House Agriculture, Forestry and Economic Development Committee Part 2
Video
Transcript
Bills discussed (5)
| Bill | Title | Sponsor | Status |
|---|---|---|---|
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HB1980
· 2 mentions in chapter, transcript
Matched: “HB1980”
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Pre-2017 bill | ||
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HB2195
· 2 mentions in chapter, transcript
Matched: “HB2195”
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Pre-2017 bill | ||
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HB1394
· 1 mention in chapter
Matched: “HB1394”
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Pre-2017 bill | ||
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HB1955
· 1 mention in chapter
Matched: “HB1955”
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Pre-2017 bill | ||
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HB2157
· 1 mention in chapter
Matched: “HB2157”
|
Pre-2017 bill |
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Gene Eagle
Unverified
0:00
debt service that can be covered with the general obligation bonds but but kind of the answer
Representative Charlie Collins
Unverified
0:05
that you gave earlier was that these projects would have the economic payout so that they would uh... and then generally when you do that you set up a revenue bond to make sure that the income streams and the investors understand that the the risk they're taking is commensurate with the income of the project with by decoupling those and putting this on the backs of the taxpayers how
are we going to ensure that we get that same economic analysis in this new world?
Gene Eagle
Unverified
0:31
That will be done in an independent third-party study looking at the tax revenue that's generated by the project back to the state by the project. There's not really revenues generated by this project that's going to retire the debt. The debt will be paid by the state of Arkansas. It will come right off the top. But the analysis will be done at the time that this body approves the authorization of the bonds, after you've looked at the project, looked at the number of jobs and the economic benefit,
the return to the state for
Speaker 5
1:09
making that investment. Thank you. Thank you, Mr. Chairman. Next on
Representative John Charles Edwards
Unverified
1:13
the list is Representative Edwards. Thank you, Mr. Chairman. Mr. Eagle, is there a smaller end of this scale? And I agree with your comment that, you know, chasing after super huge projects may not always be the most sound economic development idea. But on the smaller end, what is a smaller type of project that you would consider to be financed under this program, dollar amount?
Gene Eagle
Unverified
1:40
That's another good question. The state already has a number of bond guarantee and incentives that they offer businesses as they expand and relocate here in the state. We can already address some fairly large projects without ever having to consider the use of this. There are costs associated with doing a bond issue that make it prohibitive. So it would have to be multimillion-dollar projects, I would think,
that would be above the capacity for the state to use any of its existing incentive programs to try
Gene Eagle
Unverified
2:21
million, or higher, lower. I think the Economic Development Commission has competed on some bigger projects like that, and we've been successful. The state had the quick-action closing fund that the governor could use. We don't know what will be available for that in the coming year or two, so this might be
something that you guys may have to consider if a really good project does come here. So it's a difficult question to answer, considering the amount of money that's available for looking at these projects. But do you have in your mind,
Representative John Charles Edwards
Unverified
3:04
not to belabor the point, but do you have in your mind an idea of, I mean,
the goal here is to have development that will create long-term, stable employment in this state. Is that correct? Is that the, okay. Okay. And I guess the bottom line is we've realized that chasing after the mega projects is not the way to go. Is that it? Yes, sir. All right. Thank you. Do I see other questions back, committee?
Representative Jerry R. Brown
Unverified
3:43
Seeing none, we'll go to the audience. Is there anyone that wants to speak against this bill
or for the bill? If not, what's the pleasure of the committee? Representative Love, did you have a motion? I recommend do pass. We have a motion that do pass. All in favor say aye. Aye. Opposed like son. Congratulations, Representative. You passed your bill. Thank you, Mr. Chairman. Thank you, committee.
We move now to House Bill 1980 by Representative Westerman. Representative, introduce yourself to the committee.
Representative Bruce Westerman
Unverified
4:24
And you may begin. Thank you, Mr. Chairman. Bruce Westerman, representative, District 30.
Didn't know so many people were interested in community retirement programs, but I'll try to be brief today. This is simply an economic development bill, and it simply amends an existing program that we have.
to move the retirement community program from the AEDC to the Arkansas Association of Development Organizations. This is a group that's comprised of the eight project planning and development organizations that are located around the state. The AADO has expressed interest in this program, and they're willing to administer it. This program was first started in 2007, but it's yet to be implemented. there are 79 million baby boomers approaching retirement age in this country and 11,000 of
them are retiring each day and we have a huge potential in Arkansas to attract these retirees here but right now only 11,000 per year are moving to Arkansas retirees bring about $12,000 annually in federal assistance and a typical household spends about $30,000 annually and when When they retire, they also bring their financial assets with them. So I'll answer any questions that you have about the bill. Questions by committee?
Representative Kelley Linck
Unverified
5:54
Representative Link. I believe you said both of the organizations are in favor of this.
Representative Bruce Westerman
Unverified
6:01
Did one of them bring the bill to you? I
Representative Kelley Linck
Unverified
6:05
worked with both organizations to develop the bill. I saw where we took the fee from $5,000 to $2,500. Is that to get
Representative Bruce Westerman
Unverified
6:13
better participation? Yeah, and in analyzing the program, we thought that was a more fair fee. The initial
fee is $0.25 per resident in the retirement community, and then there's an annual fee of $2,500 per year to sustain the program.
Speaker 30
6:29
Motion, proper time. Other questions? Representative Meeks. Thank
Representative Stephen Meeks
Unverified
6:37
you, Mr. Chairman. Just to follow up, what would be the benefit to them paying the $2,500 dollars to stay in
Representative Bruce Westerman
Unverified
6:45
the program, what will be the catalyst for them to do that? Well, the program will assist these communities through training, marketing, advertising, public relations, doing brochures and support materials. They'll put information on their website, and they'll also do yearly evaluations on the retirement communities.
Speaker 36
7:04
Okay. Thank you. Thank you, Mr. Chairman. Representative Love. Thank you,
Representative Fredrick J. Love
Unverified
7:09
Chair. Mr. Westerman, is there any additional monies needed for this program besides these fees that you're charging or the fees that are set up in here?
Representative Bruce Westerman
Unverified
7:19
It would be nice if they could get some GIF money to seed the program, but they're going to try to do it with the fee structure that's in
Speaker 40
7:30
here. Did you say general improvement funds?
Representative Bruce Westerman
Unverified
7:35
That's what I said, but I said it would be nice if they had
Representative Fredrick J. Love
Unverified
7:39
them, not that they're going to get
Representative Bruce Westerman
Unverified
7:43
them. Now, you know that's a dirty word around here, don't
Speaker 42
7:47
you? I guess that depends on who you're talking to, Representative. Thank
Speaker 43
7:55
you, Mr. Linderman. Westerman. Westerman, that's pretty good.
Speaker 45
8:02
You're welcome, Representative Leno. Moving right along, Representative Edwards, question.
Speaker 48
8:05
Thank you, Mr. Chairman. And very quickly, on the bill,
Representative John Charles Edwards
Unverified
8:11
you talk about one of the issues that this group will identify as emergency medical services and hospitals. In your formulation of this bill, how much feedback did you get about the importance of emergency medical care and
Representative Bruce Westerman
Unverified
8:29
communities? That's actually one of the, it's number three on the list of things that retirement folks are looking for.
Representative John Charles Edwards
Unverified
8:38
Oh, I know that, but I'm saying, did they discuss that detail with you in any, did they expand upon why that's so important? Just that that's something that retirees
Representative Bruce Westerman
Unverified
8:48
are looking for when they choose an area to retire. I think you're right, and I
Representative John Charles Edwards
Unverified
8:52
think that's something we all need to remember. Thank
Representative Randy Stewart
Unverified
8:58
you very much. Now we move to Representative Stewart. Yes, thank you, Mr. Chair. Just got a question. I don't see a definition of the Arkansas Association
of Development Organizations in the bill anywhere.
Could you go over again who
Representative Bruce Westerman
Unverified
9:12
that is exactly? We have our eight planning and development organizations, and this is the umbrella organization for those
eight economic development organizations that are located around the state. And then each of those organizations will
Representative Randy Stewart
Unverified
9:24
be responsible for their geographic area? Right. Okay. And then I noticed over the – and on the back page, all the money is in the account will go through the Arkansas Institute for Economic Advancement at the University of Arkansas at Little Rock?
That's correct. And then it's paid out to these AADO organizations? That's correct. Okay. All right. Thank you. Do we have other questions about committee? Anyone in the audience wants to
Representative Jerry R. Brown
Unverified
9:56
speak against this bill or for the bill? If not,
I'll be aware of motion by Representative Link. Motion do pass. We have a motion do pass. All in favor say aye. Opposed, like sign.
Congratulations, Representative. You passed your bill. Thank you, Mr. Chairman. Thank you, Committee. Committee, we move
now to House Bill 2195, Representative Colin Smith. Ma'am, if you would have
Representative Linda Collins-Smith
Unverified
10:31
a seat, introduce yourself to the committee. You may begin. MS. Thank you, Mr. Chair, Committee. I'm Representative Linda Collins-Smith, and
thank you for allowing me to present this bill this morning. This bill is a bill about economic development.
It's not a bill about tort reform. Industry think tanks like ALEC, the American Legislative Exchange Council, rank states as to how they're business-friendly, what the business atmosphere is. They publish those rankings to their members for the use when they are considering potential locations. They downgrade states that have not limited certain types of lawsuits. For instance, one is, I ate too many cheeseburgers. This bill will not restrict any type of lawsuits,
only those that attempt to blame food suppliers for their obesity. or those that are they say that they're obese and it causes illness this will not bring negative impact principal attorneys at all but will increase Arkansas's standing in business friendly rankings Arkansas is low ranking of business friendly states this bill alone does not promise for one job to come here but with the climate
of the 88th General Assembly We can use this as one more drop in the bucket to move our state forward to becoming one of those business-friendly states. If you follow the law, you're meeting every standard, every rule. In your business, you shouldn't have to worry about being sued. If, however, you're in violation and are lying to customers, this bill does not keep you from being sued. This bill simply keeps attorneys from filing frivolous lawsuits.
When someone gets fat for making poor choices about food, they're going to get fat. The ATLA agreed with me. This bill doesn't do anything. They're not doing those types of lawsuits. Then they came back just recently and said, well, someone sent some note in that says maybe we should
add a few things or take a few things out of the bill after already admitting it does nothing, because they're not doing those lawsuits.
