Federal court upholds state’s right to stop natural gas pipeline under the Clean Water Act

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Federal court upholds state’s right to stop natural gas pipeline under the Clean Water Act

Pipes for the Constitution Pipeline are stacked at a pipe yard in Altamont, NY in 2014

Last Friday the Second Circuit Court of Appeals sided with the New York State Department of Environmental Conservation (“NYSDEC”) and their denial of a § 401 certificate under the U.S. Clean Water Act to Constitution Pipeline (a partnership among Cabot Oil & Gas Corp.; Oklahoma-based energy company Williams Cos.; Piedmont Natural Gas; and WGL).

Denying Constitution Pipeline’s application effectively vetoed a $750 million plan for a 124-mile pipeline stretching from the Marcellus shale deposits in Pennsylvania to the Iroquois pipeline in New York state, and eventually feeding the supply-choked Northeast region in  with natural gas.  Although Constitution obtained various permits from the Federal Energy Regulatory Commission (“FERC”) over the last five years in order to proceed with the project, they failed to satisfy NYSDEC’s requests for environmental impact accommodations on each of the 251 New York water bodies the pipeline would have traversed.

Pipeline developers ‘shot themselves in the foot’ by fumbling the state environmental review

The Second Circuit specifically noted in its decision that Constitution had failed to address water resource impacts despite the state’s repeated requests for more information.  Much of the Court’s decision hung on the company’s failure to consider alternative routes, less harmful stream crossing methods, and other information the state needed for its environmental review.

Constitution argued that it provided “sufficient” information since trenchless crossing methods for streams less than 30 feet wide was not “an industry recognized standard”.  The court rejected this argument, stating that, “[i]ndustry preferences do not circumscribe environmental relevance.”  The decision upheld NYSDEC’s denial based on Constitution’s failure to provide the extra water impact information requested.  The case clearly signaled that states have a right to halt pipeline projects over environmental concerns – even when the project has otherwise been given federal approval.

Wider impact on state control under Clean Water Act remains to be seen

Under the U.S. Natural Gas Act, FERC has authority to approve the construction of interstate natural gas pipelines.  However, Section 401 of the Clean Water Act requires that certain federally licensed projects gain state permits for environmental reasons.  Up to this point, FERC has been somewhat slow to accept that states have veto power of federal licenses.  Friday’s unanimous decision, while not binding on the rest of the country, is a strong indication of how other circuits might rule.

The Second Circuit specifically stated that the § 401 certification is:

… a statutory scheme whereby a single state agency effectively vetoes an energy pipeline that has secured approval from a host of other federal and state agencies … Through [the § 401 certification] requirement, Congress intended that the states would retain the power to block, for environmental reasons, local water projects that might otherwise win federal approval. 

Constitution also argued that NYSDEC’s delay constituted a waiver of the state’s right to deny the certification.  This argument was dismissed by the Circuit Court because jurisdiction over that decision falls to the U.S. Court of Appeals for the District of Columbia Circuit.  In June the DC Circuit decided a similar issue of waiver and told the pipeline developer that state agency delay of over a year can allow developers to bypass the state and go straight to FERC.

The Second Circuit’s decision comes as the state of Virginia is holding public hearings on § 401 certificates for the Atlantic Coast and Mountain Valley pipelines.  While state regulators have vowed to asses construction impacts and “ensure that water quality is maintained into the future,” many are now keeping a close watch on Capitol Hill as the energy bill moves through the U.S. Senate.  The decision could result in increased pressure on members of Congress to explicitly strip states of their newfound authority under federal law.

If you are involved in a legal dispute involving these or any other water law issue, contact  the experienced attorneys at Christensen & Jensen and avoid pitfalls both before, during, and after litigation.

Source: 2nd Circuit Decision May Not Mark the End of NY Pipeline Battle | New York Law Journal

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Utah Public Waters Access Act

Utah Public Waters Access Act “violates” Utah Constitution 4th District judge says; Utah Supreme Court stays ruling pending appeal

Utah Public Waters Access ActThe issue of public access to waters in the state of Utah has become a hot-button issue in the Utah courts recently.  As reported in the Salt Lake Tribune, the issue stems from a ruling from 4th District Judge Derek Pullan that held that “the ‘unfittingly named’ 2010 Utah Public Waters Access Act violates the Utah Constitution by denying the recreating public from a resource that the state must manage in the favor of all Utahns.”

Utah Public Waters Access Act

In 2010, the Utah legislature passed the Utah Public Waters Access Act, which governs access to “public water” in Utah.  Under the Act, “[t]he public may use a public water for recreational activity if the public water is a navigable water or is on public property and the recreational activity is not otherwise prohibited by law.”  The public’s access to “public water” on “private property” is treated differently under the statute.  In relation to access to public water on private property, the statute states that “[a] person may access and use a public water on private property for any lawful purpose with the private property owner’s permission,” but “[a] person may not access or use a public water on private property for recreational purposes if the private property is property to which access is restricted, unless public recreational access is established….”

