Thursday, February 2, 2012

Preemption Challenges to Local Fracking Bans in New York

Good morning. I'm looking forward to guest blogging here this month. I will be posting about the many issues we are working on here in the Columbia Environmental Law Clinic. Our students are working extensively on hydraulic fracturing, easement defense and many other issues. Today we begin with the challenges fracking presents to home rule in New York.

Preemption Challenges to Local Fracking Bans in New York

New York state has arrived at a critical passage in the ongoing debate over hydraulic fracturing. The NY DEC's comment period for the Draft Supplemental Generic Environmental Impact Statement and the proposed regulations for "high-volume hydraulic fracturing" closed on January 11, 2012, paving the way for an administrative decision that may lift the statewide fracking moratorium and determine whether - and if so, how - fracking will occur in the state. In this context, it's worth considering the question (referenced previously on this blog, but now more pressing and developed) of whether a NY municipality may ban fracking through exercising its zoning authority.

Citing home rule powers delegated by statute under the state constitution, dozens of municipalities across the state - including Syracuse and Buffalo - have adopted zoning ordinances that remove natural gas exploration and extraction from the list of permissible land uses within their borders. (Click here for a map of of others, with links to the text of each ordinance.) In late 2011, natural gas leaseholders and industry sued two of those municipalities - Dryden and Middlefield - arguing that the state Oil, Gas, and Solution Mining Law (OGSM) (codified as Environmental Conservation Law (ECL) § 23) preempts local efforts to ban fracking. OGSM expressly supersedes “all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries.” ECL § 23-0303(2). Thus, the question presented is whether a generally applicable zoning ordinance that bans natural gas extraction “relate[s] to the regulation” of natural gas.

No court has addressed this clause in the OGSM, and neither statutory language nor legislative history gives clear guidance. Thus the courts will likely look to parallel preemption clauses in other state statutes. Most relavent is the Mined Land Reclamation Law (MLRL), which provides that it “shall supersede all other state and local laws relating to the extractive mining industry.” ECL § 23-2703(2). In Frew Run Gravel Products v. Town of Carroll, the Court of Appeals directly addressed whether the MLRL preempted a town’s zoning laws. 71 N.Y.2d 126 (1987). The DEC had granted Frew Run a permit to conduct “sand and gravel” operations on property in the Town of Carroll. However, because the property was zoned exclusively for agricultural and residential development, the town notified Frew Run that its operation was prohibited. The Court held that Carroll’s zoning ordinance related “not to the extractive mining industry but to an entirely different subject matter and purpose: i.e., regulating the location, construction and use of buildings, structures, and the use of land in the Town of Carroll." Id. at 131 (internal quotations omitted). The Court noted that land use regulation “inevitably exerts an incidental control” over regulated businesses, and reasoned that such “incidental control resulting from the municipality’s exercise of its right to regulate land use through zoning is not the type of regulatory enactment . . . within the prohibition of the statute.” Id. That is, the MLRL’s purpose is not to control town zoning, but rather to provide uniform mining regulations. Thus, the Court ruled that local regulations dealing with “the actual operation and process of mining” would be preempted, but not local zoning ordinances concerned with the appropriate use of local lands. Id. at 133.

In light of this and other precedent, the court should adopt similar reasoning and uphold a generally applicable zoning ordinance removing oil and gas activities from the list of permissible land uses. Indeed, it has applied a similar analysis and reached the same conclusion in other contexts as well. See DJL Restaurant Corp. v. City of New York, 96 N.Y.2d 91 (2001) (upholding zoning authority in relation to alcohol in the face of implied preemption by Alcohol Beverage Control Law).

The normative considerations underlying home rule authority likewise favor a municipality’s power to decide whether natural gas extraction may occur in its territory. The NY Court of Appeals has recognized that land use is one of the essential home rule powers because it addresses distinctively local matters of concern. Even setting aside the well-documented possible environmental and human health impacts, fracking is undeniably a high-impact land use that dramatically and often irreversibly alters the character of localities, regardless of the stringency of state regulations. Forests are fragmented by roads and rights of way; land is clear-cut and covered over by cement well pads; rural ambience is replaced by the drone of compressor stations, drilling and fracking equipment, and diesel truck engines; and rural sceneries are punctuated by metal towers rising among forest or farmland. These changes are not merely subjective intrusions: they can negatively impact local economies and the character of local communities dependent on rural tourism and recreation, uses that are essentially incompatible with an industrialized landscape. While DEC should determine whether and how fracking may occur in the state, and preempt localities from enacting duplicative and/or conflicting regulations relating to oil and gas activities that would unnecessarily burden industry, localities should retain the authority to decide whether such activities are appropriate for their landscapes and communities in the first instance.

Regardless of the outcome of the Dryden and Middlefield cases, appeals are certain. The resolution of this question in these initial cases very well may influence other courts, and may encourage or discourage further local bans on fracking, depending of course on the outcomes. Meanwhile, legislation passed in the New York Assembly (Bill No. A03245-2011) and now pending in the state Senate (Bill No. S3472-2011) proposes to amend the OGSM to expressly provide that the OGSM does not prevent any local government from "enacting or enforcing zoning ordinances or laws which determine permissible uses in zoning districts." Enactment of such an amendment would no doubt moot the pending cases. But unless and until the legislature acts, this question will wind its way through New York courts, where elected judges will determine a crucial if tentative element of New York's fracking regime.

Susan Kraham

 

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