By: Gloria Leal
The Texas Legislature convened Jan. 13 with a host of new state leaders and the most conservative group of lawmakers the state has seen in decades. Texas Republican leaders, emboldened by strong victories, are viewing their decisive elections as a mandate to follow up on election promises and promote change.
January was tied up with the pomp and circumstance of inaugural and swearing-in ceremonies. By mid-February, leaders of both chambers had named committee appointments, adopted procedural rules, set permanent committee schedules and met for organizational purposes. During March and April, the Texas Legislature is in full swing with committees holding hearings on priority bills and even taking preliminary votes. In the Senate, social legislation is dominating the agenda, whereas in the House a different approach to bill consideration is taking place, guided in part by the Speaker and choice of committee chairs.
The importance of committees cannot be underestimated – the assignment is followed by months of suspense and drama, and even angst. Committee leadership and membership, as well as assigned jurisdiction, are all important determinants on the priority of legislation and probability of passage, as committees get first crack at legislation and hold public hearings before a bill is blocked or goes to the floor for a vote by a full chamber.
In the Senate, Lt. Gov. Dan Patrick invoked his “New Day” theme, reducing the number of standing committees. He also followed through on a campaign promise to change the Senate rule requiring a two-thirds vote (21 votes) to allow for a three-fifths vote (19), thereby ensuring Republican dominance of the agenda (with 20 Republicans in the Senate). By eliminating three committees previously chaired by Democrats, Patrick also reduced the number of Democrats who will lead Senate committees in the 2015 session – another campaign promise.
Sen. Troy Fraser, R-Horseshoe Bay, was named Chair of the expanded Natural Resources & Economic Development Committee, which has jurisdiction over the Public Utility Commission of Texas, the Texas Commission on Environmental Quality and the Railroad Commission of Texas. The organizations encompass oil and gas, water and now telecommunication and electricity. Other key committees for the oil and gas industry include:
Business & Commerce – Kevin Eltife, Chair; Brandon Creighton, Vice Chair
Finance – Jane Nelson, Chair; Juan “Chuy” Hinojosa, Vice Chair
State Affairs – Joan Huffman, Chair; Rodney Ellis, Vice Chair
Transportation – Robert Nichols, Chair; Don Huffines, Vice Chair
In the House, Speaker Joe Straus, R-San Antonio, announced the appointment of House committees with some major shuffling of members, although committee jurisdictions remained largely intact. Straus kept his lieutenants atop key committees on Calendars, State Affairs and House Administration but shuffled around 10 other committee chairs, perplexing even longtime Capitol observers. State Reps. Todd Hunter (R-Corpus Christi), Bryon Cook (R-Corsicana) and Charlie Geren (R-River Oaks) kept their jobs on the above committees, respectively. Straus named new chairs for 24 of 40 committees in an effort to bring in new perspectives and leadership. The committee appointments reflect the makeup of the House, the needs and priorities of both rural and urban areas, as well as diversity of House membership.
Some of the most significant moves for oil and gas include naming Rep. Drew Darby, R-San Angelo, Chair of the Energy Resources Committee and Rep. James L. “Jim” Keffer, R-Granbury, Chair of the Natural Resources Committee, which has jurisdiction over ever-important water issues. Rep. John Otto, R-Dayton, will chair the budget-drafting Appropriations Committee; and Rep. Dennis Bonnen, R-Angleton, is at the helm of the tax-writing Ways & Means Committee. Geanie W. Morrison, R-Victoria, was named Chair of the Environmental Regulation Committee, which has jurisdiction over air and other environmental factors. In a move sure to have implications, John T. Smithee, (R-Amarillo), longtime Chair of the Insurance Committee, was replaced with John Frullo, R-Lubbock. Smithee will now chair the Judiciary & Civil Jurisprudence Committee. Rep. Rafael Anchia, D-Dallas, retained the Chair of International Trade & Intergovernmental Affairs – a more significant appointment given the importance of trade with Mexico and energy reforms in that country. Rep. Joe C. Pickett, D-El Paso, will chair the Transportation Committee, with Armando “Mando” Martinez, D-Weslaco, as Vice Chair.
