State law trumps local regulation of injection wells
Gearmar Properties Inc. leased the property at 1818 N. Main St. on the Weathersfield-Niles border to American Waste Management Services last year for the construction of two injection wells, which await a permit approval from the Ohio Department of Natural Resources amid contention from local officials. (Photo by Doug Livingston/TheNewsOutlet.org)
Published September 10, 2012 in The Vindicator(Link)
By Doug Livingston
When he leased his commercial property nearly a year ago, Dean Gearhart had no idea that it would cause such a fuss.
Gearhart co-owns Gearmar Properties Inc., which owns and manages about 140 acres of land along State Route 169 in northern Weathersfield Township. The property rests in a Joint Economic Development District (JEDD) between the City of Niles and Weathersfield Township.
But the Pennsylvania businessman and real estate developer has not been given much of a welcome by area officials who are opposing his business plan for part of the property.
It’s not proposed business that has local officials opposing Gearhart’s lease agreement; it’s the leveled area on the property where American Waste Management Services plans to drill two injection wells.
Niles council members on Aug. 22 passed a resolution to ban injection wells altogether. And Weathersfield trustees have lobbied the state to reject American Waste Management Services’ well applications.
But officials from both government organizations reluctantly admit that they do not have the power to stop injection wells. That power belongs to the Ohio Department of Natural Resources (ODNR).
Gearhart said he leased the property to American Waste Management late last year with the intent of receiving royalties for brine wastewater disposal.
American Waste Management Services of Warren applied to ODNR for the wells on Dec. 23, just one week before a 4.0 magnitude earthquake rippled the Youngstown area on New Year’s Eve, spurring regulators to issue a statewide ban on the injection wells.
“Along came the state, and that put an end to it,” Gearhart said.
The statewide ban, which thwarted the injection well application process, has since been lifted, and Gearhart heard nothing about the two proposed wells on his property until early August when American Waste Management told him that the wells were awaiting permit approval.
Since then, there has been a near-constant flurry of activity in Ohio politics surrounding injection wells that reflects the conflict between local Home Rule and the state’s broad power in regulating gas and oil exploration.
For instance, on Aug. 1, Cincinnati City Council passed a resolution banning injection wells within city limits. But even Cincinnati’s chief law officer isn’t sure that the resolution will hold up against state law.
House Bill 278, passed in 2004, gave ODNR “sole regulatory authority for permitting of the oil and gas industry here in Ohio,” ODNR Spokesperson Heidi Hetzel-Evans said. “As long as an operator meets all criteria under state law, we will move forward to operate under the law as it stands right now.”
That means issuing permits for injection wells, even in places like Cincinnati where local rules forbid them.
“At this point, we’ll deal with the issue if it arises,” John Curp, Cincinnati’s city solicitor, said of local resolutions holding up against state ordinances.
Curp doesn’t deny the state’s regulatory primacy on permitting wells.
“What we did was look at what other states have done as far as regulating fracking,” Curp said. “And what we decided we were going to do is take a broader approach and ban all deep well injection. And if someone wants to come to Cincinnati and do deep well injection, then we’ll have to scrutinize whether or not preemption (of state law) applies or not.”
But unlike Cincinnati, which has no injection wells and sits beyond the fringe of the Utica Shale gas reserve, Trumbull and Mahoning counties have nearly 20 injection wells combined, with another nine awaiting approval.
And unlike Cincinnati, which has 300,000 people, less populated rural townships in Trumbull and Mahoning counties face a more daunting task of defending local regulations like those drafted in Weathersfield and Niles, attorneys and local officials say.
In Ohio, some cities and villages are granted “home rule” powers by the state constitution. These powers supersede state laws and Ohio Revised Code. But not laws related to the gas and oil industry, says Matt DeTemple, an attorney and executive director of the Ohio Township Association.
“Even if a township has limited home rule, it would not have the authority … to preempt ODNR’s permitting authority on the oil and gas wells,” DeTemple said.
ODNR assumed that power in 2004, when then Republican Governor Bob Taft signed HB 278 — legislation that DeTemple says streamlined the permitting process for oil and gas companies.
“At the time, the (oil and gas) industry was saying they were running into too many different sets of requirements, and that the requirements would vary from locale to locale,” DeTemple said.
Should ODNR approve the two injection wells in Weathersfield Township, liquid waste from hydraulically fractured wells would travel to the site in tanker trucks and be injected up to 9,100 feet below the surface at a maximum rate of 92,400 gallons a day.
The fluids would mostly come from gas and oil operations in Ohio, Pennsylvania and other states. These fluids, referred to as oilfield waste, contain hazardous chemicals and high salinity levels.
And that’s what has local officials passing resolutions to oppose injection wells.
“The uncertainty of this waste water and potential problems it may cause are worrisome to us,” Steve Gerberry, chairman of the Weathersfield board of trustees, wrote in a letter to the Ohio Department of Natural Resources on Wednesday. “Our primary concern is for the safety of our residents in this area. A secondary concern is that having an injection well on this site may damage any progress Weathersfield Township has had with the City of Niles on this potential JEDD.”
Niles Councilman Edward Stredney expected two businesses to move into the Niles Commerce Park, but after the injection wells are drilled, he said the area might be less attractive for those businesses.
“By resolution, we cannot ban (injection wells) from being in the township,” Stredney said. “The local municipalities have no oversight in any of it.”
The Niles resolution was passed to support “Weathersfield’s objection to those brine injection wells,” Stredney added.
Gerberry agrees that local municipalities carry little clout forregulating the oil and gas industry.
“Our resolution just simply opposes the wells in our township,” Gerberry said. “It’s our stance … I don’t think that legally we could not permit them or not allow them. What ever ODNR says is gospel.”
And while municipalities host public discussions on injection well applications, ODNR has the last say in approving permits.
“Whatever’s better for the community, whatever they want to do, you know,” Gearhart surmises. “I didn’t think there would be any problems with putting an injection well there, but I guess if there’s going to be problems, then it doesn’t mean a heck of a lot to us to put an injection well on there or not.”
Gearhart won’t make a dime on royalties if the wells aren’t constructed, and he isn’t sure how much he’ll make even if they are. It’s calculated on each gallon injected, he figures.
But, as a realtor and businessman, he knows that he has signed a contractual agreement with American Waste Management Services, which did not return a phone call Friday.
“If the company wants to put it in there, whatever occurs, occurs. Can’t help it, can’t stop it, can’t do anything about it,” Gearhart said.
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