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STEUBENVILLE -- It wasn't that he was thrilled at the prospect of letting Ascent Resources drill under 19 city-owned parcels, including historic Beatty Park and the old city landfill. And he didn't vote for it just because there'd be a $1 million-plus signing allowance.
Councilman at large Joel Walker said he was one of six city council members to vote "yes" because under Ohio's forced pooling law, Ascent could and likely was going to do it anyway -- and at least by accepting their bid, the city will get a hefty signing bonus plus royalties.
"The city was one of the last players to lease their gas and oil rights," Walker said. "The county leased the property that (YSU-Steubenville) sits on. Both cemeteries did also. Most, if not all the property owners around the parks have also. We were the only one that held a public meeting to let the public know what we were doing and why."
The why is easy: Under Ohio law, energy companies don't need to get every property owner to sign on the dotted line -- they just need a majority of them to do it so they can combine the parcels they do have rights to into one drilling unit. Once enough people sign leases, a driller can petition ODNR to initiate forced pooling. If it's granted, the properties will still be fracked but non-signers will be penalized with no signing bonus and extremely low royalty payments.
"The state controls it all, they regulate it," City Manager Mike Johnson said. "They took the power away from the city –all we're doing is leasing our property to Ascent. If the city didn't do anything oil and gas was still going to occur in city limits because multiple entities, from private homeowners to the county to businesses, had already leased their property — Jefferson County leased their property in the city. Union Cemetery leased their property, Franciscan University leased their property, someone in Buena Vista who owns a lot of property leased it ... they all did it before the city leased its property. And they can take it anyway, under the forced pooling law."
The well pad will be on Coal Hill Road and all drilling will be done underground.
"The pad will be above-ground but all the drilling is going to occur underneath the surface, none of it will be on the surface of city property," Johnson said, pointing out they've entered into a cooperative agreement with Jefferson County for a road use maintenance agreement that puts the onus on Ascent to ensure roads their trucks use are maintained. "The trucks that will becoming in, they have a route they're supposed to use."
Johnson figures council did the right thing, "doing their due diligence and getting the most money for the property that they can, because otherwise the oil and gas company could have taken it anyway and give the city little-to-nothing for it."
And in a city with limited revenues and a multitude of big-ticket infrastructure needs--among them, a new fire station--officials said identifying and preserving new funding sources is critical: The city will get $7,000 an acre--somewhere around $1, million plus a 20 percent gross royalty--for leasing the 19 parcels.
Council has already decided lease revenues should be placed in a separate, special account until they're ready to vote on how to use the money. While revenue generated from drilling under the old landfill must go into the city's landfill account, one source said council at the moment seems to favor using the rest for park improvements, though that could change.
But not everyone is happy about it.
Throughout the vetting process, residents voiced concern about everything from noise and light pollution to health and environmental risks associated with fracking, particularly at Beatty Park.
"Just because you're not (directly over it) doesn't mean you're going to be clear of any of the effects," said Suzanna MacDonald, a Harrison County resident who spent much of her youth at Beatty Park. "We know from peer-reviewed studies that some of the air pollutants can travel up to six miles. (Well pad) noise is going to be an issue, then you're going to have to worry about light and light pollution, which affects humans as well as other species."
Health-wise, she voiced concerns about the chemicals used in fracking as well as radon gas exposure.
"There's no amount of money that will replace the ecosystem and the beauty of Beatty Park," MacDonald added. "This is a historic place. You know, I can't imagine selling one of my children for money -- this, to me, is almost as egregious because everyone in Steubenville and the tri-state area gets to enjoy this park. Once it's damaged it's never going to be the same.
Councilman Royal Mayo, the lone hold-out, agreed.
"My primary concern is the health and wellbeing of the citizens of Steubenville," he said. "When we first were asked about doing it, we were given very little information--we got the pros, the money (angle) nothing else. I thought should have put a lot more research on the negative effects, we should have done a lot more listening to what the citizens thought and said. It didn't have to be done that fast, I don't know what the rush was."
Mayo maintains that too often policy making is "being led by people working for the city and not by the people who were elected by the citizens of the city. A lot of times what we're being told is what they want, not necessarily the options."
Prior to voting Mayo also raised concerns about health risks.
"Your health should never be for sale," he said. "Go back to 1974, the Harvard lung study: It found that steel mills and coal mines — things we have around here -- had an adverse health risk that made this one of the most unhealthy places to live, if not the most unhealthy place to live for cancer and lung disease. I think we needed to put more time into it."