2020 Environmental Real Estate Issues

The Supreme Court of Texas upheld issuance of an injection well permit 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.

RCT’s Issuance of “No Harm” Letters
Among the issues presented in the case was the role of the Railroad Commission of Texas (RCT) in the permitting process.  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.”

TCEQ Complied with Statutory Requirements
In this case, RCT issued the “no harm” letter but reconsidered that decision while TexCom’s application was pending before TCEQ. However, RCT only withdrew the letter after TCEQ issued the permit.

In upholding issuance of the permit, the Court determined TCEQ met statutory requirements because it issued the permit prior to RCT’s withdrawal. The Court further held TCEQ was within its discretion to ignore RCT’s post-issuance concerns because RCT had issued its letter more than five years before TCEQ issued the permit.

TCEQ Can Reject ALJ Recommendations and Amend Factual Findings
TCEQ issued the permit even though the administrative law judges (ALJs) who heard evidence in the permitting case recommended against it. To support its decision, TCEQ amended and added to the findings of fact from the ALJs.

The Court determined Section 2003.047(m) of the Texas Government Code allows TCEQ to “amend ‘any findings of fact’ so long as the amendment is based on the administrative record and accompanied by an explanation.” According to the Court, the legislature intended to give TCEQ greater discretion to amend factual findings than that of most state agencies because of TCEQ’s special expertise. Section 2003.047(m) also allows TCEQ to issue additional findings in support of its decisions if the findings are based on the record.

To see the opinion https://www.txcourts.gov/media/1454394/191104.pdf