Towns across the country are blocking energy companies from fracking
The people cheered and held up large banners scrawled with the words "No frack!" and sunflower-shaped signs that read "Home rule."
"We did it!" proclaimed one Dryden resident in a news release the day of the ruling.
Over the past three years, the towns of Dryden, near Ithaca, and Middlefield, about 100 miles to the east, had been engaged in all-out legal warfare with the oil industry. In 2011, the two towns passed ordinances banning oil and gas development within city limits. The industry swiftly sued, saying that such bans were pre-empted by a state statute permitting oil and gas development.
The towns argued that the state law shouldn't trump their constitutional "home rule" right to enact zoning ordinances that protect the "health, safety and general welfare" of their communities. Two lower courts and, finally, the New York Court of Appeals sided with the towns.
"The towns both studied the issue and acted within their home rule powers in determining that gas drilling would permanently alter and adversely affect the deliberately cultivated, small-town character of their communities," wrote Judge Victoria Graffeo of the New York Court of Appeals in the majority opinion in Wallach v. Town of Dryden, issued June 30.
While the townspeople in Dryden gathered to hail the court's decision, there was one notable person absent. Helen Holden Slottje was in Cape Cod, sitting around the dining room table at her parents' house. She could barely contain her excitement.
"They say you can see someone smiling through the telephone," she said in a phone interview just hours after the decision was handed down. "I feel that's true for me today."
In the battle against fracking, Slottje, a former corporate attorney, is the legal equivalent of the Wizard of Oz: While she wasn't the face of the towns' victories, she was behind the curtain in many meaningful ways.
Slottje, with the help of her attorney husband, David Slottje, is credited with unearthing a legal theory that allows municipalities to enact zoning ordinances that ban oil and gas development in their backyards.
Her pro bono legal assistance has led to an anti-fracking groundswell locally and across the country. Her research has formed the basis of bans on oil and gas drilling in nearly 200 municipalities in the state of New York.
"We've had people reach out to us from every oil and gas state asking how could they do something like this in their state," she says.
ANTI-FRACKERS, ARISE!Dryden is among a growing number of towns across the United States flexing municipal muscles in an increasingly acrimonious fight against Big Oil.
At the heart of the matter is a worldwide scramble to develop cheap, relatively clean-burning natural gas reserves. To do that, oil companies are deploying a heavy industrial process called fracking to unearth underground natural gas reserves that are trapped in deep formations of shale, a type of rich, black sedimentary rock.
At its most basic level, high-volume hydraulic fracturing, or fracking, involves breaking open the shale by injecting a high-pressure mixture of water, sand and chemicals underground. The pressure fractures the rock, releasing the gas and allowing it to be captured by wells dug into the earth.
Fracking has become increasingly popular with energy companies in recent years in a push to domesticate energy supplies—and amid rising oil prices that have made expensive new technologies, such as horizontal drilling, profitable.
Today, fracking is used in dozens of countries around the world, amounting to a global market worth a projected $42 billion, up more than 300 percent since 2005, according to Richard Spears, vice president of Spears & Associates Inc., a petroleum business consulting firm based in Tulsa, Oklahoma.
The rush for natural gas has turned previously sleepy corners of the map into wildcatting meccas. Fracking wells are popping up in places that happen to sit atop shale reserves, even in residential areas.
In Greeley, Colorado, a fracking well sits just 400 feet from a running track at a local high school. Last year, a Colorado congressman sued an oil company for building a fracking well just 50 feet from the driveway of his rural farm.
The in-your-face development is causing many towns to balk. Earlier this year, Beverly Hills became the first in California to ban fracking. Five towns in Colorado have passed local bans. More than 100 in New York have land-use laws banning oil and gas development. Dozens more towns, from Michigan to Texas to Hawaii, have followed suit.
"It's pretty amazing how close these wells are being put to residential areas," says Lisa Trope, an organizer in the Denver office of Food & Water Watch, a Washington, D.C.-based environmental group that opposes fracking. "These communities have spoken pretty loudly that they don't want this industrialized process in their backyard."
THE GAS EFFECTFor the industry, the movements in these towns are becoming more than a nuisance.
New York is the second Northeastern state after Pennsylvania to vindicate the towns in their fight. Both states' high courts have ruled that local zoning and land-use powers can trump state law when it comes to regulating oil and gas development.
That is no small deal. The two states sit atop the Marcellus Shale formation, a 100,000-square-mile reserve that holds one of the largest natural gas fields.
"It's a huge deal because it essentially empowers municipalities to ban oil and gas development altogether," says Thomas West of the Albany-based West Firm, who represented the industry in the New York Court of Appeals case.
West says that decision by the highest court in the state sends the wrong message that "New York is not open for business," and he fears that it will embolden the "fracktivists," as he calls them.
