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CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 HYDROFRACKING:

STATE PREEMPTION, LOCAL POWER, AND COOPERATIVE GOVERNANCE John R. Nolon^ & Steven E. Gavin^ ABSTRACT Advocates for the gas drilling technology known as hydrauhc fracturing, or hydrofracking, argue that it will bring significant economic benefits to the private and public sectors. Its opponents dispute these claims and point to significant environmental and public health risks associated with hydrofracking—risks that must be considered in adopting government regulations needed to protect the pubhc interest. One of the many issues raised by hydrofracking is which level of goverrmient should regulate which aspects of the practice. This debate is comphcated by the fact that the risks associated with hydrofracking raise concerns of federal, state, and local importance and fit within existing regulatory regimes of each of these levels of goverrmient. This Article begins by describing the hmited aspects of hydrofracking that are currently regulated by the federal government, which leaves many of the risks unaddressed, opening the door for state and local regulation. This Article describes the legal tension between state and local governments in regulating hydrofracking in the four states that contain the immense MarceUus shale formation. Its particular focus is on court decisions that determine whether local land use regulation, which typically regulates local industrial activity, has been preempted by state statutes that historically regulate gas drilhng operations. This investigation suggests that the broad scope and durabihty of local land use power as a key feature of municipal governance tends to make courts reluctant to usurp local prerogatives in the absence of extraordi- narily clear and express language of preemption in state statutes that regulate gas drilling. The Article concludes with an examination of how the legitimate interests and legal authority of all three levels of goverrmient can be integrated in a system of cooperative governance.

t John R. Nolon is Professor of Law at Pace Law School and Counsel to the Land Use Law Center, and has been an adjunct professor at the Yale School of Forestry and Environmental Studies since 2001.

\ Steven E. Gavin is a student at Pace Law School and editor in chief of the Pace Environmental Law Review.

995 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance CONTENTS INTRODUCTION:

HVDROFRACKING RAISES JURISDICTIONAL ISSUES 996 L LIMITED SCOPE OF GURRENT FEDERAL REGULATIONS 1000 A.

Safe Drinking Water Act 1002 B.

Clean Water Act 1005 C.

Clean Air Act 1006 D.

Comprehensive Environmental Response, Compensation, and Liability Act 1008 E.

Resoxirce Conservation and Recovery Ad 1009 F.

Endangered Species Act lOlO C.

Toxic Substances Control Act 1012 IL NEW YORK:

LOCALITIES WIN ROUND ONE, ESCAPINC PREEMPTION...

1013 in.

PENNSYLVANIA: PREEMPTION THWARTED 1021 ÍV.

WEST VIRCINIA AND OHIO; HYDROPRACKINC LAW IN LIMBO 1026 A.

West Virginia Cas Regulation and Local Land Use Control 1026 B.

Ohio 1031 V. GooPERATivE GOVERNANCE:

STATE-LOCAL GOLLABORATION 1036 INTRODUCTION:

HYDROFRACKING RAISES JURISDICTIONAL ISSUES Hydraulic fracturing, or hydrofracking, is a gas well stimulation and extraction technique designed for ai'eas underlain by large shale formations foimd often a mile or more below the surface. Vertical hydrofracking has been done for decades, but relatively recent technology enables directional drilling, which allows the drill stem and borehole to follow the horizontal structure of the shale formations and proceed thousands of feet to exploit gas reserves fai- from the well head.' In horizontal hydrofracking, millions of gallons of water ai'e pmnped at high pre&sure into the well bore—water that contains thousands of gallons of proprietary chemical shnrries and a propping agent, such as sand.^ The pressure creates fractures in the hychocaibon- 1.

Marianne Levelle, Forcing Cas Out of Rock with Water, NAT'L GEOGRAPHIC DAILY NEWS (Oct. 17, 2010), http://news.nationalgeo graphic.com/news/2010/10/i01022-energy-marcellus-shale-gas-science-tec hnology-water.

Between one million and five million gallons, or more, of water are needed for a typical gas well in the Marcellus shale. MICHÈLE RODOERS ET AL., MARCELLUS SHALE: WHAT LOCAL GOVERNMENT OFFICIALS NEED TO KNOW 5 (2009), available at http://pubs.cas.psu.edu/ freepubs/pdfs/ua454.pdf. About 99.5% of this finid is composed of water and proppant (usually sifted sand) and about 0.5% consists of chemical additives.

See GROUNDWATER PROT. GOUNCIL, MODERN SHALE GAS DEVELOPMENT IN THE UNITED STATES:

A PRIMER 61-62 (2009), available at http://www.gwpc.org/sites/default/nies/Shale%20Gas%20 Primer%202009.pdf (noting that chemicals used include biocides, gels.

996 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance bearing shale and the propping agent keeps the fissures open.^ This releases the natural gas that the shale contains and allows it to be pumped to the surface.'' Some of the fluid mixture, known as "flowback water," returns to the surface, where it is either trucked off site to injection wells or released into water treatment facihties.^ This raises complications in some states, particularly those in the Marcellus region, where the geology is not favorable to injection wells.® This, in turn, leads to a search for appropriate injection wells in other states and for treatment plants that can handle this wastewater, which axe often in short supply.^ Horizontal hydrofracking operations also emit volatile organic compounds and methane during the completion of the wells, raising both public health and climate change concerns.^ Additional air pollution is caused by the thousands of truck trips that each well may generate—'trips that require improved or new roads, that can cause landscape fragmentation, and that create congestion, noise, and the need for expensive road repairs, thus burdening local tax payers.^ Advocates for the gas drilling industry argue that hydrofracking will bring significant economic benefits to the private and pubhc friction reducers, and other agents that reduce corrosion, thus easing the process of hydrofracking the shale).

For a graphic representation, see A Fluid Situation: Typical Solution Used in Hydraulic Fracturing, ENERGY IN DEPTH, http://www.energyindepth.org/frac-fluid.pdf (last visited Apr.

9, 2013).

3. N.Y.

STATE DEP'T OF ENVTL. CONSERVATION, REVISED DRAFT, SUPPLEMENTAL GENERIC ENVIRONMENTAL IMPAGT STATEMENT ON THE OIL, GAS AND SOLUTION MINING REGULATORY PROGRAM 5-5 (2011) [hereinafter REVISED DRAFT SGEIS], available at http:// www.dec.ny.gov/data/dmn/rdsgeisfullO911.pdf; John A.

Harper, The Marcellus Shale—An Old "New" Gas Reservoir in Pennsylvania, 38 PA.

GEOLOGY 1, 10 (2008), available at http://www.dcnr.state.pa.us/cs/ groups/public/documents/document/dcnr 006811.pdf.

See REVISED DRAFT SGEIS, supra note 3, at 5-5 (describing how hydrocarbons are retrieved after fluids are injected and recovered).

See id. at 5-131 (noting the disposal options for flowback water).

6. Joanna Zelman, New York Fracking Debate Focuses on Wastewater, HUFFPOST GREEN (Feb. 20, 2012 8:27 AM), http://www.huffmgton post.com/2012/02/20/new-york-fracking_n_1288696.html ("Other geologists have said New York doesn't have the right geology for such wells.").

See REVISED DRAFT SGEIS, supra note 3, at 5-132 to 5-133.

8. Press Release, EPA, EPA Proposes Air Pollution Standards for Oil and Gas Production (July 28, 2011), http://yosemite.epa.gov/opa/admpress.

nsf/le5abll24055f3b28525781f0042ed40/8688682fl3bblac65852578db0069 0ec5 ! OpenDocument.

See REVISED DRAFT SGEIS, supra note 3, at 6-303 (estimating that each permitted well generates about 6,800 truck trips).

997 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance sectors.'" The opponents of hydrofracking dispute these claims and point to environmental and public health risks associated with hydrofracking—risks that must be considered in government regulation needed to protect the public interest. The debate on both sides yields differing projections of supplies, jobs created, ta^ revenues, water needed, wastewater created, and the extent of gronndwater and surface water pollution. Hydrofracking's proponents and opponents argue over the effect of hydrofracking on community character, climate change, the nation's balance of payments, and whether or not it will help the United States become less dependent on oil imports or retard the development of renewable energy sources.

Those who object to hydrofracking point also to a variety of environmental risks that they fear are associated with the technology:

air pollution, groimdwater depletion and contamination, surface-water pollution, soil erosion and sedimentation, visual blight, noise pollution, road congestion and destruction, and the deterioration of community chai"acter." They worry as well about a vai'iety of public health concerns, including escaped methane and other volatile organic compounds, exposure to ground-level ozone causing respiratory illness, chemical fires, lung disease in workers caused by the inhalation of silica dust, benzene pollution of the air near drilling sites, particulate matter from heavy trucks travelling on dirt roads, personal injury from seeping hydrochloric acid and solvents, eai'thquakes, and diesel ñiel and toxic chemicals in ground water.'"^ One of the many issues raised by hydrofracking is which level of government should regulate which aspects of the practice. This debate is complicated by the fact that the benefits associated with hydro- fracking are national, regional, statewide, and local in nature and that the risks associated with hydrofi-acking raise concerns that are within the existing legal jurisdiction of federal, state, and local government.

These realities lead, in turn, to further debates about which level of government should have the primary role in regulating hydrofracking; indeed, some argue that the federal government should fully preempt the field of hydroñ'acking regulation, others argue that states should 10.

See Jared B. Fish, Note, The Rise of Hydraulic Fracturing: A Behavioral Analysis of Landowner Decision-Making, 19 BUFF. ENVTL.

L.J. 219, 265 (2012) (noting that entry of the natural gas industry can bring jobs to communities and produce quick Financial gains for landowners).

11.

See REVISED DRAFT SGEIS, supra note 3, at 2-9 to 2-19.

12.

See Charlotte Tucker, Health Goncems of 'Fracking' Drawing Increased Attention, NATION'S HEALTH, Mar. 2012, at 1, 14, available at http://thenationsheaIth.aphapublications.Org/content/42/2/l.2.rull (noting the EPA's public health concerns related to hydrofracking); see generally REVISED DRAFT SGEIS, supra note 3 (providing a detailed accounting of the airborne chemicals detected at well sites, water quality measures, seismic activity, traffic effects, and health risks).

998 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance preempt local regulation, and some see benefits in the involvement of all three levels of government in regulating the technology..'^ If the advocates of either federal or state preemption prevail, the historical role of local governments in controlhng local land uses and their impacts will be diminished, if not extinguished." LocaJ govern- ments are created by and derive their powers from the state. They get the power to adopt land use plans and regulations through state planning and zoning enabling acts and home-rule statutes. If the state legislature expressly and in certain terms preempts using that delegated power in order to promote a state interest such as gas exploration, the power of local government is clearly trumped. Where state legislatures do not expressly preempt local zoning, or where their intention to do so is ambiguous, it is the job of the courts to determine whether localities are preempted. Courts may find that, by imphcation, state legislatures 13.

See Ghristopher S.

Kulander, Shale Oil and Gas State Regulatory Issues and Trends, 63 GASE W.

RES.

REV.

1101, 1140 (2013) ("[W]hat.is being derided as a weakness is actually a strength: each state can rapidly respond to its unique blend of economic, political, hydrologicàl, and geological realities to achieve realistic and functional regulatory oversight.

A further weakness alleged by those favoring federal primacy, that states are 'rushing' to create law regulating fracing, is also a strength:

the necessary regulations are made in a timely manner, in response to industry activity, and by those more familiar with the challenges faced by an individual state.").

14.

The law of preemption is fraught with ambiguity, giving courts leeway to embrace different policies and achieve different results, given the context.

The Supremacy Glause can be relied upon to support federal dominance, or the Tenth Amendment to support strong state control; jurists can dissect language in federal or state statutes that seems to express an intent to preempt and still decide that the matter under investigation is not preempted because some aspect of the field regulated is not dealt with in the statutory scheme. When local governmental power is the issue, home-rule statutes and fundamental powers of local government can be relied upon to argue against state law preemption; in Dillon's Rule states, this is more difficult, but the Rule is declining in popularity, and more liberal interpretations of local power are emerging giving more sway to statutes that delegate power to localities. This leeway in the law of preemption gives both parties to disputes over legal power opportunities to make their best case for control of the matter at hand. This Article posits that those favoring local control over hydrofracking have a good ca^e because of the complexity, comprehensiveness, and importance of local land use control in the critical matter of municipal governance.

The authors credit Michael Allan Wolf, Richard E.

Nelson Ghair in Local Government Law, University of Florida, Levin Gollege of Law, for this insight, which was offered during his introductory remarks at the 2013 Nelson Symposium.

Professor Wolf urged that scholars and lawyers should embrace this ambiguity and make their best case for their desired result in each instance.

The argument for a presumption against preemption of local land use control is the authors' own.

999 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Govemance intended to preempt local power. Implied preemption may be based on the court finding direct conflicts between general state legislation and local zoning controls (conflict preemption) or by finding that the state legislative scheme is so comprehensive that it intended to occupy the field (field preemption).

In most states, zoning is one of several powers delegated to local governments to serve local and state interests. Zoning determines how property is used, developed, and how valuable it will be; localities have the power to impose property taxes on the land they regulate and they are expected to use those revenues to fund municipal operations, provide mmiicipal infrastructure, and carry on the business of local government, which benefits local citizens and the state in multiple ways. Given the complexity, comprehensiveness, and utility of these linked powers and duties, the judiciary is rightfully cautious about implying that state regulatory enactments, such as those regulating hydrofracking, were intended by the legislature to inhibit local prerogatives. The importance of local land use regulation leads to a presumption against preemption that must be overcome to convince most state judges that, in adopting oil and gas laws, state legislatui"es intended to preempt local zoning.

