2020 Environmental Real Estate IssuesIn Dyer v. Texas Commission on Environmental Quality, a three judge Austin Court of Appeals panel recently upheld, with one dissent, an injection well permit granted by the Texas Commission on Environmental Quality (TCEQ) to TexCom Gulf Disposal.  The permit allows TexCom to inject non-hazardous industrial waste into its subsurface injection wells.

The Austin Court is an intermediate Texas appellate court.  With its location in the state capitol, it hears many appeals from cases originating before state agencies.

RCT Issuance of “No Harm” Letter
Among the many issues presented in the case was the role of the Railroad Commission of Texas (RCT) in the permitting process.  Under Texas law, TCEQ is the permitting agency for injection wells that will accept industrial or municipal waste. RCT issues injection well permits for oil and gas production wastes.  For injection well permits within TCEQ’s jurisdiction, the applicant must submit to TCEQ a “no harm” letter from RCT stating the proposed injection well “will not endanger or injure any known oil or gas reservoir.”

According to the Austin Court:

  1. TexCom obtained and submitted with its application the “no harm” letter.
  2. While its application was pending before TCEQ, RCT indicated it would hold a hearing to reconsider its “no harm” letter.
  3. RCT held its hearing to reconsider after the close of evidence in the TCEQ permit proceeding, but before TCEQ issued the permit.
  4. RCT issued a preliminary decision to withdraw the “no harm” letter before TCEQ took final action granting the permit, but RCT’s final action to withdraw came 11 days after TCEQ’s final order issuing the permit.
  5. Those opposing TexCom’s permit, including the County where the injection well will be located, argued that RCT’s action in reconsidering the “no harm” letter and issuing a preliminary decision to withdraw it should have prevented TCEQ from proceeding to final action.

Need for Finality in Administrative Proceedings
In upholding the issuance of the permit, the Austin Court majority emphasized the need for finality in administrative processes.  Applying the opponents’ interpretation would allow RCT to rescind a “no harm” letter even years after TCEQ completed its proceeding.

Dissent on Other Grounds
The dissent did not express a view on this portion of the majority’s decision but identified another issue for disagreeing with the majority; that issue may be the subject of another alert.

For a copy of the majority opinion http://www.search.txcourts.gov/SearchMedia.aspx?MediaVersionID=0ee2b312-0d7f-4f18-82d4-ccb2449d2b0b&MediaID=96a3a835-39e5-4a25-83ed-b9008b17ffe4&coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&DT=Opinion

For the dissent http://www.search.txcourts.gov/SearchMedia.aspx?MediaVersionID=cdb16b02-1bc3-4da7-ad14-49202abe6379&MediaID=841939a1-2def-46c1-b4ab-e09fde6bbe05&coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&DT=Opinion