Counties around the state are scrambling for a $225 million pool of state grant funding, and Smith County is trying to get every dollar it can.
Last week, county commissioners approved action, which could make hundreds of thousands of dollars in state grant funding available to address road degradation caused by oil and gas activity.
During the most recent legislative session, officials approved $450 million for the Texas Department of Transportation and counties to pay for road projects to address roadway damages caused by oil and gas equipment. Half the funding goes directly to TxDOT while $225 million is being available to counties who apply. All 254 counties are eligible for funding.
Smith County is eligible for at least $430,000 if it completes the application process before Feb. 7, said Amazing Grants President Mary Kay Thomas, who handles the county’s grant applications. The county would have to hold a public meeting about the creation of the investment zone during a 30-day public comment period. The court also is required to appoint an investment zone advisory board made up of three oil-and-gas representatives and two county residents.
The county also would be required to match 20 percent of the grant amount. Grant money would be eligible for use outside the zone.
Eligibility is based on a TxDOT formula including well completions (50 percent), overweight truck permits issued in the county by TxDOT, (which includes other activity such as lumber, 20 percent), oil and gas severance taxes paid (20 percent) and salt water injection activity (10 percent).
The county would have to create a 10-year County Energy Reinvestment Zone to qualify for the money. The zone would collect tax revenues on a tax increment basis, which would go toward transportation projects in the county. However, ambiguity within the law allows counties to dissolve the zone upon receipt of the grant, Ms. Thomas said.
Texas Association of Counties spokesman Lonnie Hunt said the law was vague about possible dissolution of the zones and it would “require further interpretation from the state.”
With any grant process, he said, there are “strings attached” and counties around the state are rushing to understand the requirements and meet the deadline.
“We’re excited about it because counties have been talking about these problems for a long time, and this is the first time the state is applying some money,” he said. “Hopefully the response will show the legislature the need is there, and there will be more money available in the future.”
Commissioners approved hiring a law firm, which specializes in grants, and set a public hearing for 10 a.m. Dec. 30.
Other area counties are making the same efforts.
Rusk County commissioners held a public hearing last week, and the county is eligible for more than $1 million from the funding pool.
Cherokee County is eligible for $370,000; Anderson County is eligible for $314,000; Gregg County is eligible for $1 million, Henderson County is eligible for $286,000; Upshur County is eligible for $630,000; Van Zandt County is eligible for $279,000; and Wood County is eligible for $680,000.
Hunt said if counties do not meet the deadline or refuse its portion, the money would likely be distributed to approved counties.
County Judge Joel Baker said the impact of oil and gas drilling on roads is clear in some areas of the county. He said the 20 percent county portion would likely more impact to next year’s budget, but the county would be financially able to go after a much larger sum than $430,000 if it becomes available.
“It appears to be an opportunity to make needed repairs to county roads and we’re leaving no stone unturned in that regard,” Baker said. “We’re going to seek as much as possible because (the money) is going somewhere, and we want it here.”
County officials do not know where the investment zone would be located but are aware of different areas in the county with active oil and gas production.
The county Road and Bridge Department has been monitoring roads closely as part of its maintenance program and recent traffic count studies, County Commissioner JoAnn Hampton. Mrs. Hampton said the county would make every effort to ensure steps within the process are completed before the Feb. 7 deadline.
The money “means we can address more needs,” she said.
County commissioners added about $600,000 to the Road and Bridge department budget this year after cutting 37 percent of its funding in 2010. The county entered a “maintenance only” program, which has focused on repairing roads and extending road life. But officials and commissioners understand the “maintenance only” program is not addressing looming problems associated with countywide growth. Many roads were not designed and built to handle current traffic volumes and are causing congestion and raising safety concerns.
Commissioner Jeff Warr said the money is an opportunity for the county to address local road conditions at a time when is needed most.
“That’s our money,” he said. “It’s coming from vehicle registrations and state and local fees and if we don’t get it, it goes to other counties. We’re the ones paying for the roads and dealing with the problems, so I say we go after it.”