Bluegrass Beacon: Don’t let extremists, unnecessary laws stymie pipeline

Thursday, Nov. 7, 2013, 2:15 p.m. —  No one is a more ardent supporter of private-property rights than this columnist.

I once teamed up with former Bowling Green City Commissioner and Western Kentucky economics professor Brian Strow to debate former Bowling Green Mayor Elaine Walker and Kentucky League of Cities lawyer Bill Thielen on the government’s use of eminent domain before energetic students at Western Kentucky University.

I felt like the mayor had, at best, a nonchalant attitude toward private-property rights. Worse, she seemed willing to allow much-too-low threshold for the taking of private property – especially for potential uses by other private entities.

Yet while I strongly believe in opposing abuse of eminent domain, I’m not convinced that additional legislation is needed to keep it from being used by the consortium now purchasing easements for the Bluegrass Pipeline, a 1,100-mile pipeline that will carry natural gas liquids from the Marcellus and Utica shale-producing areas in Pennsylvania, West Virginia and Ohio through Kentucky to the Gulf Coast.

For sure, private companies should not be able to use eminent domain to acquire private property from individuals who either want to sell at a higher price, or are not interested in selling at all.

Kentucky’s General Assembly passed legislation in 2006 to clarify that point and protect landowners after the Supreme Court ruled that the city of New London, Conn., could employ eminent domain to take away the homes of seven families in order to benefit a large private development.

But some Kentucky lawmakers, who represent areas through which the pipeline will travel, worry that the changes made in 2006 will not keep a judge from wrongly allowing the use of eminent domain in cases involving the pipeline project.

The pipeline’s owners claim they can use eminent domain, if necessary, to gain easements from landowners they cannot convince or locate. Lawmakers, however, say because the pipeline delivers only natural gas liquids, which are used primarily for plastics and not energy to heat homes, it cannot be considered a public utility and thus cannot use eminent domain.

The issue would likely end up in court, which is why Rep. David Floyd, R-Bardstown, is filing legislation to “clarify legislative intent” concerning eminent domain.

“I think the current law is clear enough that they cannot employ eminent domain because it’s a private company and that it is not for public use, which is what we said in 2006,” Floyd said. “However, their attorneys say that they are eligible for using eminent domain. I just don’t know how the judge is going to decide. So this would definitively prohibit the use of eminent domain in this case, and that’s the reason for filing.”

I’m suspicious that we need another law on this matter, especially since Floyd told WHAS radio talk-show host Leland Conway that extreme environmental attorney Tom FitzGerald “actually drafted the idea” for his bill.

FitzGerald has become Kentucky’s chief cheerleader against the commonwealth’s coal industry and stands squarely in the way of policies like telecommunications reform, which is vital to the economic vitality of the Bluegrass State.

This policy dust-up may really be about protecting landowners.

But do we need an out-of-town environmental-extremist lawyer like FitzGerald dictating the future of a project that will provide as many as 1,500 construction jobs to 13 Kentucky counties during the next couple of years, $136 million in tax revenue to the commonwealth over the next decade and additional payments of up to $50 million to landowners to purchase easements?

Surely as much time as our legislators now spend in Frankfort, they can find more effective ways of protecting citizens from both the abuse of eminent domain but also from environmentally extreme, job-stopping agendas like the one offered by Fitzgerald.

Can’t they?

Jim Waters is president of the Bluegrass Institute, Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.

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