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Posts published in “Mendiola”

Prospects for natural gas in Idaho

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Mark Mendiola
Eastern Idaho

Hydraulic fracturing or “fracking,” coupled with technological advances in horizontal drilling, have revolutionized the natural gas industry’s ability to tap into North America’s vast shale reserves and dramatically boost available natural gas volumes.

Because of its relatively low cost and increased availability, natural gas has become the “energy of choice” for many companies using it to fire up their plants, heat their buildings, generate electricity and maintain business operations.

Natural gas executives lately are expressing an optimism they haven’t always enjoyed about their industry’s future. Before, limited natural gas reserves appeared for decades to be locked up and inaccessible due to an inability to reach them underground.

Fracking and horizontal drilling have made an almost infinite supply of natural gas and petroleum a reality, they say, greatly helping America’s energy independence.

But the controversial hydro fracturing technology is opposed by many environmental groups who fear it contaminates ground water, reduces air quality and causes gases and chemicals to migrate to land surfaces.

Injection of highly pressurized fluids into subterranean shale formations creates new veins or fractures, which improve extraction rates and recovery of hydrocarbons. The fluid injected into the rock typically is a slurry of water, sand, gels , foams, chemical additives and gases, including nitrogen, carbon dioxide and oxygen.

Industry officials say fracturing liquids consist 90 percent of water, 9.5 percent of sand and .5 percent of chemicals. A typical fracking treatment uses between three and 12 chemical additives, including acids, salt, friction reducers, ethylene glycol, methanol, isopropyl alcohol, carbonates and disinfectants.

Petroleum engineers, not public relations professionals, coined the term “fracking,” notes Dan Kirschner, executive director of the Portland-based Northwest Gas Association – a trade organization that includes six natural gas utilities serving Idaho, Oregon, Washington and British Columbia, and four transmission pipelines that transport natural gas throughout the region from supply basins.

There were large declines in industrial natural gas use in 1999 and 2000 in connection with California’s energy crisis, which left only two of 10 aluminum plants standing in the Pacific Northwest, Kirschner says. The “Great Recession” that started at the end of 2008 also caused permanent shutdowns of other plants across the region.

Meanwhile, “gas came into the market right into the teeth of the Great Recession. There was a decline in demand just as there was a great increase in production.” From 2007 to 2010, there was a dramatic spike in production, driving down costs. (more…)

Crapo looks at the cliff

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Mark Mendiola
Eastern Idaho

With about 6,100 jobless Idahoans facing a cutoff in their extended weekly unemployment payments by the end of December and plunging over their own fiscal cliffs, U.S. Sen. Mike Crapo, R-Idaho, says Congress and the Obama administration have only a few weeks left to resolve the nation’s ominous federal budget crisis before taxes spiral up and deep spending cuts are imposed.

Conducting a November 14 iTownHall conference call from his Washington office that reportedly was tuned into by thousands of Idahoans, Crapo said, “We truly are facing difficult and historic times in our country.”

Noting the nation recently went through extremely intense presidential and congressional elections that only succeeded in maintaining the status quo – President Barack Obama remaining in the White House, Republicans controlling the U.S. House and Democrats dominating the U.S. Senate – Idaho’s senior senator said the government has been split and unable to bridge partisan differences.

Meanwhile, Americans “face very, very serious and immediate problems,” including a $16 trillion national debt swelling by $1 trillion a year, and the Social Security, Medicare and Medicaid entitlement systems “rapidly facing insolvency.”

Crapo said: “The economy is beginning to reel because of our debt load. If we don’t take prompt action soon, the world markets will soon lose confidence in the ability of the United States of America to pay its debt. We literally face the threat of losing the American dream.”

