Federal Court Holds Counties May Not Impose “Safety Standards” on Carbon Pipelines

Under the U.S. District Court for the Southern District of Iowa’s decisions, counties may not regulate carbon pipelines’ setbacks, decommissioning or emergency-response requirements.

Under the Supremacy Clause of the U.S. Constitution, federal statutes and regulations preempt any incompatible local law.[1]  Preemption can occur either expressly or by implication, such as when federal law comprehensively regulates a subject or conflicts with a local government’s regulations.[2]

Carbon pipelines are the subject of both express and implied preemption.  Federal law regulates carbon dioxide as a non-flammable gas hazardous material.[3]  Carbon pipelines thus must comply with the Hazardous Liquid Pipeline Safety Act (the “Pipeline Safety Act”).  It expressly preempts any state or local laws imposing a safety standard on carbon pipelines.  As the Pipeline Safety Act expressly provides, “a [s]tate authority may not adopt or continue in force safety standards for interstate pipeline facilities or interstate pipeline transportation.”[4]

The first carbon-pipeline case testing the Pipeline Safety Act’s preemptive effect came in July 2023.  In Couser v. Shelby County, Iowa,[5] a carbon-pipeline operator and landowner sued to preliminarily enjoin an Iowa county’s ordinance regulating carbon pipelines.  The ordinance required pipeline operators to obtain a conditional use permit, comply with setback requirements, submit a decommissioning plan and submit an emergency response and hazard mitigation plan.

Plaintiffs claimed federal and state law preempted the ordinance.  The court agreed.  The court characterized the Pipeline Safety Act as “a sweeping exercise of express preemption.”[6]  Under the Pipeline Safety Act, for instance, the federal Pipeline and Hazardous Materials Safety Administration (the “Pipeline Administration”) already requires carbon pipeline companies to:

• • develop procedures regarding decommissioning, “including safe disconnection from an operating pipeline system, purging of combustibles and sealing abandoned facilities left in place to minimize safety and environmental hazards,”[7] and
  • prepare and follow a manual that includes “procedures . . . [for] when an emergency condition occurs,” including “receiving, identifying and classifying notices of events that need immediate response,” “having personnel, equipment, instruments, tools and material available as needed at the scene of an emergency” and “assisting with evacuation of residents.”[8]

Federal law thus preempted the county’s decommissioning and emergency-response requirements.  The court, on December 4, 2023, reiterated that position and granted summary judgment to the carbon pipeline operator.[9]

In another case, the court added that the Pipeline Safety Act also preempts local setbacks.  In Couser v. Story County, Iowa,[10] the same carbon-pipeline operator and landowner sued to enjoin a different county’s zoning ordinance.  Among other requirements, it reiterated the federal requirement for setbacks from carbon pipelines.[11]

The court clarified that federal safety standards set both the floor and ceiling for carbon pipeline regulations.  Federal regulations, for instance, state:

• • “Pipeline right-of-way must be selected to avoid, as far as practicable, areas containing private dwellings, industrial buildings, and places of public assembly,”[12] and
  • “No pipeline may be located within 50 feet (15 meters) of any private dwelling, or any industrial building or place of public assembly in which persons work, congregate, or assemble, unless it is provided with at least 12 inches (305 millimeters) of cover.”[13]

Those federal setbacks for carbon pipelines are “exclusive,” the court held.[14] It did not matter the county’s regulation merely reiterated the federal requirement.  The federal requirement itself “precludes states and municipalities from regulating in any manner whatsoever with respect to the safety of pipeline facilities.”[15]  Federal law even “preclude[s] state authorities from adopting standards identical to the federal standards.”[16]

Shelby Count has appealed to the U.S. Court of Appeals to the Eighth Circuit.  Subject to that appeal, however, federal law preempts counties’ right to impose safety standards, including any decommissioning requirements, emergency response standards or setbacks.  It remains unclear if counties may require a zoning approval.

Attorneys at Baird Holm LLP specialize in various subject matter areas including administrative, environmental and land use law.  Please contact us if you have any questions about this or a related matter.