Act 13 case: More to come.

In its recent decision in Robinson Township v. Pennsylvania, a plurality of the Pennsylvania Supreme Court made some decisive proclamations in declaring certain portions of Act 13 unconstitutional. But the Court’s decision also left a number of significant issues undecided by “remanding” several issues to the Commonwealth Court – i.e., finding that the Commonwealth Court had decided those issues incorrectly and sending them back (with instructions) – for the Commonwealth Court to re-decide.

• One of the most significant issues remanded to the Commonwealth Court involves “severability.” When parts of a statute have been struck down, severability enables the remaining portions of the statute to remain and continue as law. In this case, the question is whether the portions of Act 13 not declared unconstitutional remain valid law in the absence of the unconstitutional sections. Pennsylvania law creates a presumption in favor of severability, but it allows judges to declare an entire statute unconstitutional if the remaining portions of the law “are so essentially and inseparably connected with, and so depend upon, the void provision or application, that it cannot be presumed the General Assembly would have enacted the remaining valid provisions without the void one” or “are incomplete and are incapable of being executed in accordance with the legislative intent.” 1 Pa.C.S. § 1925. The Supreme Court’s decision in Robinson Township determined that certain otherwise valid provisions of Act 13 – e.g., section 3215(b), which establishes gas well setbacks from streams and wetlands – were not severable from the unconstitutional provisions, and therefore had to be struck down with them. But, it directed the Commonwealth Court to consider more carefully the broader issue of the severability of the rest of Act 13. This could be a difficult issue for the Commonwealth Court, and it is worth following closely. If the Commonwealth Court ultimately decides that the remaining portions of Act 13 are not severable, the entire act would be struck down – even if no further provisions are deemed unconstitutional.

• The Pennsylvania Supreme Court also remanded the claims of Dr. Mehernosh Khan, who challenged the portion of Act 13 that requires physicians treating patients sickened by fracking fluids to sign a confidentiality agreement in order to obtain the chemical composition of those fluids. Contrary to the Commonwealth Court’s initial holding, the state Supreme Court determined that Dr. Khan was an appropriate person to raise the claim (i.e., had “standing”), and instructed the Commonwealth Court to evaluate Dr. Khan’s claim on the merits.

• Finally, the Supreme Court directed the Commonwealth Court to reconsider the plaintiffs’ claims – initially rejected by the Commonwealth Court – that Act 13 is unconstitutional as a “special law” and an unlawful “taking” of private property. Article III, Section 32 of the Pennsylvania Constitution prohibits “special laws” that apply too narrowly to a particular person or group of people and are not generally applicable, and both the Pennsylvania and United States Constitutions prohibit the government from unlawfully taking private property for private uses.

Considering the stakes of this litigation, it is possible (even likely) that the Commonwealth Court’s resolution of some of these issues will be appealed by one or both parties back to the Pennsylvania Supreme Court. Bottom line: this decision is already a landmark case, but stay tuned. There could be even more excitement to follow.

Michael Helbing is a staff attorney in PennFuture's Philadelphia office.

Fracking Requires An Environmental Impact Statement

In the first decision applying the National Environmental Policy Act ("NEPA") to hydraulic fracturing or fracking, a US District Court in California ruled that the Bureau of Land Management (BLM) violated NEPA when it did not perform an Environmental Impact Statement that considered the impacts of fracking on federal lands.

Central California's Monterey Shale Formation is estimated to contain 15 billion barrels of shale oil equal to 64% of the nation's shale oil reserve. Nearly half of the land in California is controlled by various federal agencies.

In this case, BLM sold four leases to allow drilling on 2700 acres of federal land that contained areas responsible for refreshing important drinking water aquifers, was near two drinking water reservoirs, contained high quality streams, and possessed habitat for a number of federally listed endangered species. Two of the leases contained no-surface occupancy (NSO) conditions, and the other two did not.

NEPA requires federal agencies to prepare an Environmental Impact Statement ("EIS") for any major federal action "significantly affecting the environment." An EIS assesses impacts such as affects on air resources, water resources and wildlife, along with alternatives that may avoid or mitigate those impacts.  As a preliminary matter, federal agencies need not prepare a full blown EIS if they find that the action will have no "significant" affect on the human environment ("FONSI").

To allow oil and gas development on land it controls, BLM must follow a three-step process: first, it adopts a land management plan; second, it leases particular parcels of land; and third, it issues drill permits for specific wells. The effect of BLM granting a lease is to afford the lessee a right to develop the resource.  At the permit stage, BLM retains the authority to require the driller to relocate or redesign the operation to protect sensitive resources, but it would not be able to prevent drilling or fracking.

BLM determined that its lease sale would not significantly affect the human environment and that no EIS was necessary.  In making that decision, BLM did not look at the affects of horizontal drilling and fracking on the environment.  BLM instead sought to postpone that consideration until it issued drill permits for specific wells.

For the two leases with NGO provisions, the Court agreed that a NEPA analysis was not required because BLM could still prevent drilling once more information became available.

But for the two non-NGO leases, the Court said that a NEPA analysis was required because otherwise BLM would not be able to avoid serious environmental affects by preventing drilling at the permit stage.

The Court also found that an EIS should have been prepared for the non-NGO leases. BLM did not prepare and EIS because it assumed, based on historical data, that one exploratory well would be drilled on the lease and no other surface activity would take place.  It did so despite recognizing that modern fracking and horizontal drilling has dramatically increased the economic feasibility of extracting oil and gas from shale reserves across the nation. The Court found BLM's assumption that horizontal drilling and fracking would not likely occur on the leased land to be unreasonable. The Court said that BLM should have prepared an EIS that considered the impacts of fracking before the non-NGO leases were issued.

The case is Center for Biologic Diversity and Sierra Club v. Bureau of Land Management and Ken Salazar, C-1106174, US District Court, Northern District of California.