He explained the so-called “fiscal cliff” technically is different from the debt crisis but related. The cliff over which the federal government is scheduled to go over on Jan. 1, 2013 involves $1.2 trillion in automatic spending cuts “done in a way that is very inartful with the potential of causing great damage to the military and the economy,” Crapo said. (more…)

A growing credit union

pocatello
ICCU President and CEO Kent Oram and tellers Rebekah Cote, center, and Dani Neumann inside ICCU’s new Chubbuck branch, the latest of the company’s 19 Idaho branches. (photo/Mark Mendiola)

 

mendiola
Mark Mendiola
Eastern Idaho

Idaho Central Credit Union’s November 5 opening of its $2 million Chubbuck branch marks another milestone for the state’s largest credit union as it continues to grow at a robust double-digit pace against strong head winds in the nation’s financial markets.

ICCU’s statewide monthly payroll ranges between $1.5 million or $1.7 million – or more than $20 million annually, says Kent Oram, ICCU president and chief executive officer. Of the nation’s 7,000 credit unions, Idaho Central ranked 164th in assets at the end of September.

Its growth rate stands at about 20 percent annually. By comparison, the national growth rate for credit unions amounts to about 4 percent.

Idaho Central – a state chartered and federally insured financial institution – boasts 40,000 mobile banking users. Between 900 and 1,000 ICCU customers have signed up for “very well-received” mobile deposits that were started a month ago and allow photo copies of checks.

ICCU’s annual loan growth rate has averaged 26 percent as opposed to the national average of 1 percent. Idaho as a whole is doing better than other states in the nation, Oram says adding there are about 60 credit unions operating in the state, down from about 110 to 120 when he started. There were about 12,000 credit unions nationally three decades ago.

The Chubbuck branch on Yellowstone Avenue is not far from ICCU’S five-story, 700,000-square-foot headquarters building near the Interstate 86 interchange, where the company has been based the past five years. That highly visible structure is at 80 percent capacity with 175 employees, Oram says.

Planning for the HQ building started about 10 years ago and construction commenced seven years ago. Some of its electrical, heating and air conditioning systems are solar-enabled.

“People thought it was a hotel for a while. Now, it’s our home,” says Oram, a Blackfoot native who earned a bachelor’s degree from Idaho State University in information systems management. (more…)

College: Appropriations down, needs up

isu
Pocatellan Robert Kimber, center, shares a laugh with ISU President Arthur Vailas, left, and ISU Foundation President Arlo Luke at the Stephens Performing Arts Center in Pocatello. (photo/Mark Mendiola)

 

mendiola
Mark Mendiola
Eastern Idaho

Emphasizing that higher education helps drive economic development, Idaho State University President Arthur Vailas said during his recent “State of the University” presentation that the state’s colleges and universities still need substantial financial support from the Legislature to cope with increasingly tight budgets.

“Appropriations continue to decline,” Vailas told business, government and education leaders at the ISU Stephens Performing Arts Center. “The state always should have a role and continued responsibility in support of education.”

ISU’s health profession departments treat 40,000 patients a year, but Idaho still does not have a medical school, he lamented, pointing out that the state’s rural communities are the most underserved in the United States in regards to health care.

Tuition and fees totaling $71.76 million in Fiscal 2012 were the largest revenue source for ISU, edging out state appropriations that totaled $70.59 million. Grants and contracts amounting to $55.6 million were the third largest slice of the Pocatello university’s budget pie. ISU has submitted $164.3 million in grant proposals for Fiscal 2012 compared to $108.3 million submitted the previous year to help fill funding needs.

“The competitiveness of getting outside support is more and more challenging,” Vailas said, noting federal stimulus funding has disappeared and budget earmarks are gone. “Expenditures have grown as well.”

ISU’s full-time equivalent fall 2012 enrollment was up 2.1 percent this year at 11,251 students, but total unduplicated student head count was up 3.4 percent at 19,284 students and undergraduate head count was up 4.5 percent at 14,205 students.

Total non-resident students increased 4 percent, but total international students increased 29 percent. Jesse Kiboko, immigration advisor with ISU’s international programs office, said ISU’s 700 international students – representing 58 countries or about 3 percent of ISU’s total enrollment – spent about $1 million to enroll at ISU. Their numbers are expected to double to 1,400 by 2014, Kiboko said.

