374 R.R. Comm’n of Tex. v. Tex. Citizens for a Safe Future & Clean Water

Richard F. Brown

 
The following is not a legal opinion. You should consult your attorney if the case may be of significance to you.
 
Railroad Commission of Texas v. Texas Citizens for a Safe Future, 336 S.W.3d 619 (Tex. 2011) held that a Texas Railroad Commission (“TRC”) determination that the term “public interest” does not include traffic safety considerations is reasonable and entitled to deference. Pioneer Exploration, Ltd. applied to the TRC for an injection well permit. In order to grant such a permit, the TRC must find that the well is in the “public interest”. Several Wise County residents objected to the proposed well on the grounds that the large trucks used to service the well could damage local roads and present public safety issues. The residents argued that these traffic safety issues made the well inconsistent with the public interest requirement and encouraged the TRC to reject Pioneer’s application. The TRC declined to consider traffic issues in its public safety analysis and approved the well. The residents challenged the approval, and the issue was whether the TRC’s determination was entitled to judicial deference.
 
The court noted that formal agency determinations are generally reviewed under a “serious consideration” analysis.  Under this standard, the court will defer to the agency when (1) the agency is interpreting ambiguous statutory language and (2) the resulting interpretation is reasonable. Applying this test, the court first concluded that the words public interest were inherently ambiguous. Next, the court considered whether the TRC’s determination was reasonable. The court considered several factors in this inquiry. First, the Injection Well Act was amended after its passage to require the Texas Commission for Environmental Quality to consider the impact on public roadways when granting permits for other types of wells. The inclusion of express statutory language requiring traffic considerations for some wells—and the exclusion of such language in the section governing the TRC’s permitting requirements— suggests that the language was intentionally omitted. Second, the court looked to the language preceding the public interest requirement and concluded that all the factors that the TRC is expressly required to consider relate specifically to the production of oil and gas. Evoking the principle of ejusdem generis, the court concluded that the meaning of public interest should be interpreted restrictively—consistent with the preceding language. Finally, the court interpreted the public interest requirement in light of the purpose of the Injection Well Act, namely to “maintain the quality of fresh water . . . .” According to the court, this suggests that the public interest requirement should be limited to considerations of natural resources and not any conceivable public interest concern. Therefore, the court held that the TRC’s determination was a reasonable interpretation of the statute. Because the term public interest is ambiguous and the TRC’s interpretation was reasonable, the court concluded that deference was appropriate and the TRC was not required to consider traffic safety issues in its public interest analysis.
 
The significance of the case is the limitation of the public interest inquiry in the permitting process for injection wells. The inquiry will be limited to matters pertaining to oil and gas production and the protection of natural resources.  The public interest inquiry will not extend  to  all  conceivable  issues  which  could  affect  the  public  interest,  and  the  TRC  is specifically not required to include an inquiry into traffic safety.