The Impact of Otter Creek Coal Development on the Montana EconomyOtter Creek Coal Study  

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Today Montanans are sitting atop a vast coal deposit in Otter Creek – an untapped resource waiting to be utilized.  In the coming years it could be much more than that.  It can be a road to more jobs and more affordable electricity.  It can be a road to more income for Montana residents in addition to a larger state budget due to taxes the mine would have to pay.  Most importantly, it can be a road to a more stable economy and better quality of life for Montana residents state-wide.

A study conducted by the Bureau of Business and Economic Research (BBER) at the University of Montana illustrates this belief.

The study analyzed how the development of the coal seam in Otter Creek would affect the state’s economy in both phases of the project – phase one being land preparation, construction of mining facilities and the necessary infrastructure that goes with it (including railways), and phase two being all the ongoing coal operations after construction has been completed.

Within the first phase of construction, Montana would see a large boost in spending and investments, largely due to the number of jobs that would be created in the construction industry.  These jobs would bring more people to Montana increasing state revenue in areas such as food, accommodation, health care and local government.  Overall, 2,648 jobs would be created in this phase bringing $103.5 million in personal income to Montana residents. 

“Coal is important to Montana. It creates jobs, pays taxes and generates affordable electric power for homes, businesses and communities.”
- Jessica Sena, Western Regional Vice Chair, Young Republican National Federation Helena - Independent Record (5/16/12)

The second phase is responsible for less jobs being created, as once construction is completed those jobs will no longer be in Montana after the (estimated) year of 2017, when coal production is scheduled to begin.  Instead of bringing temporary jobs to the region, the second phase would create permanent jobs within the mine amounting to 1,740 new, permanent positions.  This is not just jobs at the mine, but includes jobs in other industries such as the railway industry, wholesale and retail trade, real estate, and professional and technical services to name a few.  These jobs would bring $125.4 million permanent increase in personal income once the mine in is full operation.  In addition to this added income there would be an increase in both state and local tax revenues.

Montana needs to tap this vast resource of usable coal, and stands to lose more than it would gain from not developing the Otter Creek coal seam.  The total job creation of the development project would be over 4,300 jobs and could add almost $168 million in income after taxes.  This development, although taking place in southeastern Montana, would have far-reaching effects that could be felt across the state, in both public and private job sectors.  This is an opportunity to advance and grow the economy of our great state, but it cannot be done without your help.  We need to show the country that America, not just Montana Counts on Coal.

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