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Proposed New Law for Pipeline Condemnation Did Not Pass the Texas Legislature

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Texas landowners and oil and gas attorneys have been watching Senate Bill 740 with interest. This bill, introduced by several Texas senators, would have increased landowner protections in the event a pipeline company sought to obtain an easement on their property using eminent domain. You can read the full text of the bill here.

The bill contains amendments to the “Bill of Rights” contained in the Texas Government Code and numerous amendments to the Texas Occupations Code dealing with right-of-way agents, but most importantly, it contains amendments to the Texas Property Code dealing with offers to land owners by pipeline companies seeking pipeline easements. Examples of the new provisions are:

  • a requirement pipeline company must provide any new, amended or updated appraisals to the property owner within a specific time
  • a requirement that a bona fide offer must include a monetary offer equal to or greater than 150% of the market value property sought to be acquired
  • requirements that the pipeline easement specify the maximum number of pipelines that may be installed, the maximum diameter of pipelines, the type or category of substance to be transported in the pipeline, the maximum width of the easement, the minimum depth to which the pipeline will be initially installed and numerous other provisions that will be of benefit to landowners.
  • A requirement that the easement contain “a provision regarding the repair and restoration of areas that are used or damaged outside the right-of-way area to their original condition or better” although it is unclear whether this means the easement can disclaim the repair and restoration or whether it must promise to perform repair and restoration

Two of the most significant additions concerning liability and attorneys fees. The bill would have added an amendment to the Property Code that specifically provides that the property owner is not liable to a condemning entity or its agents, employees or contractors for any personal injury, death or property damages. Another amendment would give the property owner the right to recover attorney’s fees if the condemning entity appeals the final judgment in a condemnation proceeding and doesn’t deposit the full amount of the judgment or a surety bond with the trial court.

These amendments don’t go far enough to protect landowners in several ways, but they were a move in the right direction. Unfortunately, the bill was referred to the Land & Resource Management Committee and there it died when the legislative session ended. It is doubtful that it will be taken up in the special session that Governor Abbott has called.