The Act 13 decision: A setback for setbacks?

In writing that Act 13 violated the Environmental Rights Amendment to the Pennsylvania Constitution, did the Supreme Court actually harm the government’s ability to protect the environment? That is the contradictory narrative being spun by some who apparently disagree with the Court’s ruling in Robinson Township.

When the Pennsylvania Supreme Court struck down subsection 3215(b)(4) of Act 13 – the part of the law that allowed the Department of Environmental Protection (DEP) to waive setback protections for streams and wetlands based on a plan submitted by the operator -- it also enjoined the DEP from enforcing the setback requirements that are found in another subsection of 3215(b). The Court reasoned that the waiver and setback requirements were intended to be a “package deal.” “It would appear that the General Assembly did not intend for the setback provision to operate without allowing industry operators to secure waivers from the setbacks.” Because the setback protections were not legally “severable” from the invalid waiver provision, the Supreme Court enjoined DEP from applying any portion of section 3215(b).

It would be inappropriate, and violate the fundamental basis of Justice Castille’s “pioneering” opinion, for the government to conclude that it lacked authority to protect waters of the Commonwealth because of the Robinson Township decision.

It is important to emphasize that the Court found nothing repugnant about the setback protections in the law. The Court held that the law gave DEP too much discretion to waive the requirements without adequate guidance on doing away with the protections. Any suggestion that wells should now be permitted without adequate buffers to protect streams would directly contradict the rationale behind the Court’s opinion.

DEP retains authority under the Oil and Gas law to enact regulations addressing appropriate setback protections for streams and wetlands. Section 3274 expressly provides the Environmental Quality Board with express authority to promulgate regulations under the law. This provisions was not affected by the Court's decision. With the legislature already indicating its intent to establish minimum setback protections, the DEP could use this authority to propose regulations for EQB adoption that would establish setback protections consistent with the General Assembly’s intent.

In addition, DEP has both the authority and obligation under the Clean Streams Law to take a variety of actions, including putting conditions in permits, which would protect Pennsylvania’s streams and wetlands. Indeed, under certain circumstances such as in special protection watersheds, it would violate the federal Clean Water Act for DEP to issue permits that would not protect the existing water quality of streams and wetlands.

As Justice Castille wrote, Article I, Section 27 “requires each branch of government to consider in advance of proceeding the environmental effect of any proposed action,” and it imposes on the Commonwealth “a duty to refrain from permitting or encouraging the degradation, diminution, or depletion of public natural resources.” If anything would be an affront to the Court's ruling, it would be for DEP to use the ruling as a basis for issuing permits that fail to ensure protection of the resources that it holds in trust for this and future generations.

DEP has not announced how it intends to evaluate permit applications in light of the Supreme Court's Robinson Township decision. What should be clear, however, is that even without section 3215(b) of Act 13, DEP has ample authority to require that oil and gas development activities be planned and conducted in a manner that fully protects the waters of the Commonwealth.

Mark Szybist is a staff attorney in PennFuture's Wilkes-Barre office. He specializes in oil and gas issues.

The takings hits keep on coming from the Supremes

The Supreme Court, on June 25, handed down its decision in Koontz v. St. John's River Water Management District. The 5 to 4 decision should be of keen interest to regulators who must decide how to issue permits for construction projects that impact wetlands.

In takings cases, the general concern is whether government regulation so severely restricts a person's use and enjoyment of their real property as to effectuate an unconstitutional "taking without just compensation" in violation of the Fifth Amendment, the classic case being Penn Central Transp. Co. v. New York City, 438 U. S. 104 (1978).

The Supreme Court's decisions in Nollan v. California Coastal Comm'n, 483 U.S. 825 (1987), and Dolan v. City of Tigard, 512 U.S. 374 (1994), layered another level of protection for property owners in special cases involving land exactions - that is, where the government seeks to have a person surrender real property in exchange for a permit to develop a piece of land. To avoid an unconstitutional taking, the government must demonstrate that its demand bears a logical relationship (or “nexus”) to, and is proportional to, the impacts of the proposed land development.

In Koontz, Justice Alito, writing on behalf of the Supreme Court's conservative majority, said that (1) it doesn't matter whether the state issues a permit with an unconstitutional condition or denies the permit because the applicant will not assent to the unconstitutional condition - both cases are unconstitutional; and (2) even when the government demands monetary expenditures as compensation for harm, that claim must satisfy the Nollan and Dolan standards of nexus and proportionality.

As in Pennsylvania, Florida law requires a person obtain a permit to build in a wetland, and in the process, the applicant must mitigate any harm to the wetlands.  Koontz offered to provide a conservation easement to the state for almost three-quarters of his property as mitigation for harm to a portion of the wetland. The Conservation District wanted a smaller development and a larger easement than what Koontz had offered. As an alternative, the District requested that Koontz hire a contractor to make improvements to wetlands several miles away.  Koontz filed suit under a state law allowing for takings claims, and the District denied the permit.

The trial court found that the District had acted unlawfully because the conditions were unreasonable for failing to satisfy standards of  Nollan and Dolan.  The State Supreme Court reversed on two grounds - that the case was distinguishable because the District ultimately denied the permit, and that a takings claim could not be based on a demand for money. The U.S. Supreme Court overturned that decision.

In a dissenting opinion authored by Justice Kagan, the Supreme Court's minority only contested the second part of the majority decision - that Nollan and Dolan should not be extended to cases where the government conditions issuance of a permit on the expenditure of money.  Nollan and Dolan, Kagan argued, should apply "only when the property the government demands during the permitting process is the kind it otherwise would have to pay for—or, put differently, when the appropriation of that property, outside the permitting process, would constitute a taking."