Economic Impact of the Eagle Ford Shale County-Level Detail Appendix. September 2014

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1 Economic Impact of the Eagle Ford Shale County-Level Detail Appendix September 2014

2 Acknowledgements This report was prepared by the Center for Community and Business Research at the University of Texas at San Antonio s Institute for Economic Development. The project was supported with funding from the South Texas Energy and Economic Roundtable (STEER), America s Natural Gas Alliance (ANGA) and SHALE Oil & Gas Business Magazine. Any findings, conclusions, or opinions are those of the authors and not necessarily those reflected by the University of Texas at San Antonio, STEER, ANGA, or SHALE Oil & Gas Business Magazine. Principal Investigator: Thomas Tunstall, Ph.D. Lead Investigator: Javier Oyakawa, M.A., MSc. Researchers: Gina Conti, Maricela Diaz-Wells, Jason Hernandez, Yongsun Lee, Vincent Loeffelholz, Neeraj Ravi, John Rodriguez, Feihua Teng, Carelli de la Garza, Hector Torres, Binbin Wang, John Zhang GIS Specialist: Hisham Eid Review Assistance: Chris Clark 1

3 Contents Acknowledgements... 1 Executive Summary Atascosa County Overview of Atascosa County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Atascosa and 15-County EFS Area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in Bee County Overview of Bee County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Bee and the EFS Area Employment Changes Employment Forecast State Sales Tax

4 Commuting Patterns Economic Impacts in Economic Impacts in DeWitt County Overview of Dewitt County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in DeWitt and 15-County EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in Dimmit County Overview of Dimmit County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Dimmitt and 15-County EFS area Employment Changes Employment Forecast State Sales Tax

5 Commuting Patterns Economic Impacts in Economic Impacts in Frio County Overview of Frio County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Frio and 15-County EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in Gonzales County Overview of Gonzales County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Gonzales and 15-County EFS area Employment Changes Employment Forecast State Sales Tax

6 Commuting Patterns Economic Impacts in Economic Impacts in Karnes County Overview of Karnes County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Karnes and 15-County EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in La Salle County Overview of La Salle County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in LaSalle and 15-County EFS Area Employment Changes Employment Forecast State Sales Tax

7 Commuting Patterns Economic Impacts in Economic Impacts in Lavaca County Overview of Lavaca County General County Data Population Growth Comparison Population Forecast Job Growth Comparison Natural Resource and Mining Employment Growth Comparison Location Quotients for NRM Employment in Lavaca and 15-County EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in Live Oak County Overview of Live Oak County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Live Oak and 15-County EFS Area Employment Changes Employment Forecast State Sales Tax

8 Commuting Patterns Economic Impacts in Economic Impacts in Maverick County Overview of Maverick County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Maverick and 15-County EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in McMullen County Overview of McMullen County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in McMullen and 15-County EFS area Employment Forecast State Sales Tax Commuting Patterns

9 Economic Impacts in Economic Impacts in Webb County Overview of Webb County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Webb and 15-County EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in Wilson County Overview of Wilson County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Wilson and 15-County EFS Area Employment Changes Employment Forecast State Sales Tax Commuting Patterns

10 Economic Impacts in Economic Impacts in Zavala County Overview of Zavala County General County Data Population Growth Comparison Population Forecast Natural Resource and Mining Employment Growth Comparison Job Growth Comparison Location Quotients for NRM Employment in Zavala and 14-county EFS area Employment Changes Employment Forecast State Sales Tax Commuting Patterns Economic Impacts in Economic Impacts in Additional Counties: Bexar County Population County Overview Population Growth Comparison Job Growth Comparison Natural Resource and Mining Employment Growth Comparison Location Quotients for NRM Employment in Atascosa and 14-county EFS area Jim Wells County Population County Overview Population Growth Comparison Job Growth Comparison Natural Resource and Mining Employment Growth Comparison

11 Location Quotients for NRM Employment in Atascosa and 14-county EFS area Nueces County Population County Overview Population Growth Comparison Job Growth Comparison Natural Resource and Mining Employment Growth Comparison Location Quotients for NRM Employment in Atascosa and 14-county EFS area San Patricio County Population County Overview Population Growth Comparison Job Growth Comparison Natural Resource and Mining Employment Growth Comparison Location Quotients for NRM Employment in Atascosa and 14-county EFS area Uvalde County Population County Overview Population Growth Comparison Job Growth Comparison Natural Resource and Mining Employment Growth Comparison Location Quotients for NRM Employment in Atascosa and 14-county EFS area Victoria County Population County Overview Population Growth Comparison Job Growth Comparison Natural Resource and Mining Employment Growth Comparison Location Quotients for NRM Employment in Atascosa and 14-county EFS area References

