Pipeline regulation moves ahead on two fronts

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November 14, 2011 - 6:00pm

The Legislature moved forward on two fronts Tuesday in the battle over regulating oil pipelines. But how long it will take until Nebraskans know the fate of a revised Keystone XL proposal remains uncertain.

The first front in the battle is a proposal that would apply only to Keystone XL. It's an agreement worked out by legislative Speaker Mike Flood, under which TransCanada agrees to move the proposed pipeline out of the Sandhills. In exchange, the state will conduct an expedited environmental review of a new route to be proposed. That review is expected to take six to nine months.

In a hearing Tuesday afternoon, representatives of TransCanada, Sandhills residents and the Nebraska Chapter of the Sierra Club voiced their support for Flood's proposed amendment to LB4. Flood said the state should pay for the review, which the legislative fiscal office estimates will cost two million dollars. He said TransCanada had not asked the state to pay, adding "I'm telling you straight up, I think the taxpayers should pay for this, because this report belongs to us. And it will be objective, and it will belong to the people that live along that new proposed route."

The only person to testify against the Flood's proposal, Emily McKeone, mentioned the funding of the study among her objections. "It is not in Nebraska's best interest to use our tax dollars to speed up the federal government's process when the decision for a presidential permit has already been delayed until 2013," she said.

TransCanada officials have said they hope the federal decision could be speeded up by the expedited state review. But in a press briefing Tuesday, a State Department spokesperson repeated the first quarter of 2013 as the earliest date for a decision.

On another aspect of his proposal, Flood argued it still gives the governor the power to approve or disapprove a new route for Keystone XL. "Ultimately the people in this state have to convince one person - that being Gov. Dave Heineman at this current time - that this route's in the best interest of Nebraska or it's not. And he has to certify in writing," Flood said.

The bill requires the governor to indicate in writing if he or she approves any of the routes considered. The original version of the bill would have specified that that governor's decision was final, but subject to an appeal to the state Supreme Court.

In a news conference, Heineman said he would be comfortable making a decision to approve or disapprove a pipeline route. The governor, who left a meeting in Nashville early to hold a news conference in the Capitol on developments, said his decision to call a special session had been the catalyst for the deal to move the pipeline. "I think we were leaders in this process because we called a special session. It wouldn't have happened if we hadn't called the special Session," he said. "Secondly, I want to acknowledge the great work that Speaker Flood did. I really appreciate - and I think that's part of the legislative process. So I think everybody was doing their job allowing us to move forward," he added.

Heineman had resisted calling a special session for months, and Flood had said he didn't think the Legislature could enact siting legislation that would be constitutional, before the governor changed course and called the session late last month. The State Department then announced a lengthening of the federal review process, citing environmental concerns in Nebraska and the special session.

On the second front, dealing with the routing of future pipelines, the Legislature gave first round approval to a bill giving the Nebraska Public Service Commission siting authority. The bill lists various factors the PSC would have to take into account, including depletion of natural resources and intrusion into unusually sensitive groundwater areas.

Omaha Sen. John Nelson was among several senators who suggested the bill may go too far. "When I first read through the bill it just seemed to me like we're building a wall here that's going to make it almost impossible for any oil line to come through," Nelson said.

But Sen. Annette Dubas of Fullerton, the bill's sponsor, said that given Nebraska's reliance on agriculture, the protections it contains are necessary. "We need to be able to weigh that, if you're putting a pipeline in, is there that potential for any adverse impact that would impact that particular area of the state's ability to generate a positive economy?" Dubas said.

To try and balance those concerns, lawyers for TransCanada and those who want to regulate pipeline routes were to meet to try and agree on language before the next round of debate.

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