Columbus -- Who controls the location of oil and gas wells, local communities with zoning regulations in place or the Ohio Department of Natural Resources?
That's the question the state's high court is considering, following oral arguments Feb. 26 on a case that pits the city of Munroe Falls against the state and an energy company.
The latter sought and received permits from ODNR to drill in an area zoned for residential uses. The city challenged the location, saying local zoning rules prohibited drilling in the area in question and instead should be focused in industrial areas.
A trial court sided with Munroe Falls. An appeals court ruled the driller had to comply with certain local ordinances but that the city's zoning rules were in conflict with state law.
Thomas Houlihan, representing the city, argued Feb. 26 before the Ohio Supreme Court that the local zoning ordinance and state regulations could operate in harmony, because they address different issues. The zoning rules focus on the location, while ODNR regulates drilling methods and production.
If a company wants to drill in a certain area, he said, they must ensure they comply with local zoning ordinances and get ODNR approvals. That didn't happen in the Munroe Falls case.
"The driller took the position that they didn't have to comply with any of our regulations," Houlihan said, adding later, "[ODNR is] granting permits for locations without any regard to whether or not the driller has complied with local zoning."
Legal counsel for the state and Beck Energy Corp. countered that state law clearly gives ODNR sole authority to regulate the location of oil and gas wells.
"We think that local zoning ordinances trying to restrict oil and gas drilling to particular zones would conflict with the state law," said Peter Glenn-Applegate, representing ODNR.
Justice Paul Pfeifer pressed, "So the position of the state of Ohio through the attorney general is local zoning has no place in the regulation of oil and gas well drilling in this state?"
Glenn-Applegate responded, "Yes, your honor."
Justices will consider the case in coming weeks. There is no timeframe for them to issue a ruling.
Marc Kovac is the Dix Capital Bureau Chief. Email him at firstname.lastname@example.org or on Twitter at OhioCapitalBlog.