The Judiciary Committee heard testimony Nov. 8 on a bill introduced this special session to address concerns about the process used by oil pipeline companies for obtaining voluntary land use agreements.
LB3, introduced by Lincoln Sen. Bill Avery, would require that companies, corporations or associations created for the purpose of transporting crude oil through the state be granted a federal or state permit prior to declaring eminent domain for purposes of acquiring land, lot, real estate right-of-way or other property for crude oil pipeline construction.
Avery said the oil pipeline company TransCanada provided letters to owners of land along its proposed pipeline route, giving them 30 days to agree that their land could be used. The letters threatened that the company would use eminent domain to acquire use of the land after that point, he said.
“Their actions, I believe, were threats designed to intimidate landowners,” Avery said. “LB3 was introduced to protect Nebraska landowners from improper and unjust condemnation actions.”
Omaha lawyer Dave Domina testified in support of the bill, saying that among all states, Nebraska’s statutes provide the least control of eminent domain power over oil and pipeline companies. Essentially, he added, a pipeline company has the same power that the state does to use eminent domain.
LB3 would prohibit pipeline companies from impersonating a sovereign, he said, and could control the problems of acquisitions and mergers by implicating a federal process.
Alan Peterson, testifying on behalf of the Nebraska chapter of the Sierra Club, also supported the bill. He said the landowners who received the letters did not understand their rights.
“I think a lot of what is targeted by this bill is deception and fraud,” he said.
Lee Hamann, a lawyer representing TransCanada, testified in opposition to the bill, saying the language in LB3 regarding controlling permits is vague.
A significant number of permits must be obtained when a pipeline crosses multiple states, Hamann said. The bill does not specify which permits are required prior to declaring eminent domain, he added.
“That lack of definition creates a real burden to a major pipeline,” Hamann said.
Robert Jones of TransCanada also testified in opposition to the bill, saying that TransCanada’s policy is to use eminent domain only as a last resort.
The U.S. Environmental Policy Act requires that companies consult landowners prior to building the pipeline, Jones said. Ninety-one percent of landowners in Nebraska already have agreed to allow the Keystone XL pipeline to be built on their property, he added.
“[LB3] would suggest that we have to wait until we get all the permits and that is a delay in my mind,” Jones said. “I am against any legislation that I think will delay this project.”
The committee took no immediate action on the bill.