It’s time to talk about regulations again… This time the regulations are not on the oil and gas companies, they are now on local governments. Two bills are entering the Texas Legislature that would drastically discourage cities and counties from placing any bans on fracking.
Both of these bills stem from the fracking ban that Denton, TX established in 2014. The city of Denton had over 58% of it’s voting population vote to ban all hydraulic fracturing within its city limits. This ban has been a game-changer in an energy-friendly state. Naturally, oil and gas companies have been fighting the new law in Denton. These court battles are what have prompted Texas lawmakers to file the two bills, House Bill 539 and House Bill 540.
So the bills were officially filed on December 17, 2014 by Representative Phil King, a Republican from Weatherford. With the opening of the 84th Session of the Texas Legislature back on January 13th, these two bills are going to be getting quite a bit of attention. I read articles for and against these two bills. I read, even more, to ensure I understood the goal of these two bills. An article by Nicholas Sakelaris from the Dallas Business Journal put it in the best laymen’s terms for me.
House Bill 539
Requires cities to determine how much money certain drilling regulations, such as a frac ban, would cost states, school districts and other entities in lost royalties. That would be made public before the regulation goes into effect and the city would be liable for that payment if the bill passes.
House Bill 540
Requires all referendum and initiative petitions go before the Texas Attorney General for review prior to being placed on the city ballot. The AG would determine whether this action results in a government taking minerals without compensation.
Naturally, there are people for and against these bills. Those against HB539 say that passing the bill will add an unnecessary financial burden to cities that just want to ensure that safety and land regulations are in place before a company erects a frac site. They also argue that the state is only looking out for the mineral owners and not landowners. Groups for HB539 state that the bill is just there to make sure that voters are truly informed about the financial benefits that fracking can have on municipalities.
When it comes to HB540 those for it are saying that it will not take away a city’s ability to pass laws by taking away the petition or referendum process. It will be a positive thing by saving those cities time and money by having the Attorney General review petition drives. On the other hand, those that disagree with HB540 are saying that this is just another situation where a bigger branch of government is taking away power from local government.
This is a tough issue. As a native Texan and a daughter of an even more prideful native Texan, I know first hand what independent people we are. We pride ourselves on our personal and local independence from the government. There is still a lot of wide-open spaces around here. People like to be on their plot of space and do not want the government to tell them what they can or cannot do in that space. So is more government oversight really needed? On the other hand, putting a frac site across the street from a hospital and public park is a bit much. So can we trust a very lucrative industry (and yes I realize I belong to this industry) to work with local governments to ensure frac sites are safe for all involved?
One sure thing is that regulations on the oil and gas industry are not going away. The federal government is trying to get emissions reduced. There is a chance that will affect fracking on a national level. So state regulations may get trumped. Groups for and against fracking have dug in and are ready for a long battle. With Texas having 3 major shale plays spread across the state be ready to hear A LOT about these arguments.
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References:
https://www.star-telegram.com/news/business/article9886835.html
http://www.law360.com/articles/606313/texas-lawmaker-aims-to-block-city-fracking-bans
https://www.star-telegram.com/news/business/article3865449.html
http://www.texasobserver.org/railroad-commission-denton-fracking-ban/
