Dominion wins court battle over Myersville gas compressor

A U.S. District Court judge has declared Myersville town laws affecting the siting, construction and operation of a planned natural gas compressor station null and void.

Judge Richard D. Bennett, however, denied Dominion Transmission Inc.’s request for a permanent injunction to ban the town from enforcing laws against plans for the station, in an order issued Monday.

“We are not surprised, but a little disappointed,” said the town’s attorney, John R. Clapp of Clapp & Carper LLC in Frederick.

The order is the latest development in a struggle between Dominion and Myersville over the energy company’s plan to build a compressor station in the Frederick County town of slightly more than 1,600 residents.

Dominion wants to build the station as part of its $115 million project to increase natural gas flow across the mid-Atlantic, but Myersville has fought Dominion’s efforts, saying the station is inconsistent with the town’s master plan and will cause a hazard to public health and safety.

For Dominion, Monday’s order means the only barrier to beginning construction is obtaining an air quality permit from the Maryland Department of the Environment, said Dan Donovan, Dominion’s media relations director.

“We just look at it as part of the process and we are going through the process,” he said. “It’s pretty clear that this is the best site for the compressor station out of all the other alternatives that were considered.”

The Myersville mayor and Town Council held a meeting on the U.S. District Court order Tuesday and said in a statement that the town will process all the “applicable material” under the guidelines of the court’s decision.

“The Mayor and Council have been steadfast in our approach to seek out due process of this matter, to fairly represent the interests of our citizens and given this most recent court ruling have determined this process to now be concluded,” the mayor and town council wrote in an emailed statement.

Dominion’s attorney, John D. Wilburn of McGuireWoods LLP in Tysons Corner, Va., did not respond to a call for comment.

Dominion, which transports and stores natural gas between states in the Northeast and mid-Atlantic, is trying to build a compressor station on a 21-acre property at the northwest intersection of Maryland Route 17 and Milt Summers Road.

The compressor station is part of the company’s Allegheny Storage Project, which will increase the natural gas provided to Washington Gas Light Co., Baltimore Gas and Electric Co. and TW Phillips Gas and Oil Co.

To complete the plan, the company needs to build four compressor stations across Maryland, Ohio, Pennsylvania and West Virginia, which will cost about $112.3 million.

The planned Myersville station would receive gas from an existing pipeline that runs from Leesburg, Va., to Leidy, Pa., compress it and return it through 500 feet of new piping.

Dominion is one of the country’s largest energy producers and transporters, serving 6 million customers with natural gas transmission, according to its 2011 annual report.

The proposed site, however, is zoned only for commercial use. Dominion filed an application last April to amend the zoning of the property. After a number of public hearings, the town rejected the plans and denied Dominion’s zoning amendment application in August 2012.

In the meantime, however, the Federal Energy Regulatory Commission had approved Dominion’s Certificate of Public Convenience and Necessity, finding that the Myersville site was the most appropriate of nine locations considered and that the station would not create visual or noise pollution in the area.

Myersville asked the federal commission to reconsider its decision, but was denied in May 2013.

Dominion had also filed an application for an air quality permit with MDE in February 2012, but was denied five months later because it had not submitted documentation to prove it had complied with local zoning laws, a requirement under state law.

Dominion argued that because its plans were already approved by FERC, federal law pre-empted local laws.

Dominion then filed a petition to review MDE’s decision in the United States Court of Appeals District of Columbia Circuit.

The D.C. Court of Appeals did not make a legal ruling, but remanded the case to MDE to decide whether Dominion had complied with local zoning laws and if the town’s zoning and land use laws were pre-empted by federal law under the Natural Gas Act. The court ordered MDE to make a decision by June 2014. It has not yet issued a decision.

The day before Dominion filed for review of MDE’s decision, it filed a complaint in U.S. District Court.

Later, it filed a motion for summary judgment asