20 Questions, 20 Answers on Natural Gas Development in NY
Recently, we became aware of a list of supposedly tough natural gas questions floating around upstate New York. Assembled by another aging activist seeking relevance in a modern world and, more specifically, Oxford, New York, these queries were, we heard, designed to stop pro-gas forces in their tracks. We requested a copy and, despite our reluctance to give any attention to our attention-seeking friend on the other side, decided the questions, if you can call them that, deserved answers, whether our friend really wanted them or not. We suspect he prefers the issue to the answers, but, hey, that’s his problem. So here we go…
QUESTION 1: How are the Oxford Town and Village Boards going to respond to Albany’s delegation of responsibility to pass and enforce land use and zoning regulations for hydraulic fracturing?
ANSWER: There is absolutely no delegation of responsibility to municipalities to enact land use and zoning regulations with respect to hydraulic fracturing. The DEC has floated rumors, and the SGEIS suggests, the department will consider community opinions regarding natural gas development before it issues permits, but hydraulic fracturing is an operational process that falls squarely within the preemption statute (ECL 23-0303), which states :
“The provisions of [the Oil, Gas and Solution Mining Law] shall supersede all local laws or ordinances relating to the regulation of the oil, gas, and solution mining industries; but shall not supersede local government jurisdiction over local roads or the rights of local governments under the real property tax law.”
Even the judge in the Dryden case, whose decision was very flawed, said “[the statute] does not expressly preempt local regulation of land use, but only regulations dealing with operations.” If hydraulic fracturing isn’t “operations” then what is? The town has zero authority over that process and calling it land use won’t make it so. Moreover, the one piece of case law in New York that actually addresses the oil and gas preemption issue, the Erie County Envirogas case, found for industry and against the town saying the state preempts “any municipal law which purports to regulate gas and oil well drilling operations.”
QUESTION 2: How are the boards going to respond effectively before the DEC issues its report?
ANSWER: There is no need to respond because nothing in the New York State DEC’s Supplemental Generic Environmental Impact Statement (SGEIS) relating to hydraulic fracturing will change the legal position of towns or villages with respect to its rights, whatever they may be. Local government clearly has the right to address road issues and can do so before DEC acts or later. No DEC permits will be issued prior to soliciting municipal input anyway (see §18.104.22.168), so there is no threat a community will be confronted with a permitted nonconforming use that would somehow be protected from municipal regulation by the existence of a legally valid state permit.
Regardless, all of this assumes a local government can prohibit an activity it is preempted from regulating by pretending a prohibition isn’t a regulation, a conclusion that is still very much in doubt and in the courts. It is not prudent for a town or village to attempt to jump the gun and regulate before the DEC has firmly established what it regulates and the courts have resolved these preemption issues. This is only an invitation to legal challenges from landowners. A local government that relies upon the legal advice of a special interest organization (e.g., the Park Foundation funded Community Environmental Defense Council) and allows itself to be stampeded into adopting such a regulation may find itself without insurance to cover legal representation if that entity refuses to also defend what it recommended.
Chesapeake Energy well pad during and after development (West Virginia). Note the upper pond wouldn’t exist in New York State
QUESTION 3: Do any board members, their families, or business associates hold gas drilling leases or otherwise stand to benefit from any board action or inaction on this issue?
ANSWER: This question assumes the mere possession of a lease or some other connection to the natural gas industry disqualifies a local government board member from acting on any matter generally relating to the industry and even from not acting. While disclosure of interests is appropriate in all instances, recusal is another matter and is governed by the General Municipal Law which quickly becomes complicated. If a majority of a board did have leases, for example, some members would have to vote because government could otherwise not take any action. The key is the extent of any interest and whether or not it is disclosed. If members of a board have to recuse them anytime a matter comes up that could impact their interests however deep those interests run, then no landowner could ever vote on any zoning law, because it will inevitably impact their rights in land.
New York State case law on this subject indicates recusal is not required “where the interest of the member in the matter under review is not a personal or private one, but rather ‘an interest he has in common with all other citizens or owners of property’ in the community. Thus, where most of the property in a village met the acreage requirement for reclassification to a cluster residence floating zone under a proposed zoning amendment, village board members who owned qualifying property were not disqualified from voting on that zoning amendment.” It’s also worth noting those individuals who have already taken public positions on specific land use issues cannot then vote on those same issues as a member of a municipal board. Ethics law is a two-edged sword.
QUESTION 4: When can the boards compile a complete map of the properties leased to corporations for gas drilling, the owners, corporations, and the permits submitted?
