Economic Impact Study Warns Of Frac Sand Mining’s Boom/Bust Cycle

A new economic impact study of Wisconsin’s frac sand mining industry warns of booms and busts.

It also urges local officials to ask more questions before permitting more mines.

The study was commissioned by the Wisconsin Towns Association and Wisconsin Farmers Union to give local officials a fuller picture of the pros and cons of frac sand mining. It was written by Dr. Tom Power, a consultant and economist with the University of Montana. He says previous economic impact analyses on frac sand mining have only focused on benefits like jobs and tax revenues.

“This was laying out, from a conceptual point of view based on the history of mining in Wisconsin and elsewhere in the United States, what some of the likely costs are and how significant they are.”

Power’s study points to former mining towns like Hurley, Ladysmith and Black River Falls, which have struggled with high unemployment and poverty after mine closures.

He says there’s no reason to believe that frac sand mining towns will be spared the same fate: “We’ve seen these problems in the past and to just say this time will be different is not an argument.”

But Eau Claire attorney John Behling, who represents the frac sand industry, says these mines bring in a lot of dollars to local economies.

“Even if they only last 30 years, those are 30 years of great jobs and great benefits that when you look at compared with unemployment, 30 years of jobs is better than zero.”

The economic study includes more than a dozen questions local officials should ask themselves ranging from pay levels associated with mines to long term stability of production and what negative impacts there may be on other industries like tourism.