LINCOLN — Legal sages say it’s foolish to predict a ruling from questions posed by the Nebraska Supreme Court during oral arguments.

Nevertheless, the high court fired 55 questions at attorneys during Friday’s highly anticipated 30-minute hearing in the Keystone XL pipeline lawsuit. The judges directed 35 of the total to the lawyers representing the state. All seven asked at least one question.

The Q&A is supposed to help the court decide whether the current Nebraska route for the highly contested pipeline should be allowed to stand or be sent back to square one. An opinion, not expected for at least several months, could play a role in deciding the fate of the massive Canadian pipeline that has been awaiting approval from the United States for nearly six years.

Supporters and opponents of the project turned out in force Friday, listening to the court proceedings in an overflow room in the State Capitol and holding dueling press conferences to state their cases to the wider public.

“This is a fight for the citizens of Nebraska,” said Susan Dunavan of York, one of three landowners who won a lower court ruling striking down a 2012 law that allowed the governor to approve the pipeline route. As she spoke in the Capitol Rotunda, she was surrounded by several dozen supporters wearing familiar “Pipeline Fighter” shirts.

Terry Moore, president of the Omaha Federation of Labor AFL-CIO, said that from his perspective, a Supreme Court ruling against the pipeline will just delay the arrival of needed construction jobs in Nebraska.

“There’s nothing to fear in this project,” Moore said as he stood among representatives from business, industry and agricultural groups that also support the pipeline.

The key issues before the court are whether the landowners have legal standing to bring the lawsuit and whether the Legislature violated the Nebraska Constitution when it passed the law that let Gov. Dave Heineman approve the pipeline route. Many questions from the judges focused on those two issues.

The landowners, who live either on or near the pipeline path, won a decision earlier this year before Lancaster County District Judge Stephanie Stacy, who struck down the law. Attorney General Jon Bruning appealed the ruling on behalf of the state.

The landowners contend the Nebraska Constitution says authority to regulate the pipeline belongs to the five independently elected members of the Public Service Commission. They argue the Legislature illegally gave that authority to the governor when it created a law allowing major pipelines to submit an application to either the governor or the commission.

The Public Service Commission regulates common carriers such as telecommunications companies, taxi services, natural gas utilities, high-voltage electrical lines and the safety aspects of railroads. But its regulatory powers are defined by the Legislature, said Deputy Attorney General Katherine Spohn, assigned by Bruning to argue the state’s case.

“The constitution, on its face, allows the Legislature to limit the PSC’s authority, and for pipeline companies they’ve done so,” she said.

Based on a 1963 state law, the Legislature limited the commission’s authority over common carrier oil pipelines, which it defined as lines that start and end within the state’s borders, Spohn said.

“In fact, are not pipelines largely regulated by the federal government?” asked Chief Justice Mike Heavican.

Regulation of interstate and international pipelines is left to the federal government, Spohn replied.

Omaha attorney Dave Domina, who represents the landowners, argued the 2012 law provided no standards for the governor to meet in making his decision. It does not even require the governor to read an evaluation conducted by the Department of Environmental Quality.

Nor did the law spell out an appeals process for those who oppose the governor’s decision or provide for judicial review of the decision. Therefore, the law not only unlawfully delegates the Public Service Commission’s authority, it violates the constitution’s due process clause, Domina said. In other words, it completely blocks citizen input on a decision that could impact their land and water.

“For that simple and specific reason, unanswered by the attorney general, we see the court’s decision today as pretty simple and straight forward,” Domina said.

In response to questions from judges about limits to the commission’s pipeline authority, Domina said any pipeline can essentially switch from being an interstate or an intrastate pipeline, depending upon where it picks up or delivers oil.

In rebuttal, Spohn said citizens affected by a pipeline decision do have legal recourse. They can challenge the decision in court during an eminent domain hearing.

The $5.4 billion pipeline would carry 830,000 barrels of mostly Canadian oil sands crude to refineries on the Gulf Coast. It requires a presidential permit because it would cross international borders.

Opponents say the pipeline will be a risk to sandy soils and high water tables along much of its 275-mile path in Nebraska. They also say it will worsen climate change on a global scale.

Supporters point to the construction jobs and tax revenue the project would create. They also argue it would enhance North American energy independence and reduce the importing of oil from the Middle East.

The U.S. State Department has suspended its review of the project pending the outcome of the Nebraska appeal.

If the state loses the appeal, it’s not clear what the next step would be for TransCanada, the company seeking to build the pipeline. Domina said it could try to submit a new permit to the Public Service Commission or find a lawmaker willing to sponsor new pipeline siting legislation.

Shawn Howard, a spokesman for TransCanada, declined to say what the company would do if the route is declared invalid.

“It’s way too early to tell,” he said. “We’ll look at a range of options once we know what the court decides.”

State Sen. Jim Smith of Papillion, who sponsored the law challenged by the landowners, said he has not been in conversation with company representatives about the question. Nor has he been asked to introduce a new pipeline bill when the Legislature convenes in January.

Smith, who remains a strong supporter of the Keystone XL project, said he doesn’t think a new law is necessary.

“We need to have patience and wait on the process,” he said.

Contact the writer: 402-473-9587, joe.duggan@owh.com

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