Environmental lawyer urges caution by landowners when dealing with legal matters, signing documents

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By Randy Patrick; Landmark News Service

Landowners and residents who attended a meeting Thursday night on the planned Bluegrass Pipeline shared what they had learned about the project from their neighbors and heard from a leading environmental lawyer about what they should do to safeguard their property rights and other interests.

The hour-and-a-half meeting at the Nelson County Public Library, facilitated by local farmer Kenneth Drake, dealt less with environmental concerns than with what landowners need to know in dealing with Williams and Boardwalk Partners, the two companies that want to build a 500-mile pipeline from the shale natural gas deposits of Pennsylvania and Ohio to an existing pipeline in Hardinsburg that would be “repurposed” to transport natural gas liquids.

The combined pipeline to the Gulf of Mexico would carry 200,000 barrels a day of products such as pentane and butane to petrochemical processing plants, and that number would eventually climb to 400,000 barrels if the pipe can handle the pressure.

Tom FitzGerald, an environmental attorney, instructor at the University of Louisville School of Law and executive director of the Kentucky Resources Council, gave a short talk on what landowners need to know in dealing with Williams and its partners.

His concern, he said, is that landowners make their decisions “with your eyes open.”

“For those of you who have given permission and have thought better of it, and do not want these people on your property doing the survey, you have the right to rescind that,” he said.

However, those who have signed a document rather than given verbal permission should consult a lawyer before trying to rescind permission, he added.

FitzGerald suggested that if landowners do give permission to do the survey, or to grant an easement, they negotiate conditions because their interests are not the same as the companies’.

“Every part of the relationship between you and the company in the contract is negotiable,” he said.

He said that if a landowner gives permission to do the survey, he should make sure there “isn’t a provision that also gives an easement. An easement is a durable right – usually given in perpetuity, and should be negotiated separately, he said.

Those giving permission to survey should make sure it’s done when they or their representatives are present, and that they get a follow-up from the surveyor and a copy of any reports.

Landowners giving easements should require that the companies insure the property for damages, that they have a clause stating they won’t be indemnified in the event of an accident, that they pay for any damages and that they require a performance bond.

They should be careful that the easements are only for what they want to allow, such as one 24-inch natural gas liquids pipeline, and there should be a clause allowing the landowner to terminate the agreement if the companies fail to uphold any part of it, he said.

Julia Hood said her husband gave permission for a survey without discussing it with her, and now they both want to rescind it. She said they received a $50 Visa debit card for allowing them to do it but she hasn’t used it.

FitzGerald said Kentucky’s law is unclear on such situations in the case of joint tenancy.

Pat Swartz, who lived in Texas and Oklahoma and worked for an oil company before moving to Kentucky, said she knows Williams “quite well.”

“They will challenge the eminent domain. I can guarantee you that,” she said. “There’s big money in what they’re going to do, and they want to make that money.”

At an earlier meeting, a representative for Williams said it was unclear whether Kentucky law would allow the company to use the right of eminent domain, but it preferred not to exercise it.

State Sen. Jimmy Higdon, R-Lebanon, said it was unclear as to whether a private company could get eminent domain for a non-utility pipeline, but it is not the legislature’s intent that it could.

Higdon and state Rep. David Floyd, R-Bardstown, urged residents to call Gov. Steve Beshear’s office and ask that he add to his call for a special session on Aug. 19 discussion of a bill to allow an existing state Board on Electric Generation and Transmission Siting to have the authority to regulate natural gas liquids pipelines.

Currently, there is no state regulatory agency that approves NGL pipeline sitings.

Angie Boone, who is from the New Haven and New Hope area, said she talked with a land agent that is working on the pipeline project, Coates Field Services, Surveys and Construction because it would run near her parents’ house.

She said she asked the agent if he would want the pipeline on his property, and he said he wouldn’t want it any closer than 300 to 500 feet of his house, because “pipelines do burst.”

Her parents’ house and some neighbors’ houses would be closer than that, she said.

She said she was told the companies would pay about $24 per foot for pipeline easements, which “doesn’t seem like much,” she added.

Mary Ann Chamberlain said no study has shown that having an NGL pipeline on one’s property increases the land’s value, that it always decreases it.

Nelson County Judge/executive Dean Watts and Floyd both said they know of people in the county who are in favor of the pipeline.

“There are people in this room who are in favor of it,” Watts said.

No one at the meeting, however, publicly admitted being for the pipeline or spoke in favor of allowing it.