Monday, June 30, 2014

New York’s high court upholds Home Rule bans ... Decision complicates natural gas prospects

It’s settled. There will be no fracking in New York communities such as Dryden and Middlefield – serene and scenic places that have passed rules that find shale gas development incompatible with local land use ordinances.

The three-year battle over jurisdictional control over the industry ended today when the New York Court of Appeals upheld lower court decisions that cedes control over where and if shale gas development can happen from state to local governments. That’s a landmark victory for Home Rule advocates, including residents of more than 170 upstate communities that have passed moratoriums or bans on the controversial process.

But the future of fracking in the Empire state remains more unsettled than ever. All of the communities with fracking bans happen to be outside areas with the strongest prospects for shale gas development. In Southern Tier counties bordering the booming gas fields in northern Pennsylvania, many local governments either support fracking, or have no enforceable policy to prevent it. For every place like Dryden, there is a place like Sanford, a rural community near the Pennsylvania border that sits over 50,0000 acres of the Marcellus Shale, for which XTO Energy – a subsidiary of Exxon Mobile – has paid farmers $110 million just for the chance to test.

Sanford has no land use restriction, and is governed by a town council eager to see  rigs and roughnecks role across the Pennsylvania border and clear pads in the meadows, fields and woodlots of Southern Tier farms. And according to some who have been engaged in the fight since it began with the leasing rush of 2008, the prospect of drilling in these places is more imminent following today’s court ruling.

The court decision in effect provides legal sanction to a plan proposed by Governor Andrew Cuomo in the summer of 2012 to begin issuing permits on a trial basis in areas where communities and industry favor development. As reported by Danny Hakim of the New York Times in June, 2012: “Cuomo’s administration is now trying to acknowledge the economic needs of the rural upstate area, while also honoring the opposition expressed in some communities, and limiting the ire of environmentalists, who worry that hydrofracking could contaminate groundwater and lead to other hazards.”

Walter Hang, a policy analyst who runs Toxic Targeting, an environmental data firm in Ithaca, said Cuomo’s plan from 2012, combined with today’s court ruling, moves New York state a step closer to fracking in these places. “Today’s decision serves up the Southern Tier on a silver platter to allow shale gas development to begin,” he said. “Sure, it prevents fracking in some areas. But it allows it in the five counties along the Southern Tier where it’s most likely to begin. It’s the classic double-edged sword.”

Cuomo’s plan in 2012 to begin fracking in certain localities but not others drew support for those pinning the promise of economic development on the drilling industry, and drew rallies and protests by anti-frackers, who characterized the fracking trials as “sacrifice zones.” Cuomo has been mostly silent on the issue since then.

Not everybody shares Hang’s outlook. Some anti-fracking activists expect that New York’s ruling will not only discourage shale gas development in New York but will also encourage other municipalities throughout the country to establish land use restrictions. (See comments of Mary Ann Sumner, the Dryden Supervisor who helped organize the ban.)  And Brad Gill, executive director of the Independent Oil and Gas Association of New York, called the court decision “one more nail in the coffin” for fracking in the state. Gill’s view, often echoed by other industry supporters, is that drill operators will be less likely to commit capital to area that lacks regulatory uniformity and predictability. There is truth to both of those views, but they overlook the fact that the industry, first and foremost, will follow the geology. Wildcaters, in particular, are likely to seek out niches in unexplored territories, like the Southern Tier of New York.

As with most policy calculations, science and law are fundamental factors, but politics will be the decider.  The Legislature could pass a bill clarifying ambiguous language over the state’s role in extraction operations on which the Home Rule case was built. It’s also possible that the Legislature could ban fracking altogether, although anti-fracking bills passed repeatedly in the Assembly over the years are yet to fly in the Senate.

For now the decision remains firmly in the hands of the governor, who can at anytime enact or withdraw the policy review of fracking, called the Supplemental Generic Environmental Impact Statement. The 1,000-plus page document is as complicated and bureaucratic as its name suggests,  and it's been on hold for years.  Don’t expect that to happen before election. Rocking the boat on this hypersensitive issue would certainly alienate the governor’s progressive base. But after election-day, he has plenty of politic wiggle room and, with today’s Court of Appeals ruling, a clearer view of the legal landscape.


  1. I agree that this is a double-edged sword, and I am deeply concerned about the future of NY's Southern Tier. I am also keenly aware that the air and water pollution caused by shale gas extraction will affect areas beyond those that are actively being drilled, and also that the wider effects of fracking (like delaying the development of a rational national energy policy) will continue to negatively affect us all for many years to come.

    And, I am celebrating. If this decision had gone the other way, that would have meant that the shale gas industry could force its way into a town against the will of its citizens, completely altering the character of that town and endangering the health, safety and well-being of its people. That is a truly horrifying prospect. Who wants to invest in a home and community that could, at any time, be totally altered no matter what its residents think about the matter? The gas industry complains that it needs some degree of certainty in order to proceed: well, so do we all.

    Re the possibility of the NY Legislature passing a law to negate Home Rule where gas drilling is concerned: I think that would have been a much greater danger 5 or 6 years ago than it is now. At this point, there are so many eyes on the Legislature there would no way they could slip this past the public. If they try it, they are in for a major fight in which they will be called upon to explain to their constituents why they believe that gas drillers from another state or another country are of more consequence than the health and well-being of NY's people.

    It will be interesting to see what happens at the town level after this ruling, because some town boards were sincerely hesitant to pass bans because they were afraid of lawsuits, while other town boards were, I think, using the lawsuit issue as an excuse to not pass a ban. That excuse has just evaporated.

