Bacon's Rebellion

Democracy Thrives in Sunlight

Federal Judge OKs Pipeline Surveys

—

by

James A. Bacon
in ,

pipelineby James A. Bacon

A federal judge has dismissed a lawsuit filed by landowners seeking to block the Atlantic Coast Pipeline (ACP) from surveying their land for the purpose of building a pipeline.

Three landowners in the path of the proposed 550-mile project had challenged the constitutionality of a state law permitting the pipeline to survey their lands, as long as it abode by certain formalities of notification. After filing the suite, ACP altered the proposed route to bypass the properties of the three plaintiffs.

“The court concludes that the plaintiffs’ facial challenges to the statute fail because the statute does not deprive a landowner of a constitutionally protected property right,” wrote Elizabeth K. Dillon, with the U.S. District Court in Roanoke. Additionally, Dillon ruled, the challenges fail because they are not “ripe,” that is, they are abstract and hypothetical now that ACP has announced that it no longer intends to survey their property. The plaintiffs “face no immediate threat of injury.”

The ruling removes another legal obstacle to surveying and ultimately constructing the pipeline, which its owners, including managing partner Dominion, say will help meet the growing demand for natural gas in Virginia and North Carolina as electric utilities substitute natural gas for coal. In theory the plaintiffs can appeal to the U.S. Supreme Court, although it is not clear if they intend to do so.

In an email response, Charlotte Rea, one of the plaintiffs and co-chair of the “All Pain No Gain” group opposing the pipeline, stated the following:

As you might expect, I am disappointed.  I don’t think our forefathers when they wrote the Constitution expected its interpretation to allow for private investor owned corporations to violate the property rights of private citizens.  The Constitution only allows for private property to be taken if it is for proven public need and just compensation is provided the landowner.  Surveys by private corporations on private property should not be allowed.  There has been no determination made that the Atlantic Coast Pipeline project is for the public good.  Until that determination is made, private property owners should not have to cede any property rights.

In a press release, Dominion stated:

From the beginning, we have always believed that the Virginia law is consistent with the U.S. Constitution and allows surveys with proper notification and landowner protections. Yesterday’s ruling affirmed that belief and our actions.

ACP has followed the procedure as laid out in the Virginia law to survey the best route with the least environmental impact. The Virginia law allows survey only as necessary to meet regulatory requirements.

The plaintiff’s attorneys argued that the Takings clause of the Constitution protects property rights, specifically the right to exclude — to forbid others from trespassing. However, wrote Dillon, common law has long recognized that the right to exclude is not absolute. “Courts also have long recognized the common-law privilege to enter private property for survey purposes prior to exercising eminent domain authority.”

Consistent with the common law, Virginia has long permitted governmental entities to conduct surveys on private property before exercising eminent domain authority. For instance, Dillon wrote, the Code of 1819 gave a turnpike company “full power and authority to enter upon all lands and tenements through which they may judge it necessary to make said road.”

Foes have questioned whether the Atlantic Coast Pipeline provides a public purpose, given that it is one of four pipelines proposed to run through Virginia and that pipelines are being built to serve New York and nearby markets, freeing up capacity by the existing Transco mega-pipeline serving Virginia.

However, Dillon wrote:

In the Natural Gas Act, Congress ‘declared that the business of transporting and selling natural gas for ultimate distribution to the public is affected with a public interest.’ …  [The Virginia survey law] allows a natural gas company to gather … information required for the certificate by giving it the ability to enter property and conduct a minimally invasive survey. The statute thus facilitates the ‘transportat[ion] and selling’ of natural gas, and thereby serves a public purpose.”

Share this article

ADVERTISEMENT

(comments below)

ADVERTISEMENT

(comments below)

Comments

13 responses to “Federal Judge OKs Pipeline Surveys”

  1. Acbar Avatar
    Acbar

    As Judge Dillon wrote, the right to enter and perform a non-damaging survey on private property before a Virginia public utility exercises its right to condemn that private property has been settled law in Virginia since 1819. How could condemnation take place without knowing the facts?

    What will be interesting is whether Dominion can make the case to the feds (in this case, the FERC) that, after all the facts are on the table, including all the facts about the need for the project, a federal certificate of convenience and necessity — the predicate for exercising this condemnation — is supported by those facts and should be granted.

