In re Application No. OP-0003.
Susan and William Dunavan et al., appellants, TransCanada Keystone Pipeline, LP, et al., appellees and cross-appellees, Yankton Sioux Tribe of South Dakota and Ponca Tribe of Nebraska, appellees and cross-appellants, and Sierra Club, Nebraska Chapter, et al., appellees.
Jurisdiction: Appeal and Error. A
jurisdictional question which does not involve a factual
dispute is determined by an appellate court as a matter of
Administrative Law: Statutes: Appeal and
Error. The meaning and interpretation of statutes
and regulations are questions of law for which an appellate
court has an obligation to reach an independent conclusion
irrespective of the decision made by the court below.
Constitutional Law: Due Process. The
determination of whether the procedures afforded to an
individual comport with constitutional requirements for
procedural due process presents a question of law.
Public Service Commission: Appeal and Error.
Under Neb. Rev. Stat. § 75-136(2) (Reissue 2018), an
appellate court reviews an order of the Nebraska Public
Service Commission de novo on the record.
Appeal and Error. In a review de novo on the
record, an appellate court reappraises the evidence as
presented by the record and reaches its own independent
conclusions concerning the matters at issue.
Administrative Law: Appeal and Error. Where
the evidence is in conflict, the Supreme Court will consider
and may give weight to the fact that the agency hearing
examiner observed the witnesses and accepted one version of
the facts rather than another.
Constitutional Law: Public Service
Commission. The Nebraska Public Service Commission
is an independent regulatory body created by the Nebraska
Constitution in article IV, § 20.
Neb. 873] 8. Public Service
Commission. The determination of what is consistent
with the public interest, or public convenience and
necessity, is one that is peculiarly for the determination of
the Nebraska Public Service Commission.
Statutes: Appeal and Error. Statutory
language is to be given its plain and ordinary meaning, and
an appellate court will not resort to interpretation to
ascertain the meaning of statutory words which are plain,
direct, and unambiguous.
Statutes: Legislature: Intent. Components of
a series or collection of statutes pertaining to a certain
subject matter are in pari materia and should be
conjunctively considered and construed to determine the
intent of the Legislature, so that different provisions are
consistent, harmonious, and sensible.
Evidence. Unless an exception applies, only
a preponderance of evidence is required in civil cases.
Trial: Evidence: Proof. The burden of proof
is satisfied by actual proof of the facts, of which proof is
necessary, regardless of which party introduces the evidence.
Administrative Law: Pleadings. The rules of
pleading are not applied in administrative proceedings as
strictly as they are in court proceedings.
Administrative Law: Due Process: Notice. Due
process requires notice and an opportunity for a full and
fair hearing at some stage of the agency proceedings.
Notice: Waiver. It is generally held that
participation in the hearing waives any defect in the notice.
Administrative Law: Appeal and Error. An
appellate court will not consider an issue on appeal that was
not presented to or passed upon by the administrative agency.
Interventions: Final Orders: Appeal and
Error. An order denying intervention is a final
order for purposes of appeal.
Administrative Law: Statutes. Agency
regulations properly adopted and filed with the Secretary of
State of Nebraska have the effect of statutory law.
Rules of Evidence: Hearsay: Statutes. The
Nebraska Evidence Rules provide that hearsay is admissible
when authorized by the statutes of the State of Nebraska.
Legislature: Courts: Evidence. The
legislative branch has the right to prescribe the
admissibility of certain categories of evidence, but it is
solely a judicial function to determine the weight, if any,
to be given such evidence.
Evidence: Appeal and Error. In a civil case,
the admission or exclusion of evidence is not reversible
error unless it unfairly prejudiced a substantial right of
the complaining party.
Neb. 874] 22. Interventions: Pleadings.
Interveners can raise only issues that sustain or oppose the
respective contentions of the original parties.
Interventions: Parties. An intervenor who is
not an indispensable party cannot change the position of the
original parties or change the nature and form of the action
or the issues presented therein.
Interventions. An intervenor cannot widen
the scope of the issues, broaden the scope or function of the
proceedings, or raise questions which might be the subject of
litigation but which are extraneous to the controlling
question to be decided in the case.
from the Public Service Commission.
