Rural Revitalization

One of the nice things about this oil and gas boom is its rural flavor. In many ways the shale revolution has been a useful on-ramp for rural revitalization. Bloomberg Businessweek reported how the Bakken shale boom flooded rural banks with cash. Local tax receipts are up, which gives small communities badly needed money to build and improve schools and courthouses.

But there are some unexpected outcomes. Formerly poor school districts in Texas that received a lot of money from the state are now on the other end of our Robin Hood school funding formulas. While the local government budgets are higher, so are the expenses. Counties grapple with rural towns filled with broken roads, and regional hospitals are fuller than normal, both casualties of the flourishing oil and gas activity.

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Boomtowns such as Midland and Odessa are experiencing a much higher population growth rate than Texas on average. | © Melissa Reese | Source: U.S. Census

These costs are in contrast with the benefits of bustling restaurants, retail stores with increased sales, full hotels, and every other economic activity you can imagine. While the stereotypes of an all-male industry feel dated—oilfield work trailers have more women in them than ever before—it is still the case that rural strip clubs have never done better, and that’s the rub: These small town communities, many of which are very religious and socially conservative, are often a destination for people who want to avoid urban problems. But then their little hamlet starts to attract thousands of men, drugs, prostitutes, and bar room brawls, along with flowing dollars. Managing these tradeoffs moving forward is one of the grand challenges for boomtowns.