As a possible means of generating money for counties and cities struggling to pay for damaged roads in Arkansas, a temporary tax on natural gas production is being discussed, said Gov. Mike Beebe.
State, county and city officials are holding meetings with natural gas company representatives with the goal of finding a way to pay for the damages, caused by heavy trucks traveling to and from drilling rigs.
"No question that particularly some of the rural, secondary county roads were not built for the size of the vehicles necessary for the operations and are really being affected by the weight," Beebe said.
"We want the economic activity, we want the drilling activity, we want these jobs, but we want it in such a way that doesn't tear up these roads for everybody else who still has to live and drive on them," he said.
Mark Raines, a spokesman for Chesapeake Energy Corp., said that the natural gas producer is willing to work with state, city and county officials to address the problem.
"We understand we are tearing up the roads and we'll fix them," Raines said, adding that some county judges have sent Chesapeake bills for road damage, which are promptly paid. "We want to work with state, county and city officials any way we can."
"Frankly, I will tell you this, I am encouraged so far at the willingness of the industry to recognize what they're doing to the roads and at their willingness to talk," Beebe said.
John Thaeler, senior vice president of major gas producer SEECO Inc., said his company is also willing to help counties and cities.
"When our operations do require road repair, we have worked closely with county officials to do our fair share," Thaeler said. "We also meet monthly with county officials to discuss any impact and the solutions."
Executive director of the Association of Arkansas Counties Eddie Jones said that a group of county judges from counties heavily affected by the natural gas drilling have been meeting with gas producers to address the issue.
Jones proposed that maybe the Legislature would consider raising the state's natural gas severance tax, which is one of the lowest in the country.
"The severance tax is miserably low now and additional money it generates could be sent back to the counties and cities," he said.
Beebe said the Legislature in 2009 would be asked to approve any fee or tax hike agreement that develops from the meetings.