The Atlantic Coast Pipeline wants to inspect land along a proposed 550-mile route. Legal challenges from landowners could re-write a 2004 law governing property rights in utility surveys.
by James A. Bacon
Charlotte Rea decided when she retired that she wanted to live near where she grew up near Charlottesville. She found “a little piece of heaven” in Nelson County: a 29-acre spread on the north fork of the Rockfish River. With her retirement savings, she purchased the land with the idea of keeping it undeveloped if things worked out but selling two lots if she needed the cash. “All of my money is in the land,” Rea says. “It’s my long-term care insurance.”
She never imagined that someone would want her land for industrial purposes. But her homestead, as it turns out, came to be situated on the proposed route of the Atlantic Coast Pipeline (ACP) linking the natural gas fields of West Virginia with markets in Virginia and North Carolina. The 125-foot pipeline right-of-way would cut a swath across the river and through forested wetlands on her property that host a species of rare orchid. An ag-forestal district designation restricts development and prohibits industrial uses, she says. “Except it appears Dominion can industrialize it by running a pipeline through it. My property will become an underground natural gas storage site.”
Since announcing its original plans, ACP has redrawn its proposed route, leaving her property untouched. But Rea doesn’t consider the new route to be definitive, and she is little reassured. “My future is totally blown up, not knowing what’s happening to my property. No one wants to buy land with a natural gas pipeline going through the middle of the view shed. I stand to lose $50,000 in property value. I couldn’t sleep at night worrying about the darn thing coming through.”
The 63-year-old career Air Force veteran decided to fight back, signing up as co-chair of the “All Pain No Gain” group opposing the pipeline. Not only does Rea not want to see the pipeline built, she objects to ACP or its contractors even coming onto private property to survey the land. And she is just one of dozens of landowners who view the pipeline the same way.
Dominion Transmission, ACP’s managing partner, filed suit this spring in local courts against more than 100 property in order to gain access to their land. Many, like Rea, were clustered near the Blue Ridge mountains in Augusta and Nelson Counties. A local judge ruled that the notice letters had been improperly issued by Dominion Transmission, so the pipeline company withdrew the pending cases and started re-filing lawsuits as ACP. As of early July, says Rea, she knew of 27 re-filed lawsuits. Meanwhile, pipeline foes have filed two of their own lawsuits in federal court challenging the constitutionality of the state law.
The lawsuits are shaping up as the Old Dominon’s biggest battle over property rights in years. The courts will be called upon to define the balance between landowners like Rea who wish to be left alone and utilities like the four corporate partners of the $5 billion Atlantic Coast Pipeline — including Virginia energy giant Dominion, Duke Energy, AGL Resources and Piedmont Natural Gas — who argue that there is a compelling public need to build more gas pipelines as electric utilities replace coal with gas in their fuel mix. The legal outcome could influence other pipeline projects as well. Three groups besides ACP have expressed possible interest in building pipelines from the West Virginia shale fields to markets in Virginia and points south.
Pipeline foes make two overarching arguments. First, the Federal Energy Regulatory Commission (FERC) has not yet issued a certificate declaring the ACP project to be in the public interest, says Joe Lovett, an attorney with Appalachian Mountain Advocates. Because ACP cannot yet argue that the pipeline is for “public use,” it has no right to survey land without the consent of property owners.
Second, pipeline foes say, landowners deserve compensation for survey crews tramping over their property. The right to exclude others from entering your property “is one of the most important rights in the bundle of property rights,” says Josh Baker, an attorney with Waldo & Lyle, one of the preeminent landowner rights firms in Virginia. When multiple survey teams — ACP lists five different categories of crews — enter the property, they can cause considerable inconvenience. While the Virginia code allows for “actual damages” resulting from a survey, it allows nothing for inconvenience.
Dominion asserts that it is fully within its rights to conduct the surveys as long as it complies with requirements to request permission in writing to inspect the land and then provide a notice of intent to enter. Obtaining a certificate of public convenience and necessity from FERC is necessary to acquire land through eminent domain authority but not to survey land, says Jim Norvelle, director media relations for Dominion Energy. Surveys are governed by state law.
