Last of three parts
YOUNGSTOWN, Ohio – You might think an earthquake would be enough to make a town turn against fracking, but no, not here, not with a new billion-dollar steel plant open along the river and more new jobs everywhere you look.
This worn-out notch in the Rust Belt, long known for industrial decay and a Bruce Springsteen song about an unemployed steelworker fixing to die, doesn’t seem to mind being shaken up every once in a while if that’s the price to pay for an economic comeback.
Youngstown bore that price most severely on New Year’s Eve 2011, when the earth shook with a tremor that measured 4.0 on the Richter scale and that could be felt in Buffalo, 200 miles away.
Scientists later found that it happened because a local waste-disposal firm pumped so much fracking waste so deep and so violently into the earth here that the ground began to shake.
Still, that wasn’t enough to stir the voters of Youngstown. Three times in the past year, they rejected – by double-digit margins – a ban on fracking similar to the one passed by the Buffalo Common Council in 2011.
There’s only one explanation for that, said Susie Beiersdorfer, a geologist who helped lead the fight for the ban on fracking.
“It’s all about jobs, jobs, jobs,” Beiersdorfer said. “This community has been down so long, that’s all anyone is thinking about.”
And suddenly, there are new jobs to think about here in Youngstown.
Vallourec, a French manufacturer of steel pipes for the oil and gas industry, last year opened a billion-dollar plant along the Mahoning River that employs 350.
Nearby, several companies have opened up shop in an industrial park to service the burgeoning natural gas industry of eastern Ohio and western Pennsylvania. And the local pipe fitters union, which reported 40 percent unemployment at the height of the recession only 4½ years ago, reached full employment last year.
Ask people here why Youngstown is finally showing signs of life after a 40-year decline that hollowed-out downtown and left the riverfront a wasteland, and you’ll often hear the same answer.
“None of this would have happened if it weren’t for the oil and gas industry,” said Roland “Butch” Taylor Jr., business manager of Local 396, United Association of Plumbers, Pipefitters, Steamfitters and HVAC Technicians, in Boardman, just south of Youngstown.
City moving forward
It is way too soon to label Youngstown a comeback city. An old-time steel town whose population peaked at about 170,000 in 1930, Youngstown collapsed as the U.S. steel industry did, and there are strong signs that the collapse is not yet complete.
The Census Bureau identified Youngstown as the city that had shrunk the most since the 2010 census, losing more than 2 percent of its population in two years – which is not surprising, given that the region lost more than 16,000 manufacturing jobs during the Great Recession.
About 65,000 people are now spread out in a shabby urban landscape where abandoned homes and boarded-up shops seem to outnumber the occupied ones in some neighborhoods.
Yet now there are signs of positive change.
Metro Youngstown added 1,200 manufacturing jobs in the five years ending in March – which is exactly the number metro Buffalo lost in that time frame.
What’s more, amid the Great Recession in March 2009, metro Youngstown’s unemployment rate was 12.6 percent – 3.9 points higher than the national average. But by this March, Youngstown’s unemployment rate had fallen to 6.9 percent, only 0.2 points higher than the national rate and 0.2 points lower than Buffalo’s.
“For the first time in a long time, jobs are available for people,” said Tony Paglia, vice president for government affairs at the Youngstown/Warren Regional Chamber.
It is happening, in part, because the Chamber is not exaggerating when it bills itself “North America’s Center for Utica and Marcellus Shale Business.”
Sweet spot for renewal
Suddenly, Youngstown finds itself in a sweet spot, with Ohio’s Utica Shale development to the north, south and west and Pennsylvania’s Marcellus Shale fields to the east. Combine that with Youngstown’s strong labor market and transportation network, and you have a recipe for renewal, said Joel C. Mastervich, executive vice president of operations/industrial director of the North American Division of Vallourec’s Oil Country Tubular Goods, or OCTG.
“We think there’s a lot of upside opportunities for that part of the country,” Mastervich said, noting that his company’s new plant “is ideally located, with the Utica and Marcellus right there.”
That is also why Legacy Measurement Solution, a Texas-based maker of measuring and storage equipment for the oil and gas industry, opened a new plant in the region, creating 150 jobs. And it is why there is a new cryogenic gas-processing plant south of town, and two new pipelines in the works, and a host of new warehouses and storage facilities now open for business.
Then again, the regional gas boom is not the only reason for the region’s modest comeback. The area is also home to a major General Motors plant and other facilities that serve the reviving U.S. auto industry, as well as heavy-metals operations that have nothing to do with the energy industry.
For those reasons, “I can’t say exactly how much of the recent growth has been due to fracking,” said Albert J. Sumell, an assistant professor of economics at Youngstown State University. “But I can tell you it has something to do with it.”
Youngstown’s energy-related growth may be just beginning, given that Ohio’s shale operations started far later than those in neighboring Pennsylvania. In 2011, the year drilling peaked in Pennsylvania with 1,968 wells drilled, a mere 35 were drilled in Ohio. But last year, 627 wells were drilled in Ohio as of mid-December, with an additional 1,015 receiving permits for drilling to begin.
“We got off to a slow start compared to Pennsylvania,” said Lewis Horner, assistant chief of the Bureau of Labor Market Information for the State of Ohio. “We’ve going to need some infrastructure.”
That being the case, Taylor, of Local 396, said: “We’re really looking at a bright future.”
State affixes the blame
Not surprisingly, there are plenty of people in metro Youngstown who see its fracked future as anything but bright.
To prove it, all they have to do is recall New Year’s Day 2011.
That afternoon, Beiersdorfer – the geologist opposed to fracking, who was involved in the Occupy movement at the time – was at her laptop at a downtown diner, designing a flier to be handed out at the city’s First Night celebration.
