Rural Town Left out of Money, Hope After Keystone XL Shutdown
This is part four of a series exploring the effects of President Joe Biden’s cancellation of the Keystone XL oil pipeline.
PHILIP, S.D.—Entire towns and communities along the route of the Keystone XL pipeline—once lively and prosperous due to the economic opportunity it brought—have been left out of money and out of hope after the project was scrapped by President Joe Biden on his first day in office.
One such town in rural South Dakota had invested heavily in their businesses in order to provide for an influx of workers the project had brought. Some businesses had even secured contracts with various companies working on the pipeline, but now have been left in deep debt and face a bleak future.
Residents of Philip, a small town with less than 900 people, knew that the construction and extra business was temporary, but also knew that the revenue it was to generate would have long-lasting effects on their economy.
Tricia Burns is the owner of a popular fitness center in Philip called Ignite Wellness Studio, a place many Keystone workers frequented. Biden’s decision impacted her livelihood in three separate ways: first, her gym lost approximately $3,000 in recurring monthly income with the loss of membership alone; second, a ranch her family owned suffered a “substantial loss” due to the rise in energy and fuel costs; and third, she described a “heart wrenching loss” from not being able to see her newfound friends again, many of whom were pipeline workers forced to leave the town after being fired.
“The devastation was so evident,” Burns told The Epoch Times. “Not just loss of their jobs but a bleak future of the trade they worked so hard for.
“We cried many tears as the pipeline workers came in to say goodbye to cancel their memberships, not knowing what their next move was but knowing Philip was no longer home” she added.
Terry Cunha, a spokesperson for TC Energy Corp., told The Epoch Times in January that “as a result of the presidential permit being revoked for Keystone XL, 1,000 unionized jobs will be lost in the coming weeks.” Cunha did not respond when asked for more specific details about the job cuts.
Burns said her first reaction to Biden signing the executive order that cancelled the project on Jan. 20 was “disbelief followed by anger.” Then the sadness started to set in. Within 20 minutes of the president’s signature, workers had started cancelling their memberships.
Although she feels blessed to live in a community that supports its local businesses, Burns said the concern for their future is “very real.” This anxiety and fear has become almost a daily topic and sentiment among her family, friends, and community as she explained how the growth in rural agriculture-based towns like Philip is very minimal.
The Keystone XL pipeline was a huge project expected to generate $3.4 billion in U.S. GDP growth, including millions in state and local tax revenue, according to the U.S. Chamber Global Energy Institute.
It would have generated millions of dollars of economic opportunity for South Dakotans.
Many towns like Philip are fading away, Burns said, as she described the Keystone XL Pipeline as an opportunity they will likely never see again in their lives.
“I truly couldn’t believe that an executive order could be signed—one that would impact our entire nation—with little to no hesitation, in my opinion,” she said.
Her indignation was shared by many in the local community.
The town is described by Philip mayor Michael Vetter as an agricultural and ranching community with some manufacturing via Scotchman Industries, a manufacturer of metal fabrication equipment, with a small but solid group of small businesses. Unlike other towns in rural America, it is actually “not dying, but sustaining,” he said.
The mayor was left shell-shocked after the Keystone cancellation and wondered how a president even had the ability to shut down such a massive project that had already been approved and was well underway.
“Every permit had been granted, all the red tape had been cut, and every obstacle had been cleared,” Vetter told The Epoch Times.
“I don’t understand how one individual can arbitrarily stop a project. One person should not have that much power in America,” he said.
There is now legislation aimed at revoking the presidential permit authority, which Biden used to shut down the pipeline.
Some businesses in Philip had secured contracts with companies working on the pipeline. In order to fulfil their commitments, some owners made sizable capital investments in machinery and infrastructure, according to Vetter.
The pipeline project provided an opportunity for many of the town’s retail and service sector businesses to realize extra revenue. Since the town is sustaining and not growing, any chance of growth is welcome.
Now, the lost revenue denied to the town’s small businesses has caused “a trickle down affect to the community through lost sales tax,” said Vetter.
“The community will also lose a considerable amount of property tax paid by TC Energy for the life of the pipeline,” he said. “We knew the construction was temporary, but the revenue it would have generated for our small businesses would have had long-lasting effects.”
Biden’s executive order states that the KXL pipeline “disserves the U.S. national interest,” arguing that the country is facing a “climate crisis.” The Biden administration has made combating climate change a key part of its agenda and has often talked about creating renewable energy jobs and reducing emissions.
Over the past decade, the town has witnessed the project start and stop several times. Each time the project met an obstacle, it was at the discretion of a lone judge or the president himself, said Vetter. But it feels different this time around as there appears to be “less hope in those pipeline workers who left the area.”
“The city of Philip will endure, we have the pioneer spirit in our blood, but lost opportunities like this make it just a little bit harder,” he added.
Business owners in South Dakota aren’t backing down without a fight, and are increasingly making their voices heard. On Feb. 8, politicians hosted an hourlong roundtable with more than 20 business owners in the state whose livelihoods have been affected by the pipeline shutdown.
According to Burns, the cancellation of the pipeline sends a global message of “instability in our nation and our economy.” She herself has a message to the administration:
“Take the time that this project and the people deserve,” she said. “Walk the streets, talk to the employees, talk to the landowners, talk to the business owners. Truly talk to the people who are in the trenches working on this project and are affected by the executive order.”
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