Commercially Unreasonable: The Blueprint for Killing Local Control

The Texas Legislature is on the attack. And their strategy is  clear. They are going to eviscerate local control by giving the oil and gas industry the power to define what counts as a “reasonable” rule. Municipal oil and gas regulations will be judged on the industry’s terms.

Of the dozen bills that target local control, HB 40 (and its companion SB 1165) has the most momentum. This is a dangerous piece of legislation that could potentially undermine not just the ban, but also other protections won by communities over the years.

HB 40 expressly preempts local control over oil and gas, effectively making the Railroad Commission the City Council of Texas.

More specifically, this bill changes the standard for determining the validity of municipal oil and gas regulations. Currently, local rules are judged foremost in terms of the impacted communities: do they provide reasonable protections for health and safety and mitigations against nuisances? HB 40 shifts the standard to the industry’s perspective. It will require local rules foremost to be “commercially reasonable.” In other words, the test shifts from “does this protect the community?” to “does this allow operators to fully and effectively exploit minerals?”BRI

Armed with this new standard, the industry will be able to challenge a wide range of local protections, claiming now that they are illegal because they are not “commercially reasonable.” Just what counts as “commercially reasonable” is unclear, but we can be sure they will use this legislation not just to counter the Denton fracking ban. They will also use it to attack what they are now calling “extreme setbacks.” Denton, Flower Mound, Dallas, Southlake, and several other cities will be vulnerable. Anything the industry doesn’t like is now fair game for being illegal, because ‘unreasonable.’

Please let the legislature know you support community vitality above industry profits. Tell them to get their priorities straight and vote no on HB 40.

Contact the House Energy Resources Committee. Contact our Representative Myra Crownover. Contact our Senator Craig Estes. Here is a form you can use to easily email key representatives. Here is the contact information for all of Senators – tell them to vote no on SB 1165 (companion to HB 40).