Does annexation subvert local controls over frac sand mining?

As community involvement in the expansion of frac sand mining has become more organized and influential, it appears that industry has embraced annexation as a tactic to advance controversial frac sand projects.

Annexation law in Wisconsin allows cities and villages to increase their size through acquisition of contiguous land, a process often initiated at the request of landowners. Cities and villages sometimes view annexation as an economic development strategy that creates an increased tax base. Once a city or village annexes land, it is required to extend public services to its newly expanded jurisdiction.

Some frac sand operations have recently benefited from annexation, pursued to achieve a "friendlier" regulatory environment or to circumvent local opposition to controversial projects. Whether by intention or not, this tactic appears to subvert local democratic control over the decision-making process involving a contentious and rapidly-expanding industry.

Use of Annexation to Force Industry-friendly Regulations

In Trempealeau County, the frac sand industry has used annexation to secure a more lenient regulatory environment. As Tony Kennedy reports, for example, Trempealeau County issued an operating permit in 2011 for a mine in Preston Township opened by Winn Bay Sands LP of Saskatchewan. The permit limited hours of operation to weekdays, required air monitoring, and mandated periodic inspections of nearby homes. But in January 2012 the mine was sold for $200 million to Pennsylvania-based Preferred Sands. Founded by Michael O'Neill, a former Philadelphia banker and real estate executive, Preferred Sands then sought to have the property annexed to the City of Blair, a small municipality surrounded by Preston Township.

New forms of wealth and division

As part of their periodic series called "Frac Sand Fever," the Star Tribune recently reported about community divisions stemming from frac sand development in western Wisconsin.

In a piece titled "Sand Mining Creates Wealth and Friction" (Dec. 2, 2012), reporter Curt Brown tells the story of Lou Ellen and Jim Frei, a couple in their late 60s who have lived in Blair, WI, in Trempealeau County, for 40 years, and who sold their dairy farm to a frac sand company in 2010 for half a million dollars. Here are some of the financial figures cited in the story:

• Winn Bay Sand Co. paid the couple, along with three neighbors, $3850 per acre (for their 143 acres). They retained 10 years of rights to continue farming, logging, and hunting. 
• Preferred Sands bought an 80 acre parcel in 2010 for $250,000 (or $3,125 an acre).
• Brown reports on rumors of people receiving $10,000 an acre; he writes that the Texas oil and gas company Windsor Permian "has offered more than $15,000 an acre for a possible mining site near Red Wing."

From my perspective, it's interesting to examine how people try to make sense of the rapid social and economic changes associated with frac sand mining. Using a popular culture reference, one neighbor described the influx of frac sand wealth as a rural "rags to riches" story, and subtly frames the hills of rural Wisconsin as a nuisance: 

• "It's like the Beverly Hillbillies: Who would have thought these hills we've been tipping our tractors over on all these years would become such a hot commodity?" - Lorna Tenneson