Under the Utah Public Waters Access Act, “public recreational access is established if the private property has been used by the public for recreational access requiring the use of the public water for a period of at least 10 consecutive years that begins after September 22, 1982; and the public use has been: continuous during the season conducive to the recreational access; open and notorious; adverse; and without interruption.”  However, “[a] property owner’s overt act intended to interrupt uninvited recreational access is a sufficient interruption to restart any period of use that may have already begun.”

Utah Supreme Court Issues Statewide Stay

Following Judge Pullan’s decision, VR Associates (“VRA”), which “owns a luxury destination on a 4-mile stretch of the Provo River known as Victory Ranch” filed an appeal.  A lawyer for VRA has said that Judge Pullan’s decision is “premised on various erroneous conclusions,” and that:

VRA, other private landowners, the state, and the recreating public are all harmed through a deprivation of their property rights, the right to the benefit of duly enacted legislation, and ambiguity as to the scope of the public’s rights.

Specifically, VRA contends that recreational use was not envisioned by the framers of the Utah Constitution when they described public easements to ensure access to water in the 1890s.  Rather, VRA asserts that the framers of the Utah Constitution were thinking of irrigation or commerce as it relates to public easements to access public waters.

Without comment, the Utah Supreme Court granted VRA’s request for a stay of Judge Pullan’s ruling pending VRA’s appeal.  The stay represents the first adverse ruling against the Utah Stream Access Coalition (“USAC”), a collation aimed at “promot[ing] and assist[ing] in all aspects of securing and maintaining public access to, and lawful use of, Utah’s public waters and streambeds,” in the nearly five years since the group began litigating against the Utah Public Waters Access Act.

In a blog on its website, the USAC said that, “Although we are disappointed by the court’s order, it is of the utmost importance that we follow it.”  Even still, the Coalition reiterated:

We got through 5 years of restricted access to our rivers, and we can get through however many more it takes before the Utah Supreme Court rules on this issue. We remain confident in our legal arguments before the court, and we will continue to pursue all means possible to restore and preserve access to Utah’s public rivers and streams.

Even though USAC argued that Victory Ranch only had standing to seek a stay “that applies to its four miles on the Upper Provo above [the] Jordanelle Reservoir,” the Utah Supreme Court rejected that contention by issuing a statewide stay of Judge Pullan’s ruling.  Thus, for now, the public’s access to waterways on private property is all but denied without the private landowners consent.

According to VRA’s court filings, the Public Waters Access Act “prohibited and criminalized virtually all forms of public access to and use of 2,700 miles of Utah’s fishable public water that traverse ostensibly private stream beds.”  Judge Pullan’s ruling had concluded that the Act’s reach had gone too far, and that under the Act approximately 43% of the state’s fishable streams had been made off-limits to the public.

USAC Wins Related Suit on “Navigability” of Weber River

While the fate of the Utah Public Waters Access Act remains up in the air following the Supreme Court’s stay, just last year, USAC won a related lawsuit regarding the question of navigability on the Weber River.  That ruling, stemming from the 3rd District, declared that streams are “public” if, at the time of Utah statehood in the 19th century, they were used seasonably to float logs.  However, this ruling too has been appealed, and the Utah Supreme Court has consolidated any appeals associated with the navigability cases.

Utah Division of Wildlife Resources Issues Guidance for Anglers

In November 2015, the Utah Division of Wildlife Resources issued guidance to anglers that were confused with the shifting rules.  The guidance advised anglers to stick to beds of streams when crossing private lands and demonstrate respect to private landowners.  According to the Utah Division of Wildlife Resources, the best practices are to access private streams only from public access points or after obtaining express consent from the private landowners to access the streams.

Utah Supreme Court’s Stay Not Having Intended Consequences?

While Judge Pullan’s decision has been stayed, many anglers appear to have ignored the stay.  According to VRA, anglers showed up on its banks within days of Judge Pullan’s ruling and many “exceeded the bounds of what is explicitly permitted. This will likely continue until clarity is provided regarding the scope of the public’s easement,” VRA said in court filings.  In VRA’s opinion:

The public has an interest in seeing laws enacted by its representative upheld and enforced. Similarly, private landowners — members of the public themselves — have an interest in assuring that the full scope of their constitutional rights are enforced, absent direction from the Supreme Court to the contrary.

Judge Pullan’s ruling creates an interesting question regarding the Utah Constitution, namely whether the framers of the Utah Constitution envisioned public use when they described public easements in the 1890s and whether restricting access to some 43% of Utah’s fishable streams goes too far.  The ruling also raises questions related to private landowners and their rights in the face of the public’s access to the waterways of Utah for recreational purposes.