Remember, this is about economic development. Lawsuits are expensive. They're potentially devastating, as legitimate lawsuits can be. And this act is immediately necessary because protecting businesses that are operating within the laws, rules, and regulations from frivolous lawsuits is unnecessary to promote economic development and jobs. I bring this bill that's titled an act to promote and enhance economic development within the state and protect those businesses, companies, and manufacturers that are currently complying with the statutory and regulatory requirements to prohibit frivolous lawsuits and for other purposes.
purposes. Frivolous in this definition, of course, when you look at this and you look at page two of the bill, is defined. In this instance, it's about filing lawsuits so you can sue because someone gets fat. Well, you would have to prove that that's the reason they gained all this weight and you hear about the mcdonald's lawsuits
well you would have to prove that it's just because they ate at that particular store then you're going to have to decide did they eat the same meal every day at every meal try thirty years or so
to try to figure out if that's the reason they got fat so i hope you'll consider this bill as an economic development tool it's important to our state to the hospitality industry in the restaurants and most of our restaurants A lot of them are small. They're not all big chains. But those lawsuits are devastating when they happen in a community or to a business.
So I hope you'll consider a yes vote on this. I think there may be some people in the audience that would like to speak for and against Mr. Chair, and I'll take any questions.
Representative Randy Stewart
Unverified
15:03
Questions by committee? Representative Stewart, you're first. Yes, thank you, Mr. Chair. Yes, how many lawsuits have we had in Arkansas in
Representative Linda Collins-Smith
Unverified
15:10
this area? I don't have those lawsuits specifically by how many have been filed. Judge Burnett, Senator Burnett, was going to be with me today, and he probably could have helped me more on that, except he's in a committee meeting.
Representative Randy Stewart
Unverified
15:23
Do you know of any that we've had?
Representative Linda Collins-Smith
Unverified
15:25
That have been filed? Yes. The only ones I would know of are those
Representative Randy Stewart
Unverified
15:30
that you hear. Were they in Arkansas or
Representative Linda Collins-Smith
Unverified
15:33
were they in other states? I'm talking about Arkansas right now. We're talking about our state. And if you – there's one – give me one minute. I think when I answer your question is that in section – There's one over here. One – our first page under the subchapter three, there's adding a section.
attorneys file a document that says basically that this is a proper lawsuit they do that already and so you can't you might file but you might not win and the problem is it still causes a huge expense to both parties in the lawsuit and i don't have that specific number okay that's all i was trying to do was just to
Representative Randy Stewart
Unverified
16:18
ascertain how many we've had in the past that would that would that we need this bill for but you don't have that no but let me
Representative Linda Collins-Smith
Unverified
16:26
say this if i might we're worried we're doing
this for the future because we can't do anything that happened in the past we need this legislation for
Representative Garry L. Smith
Unverified
16:42
representative smith thank you mr chair uh thank you representative linda collins smith for bringing this bill i have a question is this necessary based on evidence on file that we've actually run business out of Arkansas from what you've got on
Representative Linda Collins-Smith
Unverified
16:56
record? Yes, thank you for asking the question because it is a good one.
This bill is for when you rank, one of the purposes, when you rank business-friendly states, and that's where this information for me came from that really made me want to make this a business-friendly state, is when you're ranked, they tell you what kind of categories and things that people are suing or they are – they're taxes. You know, there's a division of things. And for me, with the tourism industry, the hospitality industry, I think it's important that we get on the bandwagon now
and not wait until those large lawsuits start getting filed. They've already been started in other states. We know that. You've heard it on the national news. It's to prevent the frivolous lawsuits or what some people call the fat bill or weight gain bill. Okay, so
Representative Garry L. Smith
Unverified
17:48
this is a preemptive that, as you're saying, who's going to ride herd on this to make sure we don't have any infractions?
Representative Linda Collins-Smith
Unverified
17:58
Can I ask that question? Well, when this becomes law, I would think that when a case is filed
or that the judges will see this in the law. In district court? And I would think it's circuit court. Circuit court? Yep. Okay. All right. Thank you. Thank you, Mr.
Representative John Charles Edwards
Unverified
18:23
Chair. Representative Edwards. Thank you, Mr. Chairman. Where does Rule 11 – before I get to that question, I'm never going to file a lawsuit against anyone for eating at Cottoms or anything else. I want to get that – or does. I want to get that – We're proud of that, Representative Edwards.
How does Rule 11 come into play here? Okay. Rule
Representative Linda Collins-Smith
Unverified
18:42
11, it's unnecessary. I assume it refers to the Rule 11 of the Arkansas Rules Civil Procedure Rule 11. Am I correct? Yes, ma'am. It generally requires attorneys to sign a document they file with the court certifying that their lawsuit is filed in good faith. It is supported by the facts and existing law.
It is not filed for any improper purpose. And I think that's the key because this is already the law. You can't file, you're signing a document already that says it's not, I mean, that it's not frivolous. And
Representative John Charles Edwards
Unverified
19:21
I guess that's my point. If we already have Rule 11,
why do we need, that's one point. But the other, do we have any evidence that restaurants are being chased out of Arkansas or concerned?
We are just dealing with restaurants. Am I correct?
Representative Linda Collins-Smith
Unverified
19:42
Well, in this bill, yes. Well, look at it. It's not just that. It could be like if you had a law-abiding business that's doing every rule, every regulation that the state sets, It might also be, you know, out there when things stretch out on those lawsuits, it might be a company that prepackages food. So packaging companies could maybe fall under there. Carriers, distributors, so that it doesn't extend into those folks.
And that's, yes, it has to do this bill with food. And to answer part of your question, I don't know that they're doing it right now. Now, this is a huge effort. This is preemptive, because if you have a true lawsuit, this doesn't change anything. This is about frivolous lawsuits so that this will keep people from starting those in the state of Arkansas. And I believe that we need
Representative John Charles Edwards
Unverified
20:38
this bill for the future. And one of the concerns I have is I think, first of all, as you know, I am an attorney,
and as I know about you, you're very familiar because of who your husband is. I mean, your husband is a judge. Yes. And one of my concerns in general is that I think the bar, if people look in the paper, they see that attorneys, for all the bad raps we get, when there are attorneys that don't do well, I think the legal community does. You see when people are suspended or disbarred for their bad behavior.
My concern is that if we take away what's been in Rule 11, that we may weaken. By having other legislation, we may weaken Rule 11, which I think needs to be more enforced. I do think we've got
a rule in place, and I would like to see it enforced more. I appreciate your comments, and I
Representative Linda Collins-Smith
Unverified
21:48
feel that my section in the front page, 1 and 2, takes care of that because of Rule 11. That Rule 11 is already in place, And this should not have to be added to the bill.
I think it's just unnecessary to put back in the bill when it's
Speaker 110
22:11
already part of the law. I have no further questions. Thank you. Next, Vice Chairman Burris. Thank you, Mr. Chairman. Thank you, Representative Collin Smith. I just want to quickly summarize my understanding of what this bill does and make sure I'm clear. Effectively, all it does is say that in Arkansas, any manufacturer, distributor, or retailer of food is protected against civil action that claims they are responsible or liable for manufacturing or selling or distributing food that they say cause their obesity.
Is that the summary? That's correct. That's correct. Okay. I just want to make sure I'm clear. So how
Representative John Burris
Unverified
22:48
many other states have protections like this in place? Do you know? Actually, I
Representative Linda Collins-Smith
Unverified
22:53
don't know how many. I know that Arkansas does not, but there are several, I think, moving toward trying to be that business-friendly state. And then this is one of those items that have been mentioned in the American Legislative Exchange Council. Matter of fact, it's part of their model legislation,
is that we go ahead and move forward to be a business-friendly state.
Speaker 110
23:16
And just to be clear one more time, because it's only litigation that claims that a manufacturer, retailer, distributor caused obesity. They have to be following all the FDA guidelines, things like that, but only, you know, saying you're selling your food made me obese, that's the lawsuit we're preventing or attempting to prevent? Yes, that's correct. Okay. Thank you.
Speaker 21
23:44
I'm sorry? Representative Love, you have a question
Representative Fredrick J. Love
Unverified
23:50
Thank you, Chair Ms. Collins, I understand when you talk about obesity and different things like that but on line 14 and 15 of page 2 can you define for me what or other general known conditions allegedly caused by or allegedly likely to result from long term consumption of food can you define for me what some of those conditions may be
Because, I mean, like I said, I understand the obesity aspect, and I understand the weight
Speaker 121
24:26
gain, but what are the other ones? One
Representative Linda Collins-Smith
Unverified
24:31
moment here. I need to follow your line. If you read the top of the bill to prevent those frivolous lawsuits, you do include those distributors, carriers, holders, and sellers. if the Food and
Drug Administration has already approved the product
then you can't claim that they're gaining weight just because
of eating a hamburger at McDonald's you have to do more to prove that you cannot sue those people if they've done everything under the law that's the key it's when they break the law or when they actually, I
mean, you can still sue when they break the law. If
they're putting something in there and they're lying to you, you're still going to be able to sue those people.
Representative Fredrick J. Love
Unverified
25:22
I guess I'm just not clear about, I mean, I know someone pointed out to me it's defined at the top of the page, but I'm just trying to figure out what would these conditions be because I'm not clear about that. I mean, you know, I know what weight gain is. I know what obesity is, but what are these other conditions? Because that's what I'm not clear about, and it speaks to your bill on line 14 and 15. I don't need the fogginess of the top of the page. I need to know the conditions that we're trying to prevent along with weight gain and obesity.
Representative Linda Collins-Smith
Unverified
25:58
Is your question what I guess I need to understand your question. If you look at the top line above that particular section, I guess I still haven't understood the question. I'm sorry, Representative Lodge. What
Speaker 125
26:15
is a condition? Give me an example of a condition that would be
Speaker 40
26:20
covered under the lines 14 and 15 on page 2. The other generally known conditions. It says exempt.
Representative Linda Collins-Smith
Unverified
26:28
At the top of the paragraph, you have to read that part because it says exempt. And that's a very key thing in that particular section of the paragraph, because it says, except as exempted, in subsection B of the section, manufacturers, packers, carriers, holders, sellers, and that's an exemption, as defined in section 10 of the Federal Food and Drug Cosmetic Act, or an association of one or more entities that may not be subject to any other civil legal action arising out of weight gain, obesity,
a health condition like high cholesterol, diabetes, maybe any other numerous ulcers. I don't know. I'm just other conditions. Now you're giving me examples of what
Representative Fredrick J. Love
Unverified
27:24
could be covered. Okay, thank you. Thank you, Representative Love. Any other questions by the committee? If
Representative Jerry R. Brown
Unverified
27:33
not, we'll go to the audience. Is there anyone here that wants to speak against this bill?