This Article begins iu Part I by describing the aspects of hydrofracking that are currently regulated by the federal government, which leaves many of the risks untouched for future federal regulation or for state and local governments to consider. Parts II, III, and IV describe the legal tension between state and local regulation in the four states that contain the immense Marcellus shale formation: New York, Pennsylvania, West Virginia, and Ohio. These Parts focus on court decisions that determine whether local regulation to protect the interests, typically governed by land use planning and zoning, have been preempted by state law delegating regulation of the gas industry to one or more state agencies. This investigation suggests that the broad scope and durability of local land use power tends to make courts reluctant to usurp local prerogatives in the absence of clear and express language of preemption in gas regulation statutes. The Article concludes in Part V with an examination of how the legitimate interests and legal authority of all three levels of government can be integrated in a system of cooperative governance.

LIMITED SCOPE OF CURRENT FEDERAL REGULATIONS Several federal statutes apply, either directly or theoretically, to hydraulic fi'acturing. But the sprawling federal regulatory structure is rife with ambiguity and is in a state of flux. Mounting political pressure from environmental gi'oups, citizen-activists, academia, and 1000 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance even Holljrwood'^ is forcing federal authorities to explore new avenues of regulation within the existing regulatory structure."' Countervailing pressures, however, from conservative members of Congress, industry lobbyists, and environmentalists who advocate for state and local authority, are trying to strip the EPA of its authority or, at a minimum, contain it.

Born out of the statutes discussed in the subsections below, the current federal regulatory system is both fragmented and incomplete.

The Safe Drinking Water Act (SDWA), which applies to the injection or reinjection of hydrofracking fluid into groundwater aquifers that provide drinking water, only imposes standards upon drilling operations injecting diesel fuel, just one of myriad concerns surrounding the technology.'^ The Clean Water Act (CWA), which applies to surface water contamination, is powerless to address the potential contamination resulting from water migrating to the surface waters after being injected into the ground.'^ The Clean Air Act (CAA) is cinrrently being used to institute new rules on the release of methane and hazardous air pollutants, but the scope of this relatively successful regulatory scheme is confined to the well pad point source;'^ The Comprehensive Environmental Response, Compensation, and Liabihty Act (CERCLA) grants the EPA the authority to hold polluters strictly liable for cleanup costs of hazardous waste sites, but "petroleum . . . [and] natural gas" are exempted from the definitions of "hazardous substances."^" Likewise, oil and gas waste is exempted from the "cradle-to-grave" waste management scheme of the Resource Conservation and Recovery Act (RCRA).^' The Endangered Species Act (ESA) grants the Secretary of the Interior the power to protect endangered species from "take," but this approach is rarely used and entirely contingent upon the regional concerns regarding particular 15.

Mark Fischetti, Matt Damon's Fracking Movie Depicts Gas Gompanies as Liars, Sci. AM. (Jan. 6, 2013), http://blogs.scientificamerican.com/ observations/2013/01/06/matt-damons-fracking-movie-depicts-gas-compa nies-as-liars.

16.

In the absence of legislative action. President Obama appears poised to push federal hydrofracking regulations during his second term. See Wayne J. D'Angelo, Hydraulic Fracturing Regulation in President Obama's Second Term, FRACKING INSIDER (NOV. 13, 2012), http:// www.frackinginsider.com/hydrauUc-freicturing-regulation-in-president-obam as-second-term (noting that the Obama administration is surveying the regulatory authority it has within existing statutes and assessing how to issue rules under those statutes).

17.

See discussion infra Part LA.

18.

See discussion infra Part I.B.

19.

5ee discussion infra Part LC.

20.

See discussion infra Part I.D.

21.

See discussion infra Part I.E.

1001 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance The Obaina administration partially granted a petition to require manufacturers to disclose the chemical makeup of hydrofracking fluids under the Toxic Substances Control Act (TSCA), but even if fully granted, these disclosures do not necessitate any regulation in and of themselves.^^ A.

Safe Drinking Water A ci Enacted in 1972, the Safe Drinking Water Act is designed to ensure the integrity and safety of public water for human consumption, focus- ing paiticularly on toxic substances.^"* The SDWA estabhshes two primary regulatory structures to maintain safe public drinking water, the first of which requires the EPA to set maximimi contaminant levels for public water systems.^ The second, which appUes to hydrofracking, mandates that the EPA establish regulatory minima governing miderground injection, and prohibits "imdergi-ound injection" of fluids without a pernút.^^ This pertains directly to hydrofracking operations, which involve the undergroimd injection of millions of gallons of water containing proppants and proprietai'y chemicals.

The SDWA establishes an Undergi'ound Injection Control progi-am (UIC), which establishes "inspection, monitoring, recordkeeping, and reporting requirements" designed to protect drinking water sources from contamination due to injection operatioiis.^^ The extent to which a pai'ticular site is regulated depends on which of five classifications it receives.^ The UIC sets minima for "inspection, monitoring, recordkeeping, and reporting requirements."^^ States must implement their own UIC programs, meeting or exceeding the requirements set by the EPA.™ After the EPA approves the state UIC program, the state is 22.

See discussion infra Part l.F.

23.

See discussion infra Part I.G.

24.

42 U.S.C. §§ 300f-300j-26.

25.

See 42 U.S.C. §§ 300g-l(a)-(b) (mandating the promulgation of national primary drinking water regulations and maximum contaminant level goals).

26.

42 U.S.C. § 300h(b)(l)(A).

27.

42 U.S.C. § 300h(b)(l)(CHb)(2).

28.

See 42 U.S.C § 300h-5 (directing the EPA to promulgate regulations and determine the applicability of monitoring methods to provide the earliest possible detection of fluid migration into underground sources of drinking water); 40 C.F.R. § 146.5(a)-(e) (2012) (describing the five classes of injection wells in the UIC program).

29.

42 U.S.C. § 300h(b)(l)(C); see also 40 C.KR. § 145 (covering state UIC program requirements).

30.

42 U.S.C. § 300h-l(b)(l)(A).

1002 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance responsible for its enforcement.^' The EPA, however, retains veto power over the state permitting program.^^ The fight over the EPA's authority to regulate hydrofracking under the SDWA has a relatively long legislative history, beginning with the Legal. Environmental Assistance Foundation, Inc. v. EPA (LEAF) decision of 1997.^3 In LEAF, the plaintiff challenged the EPA's decision to approve the Alabama state UIC program, which failed to regulate hydraulic fracturing operations.^ In 1997, the Eleventh Circuit held that the plain meaning of the SDWA "require[d] the regulation of all [underground injection] activities.

"^° Following this 1997 ruling, the EPA conducted a study of the hydrofracking process in order to determine whether the risks were sufficient to warrant regulation under the SDWA.^" In a 2003 negotiated agreement with the EPA, Halliburton Energy Services, BJ Services, and Schlumberger Technology voluntarily agreed "to eliminate diesel fuel in hydraulic fracturing fluids injected into coalbed methane . . . production wells in undergrourid sources of drinking water (USDWs)."^'^ In 2004, the EPA's study on potential impacts on USDWs found that injection of hydrofracking fluids posed "minimal threat to USDWs," yet admitted that certain chemicals sometimes used in hydrofracking opérations caused some "environmental concerns."^^ Following the 2004 study. Congress passed the notorious Energy Policy Act of 2005, containing the "Halliburton Loophole," in 31.

42 U.S.C. § 300h-l(b)(3).

32.

See id. (permitting the EPA to promulgate a rule finding that a given state no longer meets the requirements of the program).

33.

Legal Envtl. Assistance Found., Inc. v. EPA, 118 F.3d 1467 (Uth Cir.

1997).

The Eleventh Circuit noted that an EPA report on hydraulic fracturing identified a "growing potential for contamination of drinking water aquifers." Id. at 1471 (quoting from a 1990 report by the EPA's Ground Water Study Committee).

34.

Id. at 1469.

35.

Id. at 1475.

36.

Hannah Wiseman, Untested Waters: The Rise of Hydraulic Fracturing in Oil and Gas Production and the Need to Revisit Regulation, 20 FoRDHAM ENVTL.

REV.

115, 144 (2009).

37.

Memorandum of Agreement Between the EPA and BJ Servs. Co., Halliburton Energy Servs., Inc., and Schlumberger Tech. Corp., at 2 (Dec.

12, 2003), available at http://www.epa.gov/ogwdwOOO/uic/pdfs/ moa uic hyd-fract.pdf.

38. EPA, EVALUATION OF IMPACTS TO UNDERCROUND SOURCES OF DRINKINC WATER BY HYDRAULIC FRACTURINC OF COALBED METHANE RESERVOIRS (2004), available at http://www.epa.gov/og wdw/uic/pdfs/cbmstudy_attach_uic_final_fact_sheet.pdf.

1003 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Freeniption, Local Fowcr, and Cooperative Governance response to heavy lobbying efforts from the oil and gas industry.-''^ The Act amended the SDWA's definition of "underground injection" to exchide "the underground injection of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal production activities."*"* Thereafter, states were no longer required to seek permits before engaging in drilling operations as part of their UIC programs, with the exception of when diesel fuel was injected."" Efforts to remove the loophole have been, thus far, unfruitful. The most salient attempt by the federal government to address hydrofracking concerns was the Fracturing Responsibility and Awai-eness of Chemicals Act of 2011 (FRAC Act). Proposed in both the U.S. Senate''^ and House,''^ the FRAC Act would impose federal regulation in two ways. First, the Amendment would repeal the hydrofracking exemption to the SDWA. It would modify "underground injection" to include "the underground injection of fluids or propping agents pin-suant to hydraulic fractin-ing operations related to oil, gas, or geothermal production activities."'"'' The EPA would then have to promulgate "inspection, monitoring, recordkeeping, and reporting requirements" for hydrofracking operations.**^ State UIC programs that did not require a permit before commencing hydrofracking operations would have to modify their UIC programs to require permits and then seek EPA approval.''*' Additionally, the Act would have required hydrofracking operators to disclose hydrauhc fractiu:ing chemicals.**^ The FRAC Act faced staunch opposition from the oil and gas industry, 39.

Energy Policy Act, of 2005, Pub. L. No. 109-58, § 322, 119 Stat. 594, 694 (codified as amended at 42 U.S.C. § 300h(d)(l)(B)(ii) (2006)).

40.

Id.

41.

Id.

42.

S. 587, 112th Cong. (2011). Pennsylvania Senator Robert Casey Jr., a Democrat, sponsored the bil! along with seven original cosponsors. The bill went to the Senate Committee on Environmental and Pnblic Works.

On April 12, 2011, the Subcommittee on Water and Wildlife held a hearing on the bill.

43.

H.R. 1084, .112th Cong. (2011). Representative Diana DeCette, a Democrat from Colorado, sponsored the bill along with thirty-one original cosponsors. On March 21, 2011, the bill was referred to the House Subcommittee on Environment and the Economy.

44.

H.R. 1084, 112th Cong. § 2(a) (2011); see also S. 587, 112th Cong.

§ 2(a) (2011) (using slightly different language to reach the same outcome as the House bill).

45.

See supra notes 27-32 and accompanying text (describing the requirements for UlC programs).

46.

Id.

47.

H.R. 1084, 112th Cong. § 2(b) (2011); S. 587, 112th Cong. § 2(b) (2011).

1004 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 ' ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Govemance from members of Congress, and from some envirormiental groups that wanted regulatory decisions to be made by local and state governments. .

Both the House and Senate bills died at the expiration of the 112th Congress in January 2013 and have yet to be reintroduced in the 113th Congress.

Glean Water Act Working in conjunction with the SDWA's regulations regarding underground sources of drinking water, the CWA''* is designed to "eliminate the discharge of pollutants into navigable waters" and to attain a level of water quality that "provides for the protection and propagation of fish, shellñsh, and wildlife and provides for recreation in and on the water."''' Hydrofracking involves the potential point source discharge of flowback waters produced during drilling operations into nearby surface waters, among other techniques of disposal. The CWA prohibits the discharge of "point source" pollution into the "waters of the United States'"" without obtaining a permit under the National Pollutant Discharge Elimination System (NPDES).^' Like it does with the SDWA, the EPA generally grants permitting authority to states under their respective State Pollution Discharge Elimination Systems (SPDES) but reserves the right to institute a federal program in the event that the state fails to subfnit an adequate program.^^ States are required to consider "technology- based effluent limitations" and water-quahty-based limits to achieve water quality goals.^^ The CWA also regulates indirect discharge of wastewater by truck or through sewer systems into publicly owned 48.

33 U.S.C. §§ 1251-1387 (2006).

49.

33 U.S.C. § 1251(a).

50.

40 C.F.R. §§ 122.2, 230.3(p), (s) (2012) (defining discharges from point sources and permits, "pollution," and "waters of the United States").

51.

33 U.S.C. § 1342(a)(5), (b) (2006) ("The Administrator shall authorize a State, which he determined has the capability of administering a permit program which will carry out the objectives of this chapter to issue permits for discharges into the navigable waters within the jurisdiction of such state.").

52.

33 U.S.C. § 1342(c).

53.

See 33 U.S.C. § 1311(b)(2)(A) ("[E]ffiuent limitations . . . shall require application of the best available technology economically achievable ...."); § 1312(a) (effluent hmitations "shall assure [the] protection of public health, public water supplies, agricultural and industrial uses, and the protection and propagation of a balanced population of shellfish, fish and wildlife, and allow recreational activities in and on the water"); see also 40 C.F.R. § 125.3(a) (2012) ("Technology-based treatment requirements . . . represent the minimum level of control that must be imposed in a permit.").

