Pipeline siting bill amended, advanced

Senators gave first-round approval Nov. 15 to a bill that would provide a regulatory framework for siting oil pipelines in Nebraska.

LB1, introduced by Fullerton Sen. Annette Dubas, would create the Major Oil Pipeline Siting Act. Among other provisions, LB1 would define a major oil pipeline as one larger than six inches in diameter and establish an application process for routing a major oil pipeline in Nebraska.

Under the bill, the Public Service Commission (PSC) would be responsible for evaluating and approving applications, as well as holding public hearings to gather citizen input. An applicant would be assessed the cost of any public hearings and investigations relating to the application. In addition, an approved application would be required prior to a company being granted eminent domain rights.

Among other information, an application to construct a major oil pipeline would be required to include a statement of the reasons for selecting a proposed route, evidence of consideration of alternative routes, an estimated number of individuals to be employed during construction and operation of the pipeline and a list of locations along the proposed route that would be in proximity to unusually sensitive ground water areas.

Dubas said the bill would allow the state to impose conditions to ensure that pipelines serve the public interest while providing pipeline companies due process guarantees.

“LB1, in my estimation, creates a very effective and constitutional piece of legislation,” she said.

Under the bill, an application would be approved if the PSC determines a major oil pipeline to be in the public interest. The determination would be based in part upon a pipeline’s impact on the state’s natural resources and evidence of methods to mitigate those potential impacts.

Also included in the determination would be evidence of a pipeline carrier’s efforts to ensure the welfare of residents along a proposed route and the views of local governing bodies.

Dubas said the bill’s intent language specifies that safety considerations would not be included in determinations of public interest. States do not have jurisdiction to create pipeline standards involving safety issues, she said, but can regulate siting for other reasons, including protection of land and natural resources for the economic and aesthetic benefit of residents.

“I clearly understand that our authority only goes to siting,” Dubas said.

A Natural Resources Committee amendment, adopted 43-0, specifies that the provisions of LB1 would not apply to any major oil pipeline that has submitted an application to the U.S. Secretary of State prior to the bill’s effective date.

Norfolk Sen. Mike Flood spoke in support of the amended bill, saying it would provide the best regulatory framework for the state going forward. Siting authority should be given to the PSC rather than the governor, he said.

“When you’re looking at long-term siting of pipelines, an agency such as the Public Service Commission has the [necessary] background and expertise,” Flood said.

Malcolm Sen. Ken Haar also supported the bill. Citizens were frustrated with the Keystone XL pipeline because they had no voice in the routing process, he said. LB1 would allow Nebraskans to provide input regarding the routing of future pipelines, he said.

“[LB1] brings a place in Nebraska – the PSC – where people can go with their questions and comments,” Haar said. “We have a tradition of government close to the people.”

Under the bill, the PSC would be required either to grant or deny an application within eight months of receiving it. An extension of up to 18 months after a public hearing – or longer if agreed to by all parties – could be granted under the bill. However, an extension would not be granted for longer than eight months past the issuance of a presidential permit authorizing a major oil pipeline.

Holdrege Sen. Tom Carlson said the bill’s time frame for approving applications was too long and that other provisions in LB1 make it unfriendly to pipeline companies interested in doing business in Nebraska. He said too many state agencies would be required to participate in making the decision to grant an application and that lawmakers should work to entice business to the state rather than discourage it.

“[The process] is too long,” Carlson said. “It’s not inviting.”

Sen. Dennis Utter of Hastings expressed similar concerns, saying the bill may require unnecessary information from pipeline applicants. For example, he said, knowing the number of people a pipeline would employ likely would not be relevant to a siting decision.

“One of the great scourges of government is regulatory burdens,” Utter said.

Dubas said senators’ concerns would be addressed before select file debate.

“By no means is this the end product,” she said.

Senators voted 44-0 to advance LB1 to select file.

Lawmakers also gave first-round approval to LB2. Introduced by Lexington Sen. John Wightman, the bill would appropriate funds for special session expenses. The bill advanced to select file on a 44-1 vote.