LINCOLN — Some key state senators raised concerns Thursday about the constitutionality of a proposal in the Nebraska Legislature to restart a state review of the controversial Keystone XL pipeline.
State Sen. Mike Flood, the speaker of the Legislature, and Omaha Sen. Steve Lathrop, both lawyers, warned that the bill carried the risk of being found unconstitutional, as "special legislation" for pipeline developer TransCanada Inc.
Lathrop said a lawsuit would "tangle up" the already delayed project in court for at least two more years.
"We need to be careful," the senator told his colleagues. "We don't want to pass something that creates litigation that slows this down even more."
State lawmakers opened debate Thursday on Legislative Bill 1161, which is designed to restart Nebraska's review of a new pipeline route that avoids Nebraska's groundwater-rich Sand Hills region.
During a special session last November, TransCanada agreed to change its route and avoid the Sand Hills in hopes that would help persuade the U.S. State Department to approve its 1,700-mile, $7.6 billion pipeline. It would carry heavy crude oil from Canada's tar-sands region to oil refineries on the U.S. Gulf Coast. Nebraska also agreed to pay for an expedited, $2 million state review of the new route.
Gov. Dave Heineman, U.S. Sen. Mike Johanns and others had objected to the original route of the 36-inch crude-oil pipeline because it threatened one of the state's most precious natural resources, groundwater.
But the special session compromise evaporated in January after the Obama administration rejected a federal permit for Keystone XL, saying officials could not meet a Republican-pushed early deadline to complete a federal environmental review of the project.
A main sticking point in getting the pipeline project approved has been concern about Nebraska's Sand Hills, a region of grass-covered dunes and fragile soils where groundwater is often at or above the surface.
LB 1161 would allow Nebraska, independently of the federal government, to restart its review of a proposed Sand Hills detour. That review would have to gain final approval by the governor. It would then be submitted to the federal government to show that Nebraska is now OK with the estimated 100-mile detour route.
But anti-pipeline groups such as the Sierra Club of Nebraska and Bold Nebraska have argued that LB 1161 represents a special favor to TransCanada that the company doesn't deserve, given its push to get landowners to sign right of way agreements and its resistance, until the last minute, to agree to a route change.
An attorney hired by the Sierra Club, Alan Peterson of Lincoln, has said the bill is special legislation because only TransCanada would be able to use it. Peterson stated that even TransCanada officials, during a public hearing on LB 1161, admitted that it would be unlikely that any other pipeline company could use the bill.
The bill's sponsor, Papillion Sen. Jim Smith, and the head of the Legislature's Natural Resources Committee, Sen. Chris Langemeier of Schuyler, argued Thursday that TransCanada officials were misunderstood and that the measure could withstand a constitutional challenge.
But Flood, who brokered the pipeline route compromise in the special session, and Lathrop urged more work on LB 1161 to address the constitutionality concerns.
Lawmakers advanced the bill from first-round debate on a 35-2 vote. Malcolm Sen. Ken Haar and Lincoln Sen. Danielle Conrad voted "no."
Ken Winston of the Sierra Club said he doubted whether amending the law now would fix the constitutionality questions.
Jane Kleeb of Bold Nebraska said LB 1161 was unnecessary and was politically motivated to allow Republicans to claim during the presidential election this year that "even Nebraska supports the pipeline and the only one who doesn't is President (Barack) Obama."
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