1005 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 - ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance treatment works (POTW), which discharge directly into U.S.

waters.^ While surface water discharges have been successfully regulated under the CWA,^^ it is unhkely that drillers will need to obtain an NPDES permit until a "solid causal connection can be made between fracking fluid injection and injiu-ies to people and property. "^'^ Nevertheless, the CWA is the primary source of authority governing the disposal and treatment of flowback water.^^ In many western states, drillers dispose of flowback water in storage wells below layers of impermeable rock, but the particular geological properties of the Marcellus formation make comparable disposal practices physically or economically impossible.^^ Accordingly, hydrofracking companies are much more likely to dispose of flowback fluid tlu'ough POTWs in the Mai'cellus region than in other areas of the country.^'-^ POTW disposal iniphcates SPDES permits, since they are regulated point soui'ces of potential pollutants.

Glean Air Act Hydrofracking operations involve the emission of a variety of volatile organic compounds (VOCs) and methane: pollutants that are harmful to public health and worsen climate change.''" The CAA*^' grants the EPA the authority to regulate emissions from stationary sources such as gas wells.''^ With respect to emissions from 54.

Attachment to memorandum from James Hanlon, Dir. of the EPA's Office of Wastewater Mgmt., to the EPA Regions, Natural Gas Drilling in the Marcellus Shale NPDES Program Frequently Asked Questions, at 6 (Mar. 16, 2011), available at http://www.epa.gov/npdes/pubs/hydro fracturing_faq.pdf.

55.

Jason Obold, Leading by Example:

The Fracturing Responsibility and Awareness of Chemicals Act of 2011 as a Catalyst for international Drilling Reform, 23 COLO.

lNT'b ENVTL.

L. & POL'Y 473, 486 (2012) ("The CWA has been successful at regulating the surface activities of hydraulic fracturing operations . . . .").

56.

fd.

57.

Rehecca Jo Reser & David T.

Ritter, State and Federal Legislation and Regulation of Hydraulic Fracturing, ADVOCATE:

TEX.

STATE BAR LiTic. SECTION REPORT, Winter 2011, at 31, 32.

58.

Id. at 32 n.l6.

59.

Id.

60.

See REVISED DRAFT SCEIS, supra note 3, at 7-46 (defining VOCs and how they affect hydrofracking operations).

61.

42 U.S.C.

§§ 7401-7671q (2006).

62.

42 U.S.C. §7411(a)(3) ("The term 'stationary source' means any building, structure, facility, or installation which emits or may emit any air pollutant.").

1006 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance hydrofracking operations, the EPA has the authority to demand reductions in Hazardous Air Pollutants'" and VOCs,'^ including methane.''^ The CAA sets National Ambient Air Quality Standards (NAAQS) and seeks nationwide attainment through both technology- based and health-based standards."" On April 17, 2012, the EPA created the first national air quality standards for hydraulically fractured natural gas wells, designed to reduce harmful emissions while allowing for responsible industrial growth."^ These rules require compliance with new emissions standards for natural gas hydrofracking wells, storage tanks, and other oil and gas equipment, to be achieved through the use of "proven technologies and best practices that are in use today.

"""^ The EPA anticipates that these regulations, when fully effective, will achieve a 95 percent reduction of VOCs from new or modified wells, accomphshed through a process known as "green completion," which utilizes speciahzed machinery to separate gas and liquid hydrocarbons from flowback fluid."^ The EPA claims that the new rules will provide the oil and gas industry with savings of up to $15 million in 2015,™ 63. EPA, OVERVIEW OF FINAL AMENDMENTS TO AIR REGULATIONS FOR THE OIL AND NATURAL GAS INDUSTRY 4, available at http://www.

epa.gov/airquality/oilandgas/pdfs/20120417fs.pdf [hereinafter OVERVIEW OF AIR REGULATION AMENDMENTS] ("EPA also must set standards for emissions of air toxics, also called hazardous air pollutants.

Air toxics are pollutants known or suspected of causing cancer and other serious health effects.").

64.

Id. ("The Clean Air Act requires EPA to set new source performance standards (NSPS) for industrial categories that cause, or significantly contribute to, air pollution that may endanger public health or welfare.

EPA is required to review these standards every eight years.

The existing NSPS—for VOCs and SO2—were issued in 1985.").

65.

Id. at 2 ("Methane, the primary constituent of natural gas, is a potent greenhouse gas—more than 20 times as potent as carbon dioxide when emitted directly to the atmosphere.

Oil and natural gas production and processing accounts for nearly 40 percent of all U.S. methane emissions, making the industry the nation's single largest methane source.").

66.

40 C.F.R.

pt. 50 (2012) (setting National Ambient Air Quality Standards for six principal pollutants: carbon monoxide, lead, nitrogen dioxide, ozone, particulate pollution, and sulfur dioxide).

67.

OVERVIEW OF AIR REGULATION AMENDMENTS, supra note 63, at 1.

68.

Oil and Natural Gas Air Pollution Standards, EPA, http://www.epa.

gov/airquality/oilandgas (last visited Apr.

10, 2013).

69.

OVERVIEW OF AIR REGULATION AMENDMENTS, supra note 63, at 1.

70.

Id.

("EPA's analysis of the rules shows a cost savings of $11 to $19 million when the rules are fully implemented in 2015.").

The oil and gas industry largely contests these economic projections and expresses concern about overregulation. "While we understand that EPA is required by law to periodically evaluate current standards, this sweeping 1007 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Poiuer, and Cooperative Covemance created by the recovery of gas and condensate that would have otherwise been lost."^' The EPA requires that all extraction companies be in compliance with "green completion" requirements by January 1, 2015.'''^ Meanwhile, companies are required to utilize combustion devices, or "flaring," to reduce their carbon emissions/~* D.

Comprehensive Environmental Response, Compensation, and Liability Act CERCLA grants the EPA authority to require the cleanup of hazardous waste sites.^'' CERCLA creates a federal "Superfund" to support remedial actions taken by government entities, and establishes a process by which federal and state governments, along with private parties, can bring suit against "potentially responsible parties" (PRPs) for the release of a "hazardous substance."'^ CERCLA explicitly excludes "petroleum, including crude oil ...

natui'al gas, [and] natural gas liquids" from the definition of "hazardous substance."™ Despite the "petroleum exception," the EPA may have authority to impose future liability upon oil and gas drillers for remediation costs for contamination because hydrofracking fluid contains nonpetroleum substances/^ Although the current regulatory scope under CERCLA is ambiguous, it is clear that the EPA possesses the authority to conduct investigations under CERCLA, at the very least, and may be authorized to regi.üate nonpetroleum pollution under set of potentially unworkable regulations represents an overreach that could, ironically, undercut the production of American natural gas, an abundant energy resource that is critical to strengthening our nation's air quality." Press Release, Marcellus Shale Coalition, Kathryn Z.

Klaber, MSC Statement on Proposed EPA Air Regulations (July 28, 2011), http://marceUuscoalition.org/2011/07/nisc-statement-on-proposed -e pa-air-regulations.

71.

OVERVIEW OF AIR REGULATION AMENDMENTS, supra note 63, at 2.

72. EPA, SUMMARY OF"' KEY CHANGES TO THE NEW SOURGE PERFORM ANGE STANDARDS 1, available at http://www.epa.gov/air quality/oilandgas/pdfs/20120417changes.pdf.

73.

Id.; see abo Timothy Gardner S¿ Ayesha Rascoe, Fracking Rules Let Drillers Flare Till 2015, REUTERS (Apr. 1.8, 2012, 4:31 PM), http:// www.reuters.com/article/2012/04/18/us-usa-fTacking-emissions-idUSBRE 83H0UH20120418.

74.

42 U.S.C.

§§ 9601-9675 (2006).

75.

42 U.S.C. §§ 9601(14), 9607(a); see also EPA, PRP SEARCH MANUAL (Sept.

30, 2009), available at http://www.epa.gov/oecaerth/resources/ pubiications/cleanup/superfund/prpmanual/prp-search-man-cmp-09b.pdf.

76.

42 U.S.C.

§ 9601(14).

77.

John C.

Martin et al.. Fractured Fairy Tales:

The Context and Regulatory Constraints for Hydraulic Fracturing, in DEVELOPMENT ISSUES IN MAJOR SHALE PLAYS 3-1, 3-13 (Rocky Mtn. Min. L. Found. 2010).

1008 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance the same act.'^ The difficulty of determining the chemical makeup of hydrofracking fluids may preclude the EPA from determining the requisite nonpetroleum or hazardous classification of the fluid. This difficulty can be overcome by an EPA requirement that gas drilhng companies disclose the chemicals used so that the agency can properly discharge its regulatory functions imder CERCLA.

E. Resource Conservation and Recovery Act Passed by Congress in 1976, the RCRA grants the EPA the authority to regulate all aspects of hazardous waste generation, transportation, treatment, storage, and disposal.^^ RCRA is complimentary to CERCLA: the former is a preventative "cradle-to- grave" statute and the latter is a remedial statute. Among other related requirements, RCRA creates disclosure and safety standards meant to encourage the reduction of such waste and the use of nontoxic alternatives.*" RCRA also established a national framework to manage nonhazardous solid wastes and underground storage tanks." Subchapter III of RCRA grants the EPA authority to establish safeguards and waste management procedures to regulate and prevent hazardous wastes.*^ Congress and the EPA reached an agreement in 1988 to exempt oil and gas from RCRA regulation in response to heavy industry, lobbying efforts.^ Subchapter III of RCRA explicitly exempts wastes generated from oil and gas exploration and production^ and imposes 78.

See id. (discussing the EPA's "investigative authority" during a hydrauMc fracturing incident in Pavillion, Wyoming).

79.

42 U.S.C. §§ 6901-6992 (2006).

80.

See 42 U.S.C. §§ 6922(b) (discussing waste minimization programs); see also EPA, RCRA: REDUCING RISK FROM WASTE 2 (Sept. 1997), available at http://www.epa.gov/osw/inforesources/pubs/risk/risk-l.pdf ("The primary goals of RCRA are to: Protect human health and the environment from the potential hazards of waste disposal. Conserve energy and natural resources. Reduce the amount of waste generated.

Ensure that wastes are managed in an environmentally sound manner.").

81.

42 U.S.C. §§ 6941-6949a ("State or Regional [nonhazardous] Solid Waste Plans"); § 6991 ("Regulation of Underground Storage Tanks").

82.

42 U.S.C. §§ 6921-6939g ("Hazardous Waste Management").

83.

Jennifer Dixon, EPA Said to Bow to Political Pressure in Oil Wastes Ruling, ASSOCIATED PRESS (July 19, 1988, 12:49 AM), available at http://www.apnewsarchive.com/1988/epa-said-to-bow-to-political-pressure -in-oil-wastes-ruling/id-87790d67435a0ba3eble5ecc5ce86c9c.

84.

42 U.S.C. § 6921(b)(2) ("[W]astes associated with the exploration, development, or production of crude oil or natural gas or geothermal energy shall be subject only to existing State or Federal regulatory programs.").

1009 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance strict standards upon transporters.^ This exemption was originally a temporary measure set by Congi-ess but became permanent after the EPA, at Congress's urging, conducted a study that determined that regulation of oil and gas wastes was unwarranted under RCRA.*"* Thus, although hydrofracking fluids may contain toxic chemicals ordinarily regulated under RCRA, the EPA lacks the authority to regulate them.^^ F. Endangered Species Ad Additional federal authority to regulate hydrofracking may be contained in the ESA.^ Passed in 1973, the ESA was designed to protect both endangered and threatened species, as well as the habitats on which they depend.**'* The ESA requires the Secretary of the Interior, advised by the Fish and Wildlife Service and the National Marine Fisheries Service, to give the "highest priority" to protecting endangered species.'-^° The Secretary of the Interior has the authority to list alt terrestrial and freshwater species as either "endangered" or "threatened," and the Secretary of Commerce has the equivalent authority for marine life.'-*' All species listed as "endangered" and most species listed as "threatened," or "likely to become an endangered species within the foreseeable future,"'*'^ are protected from "take""-'"' by public or private actors."'' Federal agency 85.

42 U.S.C. § 6923 ("Standards applicable to transporters of hazardous waste.").

86.

Clarification of the Regulatory Determination for Wastes from the Exploration, Development and Production of Crude Oil, Natural Cas and Ceothermal Energy, 58 Fed. Reg. 15,284 (Mar. 12, 1993) ("[Tjhis document only further clarifies the status of these wastes under the RCRA . . . hazardous waste exemption . . . and does not alter the scope of the current exemption in any way.").

87.

In spite of legislative inaction, the Obama administration is set to review petitions to apply RCRA to produced waters and hydrofracking fluid. See D'Angelo, supra note 16.

88.

16 U.S.C. §§ 1531-1544 (2006).

89.

16 U.S.C. § 1531(b) 90.

TVA V. Hill, 437 U.S. 153, 174 (1978) ("[E]xamination of the language, history, and structure of the [ESA] indicates beyond doubt that Congress intended endangered species to be afforded the highest of priorities.").

91.

16 U.S.C. § 1533(a)(l)-(2).

92.

16 U.S.C. § 1532(6), (20).

93.

16 U.S.C. § 1532(19) ("The term 'take' means to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect, or attempt to engage in any such conduct.").

1010 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofraeking: State Preemption, Local Power, and Cooperative Covemance actions are not permitted to "take" or jeopardize any listed species, not only by autonomous agency actions but also by permitting actions of others^^—a universal need with respect to hydraulic fracturing.