A. Domina and Brian E. Jorde, of Domina Law Group, PC,
L.L.O., for appellants.
Douglas J. Peterson, Attorney General, L. Jay Bartel, David
A. Lopez, and Lynn A. Melson for appellee Nebraska Public
Power Service Commission.
G. Powers and Patrick D. Pepper, of McGrath, North, Mullin
& Kratz, PC, L.L.O., for appellees TransCanada Keystone
Pipeline, LP, et al.
Jennifer S. Baker and Leonika R. Charging, of Fredericks,
Peebles & Morgan, L.L.P, for appellee Yankton Sioux
S. Jolly, of Brad S. Jolly & Associates, for appellee
Ponca Tribe of Nebraska.
Kenneth C. Winston for appellee Sierra Club, Nebraska
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, Papik,
and Freudenberg, JJ.
Nebraska Public Service Commission (PSC) granted the
application filed by TransCanada Keystone Pipeline, LP
(TransCanada), pursuant to the Major Oil Pipeline Siting Act
(MOPSA), Neb. Rev. Stat. §§ 57-1401 to 57-1413
(Reissue 2010 & Cum. Supp. 2018), for approval of a major
oil pipeline [303 Neb. 875] route and eminent domain
authority. The PSC approved the "Mainline Alternative
Route" (MAR), a 36-inch major oil pipeline and related
facilities to be constructed through Nebraska, from the South
Dakota border in Keya Paha County, Nebraska, to Steele City,
Nebraska. The landowners, two Indian tribes, and the Sierra
Club, Nebraska Chapter (Sierra Club), all intervened in the
proceedings. The landowners appealed, the Indian tribes
cross-appealed, and the Sierra Club attempted to appeal from
the PSC's decision.
intervenors raise numerous arguments on appeal. Each of these
arguments raises issues of public concern and represents
profound, deeply held beliefs. Upon de novo review of the
PSC's decision, we find the matters in controversy are
resolved based on the determination of four overarching
issues: The first, whether the PSC had jurisdiction to
consider TransCanada's application; the second, whether
TransCanada met its burden of proof; the third, whether the
PSC properly considered the MAR; and the fourth, whether the
intervenors were afforded due process. We answer each of
these questions in the affirmative.
outset, we observe that this appeal comes to us in a
completely different legal framework than we confronted in
Thompson v. Heineman. While both cases involve the
statutory process for obtaining route approval of an oil
pipeline, the issues in this appeal are distinctly different
from those in Thompson because here, route approval
was sought from the PSC using the MOPSA procedure. In this
opinion, we describe the procedures enacted by the
Legislature to effectuate proceedings under MOPSA. We discuss
the record in detail and show that TransCanada carried its
burden of proving that the MAR is in the public interest. We
then determine that the errors assigned by the intervenors
are without merit. Accordingly, we affirm the PSC's
determination that approval of the MAR is in the public
Neb. 876] I. BACKGROUND
is a limited partnership organized in Delaware with its
principal place of business in Houston, Texas. In 2008.
TransCanada applied for a presidential permit to construct a
pipeline across the Canadian border into the United States.
The proposed route would have passed through the Nebraska
Sandhills at a time when no legal standards existed in
Nebraska to constrain an oil pipeline carrier's right to
exercise eminent domain authority. In 2011, Gov. Dave Heineman
called a special session of the Legislature to enact siting
legislation for pipeline routing.
Legislature enacted MOPSA, 2011 Neb. Laws, L.B. 1, § 2,
1st Spec. Sess., which gave routing authority to the PSC, an
independent regulatory body with duly elected
officials.MOPSA applies to a pipeline with an
interior diameter larger than 6 inches that is built to
transport petroleum products within, through, or across
Nebraska. MOPSA requires a major oil pipeline
carrier to apply for and obtain routing approval from the PSC
before the carrier is authorized to exercise eminent domain
power pursuant to § 57-1101.
recognized that federal law preempts state regulation of
safety issues related to oil pipelines and that
Nebraska's laws cannot interfere with the federal
government's uniform standards for pipeline safety,
operation, and maintenance.Consequently, the Legislature
enacted MOPSA to address "choosing the location of the
route aside and apart from safety
considerations." With MOPSA, the Legislature harnessed [303
Neb. 877] Nebraska's remaining sovereign powers with
respect to oil pipeline construction, granted the PSC
authority to conduct proceedings and decide applications, and
determined that "[t]he construction of major oil
pipelines in Nebraska is in the public interest of Nebraska .
