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WV Senate passes tank safety roll back, preps for water, drilling bills

JUSTIN ROGERS | Gazette-Mail file photo
Ralph Long, of Ohio, holds up a sign at the West Virginia oil and gas rally at the state Capitol last week.
F. BRIAN FERGUSON | Gazette-Mail
DEP Deputy Director Scott Mandirola told lawmakers passage of the harmonic mean bill might mean industry doesn’t return next year to try to weaken statewide drinking water standards.
F. BRIAN FERGUSON | Gazette-Mail
Sen. Mike Romano, D-Harrison, wondered whether passage of the harmonic mean water pollution bill would be the end of industry requests for changes to the states water quality laws.

State senators on Saturday gave final approval to a bill that again rolls back West Virginia’s landmark chemical tank safety law, and they prepared for action Monday on separate legislation that could weaken the state’s water pollution protections and give natural gas companies help in forcing unwilling co-owners of minerals into allowing drilling.

The Senate voted 31-3 in favor of House Bill 2811, which exempts an estimated 2,300 tanks owned by the natural gas industry from the inspection and safety standards contained in the Aboveground Storage Tank Act, passed in response to the January 2014 spill at Freedom Industries that contaminated the Elk River drinking water supply that serves hundreds of thousands of people in Charleston and surrounding communities.

Final passage of the bill could mark the start of a rush in the final weeks of the session to push through several measures various business and industry groups have been lobbying for that would weaken protections for drinking water, workers, land and mineral owners in the Marcellus Shale region of the state, and streams near mountaintop removal coal-mining operations.

Last week, one such bill was greatly curbed when the Senate Energy, Industry and Mining Committee — headed by Sen. Randy Smith, R-Tucker and a Mettiki Coal employee — originated a new coal bill that backed away from the West Virginia Coal Association’s effort to remove almost all state mine safety enforcement authority.

But Smith’s new bill retains other coal association language to eliminate a requirement that the state Department of Environmental Protection ensure limits on mining and other pollution are stringent enough to preserve “a balanced aquatic community that is diverse in species composition.” Coal industry officials say the point of the change is to keep federal officials — the U.S. Environmental Protection Agency or U.S. District Judge Robert C. Chambers, who has issued a series of rulings on the issue — from telling West Virginia how to regulate water quality.

While Smith portrayed the new bill as a compromise among all sides, the West Virginia Rivers Coalition said Friday it wasn’t consulted on the new bill and warned the language targeted overturning federal court decisions aimed at holding mining operators responsible for damage to streams they polluted.

“This bill would make alarming changes to water protections,” the coalition said. “It would undermine protections for streams impacted by mining, especially vulnerable headwater streams. The bill would make it easier for coal companies to get away with pollution, kill off life in streams and not be held accountable.”

The new coal measure, Senate Bill 687, was reported to the Senate floor Saturday and will be up for the first of the required three readings Monday. Under the legislative calendar, Wednesday is the last day to consider a bill on third reading in its house of origin. If it passes the Senate by Wednesday, the coal bill then goes to the House.

Last week also saw a major bill long sought by natural gas companies emerge from the Senate Judiciary Committee, just two days after industry groups brought hundreds of oil and gas workers to the Capitol for a rally to try to drum up more support.

Senate Bill 576 aims to make it easier for companies to ignore the wishes of unwilling co-owners of minerals and to impose modern horizontal drilling techniques, despite leases written years before such methods were contemplated. The legislation’s goal is similar to that of the “forced pooling” bill that went down in the House two years ago in a rare tie vote fueled by an unusual coalition of Democrats and Republicans who shared a concern for private property rights.

Senate Judiciary Chairman Charles Trump, R-Morgan, moved the bill from his committee to the floor in a three-hour meeting that ended just before midnight Thursday after spending many days previously in the session on “stakeholder meetings” and other ultimately unsuccessful efforts to try to work out a bill the gas industry, mineral holders, surface owners and environmental groups would all support.

The latest version of Senate Bill 576 would allow drilling over the objections of a co-owner of mineral rights if the co-owners who favor drilling represent at least three-fourths of the mineral ownership. It would also allow drilling of multiple contiguous leases with horizontal drilling rights, as long as the leases don’t expressly prohibit horizontal drilling. With horizontal drilling — a technique not used when many West Virginia mineral leases were written — gas companies can drill not just down, but horizontally, allowing one well to capture gas from a larger area.

Industry lobbyists, the Republican leadership and Democratic Gov. Jim Justice all support at least some form of this type of legislation. They agree it is needed for natural gas companies to pool sufficient tracts of land and gas reserves for large-scale horizontal drilling and hydraulic fracturing in the Marcellus region.

Groups like the West Virginia Farm Bureau and the West Virginia Land and Mineral Owners Association indicated at Thursday night’s Judiciary meeting they didn’t like the current language. They said it doesn’t fully protect their property rights or ensure that if modern drilling techniques are allowed under outdated leases, the royalty payments in those leases are also updated to more modern figures.

Dave McMahon, an attorney who founded the West Virginia Surface Owners Rights Organization, released a position paper Saturday that said his group would continue to oppose the bill. McMahon said language requiring drillers to have agreements with surface landowners who don’t own their minerals is good, but the current bill doesn’t account for the fact that so many older leases were written before the scale of modern drilling — and its potential damage to people’s homes and farms — became apparent. Among other things, a requirement for new surface owner agreements is needed in the bill, McMahon said.