Yes, sir. That's okay. sir if you'll recognize
Matthew Hass
Unverified
27:56
yourself for the record mr. chairman members of the committee my name is Matthew Hass I'm the executive director of the Arkansas trial orders Association first of all I think everybody in the room for being here on this very important bill today on on our support now let me be very clear at the beginning we've met with representatives Colin Smith and and we've
got some concerns about the bill the intent of the bill to say you can't go sue a restaurant for beginning fat from eating their food you knew what you're eating we have absolutely no problem with those cases aren't filed there's never been one filed in Arkansas that we can find as a matter of fact only one we've ever been found filed was one in 2003 in New York and it was dismissed we think the laws covers those already however our concerns with this bill are we have three three concerns one I think they've all kind of been hit on a little bit. The definition of frivolous lawsuit. We think if you're going to use that term,
we'd like it to be defined. As Representative Edwards was talking about, the Arkansas rules of civil procedure define under Rule 11 what a frivolous lawsuit is. Everybody else has different definitions. Usually it means somebody files a suit against me, it's frivolous. Or if it's a suit I don't like, it's frivolous. That's not necessarily the definition. So if you're going to use the term, we'd like it to be defined in here so everybody knows what we're dealing with. Our second concern is this has some federal preemption in it, which basically says if you followed all the FDA guidelines, there would be no suit. But our major concern
with it is the unintended consequences. It's kind of what Representative Love was talking about, I believe, the other conditions besides obesity, and that's where our concern really lies with that particular section. As a brief example, if I might, I'll try to make it as current as possible. Say I own a restaurant, I own Happy Jack's Restaurant. I'm serving some hamburgers, but I found a really good deal on some beef coming out of Japan. It happens to be radiation poison, and I know that.
I serve my burgers, I run a special Kobe beef burgers, and Representative Edwards loves those. He's been eating them every day from lunch and dinner for three weeks, and now he's He's developed a thyroid condition because of the radiation, which then would lead into obesity as we all know thyroid problems are elusive and cause obesity. We think those unintended consequences in here could be covered where there would be no sooth there. On a broader scope, I think it was hit on a little bit on the, we're not only talking about restaurants but food producers and packagers, and in this day where we have five-hour energy
drinks, we have lazy cakes, we have all sorts of other goodies out there that are technically drugs but they're classified as food and no telling what sorts of chemicals will be finding those you know we've seen bath salts and everything else that have been used for consumption lately and with all that considered we don't know what all is coming in the future and that's our concern in the lives of the bill with that said I'd be happy to answer any questions thank you sir
Representative Jerry R. Brown
Unverified
30:55
for your testimony journey questions about committee representative love thank you
Speaker 137
31:02
Mr. Chair. Number one, I won't eat a happy jack.
Representative Fredrick J. Love
Unverified
31:09
We'll go partners. But number two, I was over in Judiciary the other day running the bill. And someone alluded to this, but I wanted to make sure. Does a judge have a remedy for people
Matthew Hass
Unverified
31:24
that brings frivolous lawsuits? Yes. Under Arkansas Rules of Civil Procedure, a judge can dismiss the case, award attorney's fees, and then could also actually punish the attorney for filing such a case.
Speaker 125
31:34
Okay, so there is already a remedy for frivolous
Speaker 140
31:39
lawsuits? Yes, sir. Thank you. Any other questions?
Representative John Charles Edwards
Unverified
31:46
Edwards, Representative Edwards. Mr. Chairman, just for the record, I try to eat Arkansas beef whenever I can. So I've talked, Representative Collin Smith and I have had, in our time here this session, we've had several conversations about economic development,
and I take her to be a very sincere person in this endeavor, and I'm very interested in
economic development. You said something else, so if you could expand upon for the committee, When a judge has a case, can you explain for the committee how a Rule 11 sanction could come about? The typical way
Speaker 145
32:35
it would normally happen is once the suit's filed,
Matthew Hass
Unverified
32:39
the defense is going to file a motion dismissed on summary judgment. If it's a frivolous case, and it's clearly frivolous, I can't imagine a judge in the state not dismissing it. and then there could be a complaint made with the administrative office of the
Speaker 146
32:54
courts. Okay, now, this bill, would it prevent the filing
Representative John Charles Edwards
Unverified
33:00
of the lawsuit or just made it, I mean, the lawsuit could still get. I think the intent of it
Matthew Hass
Unverified
33:09
is to prevent it from being filed.
However, I don't think you can actually stop somebody from filing the suit. I think it will get dismissed at the front
Representative John Charles Edwards
Unverified
33:19
door and never make it past that. And that's, I mean, that's my concern that I always have for the legal communities that, and they're quite often in my firm, we decline cases because we just feel like that, you know, it's not the efficient administration of justice. And, again, for the record, I've never had any kind of sanction like this ever against me. But I am concerned that what, you know, what we're really going to be able to prevent.
That's really my concern. That's a very good question. Seeing no
Representative Jerry R. Brown
Unverified
33:51
other questions, thank you, sir, for your testimony. Thank you, committee. Anyone in the audience want to speak for the bill? Anyone else want to speak against this bill? Ms. Collin-Smith, would you like to close for
Representative Linda Collins-Smith
Unverified
34:12
your bill? Thank you, Mr. Chair. Rule 11 is important. That's been discussed here today.
So I think that going back to Rule 11 is important for you to look at. Rule 11 that is not, it's on the first page. Again, I state, it's already the law. Why is it necessary to put it in the
bill? The judges who are quite capable of studying the claim know that it's there.
And so I don't think that it's necessary to put it in this bill to have more confusion to the consumers or to the citizens of the state of Arkansas. I think we should be clear to them. And I think that it is unnecessary. I, too, have ran this bill by attorneys, several of them. even the gentleman that just stuck against the bill and he said it does nothing matter of
fact he said I asked him to help me
to promote economic development in the state of Arkansas and he said I'm this close and then eventually someone said had a question about the bill we've ran that through attorneys and attorneys, senators, or attorneys, or judges, and I have to say to you, I do not believe it's necessary. The law is clear when a judge gets it
on Rule 11. So I think you
just confuse the public. And for economic development, for the state of Arkansas, I also got to go back to the happy jacks or lazy somethings that were used. In my situation, he used a thyroid disease. So let's talk about that when he and I visit about this through
our emails. He says that this section, 1655, 302A, he says it's far too broad
Speaker 75
36:21
that it would exclude a suit for injury caused by ingestion of food
Representative Linda Collins-Smith
Unverified
36:26
product that turns out to be very harmful like the Happy Jack or whatever it might be, an energy bar, that five years later they might get a thyroid disease, thus obesity
Speaker 75
36:41
or liver cancer. Well, this is not true that you can't sue if you can prove the thyroid disease was caused by eating too much.
Representative Linda Collins-Smith
Unverified
36:53
If it's a chemical that's been added to the food, what does that have to do with the food product? You're going
to go after the person that actually created that or put the cancer-causing product in the food.
Speaker 75
37:09
This bill does not limit lawsuits alleging that a food product caused a particular disease unless that disease resulted from obesity or overconsumption of food. In other words, if food causes a disease or injury, the providers of the food can be sued.
but if someone becomes obese from eating a particular food and disease or injury results from their obesity, the providers of the food can't be sued. So I'm closing for my bill, and I have to
Representative Linda Collins-Smith
Unverified
37:45
tell you that this is an economic development bill that does not cause harm to the people. It protects the business owners of the state of Arkansas if they're breaking the law. And I know that it's supported by the Arkansas Hospitality Association, that's lodging, tourism, and restaurants, and I sure would appreciate a good vote.
Representative Jerry R. Brown
Unverified
38:07
Representative Collins-Smith is closed for our bill. What's the pleasure of the committee? I have a
Representative Charlie Collins
Unverified
38:17
motion at the proper time. This is the proper time, Representative. I move that we do pass House Bill 2195.
Representative Jerry R. Brown
Unverified
38:22
Representative Collins recommends do pass. All in favor say aye. Aye. All opposed like saying? No.
In my judgment, Reverend Henry Collins-Smith, your bill fails. I'd like a roll call, please. You're not on the committee.
You cannot call a roll call. Thank you. Reverend Henry Collins? I'd like to call for a roll call. Do I see
Speaker 158
38:58
two hands? I do. We have two hands. Ms. Irvin, call the roll. Representative Ratliff Representative Shepard Representative Link
Representative Linderman Representative Collins Representative Love Representative Gene Representative Letting Representative Meeks Representative Edwards Representative McCrary
Representative Dale Representative Perry Representative Lindsay Representative Smith Representative Stewart Representative Patterson Representative Moore call mr burris and myself please representative burris yes i vote no
Representative Jerry R. Brown
Unverified
40:23
committee by a vote of seven yeses and nine no's miss college smith you failed your bill thank you committee
mr. chair thank you members next on the next on the agenda is house bill 2157 by representative jean Representative, if you'll recognize yourself, at the end of the table, you may begin, sir.
Speaker 17
41:11
Thank you, Mr. Chairman. Lane Jean, State Representative
Speaker 171
41:14
from Magnolia, coming today with House Bill 2157. It's a simple bill. It's a proactive bill, it's an agriculture bill, and today I have Dr. Mark Cochran with the University of Arkansas Agriculture Department. What this does is help define sustainable, and it's proactive with inclusive on science-based and outcomes that are performance-based, and I've got Dr. Cochran, which is the expert here, and he's going to kind of explain this bill, then we'll answer any questions.
Representative Jerry R. Brown
Unverified
41:44
Dr. Cochran, if you will introduce yourself, and you may
Speaker 174
41:51
begin with your testimony. I'm Mark Cochran. I am the Vice President for the University of Arkansas's Division of Agriculture. What this bill does, it's very consistent with some of the other attempts to define sustainable agriculture, particularly more recently the field-to-market Keystone Alliance group and then the UNFAO Committee off of it. It's based upon science-based best practices, that technology-neutral, where it is looking
at the outcomes, performances of the technologies. It has the three renowned cornerstones of economic, environmental, and social components into it, but it is outcome-based, and it also has a component in for agriculture productivity. Are you ready for questions, sir? We'll answer any questions. Committee, questions. Representative Smith. Thank you, Mr.