. . ."
same special session, the Legislature enacted 2011 Neb. Laws,
L.B. 4, 1st Spec. Sess., which created a separate procedural
avenue for a pipeline carrier to obtain route approval.
Independent from the MOPSA process, § 3 of L.B. 4
authorized Nebraska's Department of Environmental Quality
(DEQ) to collaborate with any federal agency for the
preparation of a supplemental environmental impact statement
(SEIS) for oil pipelines within, through, or across Nebraska,
in accordance with the review process under the National
Environmental Policy Act of 1969, 42 U.S.C. § 4321 et
seq. (2012). Once completed, the DEQ was to submit the
SEIS to the Governor, who then would have 30 days to indicate
his or her approval of a route in writing to the relevant
federal agencies. Both L.B. 1 and L.B. 4 were passed with
an emergency clause and became effective on the same date,
November 23, 2011.
January 18, 2012, the President of the United States denied
TransCanada's permit application. On April 17, 2012, the
Legislature passed and the Governor approved 2012 Neb. Laws,
L.B. 1161, which amended L.B. 1 and L.B. 4. In its original
form, MOPSA did not apply to TransCanada, because the
legislation contained an exemption for a pipeline carrier
which had a pending application for a presidential
permit. L.B. 1161 eliminated that exemption,
which led TransCanada to seek to obtain route approval from
the PSC under MOPSA.
Neb. 878] L.B. 1161 amended § 3 of LB. 4 so that the DEQ
could either prepare the SEIS through collaboration with
federal agencies, as L.B. 4 originally had provided, or could
independently evaluate a route submitted by a pipeline
carrier "for the stated purpose of being included in a
federal agency's or agencies' National Environmental
Policy Act review process."This amendment allowed the
DEQ to continue to review possible routes for the Keystone XL
pipeline project, which the DEQ had ceased reviewing
following the President's denial of TransCanada's
application for permit.
conducting an independent evaluation of a proposed route,
L.B. 1161 required the DEQ to hold at least one public
hearing, provide opportunities for public review and comment,
and analyze "the environmental, economic, social, and
other impacts associated with the proposed route and route
alternatives in Nebraska." The DEQ would then submit
its evaluation of the pipeline route to the Governor, and the
pipeline carrier could then seek the Governor's approval
of the route.L.B. 1161 provided that a pipeline
carrier's authorization to exercise eminent domain power
expires "[i]f condemnation procedures have not been
commenced within two years after the date the Governor's
approval is granted or after the date of receipt of an order
approving an application under [MOPSA]."
TransCanada Modifies Route
2012, TransCanada modified the original route, which would
have passed through the Nebraska Sandhills, based on
recommendations provided by the DEQ. On September 5, 2012,
TransCanada filed a supplemental environmental report with
the DEQ regarding the "reroute." The
"reroute" avoided [303 Neb. 879] the Sandhills and
other areas of fragile soils and shallow groundwater
identified by the DEQ. On January 3, 2013, the DEQ submitted
a final evaluation report to the Governor in accordance with
L.B. 1161. On January 22, the Governor approved the
"reroute" in a letter to the President and the U.S.
Department of State (the Department), asking that the
DEQ's evaluation be included in the federal SEIS report.
TransCanada filed condemnation actions, which were later
dismissed following litigation challenging the
constitutionality of L.B. 1161.
than 2 years passed after the Governor's approval of the
route, and TransCanada no longer proceeded on that approval.
On January 24, 2017, the President invited TransCanada to
resubmit its permit application, which TransCanada
accomplished 2 days later. On February 16, TransCanada filed
an application with the PSC for approval of a major oil
pipeline route. On March 23, the Department granted
TransCanada a presidential permit.