Additionally, the wildlife agencies designate "critical habitats" for each endangered or threatened species listed in the Federal Register, specifying the range of the particular species.^^ Agencies or permitted parties are prohibited firom engaging in, funding, or authorizing any action that would modify, adversely affect, or destroy a designated habitat.^^ The Secretary is required to conserve and protect an endangered or threatened species until the species is no longer endangered or threatened."* The fragmentation of the natural landscape caused by road building, heavy road use, pipeline construction, and surface-water pollution may constitute "take" of endangered species, which might be preventable through enforcement of the ESA provisions. In fact, many of the most heavily fracked areas of the country contain some of the most endangered species."'' The Secretary of the Interior might be able 94.

See 16 U.S.C.

§ 1538(a) (stating that "taking" endangered animals is "unlawful for any person subject to the jurisdiction of the United States").

Similar to the ESA, the Migratory Bird Treaty Act protects migratory bird species from dehberate or incidental "take." 16 U.S.C. §§ 703-712 (2006).

Although the Migratory Bird Treaty Act does not contain a provision to protect-' a particularized habitat, it imposes strict Uability upon any person for the death of a migratory bird, even if the death occurs as a result of the bird drinking water from a legal retaining pond.

See United States v.

FMC Corp., 572 F.2d 902, 908 (2d Cir. 1978) ("[T]he statute does not include as an element of the offense 'wilfully, knowingly, recklessly, or neghgently.' . . .

Congress recognized the important pubhc policy behind protecting migratory birds; FMC engaged in an activity involving the manufacture of a highly toxic chemical; and FMC failed to prevent this chemical from escaping into the pond and killing birds. This is sufficient to impose strict liability on FMC").

95.

16 U.S.C.

§ 1536(a)(2); see also Hill, 437 U.S. at 173 ("One would be hard pressed to find a statutory provision whose terms were any plainer than those in ... the Endangered Species Act. Its very words affirmatively command all federal agencies 'to insure that actions authorized, funded, or carried out by them do not jeopardize the continued existence' of an endangered species or 'result in the destruction or modification of habitat of such species.'" (quoting 16 U.S.C.

§ 1536)).

96.

16 U.S.C.

§ 1533(a)(3)(A)-(B) (requiring use of the "best scientific data available" when determining a species's critical habitat).

97.

16 U.S.C.

§ 1536(a)(2).

98.

Carson-Truckee Water Conservancy Dist.

Clark, 741 F.2d 257, 261 (9th Cir. 1984), cert, denied sub nom. Nevada v.

Hodel, 470 U.S. 1083 (1985).

99.

See Press Release, American Rivers, Upper Delaware Named America's Most Endangered River (June 2, 2010), available at http://www.

americanrivers.org/newsroom/press-releases/2010/teton-river-most-endang ered-2010-6-2-2010.html (discussing how hydrofracking around a national 1011 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance to use the ESA to minimize the effect of hydrofracking on protected species.'™ Indeed, the mere potential of hsting the sagebrush hzard of New Mexico afforded Secretary of the Interior Ken Salazar the leverage necessary to secure "unprecedented commitments to voluntary conservation agreements" with the oil and gas industry."*' C. Toxic Substances Control Act TSCA grants the EPA authority to require companies to report the health, safety, and exposure information of chemical substances and mixtm-es to the EPA.'"^ On November 23, 2011, the Obaina administration pai'tially granted a section 21 petition from Earthjustice"^ requesting a rulemaking under sections 4 and 8, which would require manufactiu'ers and processors to disclose chemical mixtures used during all hydrofracking operations and to conduct toxicity testing on named chemicals.'*' The petition cited numerous federal regulatory "gaps," or oil and gas exemptions in the SDWA and RCRA, and demanded park system near the Upper Delaware River is contaminating the water and threatening "several endangered, at risk, or rare species Hvjing] in ihe river and along its banks").

100.

Kalyani Robbins, Awakening the Slumbering Ciant:

How Horizontal Drilling Technology Brought the Endangered Species Act to Bear on Hydraulic Fractumng, 63 CASE W.

RES.

REV.

1143 (2013).

101.

Following the Fish and Wildlife Service's proposal to list the dune sagebrush lizard in December 2010, the state governments of Texas and New Mexico, private landowners, and oil and gas companies developed an unprecedented 650,000-acre conservation plan to preserve the shinnery oak dune habitat of the lizard. Upon the required "best available science" analysis. Interior Secretary Ken Salazar stated that the lizard faces no imminent threat of becoming endangered.

The Service will continually monitor the progress and efficacy of the conservation efforts, retaining the right to reevaluate the listing determination at any time. News Release, U.S.

Dept.

of the Interior, Landmark Conservation Agreements Keep Dunes Sagebrush Lizard Off the Endangered Species List in NM, TX (June 13, 2012), available at http://www.fws.gov/soiithwest/es/Documents/R2ES/NR_for_DSL_Fi nal_DetenTiination_13June2012.pdf.

102.

See 15 U.S.C.

§§ 2601-2692 (2006) (including the authority under section 2603 to require premanufacture notice for "new chemical substances," and the authority under § 2607 to regulate "inventory" chemicals).

103.

Petition from Earthjustice to EPA, Citizen Petition under Toxic Substances Control Act Regarding the Chemical Substances and Mixtures Used in Oil and Cas Exploration and Production (Aug. 4, 2011), available at http://www.epa.gov/oppt/chemtest/pubs/Section_ 21_Petition_on_Oii_Cas_DrilIing_and_Fracking_ChemicaIs8.4.20U.pdf.

104.

Eric Waeckerlin &; Joe Creen, Hydraulic Fracturing & TSCA: EPA's Surprising Move and its Sweeping Implications, LiSGAL BACKGROUNDER, Feb.

24, 2012, at 1.

1012 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking:

State Preemption, Local Power, and Cooperative Covemance further federal oversight on disclosure for chemicals used in hydrofracking operations.'"^ Although the EPA claims that the new rulemaking will "complement" current state disclosure requirements, the interplay between the proposed rule and state or other federal regulations is yet to be seen.'"^ II. NEW YORK: LOCALITIES WIN ROUND ONE, ESCAPING PREEMPTION'"^ The legislature in New York, like those in most states where hydrofracking occurs, has adopted comprehensive legislation to regulate oil and gas operations. As opposed to the federal government, whose jurisdiction is somewhat constrained by its limited jurisdiction over matters of property, state governments have plenary authority to regulate their resources. The legislatures of all fifty states have also created local governments and given them legal authority of various tjqjes, including the power to adopt comprehensive plans, zoning, and other land use regulations. Under that authority, localities typically regulate industrial land uses, such as gas drilling operations, by either prohibiting them altogether or assigning them to appropriate areas within their jurisdiction where the intensity of industrial activities does not adversely affect neighboring property values or the quality of life in other parts of the community.

New York's oil and gas statute contains language that at first blush seems to preclude the regulation of hydrofracking under local land use authority. The New York Oil, Gas and Solution Mining Law (OGSML)'"« provides that [t]he provisions of this article shall supersede all local laws or ' ordinances relating to the regulation of the oil, gas and solution mining industries; but shall not supersede local government jurisdiction over local roads or the rights of local governments under the real property tax law.'"^ Industry attorneys, of course, read this language as expressly preempting local land use control of the location and local impacts of 105.

Id. at 2.

106.

The Obama administration is also set to review petitions for increased hydrofracking regulation under RCRA, the Emergency Planning and Community Right to Know Act (EPCRA), and the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). See D'Angelo, supra note 16.

107.

Portions of this Part are adapted from John R. Nolon & Victoria Polidoro, Hydrofracking:

Disturbances Both Geological and Political:

Who Decides?, 44 URB.

LAW.

507 (2012).

108.

N.Y.

ENVTL.

CONSERV.

LAW § 23-0303 (McKinney 2012).

109.

Id. § 23-0303(2).

1013 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Freerrvpiion, Local Power, and Cooperative Covemance gas wells. Some localities, whose lawyers interpret the language differently, have enacted vai-ious controls on the location of gas wells to protect the integrity of their land use plans and their local environment. Landowners and the industry, in turn, have sued two towns that banned gas drilling by amending their local zoning ordinances."" Both communities won their cases in the lower courts, which found neither express nor implied preemption of local control of hydrofracking in the OGSML.'" Deciding the underlying issues in these cases will take years as they wind their way through the New York court system.

The holdings of these first decisions are consistent with the general understanding of local control and state preemption in New York. Zoning authority can be curtailed when the state has demonstrated the intent to preempt an entire field of regulation."^ This prevents inconsistent local laws from "inhibit[ing] the operation of the State's general law and thereby thwart[ing] the operation of the State's overriding policy concerns.""^ The intent to preempt can be explicit or can be implied through review of the state's regulatory scheme regarding a particular subject."'' Article IX, section 3(c) of the New York Constitution, however, provides that "[r]ights, powers, privileges and immunities gi'anted to local governments by this article shall be liberally construed.""^ This constitutional requirement has also been codified by section 51 of the Municipal Home Rule Law, which provides that home-rule powers "shall be liberally construed.""'' These requirements of liberal construction apply to towns' powers to enact zoning laws, which are 110.

New York law delegates essentially the same degree of land use power to three of the four types of local government that the state has created:

villages, towns, and cities. References in this Article to "towns" refer to all three of these types of localities, unless the reference is to a particular community. Courities in New York are considered to be local governments but do not have the authority to adopt zoning.

111.

Anschutz Exploration Corp.

Town of Dryden, 940 N.Y.S.2d 458, 474 (Sup.

Ct.

2012); Cooperstown Holstein Corp.

Town of Middlefield, 943 NY.S.2d 722, 730 (Sup. Ct.

2011).

New York's Supreme Court is the state's trial-level court of general jurisdiction.

112.

See Jancyn Mfg.

Corp.

Cnty.

of Suffolk, 518 N.E.2d 903, 905 (NY.

1987) ("A local law may be ruled invalid . . .

where the State has clearly evinced a desire to preempt an entire field thereby precluding any further local regulation.").

113. ¡d.

at 906.

114.

See id. at 907 (holding that no preemption existed because the regulatory department did not think the statute was meant to preempt local legislation).

115. N.Y.

CONST, art. ÍX, § 3(c).

116. N.Y. MuN.

HOME RULE LAW § 51 (McKinney 2012).

1014 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Gooperative Govemance derived not only from specific delegations of power contained in the Town Law,"^ but also the Municipal Home Rule Law."* The state's highest court has recognized that "[o]ne of the most significant functions of a local government is to foster productive land use within its borders by enacting zoning ordinances.""' These provisions calling for liberal interpretation of local power and extolling the importance of local land use powers create an implicit presumption against preemption.

The crux of the conflict between state and local power over gas driUing in New York involves the interpretation of the term "regulation" in the ÖGSML. If zoning laws, which regulate the use of land by, and the location of, gas drilhng facihties, axe viewed as laws "relating to the regulation of the industry, they are preempted by the language of the OGSML.'^" If not, municipalities may use their zoning powers to identify appropriate locations in the community for such driUing and impose standards to mitigate local impacts of hydrofracking, or, in proper instances, to prevent hydrofracking altogether.

When faced with a potential conflict between state and local zoning laws.

New York, courts attempt to harmonize local and state legislative enactments, "thus avoiding any abridgment of the town's powers to regulate land use thirough zoning powers expressly delegated" in the constitution and implemented through state statutes.'^' It is well settled that "[t]he mere fact that a state regulates a certain area of business does not automatically pre-empt all local legislation which apphes to that enterprise.'"^^ 117.

5ee N.Y.

TOWN LAW §§261-263 (McKinney 2012) (granting town boards the power to regulate the size, style, density, and use of structures for a variety of purposes); see also N.Y. GEN.

CITY LAW § 20(24)-(25) (McKinney 2012) (granting this power to cities); N.Y.

VILLAGE LAW §§ 7-700, 7-702 (McKinney 2012) (granting this power to the board of trustees of a village); Robert E. Kurzius, Inc. v. Inc. Vill. of Upper Brookville, 414 N.E.2d 680, 682 (N.Y. 1980) (noting the delegation of zoning power to village boards).

118.

See, e.g., Kamhi v. Town of Yorktown, 547 N.E.2d 346, 351 (N.Y. 1989) (recognizing towns' power to enaict zoning rules pursuant to section 10 of the Municipal Home Rule Law); Pete Drown, Inc. v. Town Bd. of Ellenburg, 591 N.Y.S.2d 584, 585 (App. Div. 1992) (same).

119.

DJL Rest. Corp. v. City of New York, 749 N.E.2d. 186, 191 (N.Y.

2001).

120.

N.Y.

ENVTL.

CONSERV.

LAW § 23-0303(2) (McKinney 2012).

121.

Frew Run Cravel Prods., Inc. v. Town of Carroll, 518 N.E.2d 920, 924 (N.Y. 1987).

122.

Envirogas, Inc. v. Town of Kiantone, 447 N.Y.S.2d 221, 222 (Sup. Ct.

1982), aff'd, 454 N.Y.S.2d 694 (App. Div. 1982), motion for leave denied, 444 N.Y.2d 1013 (N.Y. 1982).