Representative Garry L. Smith
Unverified
42:47
Chairman. Representative Jean, can you, in a few words, explain to me, in your opinion, why we need this bill?
Speaker 171
42:53
Well, I think this, when we come down with federal regulations, if you look on the back side of your bill, this gives the Department of Arkansas Agriculture Department and the State Plant Board more lead way in interpreting what sustainable is, and that is performance based and outcome based, that, you know, you hear a lot of stuff on organic, but, you know, there is a need for commercial fertilizer in this state for the performance of our agriculture.
Representative Garry L. Smith
Unverified
43:26
So this enables us to have a mix of those organics and commercial fertilizations as needed by determining that the AG department will make and plant board make those decisions that right correct thank you I'd already visited with you today but for the record I want to ask those questions thank you thank you mr. chair represent a word you have question I have a motion at the proper time
Speaker 142
43:44
yes sir revenue stir not even after think all right sir do we
Representative Jerry R. Brown
Unverified
43:53
have other questions anyone audience want to speak against this bill or for the bill
Representative John Charles Edwards
Unverified
43:58
seeing none represent average your motion has the grandson of farmers
Representative Jerry R. Brown
Unverified
44:07
I recommend do pass we have a do pass motion all in favor of the motion say aye opposed
Speaker 151
44:13
like son congratulations Rep. Jean. Thank you, Chairman. Thank the committee.
Representative Jerry R. Brown
Unverified
44:25
You passed your bill. On the agenda next, we have House Bill 2055 by Representative Patterson.
He has asked that we pass over that for the time being. And then next on our agenda, we have House Resolution 1026 by Representative Hopper that Representative Link is going to run I believe he's waiting on an amendment, and so we will run that sometime this afternoon. Okay? And I would like to announce at this point that I believe we're going to begin the process of why everyone's here. And my goal was to start this at 11 o'clock.
And so if everyone would look at the clock on the wall, I think we've done damn well. Thank you. Now, we're going to kind of jump around here. We've got a little pecking order in which we're going to run some of these bills. We're not going to run them exactly like they are if you all have an agenda. I've been asked by different people to run them in a certain order, and I'm going to oblige them by doing that. We're going to start with House Bill 1394.
1394 by Representative Lenderman. sir if you would introduce yourself to this committee you may begin
Speaker 55
45:54
thank you mr. chair I'm Homer Linderman state representative for district 76 I
Representative Homer Lenderman
Unverified
45:59
have asked Richard Mays attorney to sit at the table with me I want to say first
that I am pleased to have the people here to testify today. We have a fairly new industry in Arkansas that is extremely vital and extremely important to all of us. We have new technologies being used in that industry. We have a lot of people here today that are supportive of that industry, and it has been an economic boom to Arkansas. I would hope at some point as our natural gas exploration develops
that we would have pumping stations or filling stations throughout Arkansas. I would love to see our county governments, our state governments, put fleets of vehicles in the use of natural gas, compressed natural gas as a fuel. I think it would help to lessen dependence on foreign oil. I think that it could continue to be a huge economic boost to the state of Arkansas. With that being said, I am certainly not here to point fingers or to bash an industry that is so vital and important to us.
But I have these letters and e-mails that came to me, people that had concerns, and they asked that we look at this legislation. There were e-mails, people that were opposed to these bills. I want that known right up front. This is an industry that I did not enter into this lightly. I have started discussing this with different officials as far back as November.
We looked at a lot of different things, and I would like to draw attention first to the bill. This bill includes certain languages and things that we need to look at, one of which is best management practices. Best management practices do include cost-effective measures. Best management practices do include employee safety. Best management practices do include environmental safety as well. I met with a few, certainly not all, industry officials,
And in the original bills, the original documents, as I was working through these, there were three things that were brought up, and I want to address those. One of them is on page two, down at the bottom, under item C. In the original amendment, there was a presumption of guilt on the part of the industry if there was water contamination. I was told or asked to take that out. If you will notice, there is no presumption of guilt in that statement.
I took that out upon industry request. If you will look on page 3 at the top, number 1, the original document required synthetic liners only. I was told to understand that clay liners are industry standard, environmentally safe. I believe that. If you will see that document, it says synthetic liners, clay liners, or both. Either one may be used at the discretion of the industry.
On page 10, the original version said,
signage, fencing, and netting. That was unnecessary language. It was changed. Open pits do need a sign to warn people. Absolutely. If
deemed necessary, there may need to be fencing. There may need to be netting. The things
that are of contention in this bill, I think it's a good bill.
Do I think it's a perfect bill? No. Absolutely not. It will continue to be a work in progress as we look at new technologies, as we look at new techniques. And in Plan 24, I believe, there was a question from industry, do we expect a risk assessment on every well? Absolutely not. But when a landowner or a property owner starts to develop an area,
they have a right to know what the likelihood is of an environmental problem. We have accidents that do happen. We have sometimes equipment failures and things like that that I think that this bill will address. The thing that I think is most important in this bill starts at the
bottom of page 3, and that's the powers and duties. It allows the Arkansas Oil and Gas Commission.
It allows the Arkansas Pollution Control and Ecology Commission the power and duty to protect our waters through regulation, through testing, and of this industry. There has
been a lot of rhetoric about this. at where I live in the Jonesboro area. I had one person say that this is going to cause exorbitant gas prices.
I think that's a ridiculous assumption on their part. No one in here wishes to raise those gas prices. I had a gentleman from my area that said, you know all those earthquakes in the Conway area, they're caused by that drilling. That's also a ridiculous assumption in my opinion. We have no scientific data to prove that. The thing is, as with the letters I showed you, there are questions. There are concerns. Obviously, with any industry, there are risks associated.
Our question that we're going to have to look at here today is a committee, and I want everyone to know right up front, I want the oil and gas industry to do well in Arkansas. I want them to be very successful. I want them to continue to have jobs. I want Arkansas to prosper. but we know that there are risks involved. Our question as a committee today is to determine whether or not this document House Bill 1394 is the right way
to address that in regulated industry with that I will close I'll take any questions Thank you Representative Mr. Mays do
Representative Jerry R. Brown
Unverified
52:48
you have an opening statement or do you just want to answer questions I'll be happy to answer
Speaker 187
52:53
any questions that I can Please turn your mic on, sir, and
Representative Jerry R. Brown
Unverified
52:57
introduce yourself for the record. I'm Richard H. Mays. I'm
Speaker 190
53:01
an attorney in Heber Springs, Arkansas. I do a considerable amount of oil and gas practice in my law practice. Yes, sir.
Representative Jerry R. Brown
Unverified
53:11
Thank you very much for being here. We're going to start the questions
Speaker 192
53:18
now with the Representative Edwards. Well, I didn't have one at this time. Since you recognize me, I'll... You
Representative John Charles Edwards
Unverified
53:26
shouldn't have been first. Yeah. Yeah. This may be a question that I can develop more later on, but first of all, Representative Linderman, I've had the chance to know you during this session, and I mean this as a compliment. You're a serious man.
Thank you. And that's who I like to deal with around here. I like to deal with it because this is a serious issue. You
and I have talked about this bill in depth. I do have some concerns. One of the concerns, if you'll go down on page 2, line 31, and Mr. Mays, if you can help me with this, there's two concerns.
if you could expand upon what would be credible evidence and then if you could expand upon the thinking of why the well operator
would be the one to do the testing. And I can tell you one of the issues I've been wrestling with, and I've had several conversations over the last year with people myself on this topic is, you know,
what's the best way to get baseline data? What's the best way to prevent, you know, frivolous lawsuits over what's going on here? And I just don't have a real good handle of where we are on this issue at this time, and maybe you can help me understand some of that. Thank
Representative Homer Lenderman
Unverified
55:14
you for the kind words, Representative Edwards. Credible evidence. The original wording of this said that the well owner would be assumed guilty,
and that was stricken. Credible evidence would be a test, a water test, that could be conducted by a laboratory that would show the substances that are normally used in the fracking process, the fracturing process, to be in evidence in a water system would be credible evidence that
Speaker 188
55:49
there had been exposure. Okay. Mr. Mays. Certainly, any test that was
Speaker 190
55:55
done by a laboratory that shows the water supply or the water that
as being supplied to a person's home through a well, for example, as containing some of the elements that may be contained in drilling fluids or in the materials that are used in gas exploration and development would be very good evidence. In our experience, we've had a number of people who have come to complain about their wells being affected either by changes in color, changes in taste, changes in appearance and
water flow. There are all sorts of things that a well could be affected by through perhaps gas operations. The problem is proving causation and you can't just file a lawsuit primarily just because there's been a change in water color. So certainly I think the best evidence would be a laboratory examination or analysis of the water to show what's in it that may have caused those changes and link those perhaps
to activities of the gas company. Mr.
Representative John Charles Edwards
Unverified
57:14
Chairman, if I could, I see
Mr. Larry Bingle here. I would like to ask him a question on this point, if that's
proper, about the danger testing. Okay, sir. I'll allow
Speaker 21
57:26
that. Mr. Bingle, would you be available for questions? Yes, sir. If you can
Representative Jerry R. Brown
Unverified
57:34
find an empty seat anywhere down there, and please recognize yourself and what organization you're with.
Speaker 204
57:51
Lawrence Bingle, Director of the Arkansas Oil
Speaker 206
57:55
and Gas Commission. Yes, sir. Go ahead, Representative. Mr. Bingle, how,
Representative John Charles Edwards
Unverified
58:00
I mean, that's one of the challenges I think we all are trying to figure an answer
to, but can you tell me what would we be testing for and
Speaker 208
58:15
how would we test? As you know, we passed a rule recently, General Rule B-19, which
Speaker 209
58:21
specifies all the chemicals that may be used in a particular frac job, and there
could be, you know, a fair number of those chemicals. It's a small part of the frac fluid, but there could be a fair number of those. So if you wanted to prove that there was not any one of those in there, you would have to test for every single one that was used in that particular well that was fracked near the freshwater well. But what we do as a commission, because that would be a fairly costly and extensive test
for us to do as a state agency, we look for basically a test for three items. It's a four million gallon frack job that is done, a small percentage is chemicals, The rest of it is water, sand, and elements that would increase either oil and gas content of fresh water, chloride content, essentially coming from depth, or total dissolved solids. So we use those as indicators, and we test water wells for those indicators, and if in
fact they were to indicate contamination from a frack job, then that would be sufficient evidence for us to investigate further. But to truly know for sure, you have to test for every single one. But our thought process is that if you're having that much fluid move from a frack job to a freshwater well, that that much fluid moving would come with those other indicators first and not just one individual chemical alone moving without the carrier of the fluid
Representative Garry L. Smith
Unverified
1:00:00
itself. Thank you. Thank you, Mr. Chairman. Thank you, Mr. Binghamer. Smith. Thank you, Mr. Chairman. Thank you, Mr. Linderman, for this bill. I want to ask you a question. Do you not agree that the Oil and Gas Commission is taking their job very seriously and that they're doing everything within their power to safely monitor and allow these operations
Representative Homer Lenderman
Unverified
1:00:27
to continue? Thank you, Mr. Smith. Honestly, I can't answer that question
When I say everything, we do here, I have heard and had contacts where there were accidents that took place, that there are obviously environmental concerns by many people. I think any time we have a new industry to come in, any time we have new technologies being used, there's obviously some fear. There's obviously questions that people have. There's no question that there is a small amount of risk that is involved with any of these operations.
