Big Oil v. Little City

For years now, national attention has been focused on the Keystone XL Pipeline saga.  But it isn’t the nation’s only pipeline fight.  Here in Maine, what could be some very interesting pipeline litigation has just begun.

The case involves a pipeline that transports oil from South Portland, Maine to Montreal.  Since World War II, oil in the pipeline has flowed only north.  But with Albertan oil production escalating dramatically, Canada’s need for oil imports has declined, and the pipeline company would like to reverse the flow.  That would mean turning the port of Portland, Maine into a major export site for tar sands oil.

But there’s a hitch.  The southern terminus of the pipeline lies at the mouth of Portland Harbor, adjacent to South Portland’s most important park and across the water from parks and the Old Port district in Portland.  Casco Bay, into which the harbor enters, is a beloved scenic and recreational resource for residents and a major destination for tourists.  Still, seventy years ago, this was exactly the kind of place where cities would put oil pipes and tanks; providing industries with good water access often trumped everything else.  But values have changed, and South Portland has started envisioning a different future for this part of its waterfront.  When the pipeline proposal emerged, the city (through a long process described in more detail here) responded by enacting an ordinance restricting the construction of new “bulk oil” export facilities on its eastern waterfront.

Is that ordinance valid?  According to a federal court complaint just filed by Portland Pipe Line Company, the answer is an emphatic no.  The complaint foreshadows a whole host of arguments, most of them grounded in the idea that the ordinance is just regulating the contents and flow direction of an international pipeline, and such regulation is the exclusive province of the federal government.  As the complaint succinctly puts it, “[o]ne city in Maine cannot impede federal decision-making on international relations, trade, and resource transportation and replace it with its own foreign policy.”  And as Maine goes, so goes the nation and, perhaps, the world.  The complaint warns of drastic consequences if the ordinance stands: it “sets a precedent for inconsistent local harbor regulation that could cripple import and export activities nationally and invite reciprocal commerce curtailment from other nations.”  Even the founding fathers would be horrified.  South Portland, according to the complaint, has “contravene[d] fundamental principles upon which our Republic was founded,” and the complaint offers Federalist Papers citations to back that claim up.

South Portland, of course, will have a different story.  The ordinance clearly was kick-started by larger-scale events, and it may well have ramifications that extend beyond South Portland’s boundaries.  But local land use ordinances are often inspired by larger events, and they often have consequences extending across city lines.  That alone, the city will argue, does not make them constitutionally suspect.  Indeed, there are dozens, if not hundreds, of cities whose land use ordinances would probably preclude construction of new oil export facilities.  Are those ordinances also unconstitutional?   If they are, then another venerable constitutional principle—respect for local land use planning authority—may well be in danger.

Beyond that basic conflict, the case will raise many more intriguing sub-issues.  By my rough count, perhaps a dozen law school courses seem implicated by the complaint, and once the litigation proceeds, that number could easily get higher.  And these questions aren’t just academic.  The tension between energy development and transport and local governance has become one of the central legal issues of our age, with very real economic and environmental consequences. 

For me, there’s also a personal dimension to the fight.  I live in South Portland, about a mile from the oil terminal.  And while others deserve far more credit (or blame) than me, I did play a minor part in getting the ordinance passed, and, more generally, in advocating for South Portland to begin thinking about a future in which it no longer is the East Coast’s second largest oil port.  I won’t be here to see that future; in a few months, I move back to the San Francisco Bay Area.  But the neighborhood in dispute will always be the place where my children were born, and a place that I love.  I hope it also will be a place that gets to decide its own future.

- Dave Owen