    1. Rowinguy Avatar
      Rowinguy

      You may be right about Virginia public service companies, Acbar, but these interstate gas pipeline developers are not Virginia public service companies. A new provision of the Code of Virginia was enacted about 10 years ago (very quietly, I might add) that extended the right of entry to gas companies as defined by the federal Natural Gas Act. That is the provision of law the plaintiffs here were challenging.

      Prior to the new statute being enacted, as I understand it, surveying entry could only come after the FERC had issued a certificate to construct.

    2. VaConsumer Avatar
      VaConsumer

      Note that the pipeline has been rerouted to avoid these landowners. It’s a shame other landowners didn’t stand our ground. Those of us who allowed them on the property are stuck with the pipeline, and still have had little influence on location, etc. within our property. Those who fought got rid of the whole mess, protected their property.

  2. DonR Avatar
    DonR

    Yet another Judge Dillon mangling logic, liberty and the law.

    1. TomH Avatar
      TomH

      Isn’t ironic that the judge’s name is Dillon? Where is Judge Thomas Cooley when you need him?

      1. VaConsumer Avatar
        VaConsumer

        Yep, I immediately noticed the judge’s name. Fitting. Like the Dillon rule protects the state’s power and limits localities to what the state allows, the interpretation of this law gives the big company power over the little landowner – meaning what’s ours, even if we’ve owned and operated it over 100 years, isn’t really under our control. Certain utilities can come in and effectively take over decision making on the property as they decide where they will put their infrastructure. It not only exposes us to daily risk with no compensation, but limits our use of our own land forever, including changing how we use it on a daily basis. At the outset they claim we’ll be able to do anything but build or plant trees on the easement. Then they add, can’t build ponds. And, other company representatives indicate that we’ll only be able to cross the pipeline at certain places, significantly changing how we use our land on a daily basis as we go about our business. We avoid using the same path every day to keep grass growing everywhere and avoid muddy gravel soaking places. That is probably history and there’s no sign the utility will pay the costs of maintaining crossings on an annual basis. They only pay a one-time fee for an easement that makes them the priority decision makers on our whole property.

        They also claim our property will not lose value, but who would buy our property and expose themselves to the limitations and physical and psychological risks of the pipeline when there is plenty of land nearby that’s a safe distance from the pipeline and has no limitations on use? More than just the easement land is affected, the whole property is affected. People are a lot more concerned about 42 inch high pressure pipelines than about smaller pipelines without pressure. People brought in to testify about the safety they’ve experienced always have experience with small pipelines that generally have no pressure behind the gas.

        In our democracy, I never expected to find that a company that does not even serve me could effectively take over my family’s business decisions about our property – but I’ve learned the hard way that they have dominance over everything I own and I can’t do a thing about it. If they want it, the courts will let them have it even if I say no. Why don’t we make them first negotiate with a willing landowner – with incentives for accepting the infrastructure – rather than starting with the threat of eminent domain? I can’t tell you how often I’ve heard companies say in legislative and regulatory environments that they will not accept societal demands or requirements but must have incentives. It’s time for the model to change so landowners can receive incentives and landowners and companies are on a level playing field when decisions about property are made.

  3. TooManyTaxes Avatar
    TooManyTaxes

    With the pipeline’s owners decision not to cross or enter the property of the plaintiffs, there is no longer a real dispute. The Constitution forbids courts from deciding hypothetical cases. These plaintiffs cannot decide for other landowners who might not have an objection to a survey whether such unpermitted entry on land is lawful.

  4. LarrytheG Avatar
    LarrytheG

    Can ANY company claim , along with competitors – that they are SEEKING a determination of need and be granted access?

    If you have an existing company already providing some pipeline capacity – can 3 more companies all be seeking to add to or duplicate existing capacity – and all of them be granted access to survey before one or all of them have been granted a certificate of need?

    I suspect that one of more property owners who will be told one or more companies can come on their property for a speculative business venture are going to sue on that basis.

    Bottom line. Can any and all companies come on your property because they say they are proposing a pipeline and are in competition with others to do the same?

    who determines which company serves the public need best?

    If I were a Dem State Senator or a would-be, I know how I’d be speaking to rural land owners….