    (Full disclosure: my husband and I are making plans to leave our beloved home of 30 years and move to a town with a ban.)

    1. This could pitt town v. town and neighbor v. neighbor. Either way, lawyers will job create.

    2. The gas industry has already succeeded in pitting neighbor against neighbor. But yes, I do think we could have a situation in which neighboring towns may begin to feud over this issue, because after all, pollution does not stay in one place. This is why fracking shale should be banned everywhere: it is not a safe practice.

  2. Thinking about this decision some more, I am wondering what effect, if any, it might have in towns that do not have a ban but do have zoning. For example, would a variance be required if someone wanted to drill in an area that is zoned residential?

    1. Mary, the following reply to your original question is from Stan Scobie, who cannot post directly to this forum due to some technical problem. Because of its length, I have broken Stan's reply into two parts: PART ONE:

      So, what happens in towns that do not have a ban but do have zoning? There are several right on the NY/PA border in Broome County: Windsor, Kirkwood, Conklin, Town of Binghamton, and Vestal. All are above the likely most productive part of the Marcellus shale. None have a ban or any other limitation on where drilling could occur.

      Despite vigorous efforts in several Southern Tier towns, no ban effort in the most gassy areas of NY has been successful. A common boilerplate answer to those who wish to limit gas drilling has been to vote for a different town board. Of course that is a very long-term strategy, and so far has been tried relatively unsuccessfully.

      The more immediate answer lies in the full answer to the question that Susan Arbetter (Capitol Pressroom, July 2, 2014) asked of Attorney Tom West, the lead plaintiff attorney for the Lawsuit: "now what?" West had recently said if they lost, "it would be over." Meaning that shale gas drilling in NY would no longer be economically feasible.

      However, pivoting smartly, he told Arbetter that indeed there was a rational NY plan for the drillers he represents, but it was secret because he did not want to divulge strategy. In other words, it was not over, and they were not just going away.

      Here is their Plan B.

      Governor Cuomo and the DEC some time ago raised a difficult issue, namely, fracking would perhaps be OK in those towns who "wish" to be fracked, but how would we know which ones they are? To address this the pro-drillers have crafted a "zoning overlay" strategy.

      This plan would have each town modify their Comprehensive Plan, if they have one, to be somewhat fracking friendly, and then develop and legislate zoning overlays. These would, if passed, clearly identify the towns and areas in towns where fracking was OK. There would be no "frack me" resolutions passed quietly and quickly at Town Board meetings with zero attendance as seemed to be the case a couple of years ago.

      But there would also be no direct referendum, of any sort, of town residents to get their views. This is striking since, for several years, none of the many independent polls of upstate NY and of Broome and nearby Counties have indicated a meaningful majority in favor of gas drilling. None. Also, in the gas drilling Coalition for Towns of Binghamton and Conklin, the membership indicating that they might wish to be part of a fracking/drilling unit is only between 20 and 25% of the population - probably very similar in other border towns.

      What is the evidence for this grand zoning scheme that many towns would be encouraged to use? (continued in next comment)


      First, the Town of Conklin, one of the Broome County NY/PA border towns above a possibly productive part of the Marcellus shale, just finished revising their Comprehensive Plan, and have indicated that they plan to institute such "frack me" and "frack free" zoning overlays. They appear to be the first to use the scheme.

      Second, about two months ago, the Broome County Government convened a Marcellus legal workshop for municipal officials. There were nine attorneys from the local firm of Coughlin and Gerhart (attorneys Begeal, Blaise, Jacobs, Kline, McKertich, Merahan, Sacco, Valenzuela, and VanWhy). The set of presentations was aimed directly at how and why towns should get ready for drilling. Attorney Robert McKertich briefed specifically on the notion of allowing drilling in some parts and not in others - i.e., zoning overlays.

      Third, based on confidential and off-the-record information from an insider in a leasing coalition, the existence of this "secret" plan was confirmed.

      To summarize, towns that "want" drilling will probably have to go through a substantial zoning revision, or face challenges to allowing drilling, especially in any residential zones. The settled Lawsuit tells us that Boards need not fear lawsuits for restricting drilling from disappointed drillers or landowners. And, once zoning changes are made, landowners and drillers won't need to fear the awful possibility of a full ban being enacted quickly by a 3 to 5 vote and ruining their business plans.

      However, unless town boards create a coherent and transparent process that includes broadly consulting all of their residents, the usually boring, complex, and uninteresting zoning changes could drastically and almost silently change the nature of their town.

      Stanley R Scobie, Binghamton, NY

  3. Why don't you mention Walter Hang has been paid somewhere around $1 million by the Sustainable Markets Foundation to fight natural gas development? I like Walter but your readers deserve to know he's a paid advocate. See

    1. Yes, Walter is an anti fracking activist. I know of no basis for this financial arrangement that you claim.

  4. does anyone have a sense of what the effect of the trade agreements now being negotiated (TPP & TTIP) will have on home rule...they will mandate gas exports to asia and europe respectively, but will gas & oil corporations be able to sue Dryden and Middlefield for foregone profits, like they they sued Quebec under NAFTA?

  5. I'm a little hazy on where the governor will get the authority to selectively issue drilling permits. Environmental Conservation Law section 23-0503 says that if the application meets the requirements set out, then the Division of Mineral Resources "shall issue a permit" not "may issue a permit".

    Of course Cuomo has never been one to let legal niceties to get in the way when he wants something.