12 Executive Summary Source: Selected GIS software provided by Caliper Corporation; Newton, MA. Center for Community and Business Research. 11

13 Executive Summary This latest economic impact report on the Eagle Ford represents the 4 th installment in the series. Communities throughout South Texas continue to experience tremendous growth and stand to benefit from significant economic impacts as a result of natural gas, oil, and condensate development in the Eagle Ford Shale. Overall, oil and condensate production in the Eagle Ford has grown from 581 barrels per day in 2008 to over 1.1 million barrels per day as of June Natural gas production now tops 4 billion cubic feet per day. The Eagle Ford Shale continues to exceed expectations and currently attracts the most capital investment of any shale field in the U.S. This study assesses the economic impact of the Eagle Ford Shale for 2013, including direct, indirect and induced impacts in the 21 counties directly and indirectly involved in production. Lavaca County has been added to the geographical scope of this year s study. Also provided is an analysis of economic impacts of related businesses such as construction projects, manufacturing investments, as well as upstream, midstream and downstream impacts. Of particular note is the aspect of community sustainability. The ongoing activity - driven by energy companies and related industries - presents South Texas community leaders with a rare opportunity to ensure the long-term viability of their cities, towns and counties. As the natural gas, oil, and condensate production in the Eagle Ford continues to increase, the challenges facing community leaders are more critical than ever. Investments in infrastructure - roads, water, wastewater, K-12 education, medical facilities, etc. - are the key components that will provide the necessary foundation to ensure future sustainability of communities in South Texas. To address infrastructure investment, community leaders should be engaged with state legislators to develop systematic solutions to ensure that rural areas benefit from revenue sources such as the Economic Stabilization Fund. 1 Cities and counties that do not collect the two percent sales tax allowed by state law should consider doing so as well. The impact of Eagle Ford is far-reaching, but it will be up to community leadership to seize the opportunity. Estimates of overall economic impact for the 21-county area in 2013 top $87 billion, up from $61 billion in For 2023, the 21-county impact is estimated to reach nearly $155 billion, far higher than the $89 billion forecast for 2022 that we reported in the March 2013 economic impact study. The rationale for the upward revisions (as mentioned above) is due to the way the Eagle Ford continues to exceed expectations in terms of production. In addition, new manufacturing projects associated with the natural gas renaissance in the U.S., as well as new processing, refining and port facilities are factors driving increases in the economic impact statistics. 1 The Texas Economic Stabilization Fund (ESF) is more commonly referred to as the Rainy Day Fund and isexpected to approach $14 billion by the 2015 legislative session. Oil and gas severance taxes are currently providing the bulk of the funding for the ESF. 12

14 Scope This study examines the 15 core counties where activity is most prevalent in the Eagle Ford Shale. These counties are: Atascosa Gonzales Maverick Bee Karnes McMullen DeWitt La Salle Webb Dimmit Lavaca Wilson Frio Live Oak Zavala Additionally, this study examines 6 neighboring counties where significant activity, not including extraction, is occurring. These counties are Bexar Jim Wells Nueces San Patricio Uvalde Victoria 13

15 2013 Total estimated economic impacts For 2013, the oil and gas industry in the Eagle Ford is estimated to have contributed total impacts close to $72 billion in the core 15-county area, supporting almost 115,000 full-time equivalent jobs, while contributing just over $2 billion both to local governments and to the state government. The 21-county area, which includes the 15 core counties and 6 surrounding counties, is estimated to have contributed just under $90 billion in economic output, employing over 150,000 people, and provided over $2.2 billion to both the local governments and to the state government. Economic impact Direct Indirect Induced Total Output $61,470,280,412 $7,941,100,117 $2,418,234,050 $71,829,614,579 Employment, full-time 42,607 52,333 19, ,315 Core 15-county area Payroll $2,027,428,721 $1,539,076,337 $584,718,872 $4,151,223,930 Gross regional product $30,448,269,805 $4,333,962,004 $1,542,827,867 $36,325,059,676 Local government revenues $2,025,968,804 State revenue, including severance taxes $2,028,406,113 Output $70,725,115,021 $12,896,817,708 $4,135,496,654 $87,757,429,382 Employment, full-time 51,652 71,648 31, ,984 Core and neighboring 21-county area Payroll $2,707,017,870 $2,036,271,899 $896,394,413 $5,639,684,182 Gross regional product $32,992,259,490 $7,199,851,186 $2,640,560,616 $42,832,671,293 Local government revenues $2,218,877,342 State revenue, including severance taxes $2,214,664,000 Source: IMPLAN

