The Texas House of Representatives recently flexed its muscles and pushed cities and local governments away from regulating hydraulic fracturing. The Texas House approved a bill that gives the state the exclusive power to regulate oil and gas production activities such as fracking.
Sponsored by Rep. Drew Darby, R-San Angelo, House Bill 40 has a companion bill in the Texas Senate (S.B. 1165), which is sponsored by Senate chairman Troy Fraser, R-Abilene.
"The vote on H.B. 40 upholds constitutional property rights and establishes statutory local control over oil and gas surface operations," Rep. Darby said recently. "I applaud the good work the Energy Resources Committee put in to the committee substitute by working with the Texas Municipal League and the Texas Oil and Gas Association to improve this bill and move forward on sound policy."
The Texas Constitution grants the state of Texas the authority to manage minerals and then the state, in turn, delegates to the Texas Railroad Commission the duty to issue permits to access minerals and the right to produce minerals, according to Jason Modglin, chief of staff in the office of Rep. Darby.
"House Bill 40 restates that fact," Modglin said on April 20. "The bill also allows for cities to have jurisdiction over surface-related activities carried out by oil and gas entities. For example, cities have the authority to establish setback distances."
Modglin said, "Under the bill, cities do not have express authority to regulate oil and gas exploration and production. House Bill 40 puts that into place."
Recently, the city of Denton has become a symbol of Texas cities asserting their authority to regulate oil and gas activities that affect their citizens. On Nov. 4, 2014, nearly 59 percent of voters in the city of Denton approved a fracking ban in the city. Then, on Nov. 5, the Texas Oil and Gas Association announced its lawsuit against the city of Denton contesting the fracking ban. Later that same day, the Texas General Land Office, which manages millions of acres of state-owned property, also filed a lawsuit against the city of Denton on similar grounds.
Lindsey Baker, the city of Denton's public information and intergovernmental relations officer, said, "We at the city of Denton were opposed to the original version of H.B. 40. And we are still opposed to S.B. 1165 as currently drafted."
However, the city of Denton is supportive of the compromise that substituted the new language in the revised H.B. 40 that passed in the Texas house. The revised version of the bill allows cities to retain their setback authority and other surface regulatory authority, according to Baker.
"Things like political subdivisions having regulatory authority have not been expressly stated before in Texas law, so it is unprecedented that H.B. 40 contains that language. We are pleased with that accomplishment," Baker said.
Todd Staples, president of the Texas Oil & Gas Association, is pleased with the passage of H.B. 40.
"The Texas Oil & Gas Association applauds the Texas House of Representatives for passing H.B. 40, which clarifies the responsibilities of cities and the state for regulating the oil and gas industry," said Staples.
Looking ahead, the H.B. 40 will now be sent to the Texas Senate for their consideration.