Authored by Kevin Moody, General Counsel & Vice President of Government Affairs PIOGA. Article can be found in the PIOGA Press August Edition #148.

Federal court decision declaring Grant Townships claimed “right of local self-government” authority nonexistent and ordinance violative of the US Constitution renders Township’s counterclaims immaterial.

Barring a successful appeal – unlikely in PIOGA’s view – the Commonwealth Court on July 12th is the latest court to state that the so-called “right of local self-government” theory is violative of the US Constitution. PIOGA member Pennsylvania General Energy Company, LLC (PGE) began its challenge to the “right of local self-government” theory that local law is superior to state and federal law 8 years ago in federal court. This theory has been advanced by the Community Environmental Legal Defense Fund (CELDF) for over 15 years in Pennsylvania, and Grant Township used the theory to try to justify the township’s attempts to deny PGE its rights to engage in lawful, and comprehensively regulated, business activities.

Abbreviated History

This litigation saga began when CELDF convinced Grant Township that it could prohibit PGE from developing its underground injection control (UIC) well based on a so-called right of local self-government that authorized the township to enact laws that override conflicting state and federal laws. Relying on this advice, the township enacted the “Community Bill of Rights Ordinance” (CBORO), and later a Home Rule Charter (“HRC”), to do so.

PGE sued the township in federal district court in August 2014, claiming violations of the US Constitution and various state laws. PIOGA intervened because of the threat of the so-called “right of local self-government” rationale to not only the oil and gas industry but to any other industries engaging in lawful business activities that a local government wants to ban, for whatever reason.

In 2015, the federal district court agreed with PGE that six provisions of the CBORO: (i) violated the Second-Class Township Code; (ii) were preempted by state law; and/or (iii) were unlawfully exclusionary. Then in 2017, the district court again agreed with PGE and determined that the CBORO violated PGE’s rights under the US Constitution “as guaranteed under the Equal Protection Clause, the Petition Clause, and substantive Due Process.” The court also rejected the township’s counterclaim that PGE’s lawsuit violated the township’s “constitutional and inalienable right to ‘local community self-government.’”

The salient history of the federal court litigation is set forth because the Commonwealth Court determined that the federal court’s decision finding the CBORO provisions violative of PGE’s rights under the US Constitution precluded the township from relitigating the constitutionality of those provisions in Commonwealth Court, thereby rendering consideration of the township’s counterclaims “unnecessary.”

Commonwealth Court Issues

Our October 2020 newsletter article (“Constitutionality of Oil & Gas Act and Solid Waste Management Act under the ERA still in question”) provides details on the issues involved in the DEP litigation, which DEP initiated in Commonwealth Court against Grant Township just days before the federal district court issued its decision invalidating provisions of the CBORO under the US Constitution, that resulted in the July 12th decision that is the subject of this article.

In December 2020, PGE also instituted a second suit in federal court, challenging the provisions of the HRC that mirrored the invalidated CBORO. The township had adopted the HRC in defiance of the federal court’s invalidation of the CBORO. That matter was stayed pending resolution of the Commonwealth Court proceeding

When it became apparent that the DEP-initiated matter would be going to trial in Commonwealth Court, PGE intervened in the proceeding in order to defend oil and gas development against unlawful local bans, as the Commonwealth Court had ruled that the Township was entitled to seek to prove “that hydrofracking and disposal of its waste is so dangerous to the environment as to be in violation of the ERA, and thus that the statutes upon which DEP bases its preemption claims are constitutionally invalid.”

After the Commonwealth Court’s rulings on a few preliminary procedural matters, the case came down to requests for summary relief (without trial) by both PGE and the township. PGE’s request argued that, under the doctrines of res judicata and collateral estoppel, the township was precluded from relitigating the constitutionality of the HRC provisions determined by the federal courts to have violated its rights under the US Constitution. The township argued that that its HRC was a valid law pursuant to Pennsylvania Environmental Rights Amendment (ERA) “and therefore cannot be preempted by state statutes” but that, if those statutes do preempt the HRC, “they are unconstitutional because they prevent the township from fulfilling its duties as a reasonable and prudent trustee under the ERA.”

These were the two basic issues the court was asked to decide without trial. In its July 12hdecision, the court rejected the township’s argument that the federal court decision was not preclusive because the federal litigation “did not involve any claims under the Pennsylvania Constitution.” The court pointed out that in the federal litigation the township “raised similar constitutional claims under the Pennsylvania Constitution . . . [that PGE’s lawsuit] is violating the rights of the people of [the] Township to ‘local community self-government’ as secured by the American Declaration of Independence, the Pennsylvania Constitution, the federal constitutional framework, and the [] Ordinance itself.”

The Commonwealth Court also observed that even if the township’s ERA claims had merit, that “would not otherwise salvage provisions that have been otherwise declared unconstitutional under the U.S. Constitution.” In other words, the result would be the same because the U.S. Constitution is the “supreme law of the Land” and “Pennsylvania’s ERA does not override the U.S. Constitution. Any conflicts between the U.S. Constitution and the Pennsylvania Constitution must be resolved in favor of the U.S. Constitution.”

Every court in Pennsylvania that has considered the lawfulness of the “right to local self-government” theory has ruled that is has absolutely no merit. Despite this, PIOGA is certain that the township will continue its futile promotion of this frivolous theory (no arguable basis either in law or in fact) by appealing the July 12th decision. Continuing this litigation could subject the township to liability for attorneys’ fees based on the violation of PGE’s rights, which is what happened in the federal litigation, and that will impact everyone in the township. At some point the township and its residents must accept the hierarchy of the rule of law in our republic – federal law is supreme, then state law, then local law.

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