16 2023 Total estimated economic impacts For 2023, the core 15-county area is estimated to have an economic output of over $120 billion, employ 170,000 workers, and contribute approximately $4.5 billion to the local and to the state government. The 21-county area is estimated to contribute close to $155 billion in economic output, provide approximately 220,000 full-time equivalent jobs, and supply over $4.7 billion to both local governments and to the state. Economic impact Direct Indirect Induced Total Output $104,351,566,973 $12,558,453,461 $5,980,635,393 $122,890,655,827 Employment, full-time 40,588 82,307 47, ,807 Core 15-county area Payroll $7,236,771,283 $2,334,324,666 $1,446,441,954 $11,017,537,904 Gross regional product $62,080,644,141 $6,667,762,818 $3,815,928,705 $72,564,335,664 Local government revenues $4,492,272,543 State revenue, including severance taxes $4,526,209,986 Output $124,759,808,465 $21,452,588,557 $8,261,973,466 $154,474,370,488 Employment, full-time 42, ,699 64, ,406 Core and neighboring 21-county area Payroll $7,643,159,428 $3,835,633,784 $2,117,833,257 $13,596,626,469 Gross regional product $66,802,464,206 $11,821,872,891 $5,271,076,088 $83,895,413,184 Local government revenues $4,742,969,499 State revenue, including severance taxes $4,770,092,567 Source: IMPLAN 15

17 Atascosa County Overview of Atascosa County Source: Selected GIS software provided by Caliper Corporation; Newton, MA. Center for Community and Business Research. 16

18 General County Data In 2013, much of the economic development in Atascosa has centered in Pleasanton. In order to service Eagle Ford Clients in the shale region, Houston-based FlexSteel Pipeline Technologies, Inc., opened a 6,000 sq. ft. service center. The facility rests on two acres of land and supports four employees. 2 Pipe distributor, ISCO Industries Inc., out of Louisville, KY, also opened a 4,000 sq. ft. facility in Pleasanton, supplying leak- and corrosion-resistant, polyethylene pipe products. 3 In order to supply the millions of gallons of water required for the hydraulic fracturing process, the water-transfer firm, RCW Energy Services, opened an office in Pleasanton, a capital investment that increased its payroll in the area in addition to the allocation of new pipes, pumps, and storage equipment. 4 Other projects were announced in 2013 demonstrated new opportunities for other firms. With the influx of new hires by oil, trucking, and pipeline companies for Eagle Ford projects, there is a subsequent demand comprehensive background checks, including drug and alcohol testing, as a means to prevent on-field injuries. This need convinced the Greenville, South Carolina-based ARCpoint Labs to open of a new office in Pleasanton. 5 In November 2013, the Phoenix Hospitality Group announced the construction of a 70- acre, multi-family housing development, slated for completion in the second quarter of H.E. Butts Grocery Co. announced an expansion to the Pleasanton location. Once completed in August 2014, the project would double the size of the existing store. 7 Atascosa, a Texan county in the Eagle for Shale region consists of a total population of 46,446 thousand people. Out of these, the population that makes up the total employment is 10,704 people Atascosa, a Texan county in the Eagle Ford Shale region, consists of a total population of 46,446 thousand people. Out of these, the population that makes up the total employment is 10,704 people. It is estimated that out of the total employment, $30,238 is the average per capita personal income. Population 46,446 Per Capita Personal Income 30,238 Total Employment 10,704 Sources: Bureau of Economic Analysis (BEA), Regional Accounts 2 Nowlin, Sanford. FlexSteel opens pipeline-supply facility in Pleasanton to service Eagle Ford clients. San Antonio Business Journal. Nov. 18, Nowlin, Sanford. ISCO Industries opens pipe distribution facility South of San Antonio. San Antonio Business Journal. Nov. 22, Nowlin, Sanford. RCW Energy pumps up capital spending in Eagle Ford, other Texas plays. San Antonio Business Journal. September 23, Aldridge, James. ARCpoint Labs targeting Eagle Ford firms for employment screenings. San Antonio Business Journal. Jan. 8, Silva, Tricia Lynn. Phoenix Hospitality Group broadens geographic reach. San Antonio, Business Journal. November 29, Thomas, Mike W. H-E-B expanding store in Pleasanton. San Antonio Business Journal. August 1,

19 Population Growth Comparison The growth in population for the 15-County EFS area and the state of Texas has been virtually the same since 2001, with both showing a 22 percent increase. Similarly, Atascosa County also has been steadily increasing; it holds a 17 percent increase in population. Comparative Population Growth Source: U.S. Census Bureau 18

20 Population Forecast The following table projects Atascosa County s population from Atascosa County is projected by the year 2023 to see an overall increase in population. Based on our calculations starting in 2010, the population, by 2023, will see a steady annual increase of 10,165 people. Population Forecast From Year Population , , , , , , , , , , , , , ,076 Source: Texas Workforce Commission as computed in 2012 by The Office of the State Demographer for the State of Texas 19

