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December 20, 2013

PA Supreme Court Says Act 13 Violates Environmental Rights

On December 19th, Pennsylvania’s highest court ruled that the Commonwealth could not require uniform local zoning for natural gas drilling operations. In 2012, the General Assembly passed the Unconventional Gas Well Impact Fee Act, known as Act 13, which established an impact fee schedule for gas wells, allowed the Commonwealth to grant waivers to oil and gas permit applicants from certain statutory environmental protections, established uniform local zoning and setback requirements, and prohibited any regulation or zoning of oil and gas operations, including outright bans.  Under the law, municipal enactments that were inconsistent could be challenged and struck down by the Public Utility Commission, and the offending municipality would be ineligible to receive revenues from gas well fees.

Three of the Justices ruled that Act 13 violated the Environmental Rights Amendment of Pennsylvania’s Constitution,  while a fourth Justice’s opinion was based on substantive due process.  The Environmental Rights Amendment generally states that the people of the Commonwealth have a right to a clean environment and designates the Commonwealth as trustee of the state’s natural resources.  In rather strong language, the Court compared natural gas extraction to coal as having “a detrimental effect on the environment, on the people, their children, and future generations, . . . rivaling the environmental effects of coal extraction.”

With this characterization as the backdrop of the opinion, the Court invalidated the provisions of Act 13 limiting municipal authority and establishing uniform requirements.  The Justices stated that the General Assembly could not use its police power to prevent municipalities from carrying out the obligations of the Environmental Rights Amendment.  The Justices viewed Act 13 as an attempt by the General Assembly “to provide a maximally favorable environment for industry operators to exploit Pennsylvania’s oil and gas resources” by permitting industrial uses as a matter of right in every zoning district.  The Justices held that this was contrary to the constitutionally-mandated requirement to conserve and protect the environment, and would result in a disparate environmental burden among communities contrary to the requirement that natural resources be kept in trust for “all the people.”  Two Justices dissented.

On other claims, the Court remanded the Fifth Amendment takings claim regarding eminent domain power for natural gas storage, as well as the question of whether Act 13 is unconstitutional in its entirety.  The Court also rejected challenges based on the Separation of Powers doctrine to provisions of Act 13 that allow the Public Utility Commission to review local enactments and municipalities to request advisory opinions from the Public Utility Commission.

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