1015 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance The New York coiu'ts have experience looking at the distinction between zoning laws and laws that regulate business operations, including mining. The state's Mined Land Reclamation Law (MLRL) contained the following preemption provision, which is similar to the language found in the OGSML:

For the purposes stated herein, this title shall supersede ail other state and local laws relating to the extractive mining industry; provided, however, that nothing in this title shall be construed to prevent any local government from enacting local zoning ordinances or other local laws which impose stricter mined land reclamation standards or requirements than those found herein.'^ In Frew Run Gravel Products, Inc. v. Town of Carroll, the court found that the legislature, in enacting the MLRL, did not intend to preempt the provisions of a town zoning law that limited the areas of town where sand and gi-avel mines could be established.'^'' In making its determination, the com't conducted a three-part inquiry, looking first at the plain language of the statute, followed by the legislative history, and then finally to the purpose and intent of the statute.'^^ Looking at the plain meaning of the phrase "relating to the extractive mining industry," the court "[could not] interpret the phrase ... as including the Town of Carroll Zoning Ordinance.'"^^ The purpose of a zoning ordinance is to regulate land use, and in doing so, it "inevitably exerts an incidental control over any of the particular uses or businesses which, like sand and gravel operations, may be allowed in some districts but not in others.'"" The court found that this type of incidental control through zoning was "not the type of regulatory enactment relating to the 'extractive mining industry' which the Legislature could have envisioned as being within the prohibition of the statute.'"^ In so finding, the court recognized the différence between a zoning law and "[ljocal regulations dealing with the actual operation and process of mining[, which] would frustrate the statutory purpose of [the MLRL's standardized regulations].'"^^ 123.

Frew Run, 518 N.E.2d at 921 (citing N.Y.

ENVTL.

CONSERV.

LAW § 23- 2703(2)).

124.

See id. at 923 ("There is nothing in the Mined Land Reclamation Law or its history indicating . . . the preemptive effect petitioner urges.").

125.

Id. at 922.

126.

Id.

127.

Id.

128.

Id.

129.

Id. at 923.

1016 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance In August 2011, the Town of Dry den amended its zoning ordinance to prohibit natural gas drilling.''" The ordinance added definitions for "Natural Gas," "Natural Gas and/or Petroleum Exploration," and "Natural Gas Exploration and/or Petroleum • Production Wastes," and then prohibited the "Exploration for or Extraction of Natural Gas and/or Petroleum" anywhere in the town.'^' The law also purports to invalidate any "permit issued by any local, state[,] or federal agency, commission[,] or board for a use which would violate the prohibitions of" the ordinance.

'^^ The Town of Middlefield's land uses are predominately agriculture, forests, and low-density residential. After studying the potential impact of heavy industry on its rural environs and water supply,'^^ in June 2011 it amended its comprehensive plan and zoning law to prohibit heavy industry throughout the town. Heavy industry is broadly defined and includes "drilling of oil and gas wells" as well as "chemical manufacturing," "petroleum and coal processing," and "steel manufacturing.'"*" The Town of Dry den's law was challenged by Anschutz Exploration Corporation, a Golorado-based driller and developer of natural gas wells.

The Town of Middlefield's law was coritested by Gooperstown Holstein Corporation, a local dairy operation that has 130.

See Minutes, Town of Dryden Special Town Board Meeting, at 1, 5-15 (Aug.

2, 2011), available at http://dryden.ny.us/Board Meeting Minutes/TB/2011/TB2011-08-02.pdf (voting 5-0 in favor of amendments "claxifying the town's prohibition of natural gas exploration ajid extraction").

131.

Notice, Town of Dryden Notice of Adoption of Amendments to Zoning Ordinance, at 1, 2 (Aug. 3, 2011), available at http://documents.food andwaterwatch.org/doc/Frack_Actions_DrydenNY.pdf ("No land in the Town shall be used:

to conduct any exploration for natural gas and/or petroleum; to drill any well for natural gas and/or petroleum; to transfer, store, process or treat natural gas and/or petroleum; or to dispose of natural gas and/or petroleum exploration or production wastes; or to erect any derrick, building, or other structure; or to place any machinery or equipment for such purposes.").

132.

Id.

133. See GREENPLAN, INC., LAND USE ANALYSIS: HEAVY INDUSTRY AND OIL, GAS OR SOLUTION MINING AND DRILLING 4 (2011), available at http://www.otsego2000.org/documents/forwebsiteMiddlefieldLandUseAnaly sis-Greenplan.pdf (a land use analysis prepared for the Town Board of the Town of Middlefield that provides information on the potential effects of zoning amendments).

134.

Middlefield, N.Y., The Town of Middlefield Zoning Law, Local Law No.

1, art. II, § B(8) (2011), available at http://www.middlefieldny.com/ uploads/l/2/6/8/12682437/zoning_law_061411_2011_final.pdf.

1017 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance leased • approximately 400 acres of its land for natural gas development.'^^ On February 21, 2012, the New York Supreme Court, Tompkins Connty, upheld the Town of Dryden's total ban on hydroft-acking within its borders.'^'^ The court's holding was straightforward: "In light of the similarities between the OGSML and the MLRL as it existed at the time of Matter of Frew Run, the court is constrained to follow that precedent in this case.'"'*^ The court found that the OGSML did not expressly preempt local zoning and that the town's zoning amendment did not regulate gas production; rather, it regulated land use and not the operation of gas mining.

The coui't noted that "[njone of the provisions of the OGSML address traditional land use concerns, such as traffic, noise or industry suitabihty for a particular community or neighborhood.'""'^ It cited other preemptive statutes with provisions requiring the relevant state agency to consider the traditional concerns of zoning in deciding whether a permit is to be issued. "Under this construction, local governments may exercise their powers to regulate land use to determine where wittiin their borders gas drilling may or may not take place, while [the Department of Environmental Conservation] regulates all technical operational matters on a consistent statewide basis in locations where operations are permitted by local law.'""* The provision of the local law that invalidated any other permits authorizing drilling was found invalid as preempted by the OGSML and was severed ft'orn the law, while the other provisions were left in place.

'**" Three days later, on February 24, 2012, the Supreme Court in Otsego County issued a decision in the Middlefield case gi-anting summary judgment in favor of Middlefield, upholding the town's zoning law that banned natural gas drilling.''" After thoroughly reviewing the legislative history of the OGSML, the court found no provision in it to support Holstein's position, stating, 135.

Verified Complaint at 1-2, Cooperstown Holstein Corp. v. Town of Middlefield, 943 N.S.Y.2d 722 (Sup. Ct. 2012) (No. 2011-0930), available at http://catskillcitizens.org/learnmore/VsTownOfMiddlerield.pdf.

136.

Anschutz Exploration Corp. v. Town of Dryden, 940 N.Y.S.2d 458, 474 (Sup.

Ct. 2012).

137.

Id. at 466.

138.

Id. at 470.

139.

Id. at 471.

140.

The court found that the provision could be severed without Impairing the underlying purpose of the zoning amendment. Id. at 474.

141.

Cooperstown Holstein Corp. v. Town of Middlefield, 943 N.Y.S.2d 722, 730 (Sup. Ct. 2011).

1018 GASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance Neither the plain reading of the statutory language nor the history of [the OGSML] would lead this court to conclude that the phrase "this article shall supersede all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries" was intended by the Legislature to abrogate the constitutional and statutory authority vested in local municipalities to enact legislation affecting land use.'"^ In the court's analysis of the legislative history of the EGL, it found that the intention of the legislature was not to preempt the statutory authority vested in local municipalities to enact legislation affecting land use.'''^ Rather, the legislature's intent was to impose uniform statewide oversight to ensure and promote efficient utilization of a state resource.'''^ The court analyzed the policy of the state at the time of original enactment of article 3-A of the Environmental Gonservation Law in 1963.'''^ It found that the provisions "fail to specifically address therein any land use issues which would otherwise be the.

subject of a local municipality's zoning authority as an exercise of its police powers."""' Rather, it concluded that the legislatiö^n focused the Department of Gonservation's (now the Department of Environmental Gonservation, or DEG) efforts on matters that were "regulatory in nature," such as spacing units, integration of oil and gas pools and fields, oil and gas leases, and the plugging of old wells.'"^ The court also relied on case law interpreting the "strikingly similar" provision of the MLRL, which found that "in the absence of a clear legislative intent to preempt local control over land use, the [MLRL] could not be read as preempting local zoning authority.'""* Of singular importance in the Middlefield decision is the court's understanding of the state legislature's intent when it initially adopted the Environmental Gonservation Law in the early 1960s. At that time, local zoning was forty years old and had been preceded by decades of adopting local nuisance abatement laws prior to the advent of zoning. It seems imprinted in the mind of the legislature to protect local control, except where the' legislature expressly states that preemption of local prerogatives is essential to furthering overriding state interests. In the Dryden and Middlefield decisions, the judiciary 142.

Id. at 728 (quoting N.Y.

ENVTL.

CONSERV.

LAW § 23-0303(2)).

143.

Id.

144.

Id. at 728-29.

145.

Id. at 724-26.

146.

Id. at 725.

147.

Id. at 729 (quoting Gernatt Asphalt Prods., Inc. v. Town of Sardinia, 664 N.E.2d 1226, 1234 (N.Y. 1996)).

148.

Id.

1019 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Govemance in New York followed its trend to harmonize two legislative regimes— one intended to impose uniform regulations on the operation of gas drilling and the other designed to control local land use impacts, honoring the statutes that delegate extensive land use control to towns as well as the home-rule provisions of the State Constitution that promise localities control over their local property, affairs, and government.

The assessment by the two lower courts in Dryden and Middlefield of the legislative history and preemptive effect of the OGSML was affirmed by the Third Department Appellate Division on May 2, 2013, when it upheld both opinions.''"* In affirming the Dryden decision by the Supreme Court, the Appellate Division made it clear that "zoning ordinances ai'e not the type of regulatory provision that the Legislature intended to be preempted by the OGSML";'^" that "the Legislature's intention was to insure uniform statewide standards ... in an effort to increase efficiency while minimizing waste";'^' and that "nothing in the language, statutory scheme or legislative history of the statute indicat[es] an intention to usurp the authority traditionally delegated to municipalities to establish permissible and prohibited uses of land within their jurisdictions.'"^^ By distinguishing the purposes of land use regulation from "regulating the actual operation, process and details of the oil, gas and solution mining industries, 'the statutes may be harmonized, thus avoiding any abridgment of [a] town's powers to regulate land use through zoning powers expressly delegated in the Statute of Local Governments . . .

and the Town Law.""^-"* It was not lost on the court that the matters regulated by the state under the OGSML ai'e not the mattere traditionally regulated by rnimicipal zoning and land use régulations. Provisions of the OGSML "do not addi'ess traditional land use considerations, such as proximity 149.

Norse Energy Corp. USA v. Town of Dryden, No. 515227, slip op. at 15 (N.Y. App. Div. May 2, 2013) ("Thus, we hold that the OGSML does not preempt, either expressly or impiiedly, a municipality's power to enact a local zoning ordinance banning all activities related to the exploration for, and the production or storage of, natural gas and petroleum within its borders."); Cooperstown Holstein Corp. v. Town of Middlefield-, No. 515498, slip op. at 3 ("For the reasons set forth in Matter of Norse Energy Coi-p. USA v. Town of Dryden, we find plaintiffs claim to be without merit and affirm Supreme Court's judgment declaring that defendant's zoning is valid." (citation omitted)).

150.

Dryden, slip op. at 8.

151.

Id. at 10-11.

152.

Id. at 11.

153.

id. (quoting Frew Run Cravel Prods., Inc. v. Town of Carroll, 518 N.E.2d 920, 924 (N.Y. 1987) (alterations in original)).

1020 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 -2013 .Hydrofracking:

State Preemption, Local Power, and Cooperative Covemance to nonindustrial districts, compatibility with neighboring land use, and noise and air pollution .... [T]he zoning law will dictate in which, if any, districts drilling may occur, while the OGSML instructs operators as to the proper spacing of the units within those districts in order to prevent waste. "'^'' These decisions ratify the importance of local control of hydrofracking and of identifying methods of state-local coordination as recommend in Part V.

III.

PENNSYLVANIA: PREEMPTION THWARTED The tension between local and state control of hydrofracking evident in New York is profoundly evident in recent legislative and judicial decisions in Pennsylvania—the state in the heart of the Marcellus region.'^^ Under prior state oil and gas law, the state courts had determined that local governments could regulate but not prevent hydrofracking under local zoning. Following these judicial decisions, the state legislature adopted Act 13, which all but preempted local control."^° The Act explicitly required local governments to include hydrofracking as a permitted use in all zoning districts. This Act, in turn, was invalidated by Robinson Township v.

Commonwealth, which held that it failed to protect neighboring property owners from harm and made irrational land use classifications.'^^ The power of municipalities to adopt comprehensive plans and to separate land uses through zoning, and the derivative rights of landowners, in the Robinson court's view, trumped state oil and gas legislation that, on its face, preempted local regulation.

Under the former Oil and Gas Act in Pennsylvania, municipalities were permitted to regulate the location of wells within their boundaries through zoning, but were not allowed to ban wells outright:

Except with respect to local ordinances adopted pursuant to the .

. .

Municipalities Planning Code ("MPC") and the . . .

Flood Plain Management Act, all local ordinances and enactments purporting to regulate oil and gas well operations regulated by the act are hereby superseded.

No ordinances or enactments adopted pursuant to the aforementioned acts shall 'contain provisions which impose conditions, requirements or limitations on the same features of oil and gas well operations regulated by 154.

Id.

at 14.

155.

Pennsylvania has been called the "Saudi Arabia of Natural Gas." Elizabeth McGowan, Fracking's Environmental Footprint to Transform Pennsylvania Landscape, REUTERS (Apr. 25, 2011, 3:30 AM), http://www.reuters.com/article/2011/04/25/idUS308837987220110425.

156.

See 58 PA. CONS. STAT. ANN. § 3303 (West Supp. 2013).

157.

Robinson Twp. v.

Commonwealth, 52 A.3d 463, 484-85 (Pa.

Commw.

Ct. 2012).

