NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A2108
SPONSOR: Lifton (MS) TITLE OF BILL: An act to amend the environmental conservation law, in
relation to the natural gas exploration and extraction liability act of
2011
SUMMARY OF PROVISIONS: Section 1 Title of act.
Section 2 states legislative findings
Section 3 Amendments to Article 23 of the Environmental Conservation Law
Section 23-901. Definitions
Section 23-2902. Strict liability
Section 23-2903. Joint and several liability
Section 23-904 Standing of Municipal Corporations
Section 23-905 Elements of Damages; Treble Damages
Section 23-906 Attorney Fees
Section 23-907 Effective Date
JUSTIFICATION: Although individuals, businesses and municipalities
can, under existing law, recover damages from drillers and landowners
who have allowed drilling on their property, it would be necessary for
such plaintiffs to prove that negligent conduct caused the damage. This
bill will allow recovery once a causal connection between the drilling
and related activity and the damage has been proven. This "strict
liability" is found throughout the law, most relevantly in the Naviga-
tion Law regarding damages that result from petroleum spills.
Additionally, to remove any doubt that municipalities have standing to
pursue claims for damages resulting from the exploration, drilling and
extraction of natural gas, including high volume hydraulic fracturing,
("hydro fracturing" or "fracking") Section 23-2904 explicitly estab-
lishes such standing.
Numerous hazards have been associated with this type of industrial
activity. Chemicals used in fracking may be toxic, cause life-threaten-
ing illnesses, including cancer, and can be non-biodegradable and diffi-
cult or impossible to remove once they enter the natural environment.
Construction of large well pads (up to five acres), the use of millions
of gallons of water and large numbers of trucks delivering fracking
chemicals, water, and other equipment to the site can lead to excessive
noise, air pollution, deterioration of roads and bridges, contaminated
groundwater, including private and public water supplies, vibrating of
surrounding structures, fires, explosions and, in some cases, earth-
quakes. Open pits of chemically-laced water, laden with salt, heavy
metals and radioactive elements have been known to kill wildlife and
farm animals that have mistakenly drunk from them, and upon evaporation,
contribute to air pollution. Leaks and spills of fracking chemicals from
the trucks and waste pits have also been reported, causing contamination
of surface waters. There is a possibility that the fracking chemicals
that remain underground may migrate or seep through fractures in the
underground formations, cracks in the well-bore casing, and through
abandoned wells to pollute groundwater.
Any of these hazards could result in irreparable and costly damage to a
landowner's drinking water, home or livelihood in agriculture or tour-
ism, as well as to roads and bridges maintained by municipalities.
LEGISLATIVE HISTORY: None
FISCAL IMPLICATIONS: None to the state
EFFECTIVE DATE:ninetieth day after it becomes law
STATE OF NEW YORK
________________________________________________________________________
2108
2011-2012 Regular Sessions
IN ASSEMBLY
January 13, 2011
___________
Introduced by M. of A. LIFTON, GLICK, O'DONNELL, GOTTFRIED, M. MILLER,
MILLMAN, SCHIMEL, CASTRO, COLTON -- Multi-Sponsored by -- M. of A.
COOK, MARKEY, PHEFFER, WEISENBERG -- read once and referred to the
Committee on Environmental Conservation
AN ACT to amend the environmental conservation law, in relation to the
natural gas exploration and extraction liability act of 2011
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the natural gas exploration and extraction liability act of 2011.
3 § 2. Legislative findings. 1. The legislature finds that the process
4 used to stimulate natural gas extraction referred to as high volume
5 hydraulic fracturing, also known as "hydro fracturing" and "fracking,"
6 utilizes components that are often toxic, that are non-biodegradable,
7 and that are virtually impossible to remove once they enter the natural
8 environment. Among the chemicals used are volatile organic compounds
9 such as benzene, toluene, ethyl benzene, and xylene. Many of the chemi-
10 cals used in this process are federally listed hazardous substances, and
11 there is only minimal data about the rest. Many of these hazardous chem-
12 icals are known carcinogens and others can cause other life threatening
13 illnesses. As a result of the air and water pollution caused by such
14 exploration and extraction operations people are exposed to endocrine
15 disrupting agents that can cause kidney, liver, heart, blood, and brain
16 damage.
17 2. High volume hydraulic fracturing requires the construction of large
18 well pads (up to five acres) to support the large number of trucks
19 delivering the fracking chemicals, water trucks, pump trucks and other
20 equipment. Such massive scale industrial activity causes excessive
21 noise, disturbs underground water formations, vibrates surrounding
22 structures, and can result in earthquakes. Millions of gallons of this
23 chemically-laced water returns to the surface laden with salt, heavy
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD03870-01-1
A. 2108 2
1 metals and radioactive elements. This wastewater is often stored in open
2 pits until transported for ultimate disposal. Wildlife and farm animals
3 that have mistaken these pits for freshwater ponds have been killed.
4 Chemicals may evaporate from these pits, contributing to air pollution.
5 Leaks and spills of fracking chemicals from the trucks and waste pits
6 cause contamination of surface waters. The remainder of the fracking
7 fluid remains underground with the possibility of migrating or seeping
8 through fractures in the underground formations, cracks in the well-bore
9 casing, and through abandoned wells to pollute groundwater.