21 Natural Resource and Mining Employment Growth Comparison All three areas saw an increase, followed a sharp drop in 2008, with Atascosa falling as much 16 percent in Despite the decrease in 2009, in 2013 Atascosa experienced a net increase of 41 percent. The 15-County EFS area however, saw multiple spikes in employment in natural resources and mining, recovering from an 18 percent loss in 2009 to see a net increase of 49 percent in The state of Texas as whole saw the least overall fluctuation, dropping just 3 percent in There was a 23 percent increase in 2012; however, this number has fallen 10 percent in the last year. Comparative Job Growth for Natural Resource and Mining Source: Texas Workforce Commission (QCEW) 20

22 Job Growth Comparison All the three areas experienced an increase from 2007 to 2008, which was followed by a steady decline until 2010 when Atascosa County spiked and continued their increase to their current mark of 36 percent. The 15-County EFS areas as well as the state of Texas as a whole both have shown modest increases to 107 and 106 percent respectively. Comparative Population Growth Source: Texas Workforce Commission (QCEW) 21

23 Location Quotients for NRM Employment in Atascosa and 15-County EFS Area Location quotients are useful in determining the significance of a particular job sector in the local economy. This is determined by calculating the ratio of a particular job sector from the local economy with total jobs in the local economy. A location quotient greater than 1.0 denotes a sector that has greater importance to the local economy than that for the state. A location quotient less than 1.0 signifies that the sector is less important to the local economy when compared to the State. The location quotients for both Atascosa County and the 15-County EFS area as a whole have been over 1 for all five years, with Atascosa s peaking at 4.29 in The 15-County EFS area s location quotient has been steadily rising to 2.53 in Location Quotients for NRM Employment Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

24 Commission, Quarterly Census of Employment and Wages data, from 2001 to 2012 Source: Texas Workforce Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

25 Employment Changes Between the fourth quarter of 2009 and the fourth quarter of 2013, for Atascosa county area, there was a percent change in employment for all industries. Employment growth for the state of Texas for the same period was percent. The industry with the highest growth was Construction with a percent increase, and the industry with the highest negative growth in employment was Other Services, with a percent change. Area Employment Employment Change Percent Change Industry Sector 4th Qtr 4th Qtr Total, All Industries 9,328 12,955 3, % Natural Resources and Mining 863 1, % Construction 558 1,774 1, % Manufacturing % Trade, Transportation and Utilities 2,136 3, % Information % Financial Activities % Professional and Business Services % Education and Health Services 3,134 2, % Leisure and Hospitality 650 1, % Other Services % Public Administration % Unclassified Source: Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

26 Employment Forecast The following table demonstrates that Atascosa County will experience in 2023 an increase of 2,832 jobs. Year Total , , , , , , , , , , , , ,374 Source: CCBR elaboration with Texas Workforce Commission s forecasts for Workforce Development Areas (WDAs)

27 State Sales Tax Source: Texas Comptroller of Public Accounts When analyzing the smoothed data series for sales tax for Atascosa County from 2002 to 2013, we can see that the upward trend began in In just over two years, Atascosa County has seen a boom in sales tax, and as a result the amount subject to tax has risen from $60 million to $145 million in the fourth quarter of 2013, for an increase of $85 million. This is in contrast to just a $20 million increase in the previous nine years. 26

28 Commuting Patterns The following table represents the number and percent of the people that work in Atascosa County. Out of the 14,959 persons living in this County, only 3,767 persons are employed there. These figures demonstrated that 74.8% of the population of Atascosa is employed outside. Inflow/Outflow Job Counts (Primary Jobs) in 2011 Count Share Employed in the Selection Area 8, % Employed in the Selection Area but Living Outside 4, % Employed and Living in the Selection Area 3, % Living in the Selection Area 14, % Living in the Selection Area but Employed Outside 11, % Employed and Living in the Selection Area 3, % Source: U.S. Census Bureau s On the Map 27

29 Economic Impacts in 2013 The following table shows the estimated impacts of the oil and gas industry on Atascosa County in The rows contain the estimated economic impact for 2013 in regards to the oil and gas industry. During this period, the total output was $3,309 million, the total gross county product was $1, million, a total of 5,682 full-time employments were generated, and the total estimated county revenue was $103 million. Economic Impacts Direct Indirect Induced Total Output $2, $ $92.46 $3, Employment Full-Time 1,922 3, ,682 Payroll $91.28 $65.31 $21.33 $ Fiscal Impacts Direct Indirect Induced Total Gross County Product $1, $ $59.82 $1, Total Local Revenues $ Estimated County Revenue $