Full membership of key committees related to energy include:
• Drew Darby, R-San Angelo, Chair
• Chris Paddie, R-Marshall, Vice Chair
• Rafael Anchia, D-Dallas
• Terry Canales, D-Edinburg
• Tom Craddick, R-Midland
• Tony Dale, R-Cedar Park
• Abel Herrero, D-Corpus Christi
• James L. “Jim” Keffer, R-Granbury
• Phil King, R-Weatherford
• Brooks Landgraf, R-Odessa
• Morgan Meyer, R-Highland Park
• Debbie Riddle, R-Spring
• Gene Wu, D-Houston
• James L. “Jim” Keffer, R-Granbury, Chair
• Trent Ashby, R-Lufkin, Vice Chair
• Dennis Bonnen, R-Angleton
• DeWayne Burns, R-Cleburne
• James Frank, R-Wichita Falls
• Kyle Kacal, R-Bryan
• Tracy O. King, D-Batesville
• Lyle Larson, R-San Antonio
• Eddie Lucio III, D-Brownsville
• Poncho Nevárez, D-El Paso
• Paul Workman, R-Austin
Other Relevant Chairs:
• Agriculture & Livestock – Tracy O. King, D-Batesville
• Business & Industry – René O. Oliveira, D-Brownsville
• County Affairs – Garnet F. Coleman, D-Houston
• Land & Resource Management – Joe Deshotel, D-Port Arthur
• Urban Affairs – Carol Altado, D-Houston
Oil and Gas Issues on the Legislature’s Agenda in 2015
The deadline for filing bills and joint resolutions – other than local bills, emergency appropriations and bills declared an emergency by the governor – is March 13, 2015. To date, bills have been filed related to a myriad of issues, but legislation pertaining to the proliferation of local bans, seismicity, unitization authority, allocation of production permitting, disposal, well regulation and flaring is dominating discussion. Place-holder bills have been filed for defining the continuing role of groundwater conservation districts.
Local bans in light of Denton: Gov. Greg Abbott has called for doing away with local bans on plastic bags, fracing and tree-cutting that amount to what he called a “patchwork quilt of bans and rules and regulations that is eroding the Texas model” at an Austin conference in January. Various bills have been filed in both the Senate and the House addressing the issue of local bans. The bills take varying approaches to the issue. Some are narrowly crafted and are oil and gas specific – prohibiting local political subdivisions from banning hydraulic fracing or unilaterally imposing restrictions on oil and gas development, such as setbacks, without procedural conditions related to “takings” and a determination from the Attorney General. Other bills are not energy specific, but have broad impact and would restrict ordinances having economic impact. Efforts to weaken local economic bans have failed in previous sessions. But it’s clear that such proposals seek to clarify the proper role of government in local affairs regarding protecting citizens’ health and safety.
Workforce and worker safety issues: Decisions made this session will affect the workforce in one way or another. From appropriations and education to transportation and insurance, key issues of the 84th Legislature will impact the economy and directly and indirectly affect workers in the year ahead.
Of primary interest to working-class Texans is the possibility of a raise to the state’s minimum wage. Increasing minimum wage has been a national focus recently, with several states and cities having raised the minimum wage in their jurisdiction. In addition, efforts are being made to expand the budget to pay for construction and maintenance on Texas roadways, which would increase job opportunities throughout the state, including energy-producing areas. The Legislature may also see the need to address a few issues evident in the oil patch, including worker safety, training and workers’ compensation. Commercial driver issues are being discussed and may find their way into legislation as well. Of interest to employers, as in previous sessions, legislation has been filed that would require the use of “e-verification” of the legal status of employees for those entering into contracts with certain public entities.
The future path of the Texas economy and the oil and gas industry will be greatly influenced by the Texas Legislature in the upcoming months. Texas legislators face an immense challenge in continuing the economic momentum that has resulted from the energy boom; and they will consider carefully all legislation with potential economic impact as it moves through the legislative process. A more comprehensive list of those issues being considered by the legislature will be available for the next issue of SHALE Magazine.
About the author: Gloria Leal is an attorney and government-affairs consultant in Austin, Texas. Leal has a solo practice primarily relating to energy, environmental and health care matters. She also represents the Texas Alliance of Energy Producers, a national association of independent producers and service providers. She can be reached at [email protected].