ANSWER: This is no requirement gas leases be disclosed to local government for mapping purposes any more than there is a requirement landlords disclose their rental agreements with housing tenants. Notwithstanding this, most leases are recorded and such information as is available can be plotted by any person or entity with an interest in doing so. Additionally, should leases be developed, NewYork State DEC regulations will govern unit planning and such information will be publicly available in that format. Permit records are also a matter of public record and can be easily monitored at the DEC website.
QUESTION 5: What adjacent properties will be affected by Albany’s compulsory integration of the lease holder’s neighbors’ land into his contract and gas drilling husiness?
ANSWER: No landowner can be forced by compulsory integration regulations to enter into a gas lease or to permit natural gas well pads on their property. Indeed, “DEC’s integration order will not give the well operator the right to enter your property.” What the regulations are about is protecting “what is known as your ‘correlative right’ to an opportunity to receive the benefits of oil or gas beneath your acreage.”
Elk Lake School and environs. Can you find the well pad and the pipeline?
QUESTION 6: What natural aquifers, private and village wells, rivers, smaller waterways, and ponds exist on the acreage leased for horizontal drilling or projected for pipelines?
ANSWER: This, of course, cannot be known with specifying which leases and plotting them. However, almost no property of any consequence would not have one or more of these, so the question is largely irrelevant. What is relevant is the setbacks and other protections that exist with respect to each of these. These are thoroughly addressed in the SGEIS and specifically at §7.1.10 and §7.1.11. These include separations from aquifers (at least 1,000 feet below), setbacks from streams and setbacks from supplies.
QUESTION 7: What roads, highways and bridges and service stations will be used by the hundreds of heavy trucks that will service each well in this area?
ANSWER: The question is obviously rhetorical in nature and cannot be answered without knowing what areas, if any, will actually be developed. No one knows that yet. Nonetheless, the amount of truck traffic associated with natural gas development has declined by a great deal in the last two years by the introduction of water recycling where some flowback water is re-used on site and, much more importantly, by the use of fresh water storage ponds supplied by water wells or other nearby water resources, from which needed water is piped overground to multiple well pads without the necessity of additional trucking. This is to say nothing of new methods of fracturing that don’t require much water.
QUESTION 8: What businesses, farms and private homes will be impacted by drilling: increased traffic; noise; air, soil and water pollution; and damage or injuries from accidents?
ANSWER: This is still another rhetorical question designed to offer an opinion rather than gather information. However, the record is clear. Hydraulic fracturing has never polluted a water supply, for example, and that comes from no less an authority than Lisa Jackson, the EPA Administrator. Likewise, we also know the industry’s safety record is excellent, despite some attempts to portray it otherwise. The same holds true with respect to air pollution and other issues raised. The SGEIS addresses all of these in detail. See sections on environmental impacts here and here. There is no need to reinvent investigations DEC has already conducted.
QUESTION 9: What additional judicial and legal services will be needed for property and personal conflicts and lawsuits among neighbors, leaseholder’s and corporations?
ANSWER: This question implies such conflicts will be out of the ordinary and require special services, yet there is no evidence to support that assumption. All human activity generates the potential for lawsuits, particularly when some individuals and hungry trial lawyers think there’s a pot of gold to be had. The facts are, however, that natural gas development has been warmly received by the communities where it takes place. A lawsuit by dozen or so Dimock litigants is collapsing from a lack of evidence as 7,000 or so of their neighbors showed up to the Cabot Oil & Gas Picnic in appreciation for the work of the company. That’s the best evidence there is.
QUESTION 10: What skills and resources will tbe town assessor need to determine the tax rate on each well and monitor reporting, given the widespread fraud in the industry?
ANSWER: Widespread fraud? What kind of question is that? There is no evidence of anything like this whatsoever. Every major gas company is a public company registered with the Securities and Exchange Commission and if there was “widespread fraud” both the SEC and IRS would be dealing with it. Assessors, in any case, have access to the full resources of the New York State Office of Real Property Services, which specifies values, procedures and requirements.
Cabot Match Fund project to build new hospital in Susquehanna County
QUESTION 11: What new personnel, equipment, training and supplies will be required for local fire, emergency medical, traffic and environmental control and police services?
ANSWER: Natural gas companies work extremely closely with emergency service providers wherever they operate, particularly in providing training. Examples of cooperative programs may be found here, here, here, here, here and here. Companies have also assisted in emergency management with respect to flooding issues and meeting other special community needs.
QUESTION 12: What additional personnel, equipment, training and supplies will be required for town and village highway, water, waste management and other departments?
ANSWER: Natural gas companies work extremely closely with local governments to determine the best possible route for natural gas related traffic. While there are few, if any demands on water or waste management services, the natural gas industry does impact roads and will repair any on which their vehicles travel routinely, often prior to and after use, and more often than not to conditions better than before. Pennsylvania townships are also hiring more individuals for their communities because there is increased revenue coming to these local governments, allowing for improvements they were not capable of previously. Road repair examples include this one, this one and this one.