30 Economic Impacts in 2023 The following table shows the estimated impacts of the shale activity on Atascosa County. In 2023, it is estimated that a total of 12,796 jobs will be created; the county output will be $6,922 million, over $4,381 million will be the gross county product, and the total estimated county revenue will be $254 million. Economic Impacts Direct Indirect Induced Total Output $5, $1, $ $6, Employment Full-Time 2,028 7,890 2,878 12,796 Payroll $ $ $87.22 $ Fiscal Impacts Direct Indirect Induced Total Gross County Product $3, $ $ $4, Total Local Revenues $ Estimated County Revenue $

31 Bee County Overview of Bee County Source: Selected GIS software provided by Caliper Corporation; Newton, MA. Center for Community and Business Research. 30

32 General County Data Bee County also experienced an influx of capital investment. In addition to the nearly $41 million in well construction, the City of Beeville received new permits for the construction of 330 homes, totaling $75 million. Beeville received an additional 19 construction permits valued at $2.5 million dollars. 8 Bee County, a Texan county in the Eagle Ford Shale region, consists of a total population of 32,527 thousand people. Out of these, the population that makes up the total employment is 9,356 people. It is estimated that out of the total employment, $26,697 is the average per capita personal income. Population 32,527 Per Capita Personal Income 26,697 Total Employment 9,356 Sources: Bureau of Economic Analysis (BEA), Regional Accounts 8 Don Frizzell, Beeville Building Inspector, July 10,

33 Population Growth Comparison The growth in population for the 15-County EFS area and the state of Texas has been virtually the same since 2001, with both showing a 22 percent increase. Similarly, Bee County also has been steadily increasing; it holds a 17 percent increase in population. Comparative Population Growth Source: U.S. Census Bureau 32

34 Population Forecast The following table projects Bee County s population from Bee County is projected by the year 2023, to see an overall increase in population. Based on our calculations starting in 2010, the population, by 2023, will see a slow annual increase of 2,072 people. Population Forecast From Year Population , , , , , , , , , , , , , ,933 Source: Texas Workforce Commission as computed in 2012 by The Office of the State Demographer for the State of Texas 33

35 Natural Resource and Mining Employment Growth Comparison Both the EFS area and the state of Texas as a whole saw an increase, followed a sharp drop in The EFS area however, saw multiple spikes in employment in natural resources and mining, recovering from an 18 percent loss in 2009 to see a net increase of 49 percent in The state of Texas as whole saw the least overall fluctuation, dropping just 3 percent in There was a 23 percent increase in 2012; however, this number has fallen 10 percent in the last year. Bee County s increase in NRM employment was slow until a spike saw the net increase from 16 percent in 2012 to 36 percent in Comparative Job Growth for Natural Resource and Mining Source: Texas Workforce Commission (QCEW) 34

36 Job Growth Comparison All three areas experienced an increase from 2007 to 2008, which was followed by a steady decline until 2010 when Bee County spiked and continued their increase to their current mark of 36 percent. The EFS areas as well as the state of Texas as a whole both have shown modest increases to 107 and 106 percent respectively. Comparative Employment Growth Source: Texas Workforce Commission (QCEW) 35

37 Location Quotients for NRM Employment in Bee and the EFS Area Location quotients are useful in determining the significance of a particular job sector in the local economy. This is determined by calculating the ratio of a particular job sector from the local economy with total jobs in the local economy. A location quotient greater than 1.0 denotes a sector that has greater importance to the local economy than that for the state. A location quotient less than 1.0 signifies that the sector is less important to the local economy when compared to the State. The location quotients for both Bee County and the EFS area as a whole have been over 1 for all five years, with Bee s rising to The EFS area s location quotient stands at 2.53 in Location Quotients for NRM Employment 36

38 Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to 2012 Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

39 Employment Changes Between the fourth quarter of 2009 and the fourth quarter of 2012, for Bee county area, there was a percent change in employment for all industries. Employment growth for the state of Texas for the same period was percent. The industry with the highest growth was manufacturing with a percent increase, and the industry with the highest negative growth in employment was Financial Activities, with a percent change. Area Employment Employment Change Percent Change Industry Sector 4th Qtr 4th Qtr Total, All Industries 8,472 9,689 1, % Natural Resources and Mining % Construction % Manufacturing % Trade, Transportation and Utilities 1,546 1, % Information % Financial Activities % Professional and Business Services % Education and Health Services 2,573 2, % Leisure and Hospitality 761 1, % Other Services % Public Administration - 1,733 1,733 - Unclassified Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

40 Employment Forecast The following table demonstrates that Bee County will experience in 2023 an increase of 3,279 jobs. Year Total , , , , , , , , , , , , ,515 Source: CCBR elaboration with Texas Workforce Commission s forecasts for Workforce Development Areas (WDAs)