TransCanada's Application to PSC
application to the PSC sought approval of a route designated
as the "Preferred Route" (PR), which was
"refined to reflect the recommendations made by the
[DEQ] and the Governor's approval." The
"reroute" submitted to the DEQ in 2012 "was
used as the basis for developing the [PR]." The PR is
275.2 miles long and begins at the Nebraska-South Dakota
border in Keya Paha County and passes through the Nebraska
counties of Keya Paha, Boyd, Holt, Antelope, Boone, Nance,
Merrick, Polk, York, Fillmore, and Saline before terminating
in Steele City.
application referred to two alternative routes, the MAR and
the "Sandhills Alternative Route" (SAR).
TransCanada developed each of the three routes with the goal
of utilizing the "existing fixed starting point" at
the Nebraska-South Dakota border in Keya Paha County, north
of Mills, Nebraska, and the "existing fixed ending
point" at the pump station in Steele City, which is the
end point of the pipeline system already existing in
Nebraska, known as Keystone I. Keystone I (Image Omitted)
[303 Neb. 880] runs north and south through the Nebraska
counties of Cedar, Wayne, Stanton, Colfax, Butler, Seward,
Saline, and Jefferson. The PR and the MAR run southeastward
and were designed to avoid passing through the Sandhills, an
ecological region as defined by the DEQ.
would run across the southwest corner of Boyd County and then
cross the Keya Paha River; enter Holt County crossing the
Niobrara River; cross the Elkhorn River in Antelope County,
through Boone County; and cross the Loup River in Nance
County. The route would then turn and cross the northeastern
corner of Merrick County; cross the Platte River; enter Polk
County and continue south through York, Fillmore, and Saline
Counties; and end in Jefferson County. The PR would parallel
Keystone I for 7.3 miles and would require five pump
Neb. 881] The SAR is the route TransCanada initially proposed
in 2008. TransCanada's application stated: "Compared
to the [SAR], the overall footprint of the [PR] represents
less environmental impact by avoiding the Sandhills region
and minimizing impacts to areas with characteristics similar
to the Sandhills, including shallow groundwater and fragile
would "follow the [PR] for 110 miles to just south of
the Elkhorn River in Antelope County, then head in a
southeasterly direction across Madison and Stanton counties
for approximately 43 miles to intercept [Keystone I],"
and head south and parallel Keystone I for 97.6 miles,
crossing Shell Creek and the Platte River in Colfax County.
Based on the DEQ's recommendation, TransCanada adjusted
the route to divert from Keystone I for 29.8 miles to avoid
the "Seward County Wellhead Protection Area." The
route then rejoins Keystone I and continues through Saline
County to Jefferson County. The MAR would be 5 miles longer
than the PR and would require a total of six pump stations.
stated in the application that it viewed the PR to be
superior to the MAR, because the MAR would require a greater
total number of acres; increase the crossing of the ranges of
federally recognized threatened and endangered species;
increase the crossing of highly erodible soils; increase the
crossing of unusually sensitive ecological areas; and
increase crossings of perennial streams, railroads, and
roads. Despite the MAR's advantages due to its
co-location with Keystone I, TransCanada considered the PR to
be more beneficial than the MAR, because the PR was shorter
and required one fewer pump station.
application included a reclamation and revegetation plan to
fully restore lands disturbed by construction along the route
to their preconstruction capabilities. Under the Oil Pipeline
Reclamation Act, Neb. Rev. Stat. §§ 76-3301 to
76-3308 (Reissue 2018), TransCanada is responsible for all
reclamation costs necessary as a result of constructing and
operating the pipeline, except to the extent another party is
determined [303 Neb. 882] to be responsible. TransCanada
intends to revegetate the pipeline right-of-way as near as
practicable to preconstruction conditions to ensure
equivalent land capability following construction and the
establishment of native plant communities along the pipeline.