1021 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance this act or that accomphsh the same purposes as set forth in this act. The Commonwealth, by this enactment, hereby preempts and supersedes the regulation of oii and gas wells as herein defined.'^ The Pennsylvania courts examined the preemptive scope of this language in two cases decided on the same day in 2009, Huntley & Huntley, Inc. v.

Borough of Oakraont^^^ and Range Resources- Appalachia, LLC v.

Salem Twp.^^ In Huntley,^^* a drilling company, Huntley & Huntley, sought review of a city council decision denying a conditional use permit to allow drilling in a single-family residential zone.'*'^ The Commonwealth Court held that the locational restrictions imposed by the Borough of Oakmont upon Huntley were on the same topic as addressed in the Oil and Gas Act, and were, therefore, preempted."'^ Upon appeal, the Pennsylvania Supreme Court sought to determine whether the state legislature intended to leave localities any latitude to regulate oil and gas wells.'^ It reversed the lower court by determining that local zoning regulated a different aspect of drilling than the Oil and Gas Act: its location rather than the technical aspects of drilling.'"^ The Supreme Court found that the particular language of the Act preempts only ordinances that "impose conditions, requirements, or limitations on the same features of oil and gas well operations," or that "accomplish the same purposes.'"*"^ The court accepted the appellants' contention that the "very essence of zoning is the designation of areas where different uses are permitted, subject to the appropriate level of municipal review," and 158.

58 PA.

CONS.

STAT.

ANN.

§ 601.602 (West 1996) (repealed 2012).

159.

Huntley, Inc.

Borough of Oakmont, 964 A.2d 855 (Pa. 2009).

160.

Range Resources-Appalachia, LLC v.

Salem Twp., 964 Á.2d 869 (Pa.

2009).

161.

Huntley, 964 A.2d at 855.

162.

Id.

at 858.

163.

Jd.

at 859.

164.

Id. at 863 ("[O]ur interpretive task is to examine the particular wording of this provision, together with any other relevant aspect of the statute, in order to determine whether the Legislature intended to leave room for localities to designate certain zoning districts (such as residential ones) where oil and gcis wells may be prohibited as a general matter.").

165.

Id. at 864 ("[We] conclude that, absent further legislative guidance, Section 6O2's reference to 'features of oil and gas well operations regulated by this act' pertains to technical aspects of well functioning and matters ancillary thereto (such as registration, bonding, and well site restoration), rather than the well's location." (quoting 58 PA.

CONS.

STAT.

ANN.

§ 601.602 (1996))).

166.

Id. at 863 (quoting 58 PA.

CONS.

STAT.

ANN.

§ 601.602 (1996)).

1022 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance that the legislature explicitly sought to preserve local zoning power by distinguishing the "technical features of oil and gas operations.'""^ The court in Huntley found that the state's interest primarily centered on the efficient extraction and utihzation of the state's increasingly valuable natural resource.'"* In contrast, it noted that the borough's core interests emanate from police power objectives designed to protect public safety and welfare: "preserving the character of residential neighborhoods, and encouraging 'beneficial and compatible land uses."""'' In finding that these interests did not overlap, the court adopted a holding from the Colorado high court:

While the governmental interests involved in oil and gas development and in land-use control at times may overlap, the core interests in the legitimate governmental functions are quite distinct.

The state's interest in oil and gas development is centered primarily on the efficient production and utilization of the natural resources in the state.

A county's interest in land- use control, in contrast, is one of orderly development and use of land in a manner consistent with local demographic and .

environmental concerns. Given the rather distinct nature of these interests, we reasonably may expect that any legislative intent to prohibit a county from exercising its land-use authority over those areas of the county in which oil development or operations are taking place or are contemplated would be clearly and unequivocally stated. We, however, find no such clear and unequivocal statement of legislative intent in the Oil and Gas Conservation Act.'™ Thus, while the court acknowledges the presence of some overlap in purposes, the salient objectives of the local and state governments, it found, do not confiict."'' In Range Resources, decided on the same day as Huntley, the court invalidated a local law that regulated the operations of drilling rather than its location, holding that this aspect of hydrofracking regulation was preempted by the Oil and Gas Act."^^ The court identified numerous examples of "substantive[] overlap" within the ordinance in question, such as:

167.

Id.

at 860.

168.

Id. at 864-65 (quoting 58 PA.

CONS. STAT.

ANN.

§ 601.102 (1996)).

169.

Id.

at 865.

170.

Id.

(quoting Bd.

of Cnty. Comm'rs v. Bowen/Edwards Assocs., Inc., 830 P.2d 1045, 1057 (Colo. 1992)).

171.

Id.

at 866.

172.

Range Res. Appalachia, LLC v.

Salem Twp., 964 A.2d 869, 877 (Pa.

2009).

1023 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 •• ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Fower, and Cooperative Covemance permitting procedures specifically for oil and gas wells, . . .

bonding requirements before drilling can begin, . . .

regulat[ion of| well heads, including the capping of the same once they are no longer in use, . . .

regulat[ion of| site restoration after drilling operations cease, . . . [and] the requirement of restoring nearby streets to their pre-drilling conditions regardless of whether the wear and tear on such roadways was caused by vehicles associated with drilling Indeed, the court concluded that many of the restrictions imposed by the ordinance were "even more stringent than the corresponding provisions of the Act.'"^'' Thus, the court found that the ordinance in question was "qualitatively different" from the corresponding ordinance in Huntley, which "sought only to control the location of wells consistent with established zoning principles.'"^^ Since the ordinance not only sought to regulate the same features as the Oil and Gas Act, but also created regulatory obstacles to effective implementation of the Act, the court held that the doctrine of "conflict preemption" apphed.'^'' The ordinance "reflect[ed] an attempt by the Township to enact a comprehensive regulatory scheme relative to oil and gas development within the municipality" and, as such, was preempted by the Oil and Gas Act.'^ Following the Huntley and Range Resources decisions, the Pennsylvania legislature replaced the Oil and Gas Act with Act 13, containing a revised statutory framework for oil and gas regulation.'^^ The Act explicitly preempted local zoning from regulating hydrofracking, except with respect to setback requirements in limited aieas.'^'' The Act states:

Notwithstanding any other law to the contrary, environmental acts are of Statewide concern and, to the extent that they regulate oil and gas operations, occupy the entire field of regulation, to the exclusion of all local ordinances.

The Gommonwealth by this section, preempts and supersedes the 173.

Id.

at 875-76.

174.

Id.

at 875.

175.

Id.

at 876.

176.

Id.

at 877 (citing Nutter v. Dougherty, 938 A.2d 401, 404 (Pa. 2007)).

177.

Id.

at 875.

178.

58 PA.

CONS.

STAT.

ANN.

§§ 2301-3504 (West Supp. 2013).

179.

Id.

§ 3303.

1024 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Govemance local regulation of oil and gas operations regulated by the environmental acts, as provided in this chapter.'*" While Act 13 ostensibly preserves the municipality's right to enact local zoning ordinances, it prohibits local zoning ordinances from conflicting with chapter 32, which regulates oil and gas operations.'^' Among other restrictions imposed upon municipalities, the Act requires localities to amend zoning to include oil and gas operations in all zoning districts.'*^ This conformity requirement creates an obvious and fundamental conflict with the Municipal Planning Code (MPC). The MPC requires municipalities to adopt comprehensive plans and to create zoning districts in accordance with comprehensive plans.'^ Under Act 13, a municipality seeking to shield a residential area, for example, from potentially dangerous hydrofracking operations in the interest of public health and welfare would not be able to do so.

A collection of seven municipalities, private citizens, and environmental groups challenged the constitutionality of Act 13 in Robinson Township.'^ The municipalities brought a substantive due process claim, contending that Act 13 prevented them from creating zoning ordinances with a rational connection to their comprehensive plans, as required by the MPC, thus preventing them from fulfilling their constitutional duty to "protect the health, safety and welfare of their citizens.'"^* The court explained that the zoning power was but "an extension of the concept of public nuisance which protects owners from activities that interfere with use and enjoyment of their property,'"*^ citing the seminal Village of Euclid v. Ambler Realty case for the idea that "[l]and use restrictions aim to prevent problems caused by the 'pig in the parlor instead of the barnyard.""*'' Essentially, the Act required municipalities to create zoning incompatible with their comprehensive plans; if mining and gas operations were to be included 180.

Id.

181.

Id.

182.

Id.

183.

Robinson Twp. v. Commonwealth, 52 A.3d 463, 482 (Pa. Commw. Ct.

2012) ("The MPC requires that every municipality adopt a comprehensive plan which, among other things, includes a land use plan on how various areas of the community are to be used.").

184.

Id. at 468 n.3.

185.

Id. at 469.

186.

Id. at 481.

187.

Id. at 481 (quoting Vill. of Euclid v. Ambler Realty Co., 272 U.S. 365, 388 (1926)).

1025 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Gooperative Governance in all zones, as the Act required, zoning ordinances would inherently not comport with tlieir comprehensive plans.'^ Thus, the court found, the state's interest in regulating hydrofracking processes sits in direct conflict with local zoning interests. When such substantive due process conflicts appear, the court held, the judiciary "must accord substantial deference to the preservation of rights of property owners. "'^^ The court stated that by requiring municipalities to violate their comprehensive plans for gi'owth and development, [Act 13] violates substantive due process because it does not protect the interests of neighboring property owners from harm, alters the character of neighborhoods and makes irrational classifications—irrational because it requires municipalities to allow all zones, drilling operations and impoundments, gas compressor stations, storage and use of explosives in all zoning districts, and applies industrial criteria to restrictions on height of structures, screening and fencing, lighting and noise.""* Following the Robinson decision, and pending the decision of the Pennsylvania Supreme Court on appeal,''-" hydrofracking regulation in Pennsylvania has reverted to the doctrine established in Himtley and Range Resources. The courts in Pennsylvania, working with different but seemingly preemptive state oil and gas statutes, came to roughly the same result as the courts in New York. In both states, the judges have found ways to harmonize the power of local governments to adopt local land use restrictions on hydrofracking to promote local interests with the power of the state to standardize the regulation of the gas drilling industry.

IV. WEST VIRGINIA AND OHIO; HYDROFRACKING LAW IN LIMBO A.

West Virginia Gas Regulation and Local Land Use Gontrol In West Virginia, the power to adopt land use plans and zoning is delegated to counties and incorporated municipalities. Most densely 188.

Id. at 480-81 ("[T]he municipalities contend that Act 13 ... forces municipalities to enact zoning ordinances . . . allowing, among other things, mining and gas operations in all zoning districts which are incompatible with the municipalities' comprehensive plans that denominates different zoning districts, making zoning irrational.").

189.

Id. at 482 {quoting In re Appeal of Realen Valley Forge Greenes Assocs., 838 A.2d 718, 728 (Pa. 2003)).

190.

Id. at 484.

191.

Pennslyania appealed the Gommonwealth Gourt's ruling striking down portions Act 13. The Pennsylvania Supreme Court heard oral argument on October 17, 2012. Robinson Twp. v. Gommonwealth, No. 63 MAP 2012 (Pa. 2013).

1026 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance settled incorporated municipalities, such as the City of Morgantown, have adopted land use plans and zoning, and some have used it to prevent or limit hydrofracking. Morgantown, in fact, exercised its extraterritorial jurisdiction under state law and banned hydrofracking within a mile of its borders.'^^ In 2011, a lower state court in West Virginia invalidated this local antifracking law, holding that the state had completely preempted the field with respect to oil and gas law.'^' The court noted that "[tjhese regulations do not provide any exception or latitude to permit the City of Morgantown to impose a complete ban on fracking or to regulate oil and gas development and production.'"^" Does this lower court opinion leave open the prospect of local regulation that allows but limits gas drilling, particularly in light of the fact that state gas regulation standards do not consider many of the local impacts traditionally governed by zoning? In 2012, the Morgantown City Council tested this notion by amending its zoning law to prohibit gas drilhng within certain distances of schools, houses of worship, hospitals, and residential neighborhoods.'^^ This latest amendment raises interesting questions about the exercise of state and local power in West Virginia.

Regarding environmental protection generally. West Virginia statutes indicate that "[t]he state has the primary responsibility for protecting the environment; other governmental entities, public and private organizations and our citizens have the primary responsibility of supporting the state in its role as protector of the environment.'"''' Statutes provide that the job of the State Department of Environmental Protection is to "consolidate environmental regulatory programs in a single state agency," while also providing a "comprehensive program for the conservation, protection, exploration, development, enjoyment and use of the natural resources of the State of West Virginia.'""'' Case law establishes that "where an ordinance is 192.

Ne. Nat. Energy, LLC v. City of Morgantown, No.

ll-C-411, 2011 WL 3584376, at *1 (W. Va. Cir. Ct. Aug. 12, 2011).

193.

Ne. Nat. Energy, 2011 WL 3584376, at *9 ("[T]he State's interest in oil and gas development and production throughout the State as set forth in the W. VA.

CODE § 22-6 et seq. (1994), provides for the exclusive control of this area of law to be within the hands of the WVDEP.").

194.

Id.

195.

Morgantown Will Try to Zone Out Most Gas Drilling, SHALEREPORTER (June 4, 2012, 12:15 AM), http://www.shalereporter.com/government/ article_7dd089a4-adc0-llel-8543-0019bb30f31a.html.

196.

VA. CODE ANN.

§ 22-l-l(a)(2) (LexisNexis 2009).

197.

Id. § 22-l-l(b)(2)-(3).