41 State Sales Tax Source: Texas Comptroller of Public Accounts If we take a look at Bee County s state tax data, the fluctuating smoothed data series jumps out first. After a series of gains and losses from 2002 to 2010, it ended up being back at $40 million. This was followed by a steady spike, as the amount of state tax more than doubled in just less than three years from $40 million to $80 million in the fourth quarter of

42 Commuting Patterns The following table represents the number and percent of the people that work in Bee County. Out of the 10,165 persons living in this County, only 3,097 persons are employed there. These figures demonstrated that 69.5% of the population of Bee is employed outside. Inflow/Outflow Job Counts (Primary Jobs) Count Share Employed in the Selection Area 5, % Employed in the Selection Area but Living Outside 2, % Employed and Living in the Selection Area 3, % Living in the Selection Area 10, % Living in the Selection Area but Employed Outside 7, % Employed and Living in the Selection Area 3, % Source: U.S. Census Bureau s On the Map 41

43 Economic Impacts in 2013 The following table shows the estimated impacts of the oil and gas industry on Bee County in The rows contain the estimated economic impact for 2013 in regards to the oil and gas industry. During this period, the total output was $382 million, the total gross county product was $140 million, a total of 1,186 full-time employments were generated, and the total estimated county revenue was $5 million. Economic Impacts Direct Indirect Induced Total Output $ $ $33.98 $ Employment Full-Time ,186 Payroll $13.67 $31.23 $8.86 $53.77 Fiscal Impacts Direct Indirect Induced Total Gross County Product $42.24 $75.66 $22.28 $ Total Local Revenues $5.84 Estimated County Revenue $

44 Economic Impacts in 2023 The following table shows the estimated impacts of the shale activity on Bee County. In 2023, it is estimated that a total of 1,991 jobs will be created; the county output will be $1,509 million, over $333 million will be the gross county product, and the total estimated county revenue will be $14 million. Economic Impacts Direct Indirect Induced Total Output $1, $ $61.52 $1, Employment Full-Time 122 1, ,991 Payroll $19.03 $61.71 $16.02 $96.76 Fiscal Impacts Direct Indirect Induced Total Gross County Product $ $ $40.35 $ Total Local Revenues $14.29 Estimated County Revenue $

45 DeWitt County Overview of Dewitt County Source: Selected GIS software provided by Caliper Corporation; Newton, MA. Center for Community and Business Research. 44

46 General County Data In October 2013, Houston-based Kinder Morgan Energy announced a $74 million extension of its selftitled Kinder Morgan Crude Condensate (KMCC) pipeline from DeWitt County to Gonzales County. The majority of this project, approximately $65.8 million, would be based in DeWitt County alone. 9 Much of the housing development centers at Cuero, Texas. In 2013, three motel units opened in the city: a 51- room America Best Value Inn ($2.7 million), 10 a 77-room Holiday Inn Express ($4.6 million), 11 and a 42- guest room Hotel Texas. Austin-based Cuero DMA Development Company, LLC constructed a $3.2 million, 60-unit apartment complex. 12 The City of Cuero also approved 35 housing permits for $4.5 million and four commercial permits valued at $6.2 million. 13 ERF Wireless, a broadband provider based out of League City, Texas, upgraded its coverage in the Eagle Ford Shale area, particularly in Cuero. The year also saw the construction of new Chisholm Trail Heritage Museum. DeWitt County, a Texan county in the Eagle Ford Shale region, consists of a total population of 20,465 thousand people. Out of these, the population that makes up the total employment is 7,365 people. It is estimated that out of the total employment, $34,727 is the average per capita personal income. Population 20,465 Per Capita Personal Income 34,727 Total Employment 7,365 Sources: Bureau of Economic Analysis (BEA), Regional Accounts 9 Gebrekidan, Salam. Kinder Morgan to build an extension to Eagle Ford pipeline. Reuters. October 9, Retrieved from: 10 Nowlin, Sanford. Two new hotels going up in Cuero to provide Eagle Ford lodging. San Antonio Business Journal. September, 18, Ibid. 12 City of Cuero Regular City Council Meeting. January 22, Randall Malik (October 21,2013) 45

47 Population Growth Comparison The growth in population for the 15-County EFS area and the state of Texas has been virtually the same since 2001, with both showing a 22 percent increase. DeWitt County s population growth has been steady, never rising or falling by more than two percent over the eleven year period. Comparative Population Growth Source: U.S. Census Bureau 46

48 Population Forecast The following table projects Dewitt County s population from DeWitt County is projected by the year 2023 to see an overall increase in population. Based on our calculations starting in 2010, the population, by 2023, will see somewhat of an increase of 1,005 people. Population Forecast From Year Population , , , , , , , , , , , , , ,102 Source: Texas Workforce Commission as computed in 2012 by The Office of the State Demographer for the State of Texas 47

