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The fracking decision

Rochester Business Journal
July 4, 2014

Supporters of hydraulic fracturing for natural gas in New York have been waiting years for Gov. Andrew Cuomo to decide whether to allow the practice in this state. Now, the importance of that decision—whenever it may come—could be seriously diminished.

On Monday, New York’s highest court issued a 5-2 ruling upholding two towns’ bans on fracking. The plaintiffs in the cases—Norse Energy Corp., which has gas leases in Dryden, and Cooperstown Holstein Corp., which wanted to explore leasing land for fracking in Middlefield—argued that the towns overstepped their authority in issuing blanket bans. The Court of Appeals decided otherwise.

Already, nearly 20 percent of the 932 towns in New York have put in place fracking bans or moratoriums. Among them is Avon, whose prohibition was upheld by an acting state Supreme Court justice in March 2013. Many more municipalities could join their ranks.

The heart of the matter before the appellate court was whether local governments can use zoning ordinances to prohibit fracking. The plaintiffs argued that the state Oil, Gas and Solution Mining Law trumps municipalities’ home-rule authority to regulate land use.

The court’s majority held that the statewide law preempts only local laws that regulate actual oil and gas operations, not zoning ordinances that limit or ban certain land uses.

But in his dissent Associate Judge Eugene Pigott Jr. wrote that the Dryden and Middlefield zoning ordinances go beyond mere regulation of land use. In his view, they “regulate oil, gas and solution mining industries under the pretext of zoning.” And this authority rests solely with the state Department of Environmental Conservation.

The court majority did say that a local zoning law would be superseded if there were clear legislative intent to preempt local control over land use. So, lawmakers in Albany could clarify whether this is what they had in mind—but don’t hold your breath.

Better to hope that the governor finally decides whether to allow fracking in municipalities where it is favored.

Until that happens, the natural gas industry will reasonably conclude that New York is an inhospitable place to try to do business.

7/4/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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