There's no question about that. I think that they are making every reasonable effort that is required at this time. And, again, the most important part of this bill is to allow our regulatory agencies to work with the industry and to develop the regulations and guidelines that we need to develop
Speaker 110
1:01:25
the industry and to protect our resources. I agree with that. I know
Representative Garry L. Smith
Unverified
1:01:30
that the Arkansas pollution, I mean, the APC&E and the Oil and Gas Commission
are quite capable and very able to respond to any questions and any issues that come up. Do you think this bill will encourage the oil and gas industry or discourage them? to me that's real hard
Speaker 212
1:01:53
to uh to answer i appreciate that i have some of those yes sir one thing that that i
Representative Homer Lenderman
Unverified
1:02:01
do want to say is right now uh i visited with the arkansas department
of the of environmental quality and they have a question in their mind it depends on who you talk to and what day as to how much authority they do have to go out and investigate and this bill would allow them to develop rules and guidelines that would give them, without question, the authority to investigate, hopefully not harming the industry at all. There is no intent to harm the industry, but there are concerns that people have, and I think that this bill does address those concerns.
Representative Garry L. Smith
Unverified
1:02:37
And I appreciate that, but a lot of people don't understand that we already have in place a very proper and correct opportunity through rulemaking authority to allow these agencies to react to any instances, and I believe that we've got adequate government control of that. And I know that they are able to react before the General Assembly or yourself or me write a bill that would encourage some kind of safety feature to be installed. Don't you agree with that?
Speaker 110
1:03:08
Again, when I talked with them, Representative Smith, they had
Representative Homer Lenderman
Unverified
1:03:11
a question about their authority, and I think this bill addresses that. There's no question that we do have some rules and guidelines that are in place. That's not even a question that we do. But it's whether those agencies believe they have authority, and this would help to define what their line of authority is. Thank you.
Representative Garry L. Smith
Unverified
1:03:30
And I have one last question. Do you think this is a bigger government bill or a
Representative Homer Lenderman
Unverified
1:03:36
less government bill? Hopefully it would be government neutral that the agencies that we have now could do
and test on an as-needed basis without any increase
in government. That would be the hopes. Committee, let
Representative Jerry R. Brown
Unverified
1:03:50
me caution you that we have on this particular one bill 30-something people signed up to speak. There's no way we're going to get to that, but please keep all your comments in question form, okay? That's fair. Reverend DeGene. Thank you, Mr. Chairman. Chairman,
Speaker 171
1:04:08
if I could ask again for Mr. Bengel to get to the end of the table.
I think you need to stay down there with all due respect. Representative Linderman, me and you don't see eye to eye a lot, I think, but we're friends, and I have the utmost respect for you. Thank you, sir. There was a couple of questions I had when I asked, and I'm from the oil and gas area. Have you ever been in the Fayetteville shell up on a rig? I have not been on a rig. No, sir. Not at all.
Okay. The other thing is, and this may be for anybody down there that knows, hasn't Congress mandated the EPA to do some study on fracking? Yes. Is that study currently being done? I'm
Speaker 190
1:05:01
not sure Congress mandated it, but EPA is doing it. And
Speaker 171
1:05:05
that report's not out yet, is it? Okay, so we don't have all the information we need on fracking yet. All right. And the other thing is, Mr. Bengel, if we implemented this law,
do you have the proper personnel to enforce this and oversee this right now? I would answer, first
Speaker 209
1:05:28
of all, that many of these things we already have rules for. As a matter of fact, several of the items are already in a current rule that the Commission has adopted jointly with ADEQ. Their rule will become effective, I believe, later on next month. But it's a joint rule between both agencies that cover pits that we can both use our inspectors
cross inspection for, do joint enforcement, and we have an MOU between the two agencies just for that purpose so in answering your question like I say many of these items already are in rule or or coming rule so when we prepared for for that already in preparation adoption that rule okay thank you thank you mr.
Speaker 218
1:06:15
chairman we now go to representative makes
Representative Stephen Meeks
Unverified
1:06:25
thank you mr. chairman mister representative lenderman of course though this district probably affects my district just as much, if not more, than any other because my district is the heart of where all this is occurring. So obviously we want to make sure there is good water, and I don't think anyone disputes that. The questions that I have are, as they say, the devil's in the details. On this bill on page 2 in section C, It talks about the 2,500 feet rule from a water supply.
First question I have regarding to that, and Mr. Bengel may be able to answer this and may have already answered this, do you not already have
that authority, and can you speak to the choice of the 2,500
Speaker 209
1:07:22
foot rule? Yes, we would have the authority to establish whatever setback there might necessarily be or rules to implement this. Where the 2,500-foot came from, I don't know.
Representative Stephen Meeks
Unverified
1:07:33
In your opinion, does that, you know, if it's 2,500 and one foot, does that make
Speaker 208
1:07:40
it any less of a... Any time you put into regulation a specific footage, then you get in, and
Speaker 209
1:07:46
we have these now, you know, the issue is 2,500 and one too much or 2,499 just right, it becomes difficult to enforce that exact footage, but I'm not sure where the 2,500 foot or whether that's appropriate amount of setback or not. Okay.
Representative Stephen Meeks
Unverified
1:08:03
The other question I have related to this is it says AEDQ or oil and gas commission. Now, my understanding is because I've talked to you and all the agency heads concerning My understanding is that, generally speaking, AEDQ has authority over environmental concerns such as this water supply, and you focus primarily on the well pads themselves. By putting you or them, does this create more questions as far as who has authority on what part of the well? Well, we would have
Speaker 209
1:08:32
to work that out in some type of MOU.
It's not clear when you get to ground water whether ADQ or oil and gas would have a clear jurisdiction. But on surface waters, it certainly is ADQ right now. So this would confuse our authority in that area, and we probably would defer to them anyway because of that. Okay. So this would,
Representative Stephen Meeks
Unverified
1:08:54
and it seems like it would create more confusion. And then the next question I have is on page three, and this one would be the representative Lunderman. You require the installation of leak detection systems.
Have you spoken to industry, and at some point maybe when they testify they can answer this question, do we have any idea what the cost to that is going to be? Are there any set of standards on these leak
Representative Homer Lenderman
Unverified
1:09:22
detection systems? Industry will do a lot better job answering that question than I have. We have talked about that. But my understanding is that the leak detection systems are not terribly expensive, but there is a cost involved. There's no question about that. Okay.
Representative Stephen Meeks
Unverified
1:09:37
The next question I have, and then I'll kind of wrap it up here, is as we know this morning, we've got several bills that deal with this. In talking to both my constituents, the other representatives from the Fayetteville-Shell play area, our county judges, there's overwhelming opposition to these bills as they stand now. Not necessarily to the heart, but, you know, again, the devil's in the details here. Would you comment to the fact that the representatives from this area are opposed to these bills,
the county judges from these areas are opposed to these bills, and my constituents that I'm hearing from are about
Representative Homer Lenderman
Unverified
1:10:18
10 to 1 opposed to these bills? Okay. You're asking me to comment about the other representatives. Each person has to represent their own area. Each person has to represent their own convictions. I have been a high school agricultural teacher for over 30 years. I taught a lot of natural resource classes, wildlife management, hunter education courses, boater education courses, and things like that.
With that, I do have a love and a care for the environment. I believe that all of us have that. This bill is not to harm an industry. This bill is to look at and to allow and to help make sure that an industry works with us and to help the environment. I did make efforts and met with industry officials and did look at these things. I did not meet with all of them. I didn't know them all. I've only been on the job a couple of months, kind of like some of the rest of us.
Sure, definitely. And I'm learning as we go. I feel like I made a reasonable effort to address the issues that were here. We were fortunate in the fact that there were other states that already had some guidelines and things in place. We didn't know that Arkansas had the wonderful resources that we have until recent years. And as we've started to develop those, the oil and gas industry is a huge economic boom. The oil and gas industry provides a lot of jobs.
And, again, I would love to see fuel stations all over Arkansas. Sure, sure. I would love to see the state. I would love to see the counties develop a fleet of vehicles using natural gas. At the same token, I want to have water to drink, and I want to be able to take showers. Sure, of course. You
Representative Stephen Meeks
Unverified
1:12:00
know, like I said, and my people live up there where this is at, and my goal for all this is we want to make the good consumer, the good players, even better, and we want to get the bad ones to, you know, either come up to snuff or, you know, go find someplace else.
My last question is, as you stated, and, you know, as I've mentioned here, I think there's some good things here, some good principles that we need to look at. However, you know, by your own admission, this is not a perfect bill. Would you be opposed to us taking this into an interim study, looking at these things, coming out with a much better product to present to the people of Arkansas in, you know, coming sessions. Okay. I won't address the other bills. This one's
Representative Homer Lenderman
Unverified
1:12:43
mine. Absolutely not. Whatever the pleasure of this committee is, as I said,
this is a document that we're all working together for the same thing. Right. If this committee feels like this is the best way to address this is with an interim study, I would love to be a part of that and certainly would not
Representative Stephen Meeks
Unverified
1:13:01
oppose that. Okay. Thank you, Mr. Representative, for your work on
Representative Randy Stewart
Unverified
1:13:05
this. Thank you, Mr. Chairman. Moving right along. Representative Stewart, do you have a question? Yes, Mr. Chair. Thank you. Mr. Lindemann, did you meet jointly or individually with the three agencies in your bill, you know, the oil and gas, the PC&E, and ADEQ?