ISU’s total degrees and certificates awarded in Fiscal 2012 were up 6 percent, with 33 percent of the degrees awarded in Health Professions, and 18 percent in Science, Technology, Engineering and Mathematics (STEM) disciplines. Forty-nine percent of the degrees were bachelor degrees; 21 percent, master degrees; 15 percent, associate degrees; 8 percent, technical certificates, and 7 percent, doctorates. (more…)

Cuts here, tax increases there

mendiola
Mark Mendiola
Eastern Idaho

A dramatic drop in legislative funding for public education has forced a steep rise in the number of Idaho’s 115 school districts resorting to supplemental override levies to breach the gulf in their money needs.

Idaho’s total public school expenditures as a percent of all expenditures fell from a high of about 35 percent in 1982 to slightly more than 26 percent in 2013. Idaho public school total fund expenditures as a percent of Idaho personal income fell from about 4.7 percent in 1992 to about 3.4 percent in 2013.

Addressing the City Club of Idaho Falls on Sept. 21, Michael Ferguson questioned whether the Idaho Legislature is short changing the state’s school districts and violating the Idaho Constitution, which requires it to “to establish and maintain a general, uniform and thorough system of public, free common schools.”

The Idaho Center for Fiscal Policy’s director – who served as chief economist for six Idaho governors from 1984 to July 2011 – also asked if the Legislature was complying with the constitution’s mandate that “all taxes shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax.”

Ferguson said, “What this basically says is that for purposes of the property tax, a taxing entity can’t levy different rates on different taxpayers.” The property tax component of school funding has changed quite a bit in recent years in Idaho, he noted. There was a swap for sales tax done in 2006 that took away an equalized management and operations (M&O) levy.

““With the elimination of the equalized M&O levy, we’re now in a situation where all property tax dollars that are used to fund public school M&O are non-equalized,” Ferguson said.

“Since then, we’ve seen a pretty dramatic increase in the use of unequalized property tax levies. Since education is a state duty, a state responsibility, I would question whether using unequalized property taxes really fulfills the intent of having uniform property taxes.”

Public education funding is “probably one of the most important fiscal policy issues facing the state of Idaho,” he said. Ferguson has focused since the second half of 2011 on the consequences of the “Great Recession” on education funding in the state. (more…)

Pushing Pocatello retail

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Mark Mendiola
Eastern Idaho

Donald Zebe’s name isn’t exactly a household word in Bannock County, but it’s safe to say no single individual has done more to transform Pocatello’s previously lackluster retail market into a much more competitive, enticing place to shop by attracting large, well-recognized chain stores and restaurants to town.

Zebe – a Coldwell Banker retail leasing and commercial land specialist – was the driving force behind Pocatello Town Square, a 67-acre development southeast of Interstate 86’s Chubbuck interchange that boasts Lowe’s Home Improvement, Staples, Texas Roadhouse, Ross Dress for Less, Dick’s Sporting Goods, Ashley Furniture, Buffalo Wild Wings and Bed, Bath & Beyond as major occupants.

Another company, which Zebe declined to identify, has signed a letter of intent to open a restaurant next to Buffalo Wild Wings.

Zebe was involved to a lesser degree in getting Costco to locate its $17.5 million mega discount warehouse in the Gate City, working with Costco officials as early as 2003 to put it at Pocatello Town Square, but there wasn’t enough land there to suit their needs. He anticipates another Costco locating in the Idaho Falls/Rexburg area.

Among the many smaller ventures that he has succeeded in securing for the Pocatello/Chubbuck area are Ruby Tuesday, D.L. Evans Bank, Pita Pit, Jack in the Box, Walgreens, Del Taco, AT&T/Edge Wireless, Pizza Pie Cafe and Batteries Plus.

His latest ambitious project is Yellowstone Commons, another 67-acre retail development northwest of the Chubbuck interchange where Sherwin Williams has opened a large new paint store and Idaho Central Credit Union is constructing a new branch office along Yellowstone Avenue. Its size is large enough to potentially contain the likes of Target, Kohl’s, Best Buy and even a Wal-Mart. (more…)