TransCanada represented that it will abide by §
76-3304(3) and keep its reclamation and maintenance
obligations until the pipeline is permanently decommissioned
application specified that the pipeline would be 36 inches in
diameter for the entire length of the route. Construction
would occur in a linear segmented fashion within a
110-foot-wide construction right-of-way, consisting of a
60-foot temporary right-of-way and a 50-foot permanent
easement. The width of the construction right-of-way may be
decreased or increased to address natural resource or
engineering concerns. Moreover, TransCanada stated it will
adjust the route "to the extent practicable" to
avoid culturally significant sites. In addition to the
installation of the pipeline, the PR required the
construction and operation of permanent aboveground
structures, including 5 pump stations and 19 intermediate
mainline valves. The pump stations would be built on
purchased land ranging from 7 to 17 acres. Each intermediate
mainline valve would be constructed within a fenced site,
approximately 50 feet by 50 feet, located within the
concluded its application by stating that the PR had been
thoroughly evaluated by federal and state agencies, was
designed to mitigate impacts to natural resources, and
ensured minimal impacts to the orderly development and growth
of the region. In its prayer for relief, TransCanada
requested an order from the PSC that the PR is in the public
published notice of TransCanada's application in The
Daily Record, a legal newspaper in Omaha, Nebraska, on [303
Neb. 883] February 20, 2017, and set the deadline for formal
intervention for March 22. TransCanada filed proof of service
of its application on the agencies listed in §
57-1407(3), as well as proof of notice to Antelope, Boone,
Boyd, Fillmore, Holt, Jefferson, Keya Paha, Merrick, Nance,
Polk, Saline, and York Counties. TransCanada later filed
proof that notice of the application was filed in newspapers
of general circulation in those counties.
groups and individuals filed petitions to intervene in the
proceedings based on property, economic, natural resource,
social, cultural, and territorial interests. On March 30,
2017, TransCanada filed objections to certain petitions for
intervention, arguing that the asserted legal rights or
interests would not be affected due to the narrow scope of
the proceedings. TransCanada argued that MOPSA does not
provide a forum to litigate whether or not a major oil
pipeline should be constructed, but instead is limited to the
issue of whether or not to approve a particular pipeline
March 31, 2017, the hearing officer for the PSC issued an
"Order on Formal Intervention Petitions." The order
explained that, under § 57-1408(2), the applicable
statutory deadline for the PSC's decision was "eight
months after the issuance of a presidential permit
authorizing the construction of the major oil pipeline."
The presidential permit for the pipeline was issued on March
23, which meant that the PSC was required to issue its final
decision on the application by November 23. The order stated
that the decisions on the petitions for intervention were
reached by balancing the strict deadline under MOPSA with the
need to produce a complete record and afford all interested
parties an opportunity to be heard.
order granted petitions for formal intervention filed by the
landowners with no limitations or conditions. The order
granted petitions for formal intervention filed by three
different unions: the Midwest Regional Office of the Laborers
International Union of America (Li UN A); the International
Brotherhood of Electrical Workers, Local Union No. 265; and
the United Association of Journeymen and Apprentices of the
[303 Neb. 884] Plumbing and Pipe Fitting Industry of the
United States and Canada, AFL-CIO (UA). The order imposed
conditions on the unions' participation by ordering them
to jointly offer testimony from one witness at the public
hearing, participate in limited discovery, collaborate on
cross-examination of up to 1 hour per witness, and submit one
order granted petitions for formal intervention filed by the
Ponca Tribe of Nebraska (Ponca) and the Yankton Sioux Tribe
of South Dakota (Yankton Sioux). Ponca's petition stated
it had a direct interest in the proceedings because the
routes pass through its traditional, aboriginal, and
federally recognized territory, which contains
"historic, cultural, sacred and archaeological natural
resources." Yankton Sioux's petition stated that the
proposed pipeline would "traverse [its] ancestral
territory" and that it had an interest in preserving
"cultural, spiritual, and historic sites." The
hearing officer found that "neither petition cite[d] a
legally cognizable current real property interest in land
encompassing the route," but noted that §
57-1407(4)(d) requires the PSC "to consider evidence of
the social impacts of the project," and found that
evaluating social impacts could encompass cultural,
anthropological, and historical issues. The order imposed
conditions on the tribes' petitions similar to those
imposed on the unions.
order granted petitions for formal intervention, subject to
the same or similar conditions, filed by groups and
individuals asserting environmental and natural resource
interests, including Bold Alliance and the Sierra Club. The
order stated that under MOPSA, the PSC is prohibited from
evaluating safety considerations such as "the risk or
impact of spills or leaks from the major oil pipeline,"
but found that the PSC could appropriately consider issues
such as the proposed route's "environmental impact,
soil permeability, distance to groundwater, and impact on
plant life and wildlife."
