A man looks at a map of the proposed route for the Trans Pecos Pipeline at an open house hosted by Energy Transfer on April 21, 2015. (Jessica Lutz)
While Energy Transfer, the company building the pipeline, says using eminent domain to condemn land for its projects is a “very last resort,” that doesn’t mean it’s out of the question.
Just this year, the company sued 17 landowners in Michigan who refused to give survey crews access to land for a pipeline in the works there.
With all that in mind, we thought we’d take a look at where the law stands on eminent domain in Texas, and how it got there.
The pipeline industry’s fought hard to keep the courts from changing anything about when a company has the right to condemn land.
In 2011, the Texas Supreme Court ruled that landowners can challenge a company’s right to do that. Before, they couldn’t.
But it’s still been an uphill battle for eminent domain opponents.
The big challenge started when a company called Denbury was looking to build a carbon dioxide pipeline through farmland near Beaumont. Landowners said no – so the company sued. The case wound up at the state’s highest court, which said Denbury didn’t have the right to condemn land – that it didn’t qualify as what’s called a “common carrier” by state law.
Common carriers are pipelines built to be used by more than one company. The idea is they’re built in the public interest of developing the state’s economy.
Before, companies didn’t have to prove to anybody they qualified as common carriers. Now, suddenly, they did.
“What we were concerned about when the opinion came out was serial litigation up and down the pipeline that would essentially stop or delay projects,” says James Mann, a longtime pipeline industry lawyer and legal adviser for the Texas Pipeline Association.
“We are still litigating with Denbury over whether Denbury can or can’t condemn my clients’ land,” says Bill Christian, an attorney for the landowners in the case.
While the court said his clients should be able to challenge land condemnations, the pipeline got built anyway while Christian fought off appeal after appeal from the pipeline company.
Still, he says the case was a victory.
“Previously, pipeline companies had said that once they had registered with the Texas Railroad Commission, that there was no further inquiry to be made by the courts,” he says, “and the Supreme Court soundly rejected that.”
Basically, the court said to companies, “This is our turf. We’ll decide if a pipeline meets the legal standard for common carrier, not you.”
Here’s how the court described a company’s power to register as a common carrier, and to therefore automatically have condemnation powers:
“Nothing in Texas law leaves landowners so vulnerable to unconstitutional private takings.”
It was a step forward for eminent domain opponents, but so far, only on paper.
“It has not shut down any major projects, yet,” says Mann. “The pipeline industry has seen increased litigation. It has delayed some projects. Some projects have had to re-route around the area being litigated.”
Mann grew up in Monahans and went to Sul Ross for a while. He describes West Texas as his favorite part of the state. So he gets why people are freaked out by industry now creeping into the Big Bend.
But, he insists, pipelines don’t bother anybody once they’re in the ground. He argues that delays to infrastructure projects hurt the state economy, and local economies that miss out on tax revenue and jobs.
And as he sees it, after all the fighting and filing and court cases, the landowners who have fought eminent domain up to this point still aren’t any better off.
“You talk about protecting landowner rights, but what exactly has Denbury done to make things better for landowners?” he asks. “Other than being very good for lawyers, I’m not sure what has been accomplished.”
But it’s been good for industry lawyers like Mann too.
The industry’s still fighting Denbury and other cases of Texas landowners taking on eminent domain, and it’s got plenty of money to keep fighting. Many landowners don’t.
There was another win for landowners in East Texas after Denbury – a court ruled a pipeline did not meet the standard for common carrier – but a broader push at the state legislature to reform eminent domain laws later failed.
Christian says despite some updated procedures for how companies file for common carrier status, the Texas Railroad Commission – which regulates the oil and gas industry in Texas – is keeping its distance from the debate.
“My impression is that they are looking to the legislature for some more direction before they would get more involved in changing how they handle these common carrier matters,” he says.
“I think the ball on that side is in the legislature’s court, and it’s, I imagine, difficult for the legislature to navigate the two powerful interests of the pipeline companies on the one side, and the landowners on the other, and they just haven’t come up with a particular solution yet.”
As opponents of the Trans Pecos Pipeline gear up for a possible legal challenge, they’ll likely look to the Denbury case for inspiration.
But they’re also likely to know the clock is against them. The history of the eminent domain battle in Texas has shown that even if the courts say a pipeline company is overstepping its rights, the pipe can sometimes get put in the ground faster than the courts can close the case.