West is not giving up. In August, he filed a motion asking the New York high court to rehear the case. In the motion, he points to a recent district court decision in the state of Colorado that struck down a local voter-approved ban on fracking. The court in that case said that the state's Oil and Gas Conservation Act pre-empts the city of Longmont's authority to regulate fracking.
West agrees that by all measures it's a long shot to get the court to rehear a case. Still, he says, he thinks it's the right thing to do.
"I think the decision was rushed," he says. "They should have given it more consideration. ... There are a lot of landowners in those communities who want their mineral rights to be developed."
Indeed, in many places, fracking is welcomed by communities that laud the jobs created by the booming industry—and by landowners who are in a position to collect royalties on any resources extracted from their land.
In 2012, hundreds of fracking supporters marched near the capitol in Albany, urging lawmakers to allow the industry to develop the state's natural resources. Demonstrators wore red T-shirts with "Jobs" written on them, and carried signs with slogans like "Frack now" and "Support responsible gas drilling."
GROUND RULESThose in a position to develop their land have a lot to gain. According to the American Petroleum Institute, the Marcellus Shale reserve holds an estimated 500 trillion cubic feet of natural gas, worth more than $1 trillion.
But in other communities, like Dryden, people believe the potential for environmental disaster is too great.
The act of fracking produces large amounts of chemical-laced wastewater. There are reports of that water seeping into the soil and contaminating groundwater, and in some cases, causing illness. Others complain about noise and noxious smells that drift from the wells, damage done to the roads when heavy trucks roll into town, and even seismic activity that mysteriously seems to follow in fracking's wake (studies have drawn a correlation between fracking and increased earthquake activity in some places, like Oklahoma).
"People are claiming drinking water exposure to contaminants, illness, fear, injury, nuisance, property damage—you name it," says Richard G. Stoll, an environmental regulatory attorney in the D.C. and Milwaukee offices of Foley & Lardner, and a former chair of the Council of the ABA Section of Environment, Energy and Resources. "There have been hundreds of those [types of lawsuits] filed around the U.S."
The legal morass has partly to do with the fact that there is no single federal regulatory body overseeing the fracking industry.
"You've really got this incredible panoply of federal, state and legislative rules," Stoll says.
At the federal level, there are several regulations that arguably could apply to fracking, including the Clean Air Act and the Safe Drinking Water Act. But loopholes and exclusions leave even the most schooled experts perplexed when it comes to navigating the applicable rules.
At the state level, laws vary. And as the New York Court of Appeals decision shows, local laws often conflict with state laws.
One way, of course, to get more uniformity is for Congress to pass a law that would set federal standards and rules. Already some agencies have begun to act.
The Environmental Protection Agency has issued an advanced notice of proposed rule-making that could eventually require federal reporting on substances used in fracking. The Occupational Safety and Health Administration has proposed a rule that would regulate working conditions for fracking workers. The Department of Transportation is examining what authority it might have to regulate the industry. The Bureau of Land Management has proposed its own regulations for fracking done on federal lands.
But so far, any rule-making has been slow going.
FEAR OF FRACKING"I don't see anything changing much in the next few years," says Stoll. "It will continue to be sort of a state by state, issue by issue, statute by statute approach. It's going to take a while to get it all sorted out."
In New York, the issue of fracking has now been simmering for years. Around 2008, oil and gas companies began gearing up to start drilling for gas using the new hydro-fracking technology. As they sent out fleets of "landmen" to strike lease agreements with landowners, citizens began asking questions about the process and worrying that there could be adverse environmental and health effects.
Under that pressure, then-New York Gov. David Paterson directed the state environmental department to scrutinize more carefully the drilling permit applications. That led to a de facto moratorium on drilling in New York state, which remains in place.
Around the same time, Slottje, a resident of Ithaca, first heard about fracking. It was the late spring of 2009, and she had recently visited family in Pennsylvania, where the shale boom was underway.
"There were places where there had been spills, places where weird-colored stuff was oozing out of the soil; there were just these clear-cut areas of woods and the roads were a mess," she recalls. The presence of fracking was also dividing friends and neighbors. "The community was turning on itself."
When she returned home to Ithaca, she saw a news-paper ad announcing a gas-drilling meeting to be held by a local community group. She decided to attend.
While there, she encountered several fracking opponents who gave presentations showcasing images of the process, which she thought looked like an open-air factory. They also talked about how local towns needed to brace themselves for the day when the de facto moratorium was lifted and the drilling rigs would roll into town. There was talk of all the negative effects that could befall their communities.
Slottje left the meeting disturbed. She was struck by how those in attendance felt that fracking in their towns was a fait accompli.
"The county guy said there is nothing we can do. The lawyer said there is nothing we can do—all you can do is prepare for this. Another guy said what you really need to do is sign the very best lease that you can. That's the only thing that's going to provide you with protection," she recalls.
HOME RULESlottje had recently moved to the area from Boston with her husband and fallen in love with the rural life of upstate New York. Like other anti-fracking people, she feared for her bucolic life.