1027 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance in conflict with a state law the former is invahd.'"^^ The principle is so fundamental that "citation of authorities is unnecessary.'"^'* State statutes delegate responsibility for regulating oil and gas to the Depai-tment of Environmental Protection {DEP).^»" The DEP's Office of Oil and Gas (OOG) is "responsible for monitoring and regulating all actions related to the exploration, drilling, storage and production of oil and natiual gas."^*" OOG inspectors are authorized to issue orders demanding that wells cease operations if there is a violation or potential violation and imminent danger to himians or freshwater sources.^"^ Class II well operators are required to permanently dispose of wastewater,*'^™.most of which is handled through underground injection regTilated under the state's UIC program.^"'' This less than comprehensive regulatory scheme generated criticism of the state's response to hydrofracking, leading the governor to supplement legislative standards with executive requirements.

Under Executive Order 4-11, Governor Earl Ray Tomblin instructed the DEP to issue emergency rules requiring certain gas wells to be accompanied by an erosion and sediment control plan as well as a site construction plan, both of which are to be approved by a registered professional engineer.^**^ The order also required a site-specific well safety plan and set minimum standards for well construction.^"'' It further required that an applicant for a well permit submit a water management plan if the well uses more than 210,000 gallons of water monthly.^"^ Information required to be submitted with this plan includes the type of water source, the anticipated withdrawal volume, the anticipated months during which withdrawal would occur, the planned management for the processing or disposal of wastewater, and 198.

Vector Co. v. Bd. of Zoning Appeals, 184 S.E.2d 301, 304 (W. Va.

1971).

199.

Id.

200. W. VA.

CODE ANN.

§ 22-6-2(a).

201. W. VA.

DBP'T OF ENVTL. PROTECTION, OFFICE OF OIL AND GAS, http://www.dep.wv.gov/oil-and-gas/Pages/defauIt.aspx (last visited Apr.

3, 2013).

202. W. VA.

CODE§ 22-6-3(a).

203.

Press Release, W. Va.

Dep't of Envtl. Protection, industry Guidance, Gas Well Drilling/Completion, Large Water Volume Fracture Treatments, at 1, 4 (Jan. 8, 2010).

204.

Pam Kasey, Pa.

W. Va.

A ddress Salt Problems Differently, Sl\ J.

(Charleston, W. Va.), Jan. 8, 2010, available at http://www.uppernion.org/ news/charleston/SJ-SaIt_l^gulation-8Janl0.html.

205.

W. Va.

Exec. Order No. 4-11, H 4(a) (July 12, 2011).

206.

id.

H 4(d).

207.

Id.

H 4(c).

1028 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4-2013 Hydrofracking: State Preemption, Local Power, and Gooperative Governance the anticipated additives in the hydrofracking fluid.^"^ Operators are also required to record the quantity and method of management of flowback water.^"^ Finally, operators must provide public notice for any well to be located within the boundaries of a municipality. The notice is to include the well's location, the expected date that the drilling will begin, and the operator's contact information.^'" The West Virginia legislature's response to criticism of the regulatory system was to adopt the Marcellus Shale Hydrofracking Rules Bill in 2012, which significantly increased permit fees and required gas wells to be set back at least 250 feet from a water well, 300 feet from a natural trout stream, 625 feet from occupied houses, and 1,000 feet from a public water supply intake.^" Well operators under this Bill must also maintain at least 100 feet between wells and other water sources.^'^ The DEP was given the power to grant variances from these staridards under certain circumstances.^'^ In reviewing Morgantown's new.regulations on hydrofracking, or those of any other zçning municipality in West Virginia, the judiciary will be challenged to determine whether these enactments of the state legislature, as supplemented by the Governor's executive order, occupy the field and preempt local regulation. Prior case law recognized the different aspects of business that are subject to both state and local regulation.^''' There is a strong argument that the interests protected by West Virginia planning and zoning statutes extend far beyond the interests protected by existing hydrofracking regulation. This is evident in the language of the legislation adopted by the state legislature delegating planning and zoning authority to incorporated municipalities and counties.^"^ 208.

Id.

209.

Id. II 4(f)(iii)(l)(a).

210.

Id. 1 4(g).

211.

VA. CODE ANN.

§ 22-6A-12(a)-(b) (LexisNexis Supp. 2012).

212.

Id.

213.

Id. ("(T]he well operator may be granted a variance by the secretary from these distance restrictions upon submission of a plan which identifies the sufficient measures, facilities or practices to be employed during well site construction, drilling and operations.").

214.

See Longwell v. Hodge, 297 S.E.2d 820, 825 (W. Va. 1982) (upholding regulation of the location of a beer-selling restaurant under zoning, despite the fact that the establishment was regulated by state law; the purposes of the two regulatory regimes were different and no conflict was found).

215.

W. VA.

CODE ANN. § 8A-3-7 (LexisNexis 2012) (setting forth comprehensive requirements for the submission of a comprehensive plan by the planning commission).

1029 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking:

State Preemption, Local Power, and Gooperative Govemance These state statutes provide that the purpose of a comprehensive plan is to guide the local legislatiu'e so that it can accomplish the coordinated and compatible development of land and impi'ovements within its jurisdiction.^'*^ The comprehensive plan is deñned as a process through which citizen participation and thorough analysis are used to develop a set of strategies that establish as clearly and practically as possible the best and most appropriate future development of the area under the jurisdiction of the planning commission. A comprehensive plan aids the planning com misai on in designing and recommending to the governing body ordinances that result in preserving and enhancing the unique quality of life and culture in that community and in adapting to future changes of use of an economic, physical or social Under the statute, additional purposes of the comprehensive plan are to (1) Set goals and objectives for land development . . .

(3) Coordinate all governing bodies, units of government and other planning commissions to ensure that all comprehensive plans and fxiture development are compatible; (4) Create conditions favorable to health, safety, mobility, transportation, prosperity, civic activities, recreational, educational, cultural opportunities and historic resources; . . .

(7) Promote a sense of community, character, and identity; [and] (8) Promote the efficient utilization of natural resources, rural land, a,gricultural land and scenic areas . . . .'""^ Zoning ordinances under these West Virginia statutes are to be adopted to promote the public welfare, health, safety, comfort, and morals of the community, preserve historic landmarks and buildings, preserve agricultural land, and promote the orderly development of the land.^"' These provisions allow local zoning to regulate the use of the land, prohibit specific land uses, protect and enhance the physical qualities of the community, divide the community into different zones 216.

Id. § 8A-3-l(a) ("The general purpose of a comprehensive plan is to guide a governing body to accomplish a coordinated and compatible development of land and improvements within its territorial jurisdiction, in accordance with present and future needs and resources.").

217.

Id. § 8A-3-l(b).

218.

Id. § 8A-3-l(d).

219.

Id. § 8A-3-2(b).

1030 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance for regulating the use of the land, create overlay districts and special design districts within which specific additional development standards will apply, regulate, the height, axea, bulk, use, and architectural features of buildings, preserve green spaces, and require new green spaces, landscaping, screening, and the preservation of adequate natural light.

It is a fair question to ask whether the same legislature that adopted this detailed and broad legislative regime to provide for the appropriate use of the land at the local level intended to fully preempt its exercise by the adoption of the oil and gas laws, which focus on a much more limited set of impacts. Since the only case law in West Virginia to date involves a complete ban on hydrofracking and is a lower court opinion, it is possible that a full review of both legislative schemes by a higher court will reveal a path for harmonizing them both, as the courts did in New York and Pennsylvania. This possibility is furthered by the legislature's reversal of the former rule of strict construction of local land use laws.^^" B.

Ohio In Ohio, the issue of state preemption of local land use control of gas drilling was squarely addressed in Newbury Township Board of Trustees v. Lomak Petroleum, Inc.''''' Under the authority granted to it to plan and regulate development, the township amended its zoning ordinance to prohibit drilling in all residential areas.^^^ In doing so, it relied on a long tradition of local zoning in the state.^^^ In 1925, the Ohio Supreme Court upheld the constitutionality of municipal zoning, finding that local zoning helps to maintain the welfare of the community.^^'' The power to plan, zone, and regulate land use is 220.

See id.

% 8-1-7 (instructing courts to review local land use authority fairly broadly). The section declares that the "enumeration of powers and authority granted in this chapter shall not operate to exclude the exercise of other powers and authority fairly incidental thereto or reasonably implied and within the purposes of this chapter . . . [and t]he provisions of this chapter shall be given full effect without regard to the common-law rule of strict construction." Id.

221.

Newbury Twp. Bd. of Trustees v. Lomak Petrol., Inc., 583 N.E.2d 302 (Ohio 1992).

222.

Id. at 306 (holding that a township may prohibit drilling in residential areas for legitimate health and safety concerns).

223.

Id. (noting that the township zoning resolution in this ca^e did not adopt health and safety standards, which conflicted with state law that prevented prohibition of drilling in appropriate areas, unless for health or safety reasons).

224.

Pritz V. Messer, 149 N.E. 30, 35 (Ohio 1925). This case preceded Village of Euclid V.

Ambler Realty Go., 272 U.S. 365 (1926), which affirmed the constitutionality of local zoning, and particularly its separation of land 1031 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance vested in the state's Ceneral Assembly pursuant to the Ohio Constitution.^^'' Throngh its home-rule provisions and enabling statutes, the Ohio legislature and courts have given significant police power and planning authority to regulate land use to the local legislatures of counties, townships, and municipalities.^^*^ The Obio Oil and Gas Act, chapter 1509, however, expressly prohibits certain local land use restrictions, while allowing localities to adopt zoning restrictions that are designed to protect the public from the health and safety risks of drilling.^" The Newbury court noted that the Ceneral Assembly had no desire to totally strip local governments ... of the power to regulate activities within their borders. [Ohio Revised Code] Chapter 1509 attempts to strike a balance between those aspects of oil and gas well exploration and drilling which are reserved for state regulation and those areas which local governments . . .

may permissibly Despite this recognition of local zoning power over hydrofracking, the court in Newbury invalidated the total restriction of drilling in all residential districts.'-^"'^'* It noted that the residential zoning districts in the township included significant amounts of agiicultural lands—areas where gas companies traditionally drill.^''" The court also noted that there were no agricultural zoning districts in the township, recognized tbat a significant amount of land in the residential districts was not developed residentially, and questioned whether the blanket restriction truly was motivated by public health and safety uses, drawing on nuisance law as an analogy, and basing its holding in part on protecting public health and safety.

225.

OHIO CONST, art. II, § 1.

226.

See Vill.

of Hudson v.

Albrecht, Inc., 458 N.E.2d 852, 855 (Ohio 1984) (noting "that the right of the individual to use and enjoy his private property is not unbridled but is subject to the legitimate exercise of the loca! police power"); see aho Euclid, 272 U.S. 365; Morris v.

Roseman, 118 N.E.2d 429, 431 (Ohio Ct.

App. 1954) ("The enacting of a zoning ordinance is clearly an exercise of the police power of a municipality in protecting the public morals, safety, health and general welfare of the people.").

227.

OHIO REV.

CODE ANN.

§ 1509.39 (West 1996).

228.

Newbury Twp. Bd.

of Trustees v.

Lomak Petroleum, Inc., 583 N.E.2d 302, 304 (Ohio 1992). "(Ohio Revised Code) 1509.39 preempts fche power of a township to prohibit oil or gas well drilling in areas which are traditionally appropriate for such activity, unless health and safety standards are being adopted by the township zoning resolution." M at 306.

229.

Id.

at 306.

230.

Id.

at 305.

1032 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance concerns.^^' The effect of banning hydrofracking in residential zones in a town with only three zoning districts—residential, commercial, and industrial—was to confine the practice to a small portion of the community.^^^ On the strength of this logic, the court invalidated the restriction.^'^ The court remanded for further consideration of the issue of whether provisions of the local law that prohibited drilling within 300 feet of an inhabited structure protected public health and safety.

Objecting to the remand, a concurring justice noted that "the majority imposes an even higher level of scrutiny to determine whether this regulation passes statutory muster . . . .

[W]e need only determine whether it rationally promotes township health and safety, not whether it is narrowly tailored to address such concerns."^^'' This decision, de facto, prevents Newbury Township from preserving its agricultural lands for future residential use, since homes are not likely to be developed in and around a number of gas drilling facilities. Beyond that, the Newbury decision imposes a duty upon local legislatures, in adopting hydrofracking restrictions, to prove that they accomplish public health and safety objectives. This reverses the traditional deferential posture of the courts in reviewing decisions of legislatures, particularly with regard to zoning matters. From its inception, zoning determinations by local legislatures have been subjected to a rational basis test, which this decision reversed.^''^ The practical impact of Newbury is that local governments in Ohio must adduce some evidence or argument as to how hydrofracking regulations protect the public health and safety before they adopt them.^'^ How, for example, could the township have 231.

Id.

232.

Id.

233.

Id. at 306 ("Because Section 801.0 A of the Newbury Township Zoning Resolution is not an attempt to further health and safety goals, we find that Section 801.0 A conflicts with, and therefore is preempted by, state law.").

234.

Id.

at 309 (Wright, J., concurring in part and dissenting in part).

235.

See Vill.

of Euclid v.

Ambler Realty Co., 272 U.S. 365, 395 (1926) ("If these reasons, thus summarized, do not demonstrate the wisdom or sound policy in all respects of those [zoning] restrictions ... at least, the reasons are sufficiently cogent to preclude us from saying, as it must be said before the ordinance can be declared unconstitutional, that such provisions are clearly arbitrary and unreasonable, having no substantial relation to the public health, safety, morals, or general welfare.").

236.

This assertion, if correct, questions the vahdity of the October 1, 2012, adoption by the City Council of Yellow Springs of a Bill of Rights ordinance banning shale gas drilling and associated activities.

Bob Downing, Ohio's Yellow Springs Adopts Community Bill of Rights, AKRON BEACON J.