QUESTION 13: What will be the impact on local air, water, and soil quality and how will they be monitored, pollution prevented and violations publicized and remedied?
ANSWER: There have been no significant impacts on local air, water, and soil quality in any of the communities in our region where natural gas development is taking place. There have been a small number of spill incidents, but these have been very milted in number and the control measures deployed on site were successful, in each instance, in ensuring there was no environmental contamination. Also, the numbers of violations compared to development activity are dropping and are generally administrative in nature. Moreover, matters such as the Dimock allegations have not proven out, as the EPA has now indicated. The most significant issue has consisted of isolated instances of methane migration, a reflection of the shallow methane predominant in much of the region. This problem has been addressed and minimized with additional casing requirements (see SGEIS – Ch. 10 for example) in both New York and Pennsylvania. Both New York and Pennsylvania also have aggressive enforcement programs.
Dimock Township road upgraded by Cabot Oil & Gas
QUESTION 14: What plans are needed for emergency evacuations of neighborhoods, schools, highways and public facilities in the event of a fire, explosion or chemical leak?
ANSWER: Natural gas development in our region occurs in rural areas, not neighborhoods or housing developments. Only police can call an evacuation and state police/local law enforcement entities typically implement those evacuation procedures with the cooperation of company personnel. Evacuations rarely occur and are precautionary measures. Pipeline companies do have specific evacuation plans for many of their facilities and some of these are discussed here along with the issues involved.
QUESTION 15: If private security forces are employed by drilling companies how will they coordinate with the powers and jurisdictions of local police?
ANSWER: Many security personnel associated with gas companies have backgrounds in local/state law enforcement and reach out to educate or communicate with their associates on local police forces on perceived threats, potential vandalism, emergency planning and the like. This is routine and is often also accomplished through local gas task forces. Also, “the Center for Energy Workforce Development, through the support of several of its member utilities, and the U.S. Departments of Defense, Labor and Energy, have come together to develop the Troops to Energy Jobs program, which is focused on providing training and job placement services that help retiring military find satisfying and well-paying careers in the energy sector,” including jobs as security officers.
QUESTION 16: How will safety, fire and medical emergency crews gain access to fenced and locked or abandoned facilities or those with disputed or foreign ownership?
ANSWER: These services are requested as needed and access is granted as needed for local law enforcement and EMS. Other public personnel are only requested for crowd control. Local service personnel are also routinely invited on site for tours of development sites to ensure their familiarity with the process.
QUESTION 17: What additional lawyers, tax enforcement and collection agents will be required for absentee owners or American corporations selling leases to foreign entities?
ANSWER: This is an irrelevant question as foreign companies doing business in the U.S. (e.g., Royal Dutch Shell, Talisman Energy) either already have or proceed to set up U.S. subsidiaries or enter into contractual relationships with U.S. companies on a joint venture basis and there strict rules governing such foreign investment. Regardless, all companies must comply with U.S. law. Finally, foreign companies are major sources of employment in the U.S., which is a good thing for sure.
QUESTION 18: What additional local employees, supplies and equipment will be needed for this expanded range of government services? Property or sales tax increases?
ANSWER: Typically natural gas development has not required any additional equipment for public services; nonetheless, numerous companies have made specific donations of equipment where needs already existed. Here is an example of this.
QUESTION 19: What will be the economic impacts from the influx of temporary workers, more crime, increased school enrollment and demand for additional community services?
ANSWER: This is still another rhetorical question that seeks to offer an opinion not justified by the facts. Bradford County, the most heavily developed county in Pennsylvania with respect to natural gas, has reported some increases in crime statistics but a comparison of Bradford with Pike County, a similar sized county in northeastern Pennsylvania with no natural gas development, reveals the latter had significantly higher rates of homicide, robbery, assaults, property offenses and drug violations. There have been additional students enrolling in schools, and many temporary employees have become permanent residents, stabilizing populations and school enrollments that had been decreasing. Schools have also benefitted by new revenue. As for economic development, there exists plenty of new demand for services and the companies are delivering, resulting in the construction of four new hotels in Williamsport, which is now the seventh fastest growing economy in the U.S..
QUESTION 20: What will be the effects on property values from homeowner flight because of the changcs causcd by major industrialization of a traditionally rural area?
ANSWER: Contrary to the implications of the question, there is no property value destruction. Property values, in fact, have increased substantially in all areas of natural gas development in Pennsylvania as this post indicates.
So there you have it. The 20 questions weren’t that hard at all were they?