Speaker 212
1:13:19
Okay. The only one of those agencies that I met
Representative Homer Lenderman
Unverified
1:13:23
with was ADEQ. There was, as you all know, there are several of these bills, and there are a group of us that have met and worked together at different times.
but ADEQ was the only one of those regulatory agencies
Representative Randy Stewart
Unverified
1:13:36
that I met with. But your bill does outline things these other agencies have to do. That is correct, yes. But
Speaker 212
1:13:42
you didn't even talk to them about it? This bill, to answer your question, no, this bill was formed.
Representative Homer Lenderman
Unverified
1:13:50
It was looked at for a long time. It was vetted. Other people that did
Speaker 212
1:13:55
help work on this bill did meet with some of those agencies, yes. Would you agree that
Representative Randy Stewart
Unverified
1:14:02
they already have the authority to regulate and they do use best practices and they are continually updating their rules and
Representative Homer Lenderman
Unverified
1:14:11
regs? Okay. The last two, definitely. The first one, again, ADEQ, when we met, had several questions, and more than once it came up in the conversation,
well, we don't really know if we have the authority to do this. So
Representative Randy Stewart
Unverified
1:14:26
they gave you input and you included that in your bill? Absolutely. Okay. But, you know, I've got a little bit of background. I'm a biology teacher and I taught geology, too. As I reviewed these five bills, and I read all of them thoroughly and underlined, and I've came to realize that there's a lot more there and more complex than I'm capable of digesting in one committee meeting. Yes, sir. And since you have not conferred with the other agencies, I'm kind of like Representative Meeks.
this is a topic that is ripe for an interim study. And I think it should be a joint interim study with this committee and joint energy and get both of those in. That will bring some senators involved into the mix. And I think we would be better served and the state served as a whole to look at all these bills because they're all interrelated and they're all dealing with the same industry. And I would love to hear what PC&E and everybody else are currently doing, current practices, what their current regulations are
and I think they've got some that are just newly instituted we haven't seen the results yet but I know that you've already sent one built interim study as simple as teeth floating and this one is much more complex than teeth floating and I would agree with the other representative that this is something that really needs to go to a more in-depth study wouldn't
Representative Homer Lenderman
Unverified
1:15:50
you agree? Thank you for your comments and Mr. Stewart I think you very well may be right. Obviously, we have concerns with this bill.
We obviously have concerns with the industry. And, again, if it is the wishes of this committee and it is in the best interest of the industry and the environment, I'm absolutely in support of that. Yes, sir. Thank you, Mr. Stewart.
Representative Charlie Collins
Unverified
1:16:16
Representative Collins. Thank you, Mr. Chairman. And I'm kind of listening to this as we're forming, and I'm wondering to myself, are we already coming to closure on an answer? And I guess, Representative Linderman, that's for you to tell us.
But as long as we're going to keep discussing this one. Now, I kind of had two questions, one for you, and I'll start with that one. You mentioned the balance point, and I think you're right. It's important that we understand the economic engine as well as protecting the environment. And as I read this, what I don't see in here is where you're going to be including the industry and their knowledge and their understanding of these issues in forming all these rules. This reads more like a laundry list of rules plus a lot of authority for a lot of agencies to make even more rules.
Can you help me understand where in this bill the industry becomes a part of the
Representative Homer Lenderman
Unverified
1:17:12
solution? Well, I think industry is certainly represented on the oil and gas commission. Is that not correct? Someone else may have to answer that for me. Okay. I believe that they are represented on the oil and gas commission.
Representative Charlie Collins
Unverified
1:17:25
Okay. Thank you. Then my second question, Mr. Bengel, for you is where is the oil and gas commission on this bill? Do you feel good about it, not good about it, or something in
Speaker 209
1:17:36
between? Since the language has been put out on these bills, the oil and gas commission has not
met, so there is no position officially as an agency. As an executive agency, which we are, there's no administrative position, administration position either. So to answer your question, our official position is neutrality on the bill. CHAIRMAN BRYANT. Thank
Speaker 211
1:17:53
you. Thank you, Mr. Chairman. CHAIRMAN BRYANT. Thank you, Representative. CHAIRMAN BRYANT. Representative
Representative Matthew Shepherd
Unverified
1:18:06
Shepard. CHAIRMAN BRYANT. Thank you, Mr. Chairman. A number of my questions have previously been asked, but I do have one or two additional ones.
There's been a lot of discussion about the natural gas industry. This bill, as I read it, also applies to the oil
Representative Homer Lenderman
Unverified
1:18:25
industry. Is that correct? That
Representative Matthew Shepherd
Unverified
1:18:27
is correct. It was included in the bill. Okay. And that's a concern, obviously, for me. In my district, we've been producing oil and gas for almost 100 years. My additional question is, aren't there already deterrents out there to industry operating in such a way as to polluting groundwater or other natural resources?
I mean, isn't there civil liability? Are there federal laws, other things that already regulate in this area? And maybe Mr.
Speaker 190
1:18:59
Mays could answer that. MR. Well, you have the existing structure with the Oil and Gas Commission and the Arkansas Department of Environmental Quality, and because of the relative newness of the gas play in the Fayetteville shale, some of the areas that have been created, some of the areas of concern that have been created because of the fracking procedure
that's used and other things, there's some confusion about which agency has jurisdiction over which particular problem. I think the effort here of this bill, the intent of the bill, is to provide a system for assisting landowners whose property may have been affected either by groundwater source or surface water or soil to perhaps get on an even keel with the gas companies
and to get a little assistance because these things can get very expensive to try to fight if you have a problem, if your well is contaminated. It's an expensive proposition. But the answer to your question is, yes, there are some existing regulatory structures, whether those structures are adequate or not to meet the needs that we have today is open to debate. And I think that the suggestion that I've heard about referring this to an interim study,
which I understand Representative Lieberman is willing to do, is an excellent idea because these things are complicated and some of the costs are considerable to the gas companies. Nobody's trying to put them out of business, but there are concerns about the environment. We bill ourselves as the natural state. The gas companies are going to be here, and they'll be gone eventually, and we'd like to have something left in the natural state that will attract tourists and people to an area of the state that this activity is taking place in that is a very attractive area
and draws a lot of tourists. So we're all concerned. never people in the table of shell area are very concerned about all of the effects of
Speaker 149
1:21:18
this gas drilling shepard if you finish the question gentleman we have two more committee members that would like to ask questions and then we're going to try to go to the audience hope we can finish here by twelve o'clock
Speaker 143
1:21:34
uh... resident link uh... my questions been well
Speaker 80
1:21:44
addressed thank you sir and finally record a day thank you mr chairman uh... i've got about uh... three short questions here
Speaker 235
1:21:52
uh... my first would be to mr bingo we made a comment there that the oil and gas commission serves the drilling companies which you Tell me who the oil and gas company serves.
Speaker 209
1:22:07
The oil and gas companies, the oil and gas commission was not created for the purpose of serving the oil and gas companies. It is a board, an administrative board, that regulates the Arkansas oil and gas industry. It's nine members appointed by the governor for that purpose, to enforce the rules and regulations passed by the legislature, which is what we do. So that's its official purpose. By statute, several members have to have knowledge of production and transportation of oil and gas,
which is obvious in some of the matters that we take up are complex, and you need that experience. And so that's the creation and the purpose
Speaker 80
1:22:51
of the commission. Could that mean that
Speaker 208
1:22:54
you serve the citizens of Arkansas? Yes, that's our role, to serve the citizens
Speaker 80
1:23:00
and enforce the rules passed by the legislature. Thank you very much. Representative Linderman, on page 2, line 19,
you say that the Oil and Gas Commission or the Pollution Control Commission should use the rules as developed by the Gold Book Best Management Practices. I'm not familiar with that. Can you tell me a little bit about that? Okay, I can tell you a
Representative Homer Lenderman
Unverified
1:23:33
little bit about it. There has been a study by the Arkansas Public Policy Panel that I think did a pretty good job.
It took different states' rules that looked at the different positions and things, the different risks that were involved in developing natural gas and oil, and this was one
of the guidelines that was felt like that this was a good document to use to base our regulations regarding water contamination on.
Speaker 80
1:24:16
Does it make considerations for different areas? I mean, is there one of these that would
Speaker 235
1:24:22
cover our special needs in Arkansas, or is it very general
Representative Homer Lenderman
Unverified
1:24:27
rules? It is general rules and guidelines that would be very general in nature, Representative Dale. The last
Speaker 235
1:24:35
question I have is everything around here seems this session has been centered around three things, and that would be money, money, money. And so I'm wondering, we've got to be talking about some money here.
If we're going to be doing additional controls, that surely is going to require some additional state employees or some kind. Do you have a projection on the cost that your bill would cause for the people of
Representative Homer Lenderman
Unverified
1:25:06
Arkansas? No, sir. I have none. And again, the hope would be, in talking with the industry, they have assured me that most of the things in this bill are being addressed.
If that is the case, the regulatory agencies would only come into play when there was a problem, such as a well owner came in with a test and said, look, we've got a problem. That would be the hope. In the future, is there going to require more people? Probably. Is there going to be some cost to the industry? Yes. Hopefully it will be minimal cost
because, again, they have assured me that most of these practices are being implemented or performed now.
Representative Jerry R. Brown
Unverified
1:25:52
Thank you. Thank you, Representative. Thank you. Thank you, committee. Seeing no other questions, we will now go to the audience. I caution the people that have signed up to speak for and against the bill, use your words wisely. Pick the people that you want to choose to speak wisely. This committee has a bad habit of limiting debate so many minutes aside, just as your suggestion.
We will now go to speak against the bill. Rod Bryan. Yes, sir. Should I stand or have a seat? I'd prefer to stand if that's okay.
Speaker 238
1:26:31
No, sir. You need to have a seat so you can be recorded. Can I hold the mic? I've got a back condition. How did you
Representative Jerry R. Brown
Unverified
1:26:43
get here, sir? Did you walk? I rode a bicycle, sir. You sat on it
Speaker 212
1:26:45
or did you stand up on it? I sat on it, sir. You need to sit down, please, sir. Thank you. Thank you, sir. Mr. Chairman, would you like us to move and let... Please do. Okay.
Speaker 241
1:26:53
Thank you. Get the green lights on. I can hear. Can I kneel? Sir? I'm just asking. I'm seriously, I had a little trouble earlier, and I'm
Representative Jerry R. Brown
Unverified
1:27:11
just trying to make sure that I can, what I can do here. Yes, sir, please keep your
Speaker 241
1:27:15
remarks as brief as possible. You may begin, sir, once you recognize yourself. My name is Rob Bryan. I was the independent candidate for governor in the 2006 election. Not that that matters a lot here.