"When I went to this meeting and saw these terrible pictures and thought about where I live, I realized I loved living where I live. But that if I wanted to stay, I needed to fight because there would be no point in staying if it was wrecked," she says. "I resolved for that summer, I was going to do what I could to help in this fight."
She started reading case law and looking at court rulings across the country. She attended a conference on constitutional issues and environmental law at Georgetown University. She examined whether there was a way to get leaseholders out of their leases. And then she found the New York Oil, Gas and Solution Mining Law, which states that "the provisions of this article shall supersede all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries."
At first blush, she thought that law spelled the end of the story. But she paused. "It just didn't seem right to me," she says, "like in a moral sense and also in a legal sense, that someone could come in and destroy your community and you had no say. It just seemed wrong."
Then she stumbled upon a case called Frew Run Gravel v. Carroll, which helped her piece together a plausible legal theory that she believed could stop oil and gas development in her area.
In that case, decided by the New York Court of Appeals in 1987, the court agreed that the town of Carroll's zoning ordinance banning a sand and gravel operation was allowable because "it does not purport to regulate an industry. It simply seeks to regulate land use generally," according to the opinion.
Next she examined the New York Constitution, which includes a right to home rule. The home rule provision says "every local government shall have power to adopt and amend local laws not inconsistent with the provisions of this constitution or any general law ... except to the extent that the legislature shall restrict the adoption of such a local law."
Taken together, Slottje began to think that there was a viable legal course of action. But she also wondered why nobody else had applied any similar legal reasoning yet to the fracking issue.
"We thought that we had to be missing something," she says. "This was so easy and basic ... [yet] there was nobody out there saying the emperor has no clothes."
A LEGAL STANDBecause she didn't have a constitutional law background, Slottje went the extra mile to study the issue from every angle. She pored over oil and gas laws from across the country and cases new and old, such as Hadacheck v. Sebastian, a case from the early 1900s that upheld a Los Angeles zoning ordinance prohibiting a brick manufacturer from locating within city limits.
"We went down the rabbit hole," she says. "We looked at everything ... the commerce clause, takings clause, due process, equal protection, anything we could think of where someone would say, 'You are just wrong, and I can't believe you thought you were right.' "
Meanwhile, as Slottje was embroiled in her legal research, several people in Dryden were also growing afraid that fracking might come to town. In 2010, a group of neighbors formed the Dryden Resource Awareness Coalition to organize against that prospect.
The group started meeting at each other's homes, talking late into the night about the potential adverse impacts of fracking. They set up an email discussion list to disseminate information. The more they talked, the more they became convinced they didn't want fracking in Dryden. The group became frustrated to learn that there wasn't anything they could do to stop it.
"We were being told by everyone there's really nothing you can do," says Deborah Cipolla-Dennis, a Dryden resident and member of the coalition. They started lobbying state legislators in Albany and sending their comments to elected representatives in Washington, D.C.
Then, at a fracking presentation, they met the Slottjes. "They said, 'We think that there is something you can do here. You can't regulate it, but you can ban it,' " recalls Cipolla-Dennis. "We were like, 'Wow! That's pretty simple; let's do that.' "
Eventually, the Slottjes hit the road with their toolbox of legal theories, crisscrossing the state of New York. They gave presentations to town boards and citizen groups, explaining their legal reasoning. They went to any town board meeting that would have them.
"We told basically any town in the state that wanted us to draft this kind of law for them, we will do it, and we will do it for free," Slottje says.
SCORING THE GOLD ... AND CUPCAKESIn the dead of winter in 2010, the Dryden neighbors group started a petition drive to get the town board to take up the matter of fracking. They trudged through snow and ice to knock on doors, urging their neighbors to sign their petition. They ended up with more than 1,600 signatures, just over 10 percent of the Dryden population.
"That got the town board's attention," says Dryden coalition member Cipolla-Dennis. The group began working with the Slottjes to put together a draft ordinance. Soon thereafter, the town board decided to take up the matter, meeting with Slottje along the way in an advisory capacity.
"We met with her several times," says Mary Ann Sumner, Dryden town supervisor. "We certainly heard a lot of what she said."
In August 2011, the town board unanimously passed an amendment to its zoning ordinance specifying that oil and gas exploration was not permitted in Dryden.
Not long after, the town was sued by Anschutz Exploration Corp.
Earlier this year, Slottje won the prestigious Goldman Environmental Prize for her work. She says she and her husband have started giving presentations across the country. And now, there's even interest globally. She was scheduled to give a TEDx talk in Brussels in October about the international implications of fracking.
"It was the most fulfilling work that either one of us had ever done," she says. "People would bring us by casseroles, cupcakes and cookies when working late."
As a corporate lawyer, she says, "I never had clients bake me a cake."
This article originally appeared in the November 2014 issue of the ABA Journal with this headline: "No Fracking Way: Towns across the country are stopping the big energy industry from its controversial effort to dig for natural gas."