Speaker: Pipeline deal was 'Hail Mary pass'

2011-11-20T10:00:00Z 2011-11-20T15:47:16Z Speaker: Pipeline deal was 'Hail Mary pass'By KEVIN O'HANLON / Lincoln Journal Star JournalStar.com
November 20, 2011 10:00 am  • 

Holed up in his Capitol office on Nov. 7, state Sen. Mike Flood of Norfolk overheard a snippet of testimony from a legislative hearing that opened the way for a deal to get TransCanada to move the route for its proposed oil pipeline out of Nebraska's Sandhills.

Flood, the speaker of the Legislature, came to work that day flummoxed as to how to satisfy demands from citizens that the pipeline route be moved during the special legislative session called by Gov. Dave Heineman.

"I went to bed on Sunday night -- the night before -- totally at a loss," Flood told the Journal Star. "I had no idea what we were going to do." He was hoping an answer would emerge.

Nebraska, unlike several other states, has no law on the books giving it authority to regulate siting for oil pipelines, which must be approved by the federal government.

The $7 billion, 1,700-mile Keystone XL pipeline would run from the oil sands of Alberta to refineries along the U.S. Gulf Coast. It was met by fierce resistance from landowners and advocacy groups worried about the effects of an oil spill in Nebraska's environmentally fragile Sandhills region, where the water table of the massive Ogallala Aquifer is high.

On the other side were those arguing the Keystone XL would provide needed jobs and tax revenue and help reduce the nation's dependence on overseas oil.

There also were legal concerns that any siting law that would delay the project would violate the Interstate Commerce Clause of the U.S. Constitution, pre-empt federal authority to oversee safety issues for pipelines and be deemed special legislation targeting the Keystone XL.

There also was the widely held belief that if the pipeline were moved, TransCanada would be required to redo the eight-volume environmental impact statement for the entire pipeline route.

Then, on the TV in his office, Flood overheard part of the testimony to the Legislature's Natural Resources Committee by Sandra Zellmer, a professor of environmental and water law at the University of Nebraska Law College.

She said: "Under the federal law, and I practiced in this area for four years as a federal litigator, only a supplemental environmental impact statement would be required ... the findings of the initial projects, environmental impact statement, and quite possibly the findings from the first Keystone pipeline EIS, could be utilized and updated and made applicable and shed light on the new routing if that were to occur. This, too, simply enhances the effectiveness of state and federal partnerships along the lines of cooperative federalism."

Simply put, the entire environmental study would not have to be redone if the route were moved.

Flood perked up.

He headed to the committee hearing room, but Zellmer already had left.

In the hall outside, Flood ran into Tim Becker, chief of staff for U.S. Sen. Ben Nelson.

"I said 'What are the chances that I could get hooked up with someone in the State Department ... to find out if there's an answer to this question?' " Flood said.

The next day, Becker gave Flood a contact who told Flood to send a letter to the State Department with his plan.

Flood faxed the letter the next day.

Meanwhile, the angst over the special session and pressure on lawmakers was building.

Unless the State Department confirmed the entire environmental impact study did not have to be done, Flood's only idea was to have lawmakers pass a non-binding resolution. that resolution would tell the State Department that the Legislature opposed routing the pipeline through the Sandhills.

"I didn't feel like that would satisfy what people expected," Flood said.

The next day, Flood got a courtesy call from Kerri-Ann Jones of the State Department telling him that her office was going to order TransCanada to explore a route that wouldn't go through the Sandhills.

But there still was the possibility that TransCanada could have chosen the Sandhills route.

"I said 'Hey, while I've got you on the phone, I sent you guys a letter yesterday, and I'd really like to know if that's something you'd be willing to consider,'" Flood said.

Jones said the letter was being reviewed.

"I said 'I really need to know really fast,'" Flood said. "She said 'We'll do our best.'

"I sat in my office and rocked back and forth for about three hours," he said. "My entire idea was premised on a State Department response. Had I not had that, we had nothing."

Meanwhile, the tension was building for all involved.

Flood knew that if the State Department gave the OK, he would need a bill as a vehicle in which to insert his plan.

He and Sen. Chris Langemeier, chairman of the Natural Resources Committee, held meetings with committee members and other interested parties and later advanced a pipeline siting bill (LB4) by Langemeier to the floor for debate.

On Sunday evening, Flood met with TransCanada officials and told them of his plan.

"They said, 'Well, if you hear from the State Department, let us know."

On Monday, lawmakers arrived at the Capitol for first-round debate on LB4.

The mood was surly as debate began at 1:30 p.m.

Sen. Scott Lautenbaugh of Omaha, a proponent of the Keystone XL, filed 17 amendments to the bill as part of a planned filibuster.

What he and many others did not know was that -- 20 minutes earlier -- Flood had received a fax from the State Department's Jones with the answer Flood was praying for.

"I am confident that the department and Nebraska authorities would be able to efficiently work together in preparing any documents necessary to examine alternative routes in the state of Nebraska that satisfy federal laws and any state law Nebraska may adopt," Jones wrote.

Flood called TransCanada officials, who said they would be willing to move the pipeline out of the Sandhills.

Back on the floor of the Legislature, the tension was palpable.

Flood rose to announce he had brokered a deal whereby TransCanada agreed to voluntarily move the route out of the Sandhills.

He offered an amendment to LB4 to allow the state to pay $2 million for the required environmental impact study on the new part of the Keystone XL pipeline in Nebraska. He said the State Department and the state Department of Environmental Quality would work on the study and that Heineman would have to sign off on the new pipeline route.

The bill sailed through. It awaits final approval on Tuesday.

Langemeier said "there were a lot of moving parts" to the deal.

"A lot of people had to agree to do some things," he said. "It was a nail-biter to the wire."

Flood was more blunt.

"It was a Hail Mary pass," he said.

Where would the Legislature be if the State Department had not signed off on his plan?

"We'd be in a very dark place," Flood said. "Because I don't think there were ... votes to pass siting legislation to impact this project. But we'd have never got to that vote, because it would never have survived a filibuster."

Reach Kevin O'Hanlon at 402-473-2682 or kohanlon@journalstar.com. 



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