49 Natural Resource and Mining Employment Growth Comparison Both the 15-County EFS area and the state of Texas as a whole saw an increase, which was followed a sharp drop in The 15-County EFS area however, saw multiple spikes in employment in natural resources and mining, recovering from an 18 percent loss in 2009 to see a net increase of 49 percent in The state of Texas as whole saw the least overall fluctuation, dropping just 3 percent in There was a 23 percent increase in 2012; however, this number has fallen 10 percent in the last year. DeWitt County followed the pattern of the 15-County EFS area and the state of Texas until 2010, when it increased rapidly to 310 percent in 2012, and has slowed the increase slightly as in 2013; the employment growth in NRM sits at 334 percent. Comparative Job Growth for Natural Resource and Mining Source: Texas Workforce Commission (QCEW) 48

50 Job Growth Comparison All three areas experienced an increase from 2007 to 2008, which was followed by a steady decline until 2010 when DeWitt County spiked and continued is increase to 12 percent in 2012, which was followed by a slight decrease to its current net increase of 11 percent. The 15-County EFS areas as well as the state of Texas as a whole both have shown modest increases to 107 and 106 percent respectively. Comparative Employment Growth Source: Texas Workforce Commission (QCEW) 49

51 Location Quotients for NRM Employment in DeWitt and 15-County EFS area Location quotients are useful in determining the significance of a particular job sector in the local economy. This is determined by calculating the ratio of a particular job sector from the local economy with total jobs in the local economy. A location quotient greater than 1.0 denotes a sector that has greater importance to the local economy than that for the state. A location quotient less than 1.0 signifies that the sector is less important to the local economy when compared to the State. The location quotients for both DeWitt County and the 15-County EFS area as a whole have been over 1 for all five years, with DeWitt s rising to The 15-County EFS area s location quotient stands at 2.53 in Location Quotients for NRM Employment Source: Texas Workforce Commission, Quarterly Census of Employment an d Wages data, from 2001 to

52 Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

53 Employment Changes Between the fourth quarter of 2009 and the fourth quarter of 2013, for DeWitt county area, there was a percent change in employment for all industries. Employment growth for the state of Texas for the same period was percent. The industry with the highest growth was Natural Resources and Mining with a percent increase, and the industry with the highest negative growth in employment was Other Services, with a percent change. Area Employment Employment Change Percent Change Industry Sector 4th Qtr 4th Qtr Total, All Industries 6,333 7,447 1, % Natural Resources and Mining % Construction % Manufacturing 897 1, % Trade, Transportation and Utilities 986 1, % Information % Financial Activities % Professional and Business Services % Education and Health Services 2,001 1, % Leisure and Hospitality % Other Services % Public Administration % Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

54 Employment Forecast The following table demonstrates that Dewitt County will experience in 2023 an increase of 1,702 jobs. Year Total , , , , , , , , , , , , ,192 Source: CCBR elaboration with Texas Workforce Commission s forecasts for Workforce Development Areas (WDAs)

55 State Sales Tax Source: Texas Comptroller of Public Accounts When examining the state tax numbers from DeWitt County, one notices the giant increase once again in This is preceded by a steady gain from 2002 to 2008, followed by a sharp drop during the global economic crisis. The rise from 2010 to 2013 was from $23 million to $66 million in the fourth quarter of

56 Commuting Patterns The following table represents the number and percent of the people that work in Dewitt County. Out of the 7,411 persons living in this County, only 2,767 persons are employed there. These figures demonstrated that 62.70% of the population of Dewitt is employed outside. Inflow/Outflow Job Counts (Primary Jobs) in 2011 Count Share Employed in the Selection Area 6, % Employed in the Selection Area but Living Outside 3, % Employed and Living in the Selection Area 2, % Living in the Selection Area 7, % Living in the Selection Area but Employed Outside 4, % Living and Employed in the Selection Area 2, % Source: U.S. Census Bureau s On the Map 55

57 Economic Impacts in 2013 The following table shows the estimated impacts of the oil and gas industry on DeWitt County in The rows contain the estimated economic impact for 2013 in regards to the oil and gas industry. During this period, the total output was $ 4,947 million, the total gross county product was $ 2,391 million, a total of 9, 407 full-time employments were generated, and the total estimated county revenue was $ 134 million. Economic Impacts Direct Indirect Induced Total Output $4, $ $ $4, Employment Full-Time 3,188 4,922 1,297 9,407 Payroll $ $ $33.60 $ Fiscal Impacts Direct Indirect Induced Total Gross County Product $1, $ $ $2, Total Local Revenues $ Estimated County Revenue $

