top of a portion of the Marcellus shale play, which they say they need to access in order to generate revenue, reports The Washington Post.

“The Southern Tier is desolate,” said James Finch, Town of Conklin Supervisor. “We have no jobs and no income. The richest resource we have is in the ground.”

Conklin is one of fifteen towns that are all members of the Upstate New York Towns Association, which is now conducting an economic feasibility study for a scenario in which the fifteen towns secede from New York in order to join Pennsylvania. The association is comparing tax rates as well as cost of living and business expenses in the two states. It expects to complete its study in the coming weeks, reports Capital New York.

Fitch says that some residents travel from Conklin to Pennsylvania in order to work in the oil and gas industry across state lines. “Everybody over the border has new cars … they have new roofs, new siding,” says the Conklin supervisor. Fitch and others in the Upstate New York Towns Association say they badly need the income that would be generated from allowing hydraulic fracturing, especially after a proposal to build a casino in the Southern Tier was denied.

Bringing attention to a struggling economy

Fitch said in later interviews that secession is unlikely, in his opinion, but that he hopes this will bring attention to an economy that is badly in need of new sources of revenue. “Everyone loves it here (in New York). That’s why we’re here. Otherwise we’d all move,” he said to local TWC News.

“While we’re all frustrated, [annexing to Pennsylvania] has really never been an issue of topic,” said Tim Whitesell, Town of Binghamton Supervisor. Whitesell said he doesn’t see secession in the Southern Tier’s future. “Looking at case history, it really hasn’t flourished to the benefit of the municipalities.” Secession also requires approval from the states of New York and Pennsylvania, as well as the federal government, making it a complicated process.

Since the New York frac ban went into effect, the Cuomo administration has announced a $50 million investment plan for the Southern Tier that includes a $20 million clean energy plan and a $30 million agriculture proposal designed to help farmers grow, but many say the plan is not enough. Carolyn Price, supervisor for the town of Windsor, said that the investment plan is a good idea, but that it will not bring the Southern Tier the jobs it needs.

Missing the shale boat prompted a group of 70,000 mineral owners in New York to file a lawsuit in 2014 against the governor and two state agencies for illegally prolonging the review process.

New York

“We have the best resource we have and it’s in the ground and we’re being cut off from using it or seeking how we can use it,” said Finch. While many in the Southern Tier do not think secession will ultimately happen, they do hope that a dialogue will open so that they can take advantage of the resources beneath their feet.

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Important disclosures: The information provided herein is believed to be reliable; however, EnerCom, Inc. makes no representation or warranty as to its completeness or accuracy. EnerCom’s conclusions are based upon information gathered from sources deemed to be reliable. This note is not intended as an offer or solicitation for the purchase or sale of any security or financial instrument of any company mentioned in this note. This note was prepared for general circulation and does not provide investment recommendations specific to individual investors. All readers of the note must make their own investment decisions based upon their specific investment objectives and financial situation utilizing their own financial advisors as they deem necessary. Investors should consider a company’s entire financial and operational structure in making any investment decisions. Past performance of any company discussed in this note should not be taken as an indication or guarantee of future results. EnerCom is a multi-disciplined management consulting services firm that regularly intends to seek business, or currently may be undertaking business, with companies covered on Oil & Gas 360®, and thereby seeks to receive compensation from these companies for its services. In addition, EnerCom, or its principals or employees, may have an economic interest in any of these companies. As a result, readers of EnerCom’s Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this note. EnerCom, or its principals or employees, may have an economic interest in any of the companies covered in this report or on Oil & Gas 360®. As a result, readers of EnerCom’s reports or Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this report.