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Beaumont closer to using natural gas royalties for street repair - 12 News KBMT and K-JAC. News, Weather and Sports for SE Texas

Beaumont closer to using natural gas royalties for street repairs

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The City of Beaumont is applying to the Federal Aviation Administration to use a portion of the $52 million it's received from mineral rights on natural gas wells at the municipal airport.

A law had prevented the city from using that money on anything else but airport improvements, but the Obama administration recently signed into law changes that would free up access to some of those royalties.

The city is proposing to would like to use some of the funds for street improvements throughout the city.

NEWS RELEASE FROM CITY OF BEAUMONT

Beaumont, Texas - The City Council today moved one step closer to securing $47.8  million in oil and gas revenue for use on projects other than the municipal airport.

The city has accumulated roughly $52.8 million from mineral rights at the airport property through a lease with Cimarex Energy Company. Previously, federal law required that airports receiving federal grant funding must spend 100 percent of any mineral revenue on airport-related expenses. In February, President Obama signed a law outlining exemptions to the requirement.

Council gave the green light for staff to apply to the Federal Aviation Administration for an exemption, which, if granted, would allow the city to use the funding for  a number of street projects. The law does require that municipalities who are granted exemptions spend the revenue on transportation infrastructure.

As part of its application, the city has pledged $4.5 million to be held in reserve for the airport. The remaining $47.8 million will be dedicated to street rehabilitation projects:

  • $29.5 million for Washington Boulevard, from MLK to I-10
  • $ 6.5 million for 7th Street from I-10 to Laurel Street
  • $ 5.0 million for Old Dowlen Road from Highway 105 to Dowlen Road
  • $ 6.0 million for Northwest Parkway from Folsom to Parkdale Mall
  • $800,000 for Dowlen Road from Highway 69 to Delaware

"This is a positive step forward in our efforts to put this revenue to the best use for our citizens," said City Manager Kyle Hayes. "After much hard work by the Mayor, Council, and staff, we are hopeful that this money will facilitate some important and much-needed improvements to our streets."

Project amounts are based on engineering projections, not submitted bids. Funding
may be re-allocated to reflect changes in cost projections.

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