As for land surveys constituting a “taking,” there is plenty of legal precedent to support ACP’s position, Norvelle says. “We do not expect to damage anyone’s property when surveying. In the unlikely event there is some damage, we will reimburse the landowner.”
A half century ago, pipelines in Virginia were either intrastate pipelines under State Corporation Commission jurisdiction or they were segments of interstate pipelines built and “stitched together over time,” says Jim Kibler, who was active in eminent domain litigation in Virginia before joining Atlanta-based AGL Resources as senior vice president-external affairs. Local public utility commissions, including Virginia’s SCC, provided most regulatory oversight.
In 1977 Congress reorganized the Federal Energy Regulatory Commission (FERC) to expand its authority over interstate pipelines. That move coincided with the expansion of environmental laws and regulations. Staff from a slew of government agencies — the Department of Energy, the Environmental Protection Agency, the U.S. Army Corps of Engineers, the U.S. Fish and Wildlife Service, and local offices of historic preservation — got involved in the environmental impact analyses.
A key challenge in building a pipeline is determining the optimum route. To do that, the pipeline company needs to know what environmental or cultural obstacles might stand in the way. That information cannot be gleaned from a topographical map on a computer, Kibler says. Many significant features are not mapped, nor can they be identified by aerial surveys or satellite imaging. The only practical way to identify them — wells, springs, septic systems, family cemeteries, archaeological sites and the like — is to put boots on the ground and survey the land.
“The whole idea is to find out from the landowner if there’s a reason not to put a pipeline on the land,” says Kibler. “We want to find the flaw early in the game.”
At the turn of the 21st century, Virginia law did a poor job of spelling out the rights of both pipelines and landowners when surveys were needed. At the same time, says Kibler, there was a spreading concern, as embodied in the official state energy plan, that Virginia needed more pipeline capacity. Industry groups also worried that there were impediments to building new pipelines in the state.
In 2004 Kibler approached Sen. Frank Wagner, R-Virginia Beach, about submitting a bill to clarify the rules. The legislative process brought the Farm Bureau and property-rights attorneys, among others, into the negotiations. The resulting law, says Kibler, put into the state code Virginia’s first limitations on the right to survey a property owner’s land.
Any natural gas pipeline, reads state law, “may make such examinations, tests, hand auger borings, appraisals, and surveys for its proposed line or location of its works … and for such purposes … may enter upon the property without the written permission of the owner” as long as it had first requested permission and had given the owner notice of intent to enter. Such notices must be by certified mail and made no less than 15 days prior to the inspection.
Common law and federal law already gave utilities the right to survey, but without protections for landowners, says Trey Davis, assistant director of government relations for the Virginia Farm Bureau Federation, which represents some 40,000 farm families. By requiring utilities to notify landowners, the 2004 law “represented an improvement” over past practice, he says.
But not all property rights advocates are enamored with the 2004 statute and amendments, which they say give unconstitutional powers to members of the “condemnor’s lobby” such as utilities, local governments and the Virginia Department of Transportation. “It allows a third party operating under the cover of government action to enter your property, which violates your right to exclude … and constitutes an uncompensated taking,” says Baker. “That’s what the bedrock of our argument will be.”
Joseph T. Waldo, a partner in Waldo & Lyle, says the intrusion can go beyond mere inconvenience and constitute a financial damage. He cites the example of a private school in Suffolk that has undergone two years of surveying. In each of 17 instances in which survey parties entered school property, school employees had to attend to the surveyors as they signed in and, to ensure the safety of the children, accompanied them as they did their work. The cost in diverted labor amounted to an estimated $3,000. “Is it fair to put a burden on a private school or private homeowner that will cost them $3,000? Shouldn’t [the pipeline company] have to pay for that?”
“We recognize that we live in the modern age, we need the power, and natural gas is what’s hot right now. We get it,” says Baker, the eminent domain attorney. But landowners deserve protection. “The other side says it’s minimally invasive. That might be for some folks. But that’s not what the statute allows.”
Note: This article has been updated to incorporate the perspective of the Virginia Farm Bureau Federation on the 2004 survey-rights law.
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