58 Economic Impacts in 2023 The following table shows the estimated impacts of the shale activity on DeWitt County. In 2023, it is estimated that a total of 13,152 jobs will be created; the county output will be $8,373 million, over $4,678million will be the gross county product, and the total estimated county revenue will be $295 million. Economic Impacts Direct Indirect Induced Total Output $6, $1, $ $8, Employment Full-Time 2,675 7,614 2,864 13,152 Payroll $ $ $74.20 $ Fiscal Impacts Direct Indirect Induced Total Gross County Product $3, $ $ $4, Total Local Revenues $ Estimated County Revenue $

59 Dimmit County Overview of Dimmit County Source: Selected GIS software provided by Caliper Corporation; Newton, MA. Center for Community and Business Research. 58

60 General County Data St. Louis-operated Graybar opened to new branches in Asherton and Carrizo Springs, Texas in Dimmit County. Graybar is a national supply chain management and logistics provider. 14 In 2013, 6 singlefamily homes were constructed valued at $5.8 million. 15 Dimmit County, a Texan county in the Eagle Ford Shale region, consists of a total population of 10,461 thousand people. Out of these, the population that makes up the total employment is 4,798 people. It is estimated that out of the total employment, $34,379 is the average per capita personal income. Population 10,461 Per Capita Personal Income 34,379 Total Employment 4,798 Sources: Bureau of Economic Analysis (BEA), Regional Accounts 14 Aldridge, James. Graybar expanding out to Eagle Ford Shale region. San Antonio Business Journal. March 8, Source: U.S. Census Bureau 59

61 Population Growth Comparison The growth in population for the 15-County EFS area and the state of Texas has been virtually the same since 2001, with both showing a 22 percent increase. Dimmit County s population growth has been fairly steady throughout, with a steady increase over the last 2 years, reaching a net increase of 4 percent. Comparative Population Growth Source: U.S. Census Bureau 60

62 Population Forecast The following table projects Dimmit County s population from Dimmit County is projected by the year 2023 to see an overall increase in population. Based on our calculations starting in 2010, the population, by 2023, will see a steady annual increase of 1,162 people. Population Forecast From Year Population , , , , , , , , , , , , , ,158 Source: Texas Workforce Commission as computed in 2012 by The Office of the State Demographer for the State of Texas 61

63 Natural Resource and Mining Employment Growth Comparison Both the 15-County EFS area and the state of Texas as a whole saw an increase, which was followed a sharp drop in The 15-County EFS area however, saw multiple spikes in employment in natural resources and mining, recovering from an 18 percent loss in 2009 to see a net increase of 49 percent in The state of Texas as whole saw the least overall fluctuation, dropping just 3 percent in There was a 23 percent increase in 2012; however, this number has fallen 10 percent in the last year. Dimmit County was on a slight increase until 2010, when it increased rapidly to 361 percent in Comparative Job Growth for Natural Resource and Mining Source: Texas Workforce Commission (QCEW) 62

64 Job Growth Comparison All three areas experienced an increase from 2007 to 2008, which was followed by a steady decline until 2010 when Dimmitt County spiked and continued its huge increase to 89 percent in The 15- County EFS areas as well as the state of Texas as a whole both have shown modest increases to 107 and 106 percent respectively. Comparative Employment Growth Source: Texas Workforce Commission (QCEW) 63

65 Location Quotients for NRM Employment in Dimmitt and 15-County EFS area Location quotients are useful in determining the significance of a particular job sector in the local economy. This is determined by calculating the ratio of a particular job sector from the local economy with total jobs in the local economy. A location quotient greater than 1.0 denotes a sector that has greater importance to the local economy than that for the state. A location quotient less than 1.0 signifies that the sector is less important to the local economy when compared to the State. The location quotients for both Dimmitt County and the 15-County EFS area as a whole have been over 1 for all five years, with Dimmitt s rising to in In 2012, it stands at The 15-County EFS area s location quotient stands at 2.53 in Location Quotients for NRM Employment 64

66 Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to 2012 Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to

67 Employment Changes Between the fourth quarter of 2009 and the fourth quarter of 2013, for Dimmit county area, there was a percent change in employment for all industries. Employment growth for the state of Texas for the same period was percent. The industry with the highest growth was manufacturing with a percent increase, and the industry with the highest negative growth in employment was Professional and Business Services, with a -100 percent change. Area Employment Employment Change Percent Change Industry Sector 4th Qtr 4th Qtr Total, All Industries 2,901 5,924 3, % Natural Resources and Mining 527 1,640 1, % Construction % Manufacturing % Trade, Transportation and Utilities 464 1, % Information % Financial Activities % Professional and Business Services % Education and Health Services % Leisure and Hospitality % Other Services % Public Administration % Unclassified Source: Texas Workforce Commission, Quarterly Census of Employment and Wages data, from 2001 to