order on the petitions for intervention concluded with a
separate section devoted to addressing the MAR. The order
stated that "[MOPSA] requires the [PSC] to consider
whether [303 Neb. 885] any other utility corridor exists that
could feasibly and beneficially be used for the route of the
major oil pipeline," and that the MAR "partially
parallels [Keystone I]." The order therefore
"encourage[d] all parties to provide evidence regarding
the feasibility and potential benefits and/or drawbacks of
the [MAR]." The order granted each intervenor group
permission to call an additional witness and offer
accompanying exhibits to provide evidence concerning the MAR.
The order noted that the SAR "was previously rejected by
Nebraska authorities" and therefore has "already
effectively been determined to not be a viable option."
April 5, 2017, the hearing officer entered a case management
order. The order set a prehearing conference for July 31 and
announced that a public hearing on TransCanada's
application would commence on August 7 in Lincoln, Nebraska.
The order stated that the PSC may hold public meetings
"for the purpose of receiving input from the
public" and that "[a]ny comments received will be
made a part of the permanent record of this proceeding."
All parties were required to submit written testimony in
advance and make witnesses available for cross-examination at
the public hearing. The order stated that "any/all
Hearing Officer Orders . . . will apply to and bind all
parties, will control the course of the proceedings, and may
be modified only by order of the Hearing Officer."
published notice of the public hearing on TransCanada's
application in The Daily Record newspaper on April 11, 2017.
The notice also announced that the PSC would hold a public
meeting in Lincoln on April 18. The PSC published notice of
its August 7 public hearing in newspapers in counties along
the MAR and the PR, and sent letters to the governing bodies
of the cities and counties along both routes notifying them
that the pipeline route could pass through their jurisdiction
and seeking their views on whether that would be in the
public interest. The letters indicated that the application
was available on the PSC's website.
Neb. 886] On May 3, 2017, the PSC held a public meeting in
York. Nebraska. On May 10, "after careful and thoughtful
deliberation and reflection of the variety of public comment
received by the [PSC] at the [public meeting]," the
hearing officer entered an order "[m]odifying [c]ase
[management [p]lan and [intervention [o]rder." The order
allowed each intervenor group to present testimony from two
witnesses, in addition to a "witness regarding the [MAR]
as detailed in the [intervention order]."
7 and 28 and July 26, 2017, the PSC held additional public
meetings in York, O'Neill, Norfolk, and Ralston,
Nebraska, respectively, and received over 450 oral and
written comments from the public.
held a public hearing on TransCanada's application from
August 7 to 10, 2017, in Lincoln. TransCanada submitted
prefiled direct examination testimony from 10 witnesses,
presented each witness for cross-examination, and filed
rebuttal testimony from 6 witnesses. The landowner
intervenors prefiled testimony from 61 witnesses and offered
live testimony from 10 landowners and 1 expert witness. Ponca
and Yankton Sioux each presented testimony from one witness.
The natural resource intervenors presented testimony from
three witnesses, and the union groups presented testimony
from two witnesses.
provide a summary of the presentation of evidence at the
public hearing, along with context added from the thousands
of pages of pleadings, exhibits, testimony, and briefs in the
record before the PSC.
Palmer is the president of TransCanada Keystone Pipeline GP,
LLC, and TransCanada Keystone, LLC, which together own 100
percent of TransCanada, a company organized for the purposes
of owning and constructing pipelines which transport crude
oil from Canada to the United States. [303 Neb. 887] Palmer
is responsible for development and oversight of the pipeline
project. He testified in support of the request for approval
of the PR as set forth in the application. Palmer stated the
PR was designed by drawing the "shortest footprint . . .
from Hardisty, Alberta, to Steele City."
estimated the initial use of the pipeline would be 20 years,
which could be extended to 50 years if it was well
maintained. Palmer confirmed that TransCanada is responsible
for all reclamation costs associated with the project, unless
another party is determined to be responsible. Palmer
represented that TransCanada and all affiliated parties will
not claim any tax deductions, exemptions, credits, refunds,
or rebates under the Nebraska Advantage Act, Neb. Rev. Stat.
