A consulting company hired by a partner in the Mountain Valley Pipeline concluded that the proposed interstate natural gas pipeline would be an economic boon to West Virginia and Virginia and to the five Virginia counties it would traverse.
The report emphasizes that Franklin County, in particular, could benefit in several ways over the long term from gaining access to natural gas, including increasing the odds of attracting manufacturers.
Boards of supervisors in Roanoke, Montgomery and Giles counties have passed resolutions opposing the controversial pipeline or its current route. Franklin County’s board has not yet taken a position. The Blacksburg Town Council also passed a resolution opposing the pipeline.
FTI Consulting‘s report, released Thursday afternoon by Mountain Valley Pipeline LLC, predicts that the $3.2 billion project would generate 4,300 jobs during peak construction activity and yield $396 million in construction spending and $35 million in tax revenues in Virginia between 2015 and 2018.
Once construction ends, Mountain Valley would employ between 25 and 35 people full-time across the state for pipeline operations.
As proposed, the high-pressure pipeline would enter Virginia in Giles County and then pass through Montgomery, Roanoke and Franklin counties on its way to connect with a Transco pipeline in Pittsylvania County. The source of the natural gas would be hydraulic fracturing, or fracking, wells in West Virginia, Pennsylvania and Ohio.
Mountain Valley, a joint venture of EQT Corp. and NextEra Energy, hopes to begin construction of the 300-mile, 42-inch diameter buried pipeline in December 2016. The Federal Energy Regulatory Commission must approve the pipeline before construction could begin. If the commission greenlights the project, Mountain Valley will have access to eminent domain to acquire rights-of-way across private property.
EQT Corp. hired FTI to conduct the economic benefit analysis. The report includes a disclaimer from FTI that the information its analysis conveys is based upon financial and other data provided by EQT Corp. and public sources. The disclaimer adds, “There is no assurance by anyone that this information is accurate or complete.”
In an email, Natalie Cox, a spokeswoman for Mountain Valley, said FTI’s analysis was vetted by two independent, third-party consultants. She said Mountain Valley is “confident in the results.”
The report estimates that the five Virginia counties that would host the pipeline would receive an annual property tax boost ranging from about $900,000 a year in Giles County to about $1.9 million in Franklin County.
On Thursday, Scott Dunn, vice chairman of the Giles County Board of Supervisors, scoffed at the study’s estimate for new property taxes in the county. The pipeline would lower property values, Dunn said.
“It’s going to impact about $16.2 million in property value,” he said. “So, what we might gain in a year, we’ll lose over time.”
Similarly, for Joe Waldo, a lawyer with expertise in eminent domain, the tax figures cited in the study ignore negative impacts on the value of properties that end up hosting natural gas transmission pipelines.
“That’s going to be a negative impact and the gas companies refuse to publicly acknowledge that reality,” Waldo said.
He said the pipeline’s presence would “devalue farms, beautiful properties and homes.”
Cox offered an opposing view.
“Historically speaking, natural gas pipeline easements have had no measurable effect on property values,” Cox said. “In fact, the Federal Energy Regulatory Commission recently issued a certificate to Constitution Pipeline which looked at several recent studies and concluded that there is no evidence that supports a conclusion that there will be a significant drop in property value due to construction of a pipeline.”
The votes cast this week by the Blacksburg Town Council and the Giles County Board of Supervisors were unanimous in opposing the pipeline. Officials said the project threatened water quality and the region’s growing tourism industry, and could be dangerous to wide areas if there was an explosion.
Dunn said the pipeline’s widely staggered placement of shut-off valves could leave a lot of natural gas available to fuel a blaze.
“I don’t care what kind of fire department you have — nobody’s equipped to handle that,” he said.
Blacksburg resident Elizabeth McCommon, who has been active in regional opposition to the pipeline, also voiced skepticism about the report and the candor of pipeline officials.
“They are making impressive and unrealistic promises to counties and towns who have said, ‘We don’t want you.’ I think they’re nervous and anxious to get on with it,” McCommon said.
Yet others, including Gov. Terry McAuliffe and John D’Orazio, president and CEO of Roanoke Gas, have voiced support for the Mountain Valley Pipeline based on its potential to yield economic benefits.
In an op-ed published in November, D’Orazio wrote that the pipeline could strengthen the region’s economy: “In the same way businesses located along rail lines in the 19th century and interstate highways in the 20th century, energy corridors — natural gas, electric, telecommunications — are required to attract many 21st century businesses.”
FTI’s report notes that infrastructure and equipment costs associated with an “interconnection” along the pipeline would be borne by consumers. Cox said “costs are typically rolled into a rate for the customer through the service provider.”
The analysis notes that the current route of the Mountain Valley Pipeline would pass less than four miles north of Rocky Mount. The study reports that “the minimum demand level for an economic interconnection is approximately one billion cubic feet annually.” Although existing demand in Franklin County is about one-third of that total, the analysis says the investment necessary to gain access to the pipeline might be justifiable in view of potential demand.
Meanwhile, the proposed Mountain Valley route stirred opposition in Giles County for reasons that included its proximity to tourism draws like the Cascades waterfall trails and to the county’s Eastern Elementary/Middle School and other sensitive sites.
“We felt like if they’re going to do it, they could pick a better route,” Supervisor Larry “Jay” Williams said Thursday.
Bert Bondurant, a member of Preserve Bent Mountain, said property tax increases and temporary jobs won’t mean much if the pipeline does lasting environmental harm.
“I’m certain that some would question the foundations of Mountain Valley Pipeline’s economic promises — but assuming they’re all true, what will more tax revenue and some fleeting jobs do for our permanent residents if we can’t drink the water?”