But I'm against this bill because I think that the natural gas industry, I think they've really proven their record for taking care of the people. and I think if we just, you know, allow them to continue to do what they're doing, these chemicals that are in the fracking fluids that they use, they're ultimately going to get into the drinking water. And when that happens, all the people in central Arkansas will have to move.
And so I'm going to head over to, I'm moving to France very soon, and after Arkansas has been depopulated due to the chemicals in the water, I'm going to come back and buy all that land real cheap, and we're going to repatriate Arkansas. So, I mean, endocrine-disrupting chemicals are serious business, and if they get into your water supply from the hydrofracturing, I mean, God forbid that the nuclear facility, which is 65 miles away from the Greenbrier epicenter, if the nuclear thing went down, I mean, if that happens,
Representative Jerry R. Brown
Unverified
1:28:26
I'd be able to do it a little faster. I'd be able to purchase. Mr. Bryan? Yes, sir. I appreciate you being here, but please stay on the subject of what we're talking
Speaker 241
1:28:38
about. Mr. Gorder, he's not speaking for the bill. Yes, sir. That's my point exactly. No, I'm actually speaking against the bill. Yes, sir. Yeah, and that's why I'm saying
Speaker 45
1:28:45
we need to just... Our time here is very important. You must consider that we have 20 to 25 people that would also like to
Speaker 239
1:28:50
speak. I completely understand, yeah. So please try to monopolize the
Speaker 241
1:28:52
time. Thank you, sir. Yeah, I'm doing best. What is my limit? We're not there yet, right?
Station made. Okay. Well, anyway, I'm going to sum up, and I just want to say that I think, you know, the gas company knows what needs to go in your water. I mean, the Oil and Gas Commission, House Bill 1026, which I think, Mr. Smith, I believe you brought that. When that came in, you gave the Oil and Gas Commission the authority to do whatever the heck they want. And if they want to put chemicals in Arkansas water, that's just too bad for us. We drink it. You know, I'm with you,
Speaker 45
1:29:22
brother. Thank you, Mr. Bryan. Appreciate you. If there are any questions about committee seeing none, we appreciate you coming to your testimony.
Representative Jerry R. Brown
Unverified
1:29:30
To speak for the bill, Mr. Joe David Rice, Mr. Rice in attendance. Mr. Rice,
does anybody see Mr. Rice? Pardon me, I'm a little bit
Speaker 103
1:29:42
aged and a little bit hard hearing. Yes, sir, that's fine, sir. Please
Representative Jerry R. Brown
Unverified
1:29:46
have a seat and recognize yourself. I'm Jack White. No, sir, Mr. White. I'm sorry. I did not call your name yet, sir. You didn't? No, sir. I called Mr. Joe David Rice.
All right. Sorry about that. That's all right, sir. Is Mr.
Speaker 170
1:30:10
Rice in attendance? If not, I go to Greg
Representative Jerry R. Brown
Unverified
1:30:14
Seaton. Yes, sir, Mr. Seaton. Would you come forward? Please, sir. Mr. Seaton, if you would please introduce yourself for the record.
Greg Seaton
Unverified
1:30:33
You may begin, sir, with your testimony. Thank you, sir. My name is Greg Seaton. I live on Cooter Neck Road in Heber Springs, Arkansas. Cooter Neck Road is on the Little Red River. I come to you, Mr. Chairman and Representatives, I come to you today with three interests in this legislation. The first, I'm President of the Heber Springs Chapter 722, Trout Unlimited. In this regard, my chapter is very concerned with the protection of the Little Red River as one of the premier trout streams, not only in Arkansas, but the United States.
Tourists and fishermen come from across the country to fish the Little Red, and as guardian of this natural resource, we want to see regulations in place to give our state agencies the power to do their jobs. in visiting with these people I believe they are sincerely want to do their job I've had a lot of contact with the ADEQ and with the ANRC, the Arkansas Natural Resource Commission I ask you to give them the tools to complete the tasks that they need to do
we cannot risk the contamination of such a pristine water source as Greer's Ferry Lake and the Little Red River, which is one of the most pristine water sources in the United States, not just Arkansas. The second, as a retired landowner of the Little Red River, on the Little Red River, my dream was to retire in an area such as Greer's Ferry Lake and Little Red River. The beauty, peace, and quiet, and clean environment were all factors. To have my dream destroyed by disfiguring the countryside noise and possible
contamination of the river I love so dearly does not even seem remotely possible. But at this time, I'm dealing with a drilling pad being placed within 100 yards of the front of my home. This locates it within 200 yards of the river. If this pad is not relocated, I'm faced with 24-hour-a-day noise for up to three to four months to the degree that a person can't sleep, devaluation of a property which took most of my retirement income to buy. And most every brochure put out the Cleburne County touts the same factors I used to choose
the area as a reason for coming to Hebrew Springs. The beauty and quietness and clean water. This area has depended on the income and increase in property values brought to this area by retirees and vacationers for years. And it should not be forsaken for the new money being offered by the gas industry. The third and final is as a guide, which is my retirement job. I love the river, and I guide part-time on the river, and in doing
so, I've met people who depend on this river for a livelihood. The resort owners, hatchery personnel, motels, guides, restaurant owners, employees, most small business owners in the Heber Springs area depend on tourism, which is provided by Greer's Ferry Lake and the Little Red River. I hope that we do not surrender this mainstay for the sake of the temporary money that the gas industry offers. With sound regulations and good stewardship, I believe that both can coexist. These bills will help provide such regulations. The Greer's Ferry
hatchery, gentlemen, ladies and gentlemen, the Greer's Ferry hatchery produced 752 jobs, generated 752 jobs. I believe you'll be given a report by the U.S. Fish and Wildlife Service. These jobs generated produced $19,563,000 worth of income. The total economic output of the Greer's Ferry Hatchery alone for trout fishing was $68 million. This is an all-related and it
is on is it is document i just asked the committee committee at this time to give serious consideration these bills not as a hindrance to the gas company as a guideline for the gas company to protect this clean water that cannot be replaced thank you sir appreciate it
Speaker 169
1:34:54
thank you mr ceden speak to speak against the bill josh spence
Josh Spencer
Unverified
1:35:00
Thank you ladies and gentlemen my name is Josh Spencer from Conway Arkansas born and bred and four years ago I owned a pickup truck and a trailer. I now employ over a a hundred Arkansans to handle the water we're talking about in a responsible, sensible manner.
We've made it a point to hire, find, and train and work closely with the production companies who care a great deal about pollution and the water sources. The idea of hiring Arkansans that hunt and fish on this land we've all grown up on is the ideal route to go. I will not pollute in my backyard or anyone else's.
I don't know that some of these folks have ever spent a single day riding around in a truck having a tour to see how responsible these companies are. They care. That's what makes the difference. I mean, drive around. Look, you're not going to see pollution. You're not going to see destruction. You may see a mailbox run over every now and then. We put them back. The companies I work for, which I won't name,
have spent probably within the last three years several hundred million dollars to make accountable every drop of water, every chemical, everything that's handled. The detail that it's recorded and handled is unbelievable. They have spent millions to take care of Arkansas' property and their home. I understand that there are some people who are not happy with this industry
because it hasn't positively affected them. but for the greater good, it has impacted thousands of Arkansans and changed their lives and their futures. I now have five companies that started from one, okay? I thank God that natural gas came to Arkansas, and if it wasn't for them, we'd be arguing with Mississippi for the poorest state in the union. That's all I have. Thank you.
Representative Jerry R. Brown
Unverified
1:37:34
Thank you, sir. To speak for the bill, Mr. Don Richardson. Mr.
Richardson. Mr. Richardson, as you approach your seat, would you please look at the clock? I'll be
Don Richardson
Unverified
1:38:01
very brief. Thank you, Mr. Chairman, members of the committee, for allowing me to testify on this important issue.
My name is Don Richardson. I'm here representing myself. I live in Clinton, the heart of the Fayetteville shale play. I'm a property owner, and my property that I own is leased to a subsidiary of XTO. I'm a member also of the Arkansas Natural Resources Commission. They are completed and operating wells within a mile of my home, and as I was typing my remarks last night with the window open, I could hear another well being drilled on the next hill to the east. But I've always stated that our community, because of the loss of jobs
and the various natural disasters we have suffered of late, would be a ghost town if not for the Fayetteville shale play. I want this industry to be here and thrive, but I want them to do business the right way, and HB 1394 is a reasonable bill that is not burdensome to the industry that helps to protect the most precious resource we have, water. My primary concern is the tremendous amount of sedimentation generated by the natural gas industry which places a huge load on our creeks, streams, rivers and lakes.
Building pads and the roads and pipelines to them create enormous amounts of non-point source pollution that ends up in our waterways. The best management practices required in this bill will address this critical issue and the argument that they are already doing it means that it will not be a costly and burdensome requirement for those good actors who are already doing it, but will help us gain compliance from those who are not doing these practices. In western Van Buren County, we have a perfect example of how the companies can apply very
stringent best management practices and still drill profitably. At the Scott Henderson Gulf Mountain Wildlife Management Area, Chesapeake paid premium prices to lease the land and are contractually bound to use the BLM gold book practices. If they can do that for the Arkansas Game and Fish Commission, shouldn't they do that for me and my neighbors? I see little reason to be concerned about the fracking process itself causing contamination
in the well water, but I'm concerned that those areas closer to the surface dealing with well casing and cementing are the problems. This bill asks the Arkansas Oil and Gas Commission to meet current industry best practices referred to in the bill as the American Standard for Testing Materials International Cementing and Casing Standards, conduct a risk assessment of the potential for casing failures, consider possible impacts to water supplies and casing where they fail and require at least two layers
of casing. I think most of us who helped draft these bills think this bill, all of these are reasonable to ask of the industry and help to protect both groundwater and surface water. The other major area of concern is the tremendous amount of water that is being consumed by the process. And I said consumed because for all practical purposes the water is lost to the hydrologic cycle when it is used in the fracking process. Last week at the Arkansas Natural Resources Commission meeting held in Clinton, I spoke
to industry officials about my concerns about the amount of water being used. I have a concern that there's a lot of water that's being impounded in ponds across the region there. When you look at the total area, the amount of water used is a small amount, but when you regionalize it into an area where we have very little groundwater resources and we're using all surface water, I have real concerns that we're going to have problems with in-stream
flows taking that water out of our creeks and streams. As I told you, I'm on the Arkansas Natural Resources Commission and I've told industry and Randy Young and Governor Beebe that I intend to spend my seven years on the commission reminding this industry of their stewardship obligations. I thought it was interesting. I saw a letter yesterday that seemed to say that folks like me were somehow outside interests. I was born in Jonesboro 65 years ago, and all of my 65 years I have been a resident of Arkansas.