§§ 77-5701 to 77-5735 (Reissue 2009), and testified
that "we do not consider selling the route an
option." Palmer stated that based on TransCanada's
studies and the studies conducted by the DEQ and the
Department, he considered the PR to be superior to the MAR.
Fuhrer, the project manager for TransCanada USA Services
Inc., testified regarding the construction process for the
proposed pipeline and pump stations. Fuhrer stated the top of
the pipeline will sit a minimum of 4 feet below the surface
of land, and a minimum of 25 feet below the surface of a
water stream. Each pump station will be placed an average of
55 miles apart and utilize approximately 8 to 10 acres of
land, but could utilize up to 17 acres. Shutoff valves will
be placed at intervals along the pipeline, based on
hydraulics and other factors, and located within a
50-foot-by-50-foot fenced enclosure.
testified about the trenching operations designed to provide
sufficient width and depth to support the pipeline. The
construction and installation of a new pipeline would require
segregating topsoil from subsoil 110 feet across, and digging
trenches that are approximately 8 feet wide and 7 feet deep.
Neb. 888] (iii) Ernie Goss
Ernie Goss, a professor of economics at Creighton University
and the principal of the "Goss Institute,"
testified regarding his "socioeconomic" impacts
report. Goss concluded that the pipeline project would
generate economic activity in Nebraska such as sales, wages,
and jobs, and would contribute to the state and local tax
bases. He estimated that construction of the pipeline would
result in positive state and local tax revenue to exceed $264
million through the year 2034. Goss concluded that during the
2-year construction period, the project would generate a
total of over $890 million in Nebraska, with a labor income
of $326.6 million supporting an average of 3, 397 jobs per
year. He estimated that, during the operations period from
2020 through 2034, there would be an economic impact in
Nebraska of $1.2 billion in output/sales, with labor income
of $415.5 million supporting an average of 371.7 jobs per
year. For property tax purposes, Goss considered the pipeline
to be a 15-year asset which would depreciate out, except to
the extent that facilities are added, replaced, or
employed an input-output method, a type of applied economics
analysis that "tracks the interdependence among various
producing and consuming sectors of an economy." For
example, Goss asserted that each $1 million TransCanada
spends on construction would create a net economic gain of
$286, 522 in Nebraska and that each $1 million TransCanada
spends on operation would create a net gain of $150, 000.
Goss used "IMPLAN" software in forecasting the
economic impact of the pipeline. IMPLAN combines input-output
analysis with regional-specific statistics. Goss stated that
IMPLAN is a widely used and accepted multiplier system, but
agreed that IMPLAN is limited in its ability to determine
whether "jobs or output are new or already existing and
are simply being reallocated from other uses."
report did not disclose the scope of his engagement, but he
stated that he was engaged to update his report, initially
published in 2013, to reflect the most current data. He did
not [303 Neb. 889] recall how much he had been paid by
TransCanada. He admitted the report was not peer reviewed and
stated: "The goal was to do a study that made sense to
the woman and man on the street . . . ."
Barnett, an environmental specialist for TransCanada
Corporation, testified regarding environmental issues. Her
testimony reiterated TransCanada's commitment to comply
with the Oil Pipeline Reclamation Act and to minimize
potential impacts on land areas and natural resources.
Barnett admitted that for affected cropland, "[t]here
would be temporary yield loss during construction and perhaps
for a period of time afterward," but stated that
TransCanada will reclaim and revegetate the right-of-way and
work with the affected landowners to return it "as close
as we can make it" to preconstruction condition.
stated that if a dispute occurs between TransCanada and a
landowner about the postconstruction condition of land, the
parties will reach a resolution by consulting the Natural
Resources Conservation Service (NRCS), a division of the U.S.
Department of Agriculture, or other agencies, and include
them in the discussion in order to reach a resolution.
Regarding surface water resources, Barnett admitted that
during construction, there potentially will be temporary
degradation to groundwater quality and aquatic habitat, as
well as bank stability.
