Robinson Twp. v. Commonwealth, 623 Pa. 564 (Pa 2013).

Robinson Twp. v. Commonwealth, 637 Pa. 239 (Pa. 2016)

Private corporations that do not sell gas directly to the public for compensation are not public utilities and, therefore, are not permitted to exercise the powers of eminent domain.
Case Details:

Act 13 of 2012 was a comprehensive rewrite of the Oil and Gas Act intended to address the increase in natural gas operations as a result of findings in the Marcellus Shale in northern and western Pennsylvania.  For one, Act 13 severely restricted local regulation of oil and gas activities by permitting wells, pipelines and impoundments in all zoning districts, utilizing setbacks instead of general prohibitions to limit activity in high-density areas, and it permitted compressor stations and processing plants in industrial and agricultural zones.  Moreover, it limited the ability of municipalities to consider the effects of oil and gas operations in a manner different than other land uses.  Act 13 also granted DEP near total authority over oil and gas operations near streams and wetlands.

Municipalities immediately challenged Act 13 arguing it violated certain provisions of the Pennsylvania Constitution that protected inherent rights, limited eminent domain, and preserved natural resources.   In addition, it was alleged Act 13 violated the separation of powers doctrine.  The Commonwealth Court refused many challenges to certain aspects of Act 13.  However, it held that Act 13’s land-use regime was in violation of substantive due process because it “allow[ed] incompatible uses in zoning districts,” failed to “protect the interests of neighboring property owners from harm, alter[ed] the character of the neighborhood and ma[de] irrational classifications.”  Moreover, the legislature unconstitutionally delegated powers to DEP when it authorized the agency to grant variances from the stream and wetland buffer requirements.

The Pennsylvania Supreme Court took the case on appeal and the majority invalidated the land-use regulations among other provisions of Act 13.  However, the Court could only offer a plurality opinion on the rationale because the majority was split 3-1.  Though limited precedent existed and even though plaintiffs spent sparse time on the issue, the plurality turned to the Environmental Rights Amendment of the Pennsylvania Constitution, Article I, Section 27.  Article I, Section 27 states that citizens are entitled to “a right to clean air, pure water and to the preservation of the natural, scenic, historic and esthetic values of the environment.”  If declares further that “Pennsylvania’s public natural resources are the common property of all the people, including generations yet to come,” and obligates the commonwealth “[a]s trustee of these resources” to “conserve and maintain them for the benefit of all the people.”  The Amendment, the Court determined created “an obligation on the government’s behalf to refrain from unduly infringing upon or violating the right, including by legislative enactment or executive action.”

The plurality opined that the state legislature “has no authority to remove a political subdivision’s implicitly necessary authority to carry into effect its constitutional duties,” and, therefore, because of the local nature of the issues, it is on local governments to “tailor” their regulations “to local conditions” that “cannot reasonably be assessed on the basis of a statewide average.”  As a final stamp, the plurality determined Article I, Section 27 was automatically effective and that it created in each citizen an immediate constitutional right.  In so ruling, the plurality found the land use provision and the state-wide buffer standards for streams and wetlands to be unconstitutional.

In 2012, the Pennsylvania General Assembly passed Act 13 (Act 13). Section 3241 of Act 13 gave corporations the right to appropriate an interest in real property in order to create subsurface storage reservoirs for natural gas and allowed them to take abutting areas around these reservoirs as a buffer zone for the stored natural gas. In 2016, Seven municipalities, two elected government officials, a physician, and a non-profit environmental group (Citizens) collectively appealed to the Commonwealth Court seeking declaratory judgment that Act 13 was unconstitutional and seeking a permanent injunction against its enforcement. The Commonwealth Court found Section 3241 of Act 13 was constitutional, but on appeal the Supreme Court found Section 3241 to be unconstitutional.

In coming to its decision, the Supreme Court stated the power of eminent domain is one that belongs to the Commonwealth and allows it to take private property for public use, so long as the landowner receives just compensation for the taking. The Commonwealth may delegate that power to other entities, but the power is restrained by the federal and state constitutions, and other statutes. Section 3241 allowed empowered corporations to transport, sell, or store natural or manufactured gas and to use the subsurface real property of another landowner in order to store natural or manufactured gas. The Commonwealth Court found this was a constitutional delegation of the power of eminent domain because these corporations are public utilities and the Commonwealth has long permitted public utilities to have the power of eminent domain. The Supreme Court disagreed with this contention, holding instead that these corporations do not meet the definition of a public utility. Public utilities are those that own or operate facilities that produce, generate, transmit, distribute, or furnish natural gas, to or for the public for compensation. The relevant corporations did not sell gas directly to the public for compensation and, therefore, can’t be public utilities. Section 3241, therefore, violated the Fifth Amendment to the United States Constitution, and Article 1, Section 10 of the Pennsylvania Constitution by allowing a private corporation to take private property from landowners without just compensation.

Date of Decision: 9/28/16

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