TransCanada rep helped senator shape law

Nebraska bill would give state authority to assess and approve any pipeline route

A Republican state senator from Nebraska who introduced a law that could help TransCanada’s Keystone XL pipeline proposal get approval says his bill was drafted after “numerous conversations” with representatives from the Canadian company.

“TransCanada was in Nebraska, as they were in other states, continuously,” Sen. Jim Smith told the Star in an interview.

“I think they had a presence through lobbies and everyone else. So absolutely, I’ve had numerous conversations with TransCanada as I’ve also had conversations with other interested parties in the process.”

Smith’s bill, LB 1161, which became law in 2012, prompted a legal challenge from three landowners. Their case led the Obama administration to delay its decision on whether to approve the multibillion dollar pipeline project linking Alberta’s oilsands region with refineries in Texas.

The new law turned over signing authority to the state governor, instead of the legislature, to exercise eminent domain — the power of a government to expropriate land for the public good.

The Nebraska Supreme Court began hearing arguments in the case last week.

Environmentalists, including a local advocacy group opposed to the Keystone XL pipeline, Bold Nebraska, have been raising questions about who was behind LB 1161 ever since Smith appeared in February 2012 at hearings held by a legislative committee examining his bill.

At the time, the senator was unable to explain several aspects of how the bill would work, telling the committee that representatives from TransCanada, scheduled to appear right after him, had the detailed answers. “It was obvious that he did not write that bill,” Jane Kleeb, director of Bold Nebraska, said in an interview. Smith said it was normal for a legislator to work with experts on legislation and allow them to explain technical details. “That’s protocol,” he said. “That . . . takes place with any bill that’s introduced with this legislature.” When asked whether it played a role in drafting the bill, a spokesman for Alberta-based TransCanada told the Star it wasn’t a secret that it worked with dozens of legislators — both supporters and opponents of the pipeline — to answer their questions. “We were asked to identify concerns we had about potential legislation and we also indicated areas that we could support so that the state could achieve its goal of having a say over where an oil pipeline could go,” said company spokesman Shawn Howard. “As a pipeline company, we have a unique perspective on the legislation and broader industry considerations.” If the TransCanada project is approved, the pipeline would link Alberta’s oilsands industry to refineries in Texas, with a capacity of 830,000 barrels of oil per day, driving expansion in Canadian oil production. Smith, who was elected in 2010 after a 30-year career in the electric and gas utilities industry, said the main goal of the new law was to give the state authority to assess and approve any pipeline route after previously introduced bills required it to rely on the federal State Department. The previous laws were adopted in 2011, under the assumption that the State Department was on the verge of approving the TransCanada pipe- line expansion project, which it never did, Smith explained. He said that LB1161 was also introducing a temporary solution to review projects since the local public service commission didn’t have adequate rules and regulations in place to exercise its signing authority.

Smith also said that LB 1161, supported by 44 out of 49 senators, would strengthen landowner rights when authorities use eminent domain. The change would force the government or a company to condemn land and proceed with plans within two years of the exercising of eminent domain powers. If they fail to act within the two years, they would lose their acquired rights on the land, Smith explained.

“I stand by the legislation that I introduced,” Smith said. “I believe that my colleagues and I worked very hard to make certain that it gave no favouritism . . . and we did a fantastic job I believe.”