All of a sudden, the ground started shaking.
“It felt like a truck hit the building,” Beiersdorfer said. “It was shocking.”
It was the worst of several tremors to strike the region, which has no history of significant seismic activity. The Ohio Department of Natural Resources, or ODNR, quickly identified the likely culprit: an injection well in Youngstown that was used to store fracking wastewater, mostly from Pennsylvania, deep beneath the earth’s surface.
“After investigating all available geological formation and well activity data, ODNR regulators and geologists found a number of co-occurring circumstances strongly indicating the Youngstown area earthquakes were induced,” state officials said in a report. “Specifically, evidence gathered by state officials suggests fluid from the Northstar 1 disposal well intersected an unmapped fault in a near-failure state of stress, causing movement along that fault.”
The quake shook up people like Mike Ray, a Youngstown city councilman who immediately started asking questions about the injection well, which was run by D&L Energy.
But Ray quickly learned that even an earthquake would not upend the way many people in the region feel about fracking.
Ray was walking downtown one day when he encountered John Kennedy, owner of the Royal Oaks Bar & Grill in Youngstown, who wanted to know why Ray was being so critical of fracking.
“Mikey, you know what, when the mills were running and I was a kid, we were all dirty and the city had money and everybody was happy,” Kennedy told Ray. “What are you doing?”
Indicting ‘a bad actor’
What he was doing was asking questions about someone Ray identified as “a bad actor”: Ben Lupo, head of D&L Energy.
He wasn’t the only one asking questions. Early last year, federal officials started looking into the discharge of fracking wastes into a storm sewer that leads to the Mahoning River – and ended up indicting Lupo, charging him with violating the federal Clean Water Act.
Not only had one of Lupo’s companies been tied to an earthquake, now he was charged with creating a fracking-related mess that filled the city’s storm sewers with a vile mix of petroleum products and saltwater.
“They spent weeks doing the remediation,” Ray said, adding that the contamination reached all the way to a local Toys R Us distribution center.
Lupo pleaded guilty in March, but his antics energized the local anti-fracking movement long before that. Early last year, the “fractivists” moved to get Youngstown voters to consider a “community bill of rights” that would have banned fracking within the city limits.
The measure was on the ballot last May, last November and again this month, and it lost every time, although by increasingly narrow margins of 13.7, 9.7 and 8.5 points.
Advocates of the ban acknowledged that, for older Youngstown residents, the attempt to ban fracking for environmental reasons evoked memories of the 1970s-era clean-air regulations that, in the minds of some, decimated the local steel industry.
Campaigning for the fracking ban last fall, “we would have these absolutely rabid weasel people who will get into our faces and say, ‘You shut down the steel mills,’ ” said Lynn Anderson, who was active in Frackfree Mahoning, which pushed the ban.
‘Unique’ coalition forms
But a spectacularly diverse coalition coalesced to fight the ban.
“It was very unique,” said Paglia, of the Youngstown/Warren Chamber. “You had business and labor, Democrats and Republicans, all working together.”
Local political leaders teamed with the oil and gas industry – and with inner-city ministers – to fight the ban.
For example, the Rev. Gregory Maturi of St. Dominic’s Catholic Church in inner-city Youngstown talked up fracking and attacked the proposed ban in conversations with parishioners.
“I’m all about the revival and renewal of Youngstown,” Maturi said. “This is really to help the poor and needy. It’s about helping people get jobs.”
The pro-fracking coalition, which spent 22 times more than the fracking opponents did on the campaign last fall, flooded the airways with ads and had inner-city ministers making robo calls to city residents.
In the end, supporters of the ban said it is no wonder that they lost.
“The industry’s propaganda machine is very powerful,” said Kari Matsko, director of the People’s Oil and Gas Collaborative of Ohio, a group that works with people impacted by fracking.
Fracking opponents say that propaganda machine exaggerates drilling’s economic impact, and Sumell, the economist from the local university, acknowledged that the industry’s estimates of jobs created are “almost absurd.”
For one thing, given the urban landscape and the location of Ohio’s underground gas supplies, experts said there is unlikely to be much drilling within the Youngstown city limits.
Instead, while the city benefits from fracking suppliers such as Vallourec, Ohio’s gas drilling is occurring primarily in the surrounding counties, where opponents of fracking repeat the same complaints that you hear in the widely fracked parts of Pennsylvania.
“People here think they’re going to get jobs?” Anderson asked. “All the drillers around here are from Oklahoma and Texas.”
John Williams, an anti-fracking activist in Trumbull County, north of Youngstown, agreed.
“We’re finally starting to see high-paying jobs – but they all come with the company and move from spot to spot,” Williams said. “The locals aren’t getting the high-paying jobs. We’re getting the trickle-down from them buying hot dogs at our restaurants.”
Williams complains of the noise and fumes from fracking operations that surround a mobile home park in Weathersford, in Trumbull County. But he acknowledges that many land owners don’t seem to care very much, focusing instead on leasing their property to the gas drillers flooding to the region.
“Everybody dreams of these royalty checks,” Williams said.
Dreams for the future
That’s not at all what Father Maturi is dreaming about, though. He, like many fracking supporters here, dreams of a better Youngstown.
Maturi – known locally as “the crime-fighting priest” – has pressured the city into tearing down vacant homes near his parish and has also built a new parish center.
“But that’s not enough,” he said. “The economic component is very important. And I think the fracking is our best hope for that.”
A chemical engineer before studying for the priesthood, Maturi acknowledged that people have legitimate environmental concerns about fracking. But he said citizens should press the Ohio government to make sure that it is done safely.
After all, Youngstown’s future depends on it, he said.
“Maybe my idea is no good,” Maturi said, “but there is no alternative.”