Residents like Eli Byler are being paid large sums to sell their rights, allowing them to hit the road, Scheyder writes. Flatiron Energy Partners "is paying Byler $221,195 cash, an amount that will be tax-free thanks to an arcane part of the U.S. tax code, if Byler follows through on plans to relocate his family to Pennsylvania." One of the benefits is Section 1031 of code, which says "landowners can use cash they receive for selling their oil and natural gas minerals to buy another piece of property, tax free." The section counts mineral rights as property. Since the beginning of 2013, the number of companies buying Ohio royalty interests has risen from two to 10.
"Byler's deal is part of a larger wave of companies like Flatiron paying cash up front for oil and natural gas royalty interests, deals these companies hope will provide their clients - typically family trusts and other wealth funds - guaranteed income for decades in the form of royalty checks," Scheyder writes. "At least 35 other Amish families plan to sell their royalty rights and make an exodus from the Buckeye State to parts of Pennsylvania or New York state with little or no energy development, said Byler, who plans to sell the full 53.3 acres he owns on the surface, including his homestead, in a separate deal." (Read more)