Beaver, a project manager, ecologist, and reclamation
specialist with an environmental services company, has been
the senior reclamation specialist and special-status species
biologist for the project since 2009. He stated that
TransCanada will monitor the condition of the right-of-way
during the pipeline's entire operational life. He
admitted that TransCanada's land surveys and
"Construction Mitigation and Reclamation Plan"
(CMRP) for Nebraska have not been updated since 2012.
Neb. 890] (vi) Michael Portnoy Michael Portnoy, the
president and chief executive officer of an environmental
consulting and engineering firm, is the lead hydrologist and
project manager for soil permeability and
distance-to-groundwater surveys. He has academic degrees in
geology, geochemistry, hydrology, and business
administration. He testified that there is a wide
diversification of soil along the PR; he did not separately
study the soil along the MAR.
Dr. Jon Schmidt
Schmidt, vice president of the management contractor for the
pipeline project, helped prepare TransCanada's
application. He testified the application compared the
different routes based on the number of acres disturbed,
federally listed threatened and endangered species, amount of
highly erodible soils, ecologically sensitive areas, and
number of crossings of perennial streams, railroads, and
roads. He did not analyze the route referred to as the
"1-90 Route," which would co-locate with the entire
length of Keystone I.
cross-examination, Schmidt agreed that the MAR "ha[d]
potential environmental benefits due to its co-location with
[Keystone I]." He agreed that the PR crosses five
Nebraska rivers and the MAR crosses only two rivers, but
stated the MAR crosses more "perennial
waterbodies." He agreed that according to a map received
in evidence, both the PR and the MAR cross the "Ponca
Trail of Tears."
Kothari, a professional engineer and manager for TransCanada,
helped prepare the section of the application which addressed
the possible routes. She agreed that the MAR could
"feasibly" and "beneficially" be used in
Nebraska. She testified that the MAR's deviation from
Keystone I in Seward County was to "avoid the wellhead
protection area based on the feedback from the DEQ" and
confirmed that "there are no wellhead protection area
issues on either" the PR or the MAR.
Neb. 891] (b) Landowner Interveners Testimony
heard testimony from the landowners focusing on issues of
soil compaction, topsoil loss, wind and water erosion, soil
blowouts and slides, adverse impacts to crops based on
increased soil temperature, and proximity of pipeline
construction to water sources. The landowners also provided
expert testimony on the issue of economic impact.
Tanderup owns farmland in Antelope County. He and his wife
conduct no-till, irrigated farming and raise corn, native
corn, soybeans, and rye. He described his land as highly
erodible and testified that construction will interfere with
the topsoil and the benefits of no-till farming.
Morrison owns farmland in Antelope County, where he and his
wife produce popcorn, edible beans, and peanuts. The land
farmed by Morrison contains 65 irrigation wells. He testified
the proposed route runs approximately VA miles from
his processing facilities and intersects his property almost
Krutz owns land in Antelope County. He and his wife raise
"natural beef," corn, and soybeans. Krutz testified
that the construction could put his natural beef
certification at risk, which would affect his market sales.
He stated his concerns about the continued revegetation of
his land which supports his livestock.
Crumly owns land in Holt County. She and her husband conduct
no-till, irrigated farming and raise corn, soybeans, hay, and
potatoes. She testified that the pipeline will impact
erodible and permeable soils.
Neb. 892] (v) Bonny Kilmurry
Kilmurry owns land in Holt County. She and her husband have a
cow-calf operation, and they harvest hay from pastureland.
Her land contains subirrigated meadows with water close to
the surface, as well as highly erodible soils, which she
described as being similar to Sandhills land.
Steskal owns land in Holt County. Steskal owns no-till,
irrigated farmland that produces wheat, corn, soybeans,
edible beans, and popcorn, and she urged for the protection
of the natural resources on her land.
Andy Grier Andy Grier is a manager of a ranch in Holt
County. He testified about the pipeline's crossing of the
Niobrara River, the potential soil erosion from land
clearing, and the proximity of the pipeline to his
ranch's water supplies.
Allpress owns ranchland on the eastern border of Keya Paha
County. He stated the proposed route will cross through
fragile soil that is susceptible to blowouts and slides and
that many plants and animals will be endangered. He testified
he has observed a bald eagle's nest and whooping cranes
in areas near his property. In addition, he testified that
members of the Ponca ...