Thursday, November 17, 2016

Rural N.M. county reinvented itself after oil bust through renewable energy, affordable housing

Hobbs, N.M. (Best Places map)
Towns facing an oil bust can look to the success of one New Mexico county, which reinvented itself when the industry crashed in the mid-1980s, taking with it nearly 10,000 jobs, Leah Todd reports for High Country News. Unemployment in Lea County, which has a population of 60,000, tripled when the market crashed, forcing many to flee for greener pastures. For those that stayed and endured, a new boom has come around, in the form of renewable energy and affordable housing.

Without borrowing a dime, the county's largest town, Hobbs, "invested in housing, doubled its police force and pooled resources with five other public and private entities to build a $63.5 million recreation center," Todd writes. "Over the past five years, the town has extended $7 million in incentives to developers building more than 1,500 housing units—affordable and market-rate apartments, even single-family homes—primarily through reimbursing developers for the cost of roads, sidewalks and other infrastructure. Hundreds more units are under construction."

"Oil and gas severance taxes still make up about 50 percent of local tax revenue and one in five local jobs is in mining" and the county lost 1,500 jobs from 2014 to 2015 when oil prices dropped, Todd writes. "But Lea County’s strategic and sustained approach seems to be slowly working. The county boasts above-average salaries and—unique for an oil town—low income volatility, at least compared to other communities its size. During the slow recovery after the 2008 recession, which most gravely afflicted rural areas, Lea County was one of only a handful of counties in New Mexico that actually added businesses."

The county now has four solar power plants and four more are under construction, Todd writes. "Together those operations will produce 288 megawatts—about 19 percent of the state’s solar energy. Wind is growing more slowly, with just one operational plant and another on the way. Lea County’s wind sector will produce about 57 megawatts—7 percent of the state’s wind energy."

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