10 3. Widespread use of high volume hydraulic fracturing diminishes or
11 destroys the natural beauty of the land, depletes or interferes with the
12 natural sources of water used for domestic and agricultural purposes,
13 disrupts the natural habitat of wildlife, imposes unaffordable costs on
14 municipalities and reduces property values thereby harming both homeown-
15 ers and the municipalities in which such activities are located.
16 4. Tourism is a major industry for much of the Marcellus Shale area.
17 The construction and operation of natural gas wells in such area will
18 have a long term negative effect upon such industry that will result in
19 lost profits and diminished business value and lost revenue to the muni-
20 cipalities where such tourism ventures are located.
21 5. The natural gas industry has embarked upon the procurement in
22 unprecedented numbers of mineral leases from private landowners across a
23 broad section of New York state that overlays the "Marcellus Shale"
24 geological structure for the purpose of utilizing high volume hydraulic
25 fracturing to extract and mine natural gas from the shale. It is not
26 unusual for 40% or more of the land in such areas to be currently under
27 lease (although such land is owned by a small minority of landowners in
28 the region) and, accordingly, the industry is poised to secure billions
29 of dollars in profits from such extraction while potentially causing an
30 even greater amount of damage to non-participating land owners and
31 renters, as well as to municipalities and even visitors to the area.
32 6. The legislature further finds that the use of high volume hydraulic
33 fracturing techniques constitutes a hazardous practice that will result
34 in large scale damages to innocent parties.
35 7. The legislature further finds that landowners who, subsequent to
36 the effective date of this act, enter into or extend leases with natural
37 gas exploration, operation, transportation or extraction entities share
38 responsibility with such entities for all damages shown to be caused by
39 such activities and that all responsible parties be held strictly liable
40 for damages resulting from such activities.
41 § 3. Article 23 of the environmental conservation law is amended by
42 adding a new title 29 to read as follows:
43 TITLE 29
44 NATURAL GAS EXPORTATION AND EXTRACTION LIABILITY
45 Section 23-2901. Definitions.
46 23-2903. Strict liability.
47 23-2905. Joint and several liability.
48 23-2907. Standing of municipal corporations.
49 23-2909. Elements of damages; treble damages.
50 23-2911. Attorney fees.
51 § 23-2901. Definitions.
52 As used in this title, unless the context otherwise requires:
53 1. "High volume hydraulic fracturing" shall mean the use of chemicals,
54 water and other substances injected or pumped into a natural gas well to
55 stimulate production of the well in volumes in excess of one hundred
A. 2108 3
1 thousand gallons in a continuous twenty-four hour period or in excess of
2 two hundred fifty thousand gallons in any consecutive thirty day period.
3 2. "Person" shall mean any individual, association, corporation or
4 other entity that engages in natural gas exploration, drilling,
5 extraction or transportation. The term "person" shall include any indi-
6 vidual, association, corporation or other entity that owns an interest
7 in land that is subject to a lease or other grant that permits surface
8 rights, sub-surface rights or both surface and sub-surface rights for
9 the purpose of natural gas exploration, drilling, operation or
10 extraction unless said lease or grant was executed prior to the effec-
11 tive date of this title.
12 § 23-2903. Strict liability.
13 Natural gas exploration, drilling, extraction by use of high volume
14 hydraulic fracturing techniques and transportation of hydrofracturing
15 chemicals and waste products, having been deemed hazardous activities by
16 the legislature, entail strict liability on the part of any person, as
17 defined in this title, that undertakes such activities in the state.
18 Neither compliance with the requirements of this title, the issuance of
19 a permit for such activities nor the exercises of due care, shall excuse
20 any such person from liability for personal, property or other elements
21 of damage pursuant to this title determined to be caused by such hazard-
22 ous activities. Distinctions between direct and consequential damage
23 shall not relieve such person of absolute liability, such person's
24 intent or negligence for any personal, property or other element of
25 damage pursuant to this title notwithstanding.
26 § 23-2905. Joint and several liability.
27 The liability of any person as defined in this title shall be joint
28 and several with the liability of all other persons found liable for
29 damages resulting from the same incident, event, natural gas operation,
30 exploration or extraction or transportation activity.
31 § 23-2907. Standing of municipal corporations.
32 For the purposes of this title, all municipal corporations, including
33 school districts, shall have standing to pursue all legal remedies for
34 damages pursuant to this title.
35 § 23-2909. Elements of damages; treble damages.
36 1. In all actions arising from the provisions of this title, evidence
37 tending to prove the following elements of damages shall be admissible:
38 a. personal injury and wrongful death;
39 b. property damage;
40 c. reduction in property value;
41 d. reduction in business value, loss of profits;
42 e. all other damages caused by such activities; and
43 f. in the case of municipal corporations:
44 (1) damage to and maintenance of infrastructure;
45 (2) loss of revenue due to real property tax reductions resulting from
46 such exploration, drilling, extraction and transportation activities;
47 (3) costs incurred by emergency operations necessitated by such activ-
48 ities; and
49 (4) all other damages caused by such activities.
50 2. In any action arising pursuant to this title, if the trier of fact
51 determines that any defendant acted willfully, maliciously or with gross
52 negligence, the court shall award three times the amount of damages
53 established by the trier of fact.
54 § 23-2911. Attorney fees.
A. 2108 4
1 In any action arising pursuant to this title, a plaintiff who has been
2 awarded damages shall also recover reasonable attorney fees and expenses
3 of litigation from the defendants, jointly and severally.
4 § 4. This act shall take effect on the ninetieth day after it shall
5 have become a law.
