Fracking Insider Readers: We are pleased to bring you Volume 38 of our State Regulatory Roundup, including updates in Florida, Ohio, and Texas. As we explained in earlier volumes, we designed the Roundup to provide quick overviews on state regulatory activity. If you have any questions on any of these summaries, please do not hesitate to ask.
Florida – A recently proposed bill, Senate Bill 166, would effectively ban hydraulic fracturing in Florida by prohibiting any person from “pumping a fluid into or under the surface of the ground to create fractures in rock for the purpose of recovering oil or gas.” The bill was filed by state Sens. Darren Soto (D) and Dwight Bullard (D) on December 2, 2014 for the 2015 legislative session, which begins in March. The lawmakers cited a controversy earlier this year regarding an oil well near the Everglades that used an unauthorized well stimulation technique, as well as a recent request by Florida Power & Light for regulatory permission to partner on a natural gas project in Oklahoma that utilizes hydraulic fracturing. Despite the concerns cited by the bill sponsors, the unauthorized well stimulation at the Collier-Hogan well near the Everglades is the first and only time hydraulic fracturing or any similar well stimulation technique has been used in Florida.
Ohio – A lawsuit filed December 4, 2014 in the Cuyahoga County Common Pleas Court seeks to prevent hydraulic fracturing in the Cleveland suburb of Broadview Heights. The class action lawsuit (Mothers Against Drilling in Our Neighborhood v. Ohio, Cuyahoga Co., No. CV-14-836899) argues that the law in question, Ohio Rev. Code § 1509.02, violates the town’s residents’ constitutional right to local self-governance. The lawsuit followed the failure of the town’s attorneys and permit holders to settle a dispute regarding the community’s regulatory and preemptive authority. The drilling companies, Bass Energy Inc. and Ohio Valley Energy, sued the city in June to invalidate the city’s “Community Bill of Rights,” which bans hydraulic fracturing (Bass Energy v. Broadview Heights, Cuyahoga Co., No. CV-14-828074). The companies argued that state has the sole authority to permit drilling under the state’s Oil and Gas Act, and local efforts to prohibit drilling are preempted by state law. The city’s “Community Bill of Rights” was drafted with assistance from the Community Environmental Legal Defense Fund, which has assisted four other Ohio cities draft similar laws, and is assisting the city with its current class-action lawsuit, which is scheduled to go to trial in March.
Texas – The Texas Oil and Gas Association has filed a lawsuit against the city of Denton to overturn a ban on hydraulic fracturing passed by city voters in November (Fracking Insider has previously reported on the Denton ballot initiative here). The Association argues that the Denton ordinance goes beyond the authority granted to municipalities by “home rule” provisions of the law, and encroaches on the exclusive powers granted by the state legislature to the Texas Railroad Commission and the Texas Commission on Environmental Quality. The lawsuit contends that a “field” preemption, in which state regulations are acknowledged to be so comprehensive that local rules are not required, should apply to the Denton ban. Even if the Association’s argument fails and the ban is upheld, the city can expect mineral rights holders to sue the city, arguing that the ban is a type of regulatory taking. If a takings challenge is successful, the city may be required to compensate the mineral rights holders. The Texas General Land Office has filed a separate lawsuit against the city, arguing that the ban usurps its authority as the statewide manager of mineral interests. The city has filed a motion asking that that lawsuit be moved from the Austin district court to Denton.