“We cannot support the bill in its current form, though we appreciate the efforts to improve it,” McMahon said. “The industry has said again and again how important this legislation is to them, but they’re rather unwilling to compromise to get it passed.”

On Saturday, the Senate had been scheduled to take up the gas-drilling bill on second reading, when amendments are generally offered. Instead, the bill was moved to third reading, which is passage stage, but with the right of lawmakers to propose amendments preserved. If it passes the Senate, the bill would go to the House.

The Senate, likewise, put off potential amendments to House Bill 2506, the legislation that would switch the DEP from using what environmental groups say is a more protective low-flow stream measurement to an average flow measurement called “harmonic mean.” The bill also would allow the DEP to approve overlapping pollution dilution “mixing zones,” when a stream has multiple discharging facilities, something that isn’t currently allowed and worries citizen groups.

Senators held the legislation over until Monday, but they kept it on “second reading.” Amendments can be offered Monday, and then the bill will be up for passage Tuesday.

Business groups, including the West Virginia Manufacturers Association and the state Chamber of Commerce, have been periodically pushing for a change to harmonic mean since the early 1990s when they lost a bitter fight over what opponents of the switch dubbed the “Cancer Creek” bill.

During an early March meeting about the legislation, Chamber of Commerce lobbyist Kathy Beckett said the business community was growing tired of hearing arguments against such changes to West Virginia environmental regulations while the state’s economy continues to lag. She cautioned “there will be other questions about” the state’s environmental regulations and their impact on economic development.

“The status quo in West Virginia is not working,” Beckett said. “There is no mystery here. I think we need to move on.”

Beckett did not offer examples of the “other questions” the industry plans to raise going forward. But under a bill approved last year, the DEP and all other state agencies must prepare reports that identify areas where West Virginia regulators are more stringent than required by the federal government.

In response to a Freedom of Information Act request for any documents showing the DEP’s work so far on that project, agency spokesman Jake Glance said no such records exist. The agency reports on the issue are due Nov. 1 of this year.

During the debate on the harmonic mean bill, some lawmakers and environmental groups have noted the business community offers few specific examples of new developments or jobs that would be created by a switch to harmonic mean. The change to harmonic mean contained in the bill is actually broader than what is used by surrounding states.

In terms of specific benefits, industry officials have said the bill could help with future development of former industrial sites, or “brownfields,” and might assist some companies that are already close to their permit limits to avoid violations and rid themselves of monitoring requirements.

The current bill is more broad than changes proposed last year by the Tomblin administration DEP. The agency had proposed harmonic mean for cancer-causing chemicals where an average flow is considered more appropriate because they tend to affect humans over a long period of time. But the DEP rejected a federal EPA recommendation, and, in the state proposal, maintained the use of a low-flow stream measurement for non-carcinogens, which may have shorter-term, acute impacts on people.

In December, then-DEP Secretary Randy Huffman pulled that agency proposal entirely when he became concerned the Manufacturers Association would use the DEP rules bill as a vehicle for another of its long-term goals: Elimination of West Virginia’s longstanding policy of protecting all streams statewide as potential drinking water sources, whether they currently have intakes located on them or not.

DEP officials have been supporting the industry language this session, but they have not clearly explained why they are doing so, given the differences between the bill and the agency’s 2016 proposal.

During last week’s Senate Judiciary meeting, Sen. Mike Romano, D-Harrison, quizzed DEP Deputy Secretary Scott Mandirola, asking if Mandirola thought industry would come back next session to try to remove the statewide Category A protections.

“I honestly don’t know,” Mandirola said.

Romano asked if such an industry effort on Category A was less likely if lawmakers passed the harmonic mean bill.

“I wouldn’t see the need to make the [Category A] change,” Mandirola said.

“If we pass this bill?” Romano said.

“Yes,” Mandirola replied.

If the harmonic mean bill passes the Senate unchanged, it then goes to the governor. If senators approve any amendments, it heads back to the House.

The chemical tank safety rollback bill that passed Saturday exempts from the state’s inspection requirements and safety standards an estimated 2,300 tanks that have a capacity of 210 barrels or less — or about 8,820 gallons or less — containing “brine water or other fluids produced in connection with hydrocarbon production activities” that are located within the “zone of peripheral concern” between 5 and 10 hours upstream from drinking water intakes.

Before the House passed the bill, its Judiciary Committee amended it to retain a mandate that all tanks — including 26,700 farther from drinking water intakes — still have to register with the DEP so officials know their location and contents.

Since passing the original tank safety bill unanimously — after sending the legislation through five different committees in the 2014 session, with the Kanawha Valley water crisis still going on — lawmakers have gone back to weaken the law several times. Only Sens. Glen Jeffries, D-Putnam; Corey Palumbo, D-Kanawha; and John Unger, D-Berkeley, voted against Saturday’s rollback bill. It goes now to the governor, who has expressed support for giving the natural gas industry relief from the tank safety requirements.

Anne Blankenship, executive director of the West Virginia Oil and Natural Gas Association, said her group is pleased with the legislation, which she said “will make reasonable and practical changes to the existing aboveground storage tank laws without harming the environment.”

Environmental groups didn’t support the final version of the bill, but they said keeping the registration mandate for all tanks was the best compromise they could get.

“I’m pleased the Legislature sees the value in maintaining the tank registry and notice requirements,” said Angie Rosser, executive director of the Rivers Coalition. “But after three years of chipping away at the act, it makes you wonder if we’re going to have much meaningful protections left.”

Reach Ken Ward Jr. at

kward@wvgazettemail.com,

304-348-1702 or follow

@kenwardjr on Twitter.

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