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The Tale of Two Pipelines: You Can’t Take My Land

April 14, 2016

In the closing days of Georgia’s 2016 General Assembly session, two very different pipeline proposals were widely rebuked by legislators.  The reason, however, was the same: property rights are more valuable than anything else.

When the Georgia General Assembly adjourned at the end of March, it was Governor Nathan Deal’s announcement to veto a so-called “religious liberty bill” that immediately gained national attention.  He did so because the bill would have enabled religious organizations to deny services to gay and lesbian citizens.  To justify the veto, Deal characterized the bill as discriminatory and not representative of the Georgia way.  He said Georgia “is a welcoming state filled with warm, friendly and loving people.”  He might have also added they are defensive of their property.

A contingent of not so welcoming Georgians have not gotten much national attention.  In the General Assembly’s final days and only days before Deal’s veto announcement, two of the nation’s largest energy corporations—Kinder Morgan and Spectra Energy—were sent packing by a vast majority of the members of the House of Representatives.

For over a year, the two energy giants independently pursued two different pipelines via distinct regulatory processes on opposite sides of Georgia.  Kinder Morgan’s Palmetto Pipeline, which was to carry liquid petroleum products, needed approval from the Georgia Department of Transportation (GDOT).  Spectra Energy wanted to build the Sabal Trail natural gas pipeline, so that project was subject to Federal Energy Regulatory Commission (FERC) review.

The two pipelines would have traveled under nine of Georgia’s fourteen major rivers. Both companies have a history of egregious pipeline failures and spills.  And neither project would have served Georgia customers: the pipelines only needed to traverse Georgia, one from South Carolina and the other from Alabama, to reach customers in Florida. Opponents—including conservationists, a newspaper publisher, an oil company, environmental justice activists, and property owners—had no trouble making environmental, safety and economic arguments against both pipelines.

However, right now, executives, consultants and lobbyists in Kinder Morgan and Spectra Energy board rooms are not trying to figure out how to counter those sound arguments.  Instead, they are trying to figure out how an essential tool they need to do business—the power of eminent domain—became as dirty as a four-letter word in a state dominated by business friendly Republicans.

Utilities like pipeline companies rely on eminent domain to acquire title to the property they need for a pipeline’s route from an unwilling seller.  Objection to this facet of pipeline planning drove hundreds of Georgia and South Carolina residents along Kinder Morgan’s pipeline route to public hearings in 2015.  The majority in attendance asked: How could a state give a private company such sweeping powers to take private property while providing no benefit to Georgians?  The pipeline was not the same as a public highway, they argued.

Kinder Morgan needed GDOT’s approval to obtain the authority to use eminent domain in the state.  In 2015, Georgia’s governor came out in opposition to the project and GDOT refused Kinder Morgan such authority (and the company lost a legal appeal in 2016).  Spectra Energy obtained eminent domain powers in February after FERC granted the company a license for the project.  The company has since initiated eminent domain proceedings on 160 properties including at least 30 in Georgia.

Legislators from all over the state got an earful from their constituents and a swarm of pipeline lobbyists.  At first they just weren’t sure what to think.  One veteran journalist cleanly summarized the legislators’ ultimate behavior: “Lawmakers admitted being confused about the details of the two proposals but knew many groups didn’t like either.”

To stop Kinder Morgan in Georgia, legislators approved House Bill 1036.  The bill will institute a moratorium on activities associated with petroleum pipeline construction, institute a moratorium on the use of eminent domain for construction, and prohibit state employees from processing and issuing “any approval, permit, or document necessary for the construction of” any petroleum pipeline until July 1, 2017.  Additionally, the bill calls for the creation of a study commission to investigate pipeline construction, operation and safety, and provide recommendations to the legislature.  In response to the bill’s passage, Kinder Morgan quietly suspended the Palmetto Pipeline project.

In South Carolina, legislators are contemplating a bill to prohibit unregulated pipeline utilities from using eminent domain and forcing private landowners to sell property for projects like Palmetto.  The project is also suspended in South Carolina.

To stymie Spectra Energy, legislators denied approval of easements on state property under the Chattahoochee River, the Flint River, the Ochlockonee River, the Withlacoochee River and other waterbodies for the proposed natural gas pipeline.  Without those easements, the pipeline cannot enter or travel across the state.  It is likely Spectra Energy will attempt to use eminent domain authority granted via the FERC licensing process and the Natural Gas Act to take the necessary state property for the Sabal Trail pipeline to pass under Georgia’s rivers.

There is a lesson here for those fighting pipelines and other environmental battles all over the country.  Property rights matter.  Environmental protection is a critical element of preserving property values and conserving resources well into the future.  Conservationists and environmentalists stand a good chance of finding common ground with unlikely environmentalists when they seek to protect property rights.  And then environment protection—for communities, air, land and water—is more likely to follow.

-Chris Manganiello

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