ONLINE (Oct. 3, 2012), http://www.ohio.com/blogs/ drilling/ohio-utica-shale-1.291290/ohio-s-yellow-springs-adopts-community- 1033 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Loeal Power, and Cooperative Covemance proved that prohibiting hydrofracking in its extensive residential districts was motivated by such concerns? On the one hand, this may mean that local governments must identify, understand, and reiy on the public health and environmental risks that attend hydrofracking and import enough of that science to support their decisions.

Alternatively, localities may be able to demonstrate that their antifracking laws are motivated by public health and safety concerns by referring to existing case law in the state and the constitutional and statutory provisions that these cases reference.

Taking this latter approach, could Newbury demonstrate that preserving a large part of the township for current agxicultural and future residential use protects local health and safety? On point is Ketchel v. Bainsbridge Township,'^^'^ in which the Ohio Supreme Court found that a three-acre minimum lot size requirement in a residential zone was a valid requirement in order to protect underground aquifers from being depleted by the demands brought about through subdivision of denser, smaller lots.^^ Such a purpose is clearly tied to protecting local public health and safety. The court ruled that "a local zoning authority may consider the conservation of underground water resources when enacting zoning regulations."'"^''" The connection under Ohio law between protecting the public health, safety, and welfare and preserving natural resources is extraordinarily clear. The Ohio Constitution provides that conservatiori, preservation, and revitalization are legitimate "public purposes" and vests local governments with the authority to engage in the "conservation and preservation of natural and open areas" and to "control, prevent or minimize, clean up or remediate . . . water contamination or pollution."^'"' Among the strategies that biII-of-rights-1.338971.

Yellow Springs joins twelve other localities in Pennsylvania and New York in passing similar local legislation. Megan Bachman, Council Considers Drilling Ordinance—Ban Would Be First in Ohio, YELLOW SPRINGS NEWS (Aug. 9, 2012), http://ysnews.com/ news/2012/08/council-considers-drilling-ordinance%E2%80%94-ban-would^ be-first-in-ohio. How can such municipalities support a total ban based on public health and safety concerns? There may be responsible answers to this question, but supporting such ordinances is certainly a heavier lift than supporting, for example, set-back restrictions such as those adopted in Newbury.

237.

Ketchel v. Bainsbridge Twp., 557 N.E.2d 779 (Ohio 1990).

238:

Jd. at 785.

239.

Id. at 783.

240.

OHIO CONST, art. VIII, § 2o (authorizing local government entities to provide for the "conservation and preservation of natural and open areas and farmlands, including by making urban areas more desirable or suitable .for development and revitalisation; to control, prevent, minimize, clean up, or remediate certain contamination of or pollution from lands in the state and water contamination or pollution."); see also 1034 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Gooperative Govemance municipalities in Ohio can consider in the wake of the Newbury decision is to create conservation or environmental zones in lieu of residential holding zones. This is because zoning laws may be enacted for the protection of the environment or conservation of natural resources.^'" This has been held to be a legitimate exercise of the police powers granted to municipalities, counties, and townships to protect the local public health, safety, and welfare.^""^ In Cash v.

Cincinnati Board of Zoning Appeals,'^'^^ the Ohio Court of Appeals found that the purposes of a Cincinnati Environmental Quality- Hillside District advanced the public safety, health, and welfare.^''^ In Reed v.

Rootstown Twp.

Board of Zoning Appeals,'"'^ the Ohio Supreme Court sustained an application of an Open Space Conservation District, which established a five-acre minimum lot requirement for a swampy area in order to protect the ecological balances and conserve natural resources.^"'' The Ohio Supreme Court had held that such conservation districts were a reasonable and legitimate use of police power by the OHIO CONST, art. II, § 36 ("Laws may be passed to encourage foresti:y and agriculture . . . and to authorize the acquiring of other lands for that purpose . . .

[and] to provide for the conservation of the natural resources of the state, including streams, lakes, submerged and swamp lands and the development and regulation of water power and the formation of drainage and conservation districts; and to provide for the regulation of methods of mining, weighing, measuring and marketing coal, oil, gas and all other minerals."). This constitutional provision gives local governments great leeway in protecting and promoting the conservation of natural resources through the use of land use regulations and devices.

241.

See Ketchel, 557 N.E.2d at 783 (noting that resources such as groundwater must be conserved and protected).

242.

See Reed v.

Rootstown Twp.

Bd. of Zoning Appeals, 458 N.E.2d 840, 842 (Ohio 1984) (holding that the requirements and purposes of a township zoning resolution were "reasonable and legitimate exercise[s] of police power").

243.

Cash v.

Cincinnati Bd. of Zoning Appeals, 690 N.E.2d 593 (Ohio Ct.

App.

1996).

244.

Id. at 597. The purposes of the Cincinnati Environmental Quality- Hillside District are "to assist the development of land and structures to be compatible with the environment and to protect the quality of the urban environment in those locations where the characteristics of the environment are of significant public value and are vulnerable to damage by development permitted under conventional zoning and building regulations." Id.

at 595.

245.

Reed, 458 N.E.2d 840.

246.

Id.

at 842.

247.

Id.

at 840.

1035 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Gooperative Governance These innovative zoning techniques exhibit the strength of the power delegated to local governments and suggest a path toward demonstrating that public health and safety concerns motivate zoning provisions that limit hydrofracking. Such a strategy is bolstered by the general understanding of local power under Ohio law. The Home Rule Amendment to the Ohio Constitution, for example, states that "[m]nnicipalities shall have authority to exercise all powers of local self-government and to adopt and enforce within their limits such local police, sanitary and other similar regulations, as are not in conflict with general V.

COOPERATIVE GOVERNANCE:

STATE-LOCAL COLLABORATION There is tension in the four Mai'cellus Shale states regarding regulatory control of gas drilling. Debates take on an "either-or" character, with advocates arguing to elbow out the level of government they think least likely to meet their interests.''''"' Now that the power of New York towns to ban hydrofracking has been upheld on appeal, those who oppose hydrofracking may fan the flames of local resistance, encouraging others to follow suit. If they are successful in this, the industry and those who will benefit from its relatively cheap energy will lobby for Act 13-type solutions in the form of new state legislation clearly preempting local regulation.

Rather than ask which level of government should win the battle for control of gas drilling, it is far preferable to ask how both state and local officials and stakeholders can be involved.^"'"" As this Article demonstrates, zoning is an important tool in the municipal governance toolkit and should not be sacrificed for the sake of 248.

OHIO CONST, art.

XVIII, § 3.

249.

This discussion presupposes that the federal government will remain gridlocked legislatively and that Congress will permit only modest interventions by the EPA, beyond those mentioned in Part I. Both state and local governments would benefit from more aggressive federal action, including funding much-needed scientific research regarding the public health and environmental impacts of hydrofracking and fully integrating the gas drilling industry into khe coverage of federal clean air and water protections.

250. See INST.

OF MED. OF THE NAT'L ACADS., ENVIRONMENTAL DECISIONS IN THE FACE OF UNCERTAINTY 139 (2013) ("Agency decision-making processes that involve stakeholders, including dialogues with stakeholders about uncertainties, can demonstrate intentional transparency and create, maintain, and enhance a relationship of trust between the agency and stakeholders .... Early and continuous involvement of stakeholders can also prevent delays that can occur when stakeholders are not engaged in decision making until later in the process, at which time they might take legal actions.") "Stakeholders" is defined in this document to include communities. Id. at 139 n.8.

1036 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4-2013 Hydrofracking: State Preemption, Local Power, and Cooperative Covemance streamlining the gas drilling permitting process. Zoning out hydrofracking, on the other hand, may frustrate important state interests, particularly if it becomes widespread. Gas reserves transcend local boundaries and states have a legitimate interest in promoting an adequate supply of energy sources of their choice. These tensions cannot be resolved in winner-take-all litigation or advocacy in legislative offices and chambers. They require a concerted effort to negotiate a process and create a framework for decision making that provides a role for both local and state agencies and their stakeholders.

The result of such a process might be an agreement by the state to promulgate model zoning ordinances, such as a gas exploration overlay zone,^^' and provide technical assistance to localities in how to adapt such ordinances to their local circumstances. It may be that communities adopt total bans in part because they do not have access to best practices such as these or the understanding of both the law and science necessary to employ them. State agencies that are investing time and money in creating their own regulatory regimes can cost effectively provide such technical assistance to localities as part of a cooperative state-local approach to controlling local impacts and promoting regional and statewide interests.

In New York, the DEC has proposed giving communities with an adopted comprehensive plan component on gas drilling a method of becoming involved in the permitting process.^^^ The proposal is to require an applicant for a gas drilling permit in a town with a hydrofracking component of its comprehensive plan to negotiate with local officials to conform the drilling to the plan, prior to the DEC's final decision on the permit.^^^ But how are localities with limited professional staff going to draft an accurate and reasonable comprehensive plan component on hydrofracking, with its multiple and complex impacts? Such a plan should discuss and assess all environmental and public health risks, as well as the adverse impacts on the particular community's character and environment. State agencies that are charged with regulating the oil and gas industries can be tasked with providing information to localities to help them draft well-informed and appropriate planning documents. This 251.

See Robert H. Frelich & Neil M. Popowitz, Oil and Gas Fracking: State and Federal Regulation Does Not Preempt Needed Local Government Regulation, 44 URB.

LAW.

533, 556-57 (2012) (discussing the oil and gas element of the Santa Fe County Sustainable Land Development Plan, which "can be used as a local government model for similar planning and regulation in cities and counties where oil and gas drilling and hydrological fracturing permits are requested, in coordination with and supplemental to permits issued under state oil and gas legislation.").

252.

REVISED DRAFT SGEIS, supra note 3, at 26-27.

253.

Id.

1037 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance information could also guide communities in identifying measures that can mitigate the adverse impacts of gas drilling.

One model for state-local cooperative governance is New York's law on siting major electric generating facilities, which preempts local control of utihty siting but accommodates the local interest in the permitting system it created.^^"^ This law reauthorized and revised article X of the Public Service Law, establishing an electric generation siting board to review and approve the siting of electric utility generators of twenty-five megawatts or greater.^^^ This board is empowered to override local land use laws that it believes are unreasonably burdensome,^^" but it includes two members who are residents of the affected community.^^^ Prior to the adoption of this law and following the expiration of a previous version of article X, locahties governed this land use and often opposed or significantly delayed the approval of generation plants vitally needed by the state's power gi'id. In establishing a state-controlled siting system, the legislature largely preempted local control but allowed for the input of the affected locality and local stakeholders.^^ In addition to requiring local residents to sit on the siting board, the revised article X requires applicants to set up a fund that will enable affected local governments, environmental groups, and the community at large to hire experts, lawyers, and other consultants to participate in the process of creating a scope of review for the proposed utility.^^^ Applicants ai'e encouraged to enter into agreements with these parties regarding the scope of review and a hearing examiner is appointed to resolve any disputes that arise over the scoping.^"" While it does not impose a collaborative decision-making process on affected agencies, governments, and private actors, this legislative approach sets the table and provides significant resources so that one can occur.

There are many more such techniques that could be agreed upon if states pursued the intentional policy of including and working with local governments in the regulation of hydrofi-acking, followed by serious negotiations to create a fi-arnework and practices for working .'"^*" Such a policy would avoid the uncertainty and vagaries of 254.

N.Y.

PUB.

SERV.

LAW §§ 160-173 (McKinney 2011 & Supp. 2013).

255.

Id. § 162.

256.

Id. § 168(3)(e).

257.

Id. § 160(4).

258.

Id. § 166(j), (k).

259.

Id. § 163(4)(a).

260.

Id. § 163(5).

261.

These rather modest suggestions build on a sophisticated strategy referred to as reflexive law regimes. Commentators in the field of reflexive law, which this Article refers to as cooperative government.

1038 CASE WESTERN RESERVE LAW REVIEW • VOLUME 63 • ISSUE 4 • 2013 Hydrofracking: State Preemption, Local Power, and Cooperative Governance preemption debates and litigation, respect the critical role of local governments in controlling land uses within their jurisdictions, offer them the technical assistance they need to determine where hydrofracking can occur and how to guard against its adverse impacts, and avoid simplistic solutions such as complete proscriptions that may be inimical to larger state interests.

suggest that positive or formal lawmaking, where higher orders of government create and impose standards on lower-order governments and constituents, is not up to the task of managing highly complex, multifaceted problems such as hydrofracking, with its many local, state, and federal benefits and potential adverse impacts. They offer procedural solutions: reflexive laws that prescribe or suggest decision- making processes that involve government agencies and private sector and civic stakeholders in developing and achieving performance-based solutions. Such laws encourage reciprocal reflection within and among governmental agencies, regulated entities, and involved stakeholders about their performance regarding complex issues like those raised by the challenge of governing hydrofracking.

For more on reflexive laws, see generally Tim Iglesias, Housing Impact Assessments: Opening New Doors for State Housing Regulations While Localism Persists, 82 OR.

REV.

433, 475 n.l48 (2003); Sanford E.

Gaines, Reflexive Law as a Legal Paradigm for Sustainable Development, 10 BUFF.

ENVTL.

L.J. 1 (2003); Eric W.

Orts, Reflexive Environmental Law, 89 Nw.

U. L.

REV.

1227 (1995); John G.

Dernbach, Navigating the U.S.

Transition to Sustainability: Matching National Governance Ghallenges with Appropriate Legal Tools, 44 TULSA L.

REV.

93 (2008); Glayton P.

Gillette, Allocating Government for Disaster Mitigation, in LOSING GROUND:

A NATION ON EDGE 251 (John R.

Nolon & Daniel B.

Rodriguez eds., 2007).

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