  5. LarrytheG Avatar
    LarrytheG

    the irony of this is that – if there were no govt involved – these companies would all have to engage in true voluntary transaction business practices.

    you have to ask yourself – what exactly justifies the coercive use of govt to force people to do something they don’t want to do?

    you can’t just say that ANY company that wants to engage in a for-profit venture has that right because it is defined as a public “need” on an ipso facto basis, i.e that any gas pipeline – anywhere is, by definition a public “need”.

    so what exactly justifies it – specifically?

    doesn’t the “need” have to be actually defined with some specificity rather than an assumed “need”?

    what justifies all of them having the govt-sanctioned right to come on your property when the “need” is not actually defined with enough specificity to know if all 3 pipelines have to be built or, in fact, only one is needed and it is – really a competition to meet a defined need?

    I’m not opposed to pipelines nor power lines nor highways or other rights-of-way to serve the public. I favor them. But I also favor equitable treatment of those that are required to give up something they own to provide for a public need.

    and if you truly have 3 (or 4) companies vying for the pipeline – it implies a competition – and, in turn, truly for-profit ventures.

    If that is the case – then it would seem one of the areas of justification would be, in fact, just how much private land must be involved and the company that can meet the need with the least amount of private land would have an advantage.

    the way it sounds right now – ANY number of companies COULD propose to build a pipeline AND that alone would justify them drawing lines on maps and entering people’s properties to survey.

    that does not sound like something that is equitable or appropriate to me.

    seems like someone needs to “win” the competition – THEN they can have a right to survey – not the other way around.

  6. VaConsumer Avatar
    VaConsumer

    There are many problems in this situation.
    1) FERC was designed to approve pipelines and has only declined to approve one in history.
    2) Eminent Domain became a concept to provide for the common good. Utilities used to be required to serve everyone and their profit levels were limited but comparatively steady (stock was referred to as for widows and children)
    Today we allow our utilities to earn higher profits and there is much more emphasis on earnings for stockholders with less emphasis on steady but dependable return.
    We have changed the rules for utilities, but not for landowners. The change in Virginia law to allow utilities on property without permission from the owner or authority for eminent domain was a mistake – one legislators did not realize they made because, as usual, they trusted Dominion.
    The rules have been changed for mobile telecom. They pay landowners annually to place towers and have to obtain local zoning, etc. permission. However, electricity providers still only pay for an easement to a small portion of affected land, once.
    It’s time for the playing field to be leveled so all (especially landowners) are treated fairly in terms of process and compensation. We also need to reconsider how one type of utility is treated vs others, what society expects from utilities in exchange for what they get, etc.

  7. TomH Avatar
    TomH

    One reason the Norfolk spur connects in North Carolina might be for the entire pipeline to be interstate. Because the gas can be provided as well or better via existing pipelines, Dominion et al does not qualify to meet the public benefit standard of the VA eminent domain statute, but the federal requirement has a much lower threshold.

    In previous work with major projects requiring eminent domain, we worked out a new process with the state (NY) to resolve the need issue first. Then we got into the specific details of siting. I think that is a better solution. It saves money and landowner aggravation.

  8. VaConsumer Avatar
    VaConsumer

    The NY process sounds interesting. Who was involved? How was the utility enticed to use it rather than turn to FERC?

    1. TomH Avatar
      TomH

      This was for the siting of 1000+ MW power plants not interstate gas pipelines, so FERC was not involved. We (the utility) proposed it to the state regulators. We just had spent several years and millions of dollars to do the studies and prepare the Environmental Impact Statement to gain approval for the facilities. The load growth had declined, faster than our planners were willing to admit, and the regulators said we didn’t need it. This was happening all around the country at that time. We thought that this process was poorly designed. It had wasted our time and the ratepayers money. So we approached the regulators, they agreed, and together we developed a system which evaluated need first. We saved time, money and avoided disturbing property owners unnecessarily.

      FERC would have to decide to do this themselves. They will probably need a push. Senator Kaine has written them suggesting that they make a regional review in this case since four major pipeline proposals are intended for Virginia. The need case for FERC is very simple – if someone is willing to buy the gas (with formal commitments) then the pipeline is needed. Part of FERC’s statutory duties is to promote the development of natural gas resources (such as pipelines). They have a hard time saying no. In the case of the Atlantic Coast Pipeline, all of the owning partners have committed to purchasing at least 80% of the pipeline capacity.

      Even though, proposed additions to existing pipelines would provide twice the capacity of the ACP, at a far lower price, substantially less environmental impacts, and serve precisely the areas intended for the ACP – as far as FERC is concerned, the ACP has the firm commitments. These could easily be shifted to the existing pipelines, but then Dominion and Duke would make less money. This is clearly not an issue about better serving the public need – but of making more profit.

Leave a Reply

Read More