Yesterday, the Commonwealth Court of Pennsylvania issued an order declaring null and void sections of the new 2012 Oil and Gas Act ("Act 13"), which preempted local zoning ordinances that regulate oil and gas operations and required local governments and municipalities to amend their ordinances to allow for reasonable development of oil and gas resources.
In addition to municipalities, exploration and production companies, and pipeline companies, especially midstream and gathering line operators, should take close note of the Commonwealth Court of Pennsylvania's July 26, 2012 Order and Opinion in Robinson Township v. Commonwealth, No. 284 M.D. 2012, which nullified certain sections of Act 13 as unconstitutional. In a decision of enormous significance, the Court effectively gutted the zoning preemption provisions of Act 13, which sought to establish uniform siting standards for gas drilling activities and balance the interests of mineral rights owners and surface owners.
Zoning Provisions Held Unconstitutional
Citing "substantive due process" principles of the U.S. and Pennsylvania Constitutions, the Court found that requiring municipalities to adopt ordinances allowing gas drilling in all zoning districts could not be sustained. President Judge Dan Pellegrini wrote the opinion on behalf of the 4-3 majority of the en banc panel. The Court held that "by requiring municipalities to violate their comprehensive plans for growth and development, [section 3304 of Act 13] violates substantive due process because it does not protect the interests of neighborhoods and makes irrational classifications." It further held that any municipal action required by Act 13 would violate substantive due process "[b]ecause the changes required by [section 3304] do not serve the police power purpose of the local zoning ordinances, relating to consistent and compatible uses in the enumerated districts of a comprehensive zoning plan." In a less-significant aspect of the ruling, the Court also held that "Section 3215(b)(4) is unconstitutional because it gives [the Department of Environmental Protection] the power to make legislative policy judgments otherwise reserved for the General Assembly" by providing insufficient guidance as to when to grant a waiver to setback requirements for well sites. The Court rejected a variety of other challenges to Act 13.
The Court's decision appears to have raised municipal comprehensive plans and municipal zoning determinations above the authority of the General Assembly, by giving them constitutional standing. In doing so, the Court has pitted one set of constitutional principles against another, almost assuring review by the Pennsylvania Supreme Court. The Corbett administration is studying its appeal options, and several interested parties are also looking to challenge the ruling.
Strong Dissent Believed Act 13 Was Constitutional
Judges Brobson, Simpson and Covey joined in a dissenting opinion rejecting the notion that Act 13 deprived municipal government of its zoning authority, highlighting the limited nature of the preemption and detailed distinctions between various gas related uses and activities and finding them rationally related to the legislation's purposes. The dissent analyzed Act 13 as a type of zoning ordinance, enacted under the police power of the state. Citing prevailing due process case law principles, the dissenting judges found no basis for striking the law on constitutional grounds and would have held that the objector's failed to meet their legal burden.
Until an appeal is heard and decided, the preemptive zoning provisions are void. Our best guess at this point for a decision on any appeal is at least six months.