For the last 32 years, I've lived in the same house in Clinton. I can't say I lived in the same address because we used to be a rural route, then we used to be a highway contract, and then we used to be, then we got 911, and then 911 said they didn't have it figured out right. So my address has changed, but my house hasn't moved except during the earthquakes. I fish the rivers. I drink water that comes from Gearsary Lake.
I am not an outsider. I believe, as I said at the first, I want this industry to thrive and be here, and I think that HB 1394 is a reasonable way for that to occur, the industry to thrive, and us to have safeguards on our important natural resources, the most important of which is water. Thank you. Thank you, Mr. Richardson. To speak against the bill, Mr. Alan Perkins.
Speaker 19
1:43:41
Mr. Perkins, if you would have a seat at the end
Speaker 258
1:43:48
of the table. I believe you know the drill. I do. Thank you, Mr. Chairman. I'll try to
Speaker 259
1:43:54
talk as fast as I can. Just a very brief introduction. I practice law here in Little Rock. I'm speaking on behalf of the Arkansas Independent Producers and Royalty Owners Association. I've practiced law for about 20 years in both environmental law and natural resources, primarily water and oil and gas.
Before that, I was a wildlife research biologist. I'm a certified wildlife biologist and did that for about eight years prior to going to law school, including about half of that time with the Arkansas Game and Fish Commission as a waterfowl research biologist. My wife and I own about 280 acres of rural land in Van Buren County, and we have a cabin on Greer's Ferry Lake. So hopefully I've covered all the bases there about the interests in this bill. As Representative Meeks said earlier, the devil's in the details.
There's something that's upside down about this bill when a group in the legislature with a few days dictates very specific requirements to the agencies. The concept of executive agencies is that we put people there with specialized expertise and knowledge and experience who can spend a lot of time with experts to determine the very specific kinds of things that we see in administrative regulations. Both of the agencies primarily involved here, the ADEQ and the Oil and Gas Commission,
have done a good job of that and should be allowed to continue. But let me talk about a couple of the standards. Some of this wasn't talked about at all. Representative Dale asked about the Gold Book. The gold book is the Bureau of Land Management's guidelines for development on federally owned lands. In addition to the surface use requirements, which has nothing to do really with hydraulic fracturing directly, but any kind of surface activity, there are also lots of requirements about permits and notifications to the federal government
and the Bureau of Land Management about various different things, applications for different aspects of the program. to take a statute and dictate to the agency that they adopt that gold book standard without any other information. And this statute says, and, quote, industry-made reasonable and prudent practices, whatever those are. I mean, how does an agency adopt those things? There's not a body of information out there entitled that. And then it gives the agency an alternative.
If you don't want to do that, then you have to adopt your own best management practices that are no less stringent than all of those put together. Very, very confusing. Hard to figure out exactly what it is they're supposed to do. Second, it requires the ADEQ to study the cumulative impacts of multiple well sites and associated infrastructure by watershed. Extremely expensive. Representative Smith asked if this was a bigger government bill.
Well, let me tell you how much a watershed study costs, And there are about 40 to 46 watersheds in the Fayetteville Shale area alone, as defined by the USGS, which is the agency that defines watersheds. I actually have a copy of how lucky we are. The USGS itself has just started last year studying one watershed in the Fayetteville Shale area to determine the effects solely of water supply ponds. Nothing else about the industry, not the well sites or the roads or the pipelines.
A two-year study, $346,000 for just the ponds alone in one watershed. So if we were just going to study the ponds in 40 watersheds, the tab would be $13.84 million. It's a ridiculous requirement to put in a statute without any idea of the budgetary impact of that type of mandate to an executive agency of state government.
Next, while Representative Linderman is correct, the early version of this bill had a presumption of liability. If there was some water pollution within 2,500 feet of a gas well, they were presumed to have caused it. They took that out. But now what we do is we go straight to liability. It says nothing about the presumption. It just says if anybody produces credible evidence of pollution anywhere within virtually a half a mile of a gas well,
then the gas company has to pay for testing every water supply within a half-mile radius. No hearing, no finding of liability. Richard May said the problem is in proven causation. But most of the time, companies are allowed to defend themselves before they're required to take action. I'm going through this as quick as I can, Mr. Chairman, if you'll give me one more minute.
But this bill requires the Pollution Control and Ecology Commission to amend Regulation 1, which is a fairly old regulation that pertains primarily to saltwater disposal. What no one else has mentioned, I think there was a question that alluded to it. Just in October of last year, the Oil and Gas Commission passed a new PIT permit or pit rule that covers many of the areas that are dealt with here.
They are working together with the ADEQ. The Pollution Control and Ecology Commission has promulgated a mirror rule to B-17. It is in the process right now. There's been a public comment period. I believe they're awaiting the end of the session so that they can get a legislative review of that rule. And these two agencies have agreed to enter into a memorandum of agreement to work together, to cooperate so that their inspectors can help each other and have a proper division
of duties so that there is no overlap and no wasteful inefficiency of inspectors going here and there because a bill has required them to do a lot of different things without any definition. The other item in this bill has to do with prescribing ASTM standards, the American Society for Testing and Materials, which actually now is called ASTM, and the API, the American
Petroleum Institute. This requires the Oil and Gas Commission to incorporate those standards. I'm not an engineer, but the engineers tell me that the API standards are really not designed for that. There are a lot of different standards for different applications. You can't simply say you're required to use them all. Again, a very specialized technical area that's better handled by our agencies themselves. And then I'm not sure what the question was in the conversations that Representative Lenderman
had with ADEQ officials. There have been questions about whether ADEQ in the past can actually regulate drilling activities. But in terms of their statutory jurisdiction for water pollution, here's the statement that's in the law now. Tell me if this is hard to understand. It shall be unlawful for any person to cause pollution as defined in 84102 of any waters of this state.
That's what the Pollution Control Ecology Commission and the Department of Environmental Quality provides their basic jurisdiction to control water pollution. It's very straightforward. There's no question about whether they have jurisdiction if contamination reaches a water body. And then there were questions of the Director, Director Bingle, well, what would you test for? Water pollution is a very, very broad term, and it includes siltation.
If I went out and took a photograph of a creek that was muddy, that would be evidence of a water quality violation. Nobody could deny that. It's very easy to do. That would mean that anybody could cause at any time there's a rainfall, all, whether the ultimate factor was construction of a home, a subdivision, a county road, a farming operation. The drilling company then would have to go test every water supply within a quarter mile.
I'm very, very sympathetic to the concerns of these folks, and I share the same concerns about the protection of our environment, and so does the industry. The way that these bills have been presented, it's sort of like being met in a room with someone thrusting a knife at you. You have to defend. You're not going to say, well, wait a minute. Can't we talk about this? The industry is very, very much interested and willing to sit down with the interests and to develop plans and proposals that are appropriate, that are cost-effective, and
that are protective of the environment. That's all I have, Mr. Chairman. Thank you, Mr. Perkins. any questions if there's any time
Speaker 261
1:53:52
any questions representing Patterson I got a motion for immediate consideration
Representative Jerry R. Brown
Unverified
1:53:56
we have a motion for immediate consideration that's a proper motion do I see another hand I see two hands we will vote on whether to accept the immediate consideration or not all in
favor say I opposed like sign now do I hear a motion on the bill represent your love do you have a
Speaker 125
1:54:24
motion yes I would like to send this bill to interim study he's been asked that
Representative Jerry R. Brown
Unverified
1:54:29
and he said he wanted a vote motion do pass we
have a motion do pass. All in favor, all
Speaker 183
1:54:40
in. I have a question. Yes, sir. No, sir. Not
Representative Jerry R. Brown
Unverified
1:54:43
under immediate consideration. Thank you, sir. Yes, sir. The motion is do pass. All in favor, say aye. Aye. Opposed, like sign. No. Representative Linderman,
I'm sorry, but you have failed your bill.
Speaker 264
1:54:55
Thank you. Thank you, committee. Thank you, sir. All right. Everyone in the room, what I'm
Representative Jerry R. Brown
Unverified
1:55:02
going to do now is I'm going to give everyone in the audience that's seated and standing a hall pass to go to the restroom. And while y'all are doing that, the committee is going to eat, and we're going to try to reconvene at 1230 and try to run one more bill, okay, before we have to go into session at 1.
Agenda
HB1955
HB1980
HB2195
HB2157
HB1394
Adjournment
Documents
No documents posted.
Speakers
Gene Eagle
Unverified
Representative Charlie Collins
Unverified
Speaker 5
Representative John Charles Edwards
Unverified
Speaker 8
Representative Jerry R. Brown
Unverified
Representative Bruce Westerman
Unverified
Representative Kelley Linck
Unverified
Speaker 30
Representative Stephen Meeks
Unverified
Speaker 36
Representative Fredrick J. Love
Unverified
Speaker 40
Speaker 42
Speaker 43
Speaker 45
Speaker 48
Speaker 11
Representative Randy Stewart
Unverified
Representative Linda Collins-Smith
Unverified
Speaker 76
Representative Garry L. Smith
Unverified
Speaker 110
Representative John Burris
Unverified
Speaker 21
Speaker 121
Speaker 125
Matthew Hass
Unverified
Speaker 137
Speaker 140
Speaker 145
Speaker 146
Speaker 75
Speaker 158
Speaker 17
Speaker 171
Speaker 174
Speaker 142
Speaker 151
Speaker 55
Representative Homer Lenderman
Unverified
Speaker 187
Speaker 190
Speaker 192
Speaker 188
Speaker 204
Speaker 206
Speaker 208
Speaker 209
Speaker 212
Speaker 218
Speaker 211
Representative Matthew Shepherd
Unverified
Speaker 149
Speaker 143
Speaker 80
Speaker 235
Speaker 238
Speaker 241
Speaker 239
Speaker 103
Speaker 170
Greg Seaton
Unverified
Speaker 169
Josh Spencer
Unverified
Don Richardson
Unverified
Speaker 19
Speaker 258
Speaker 259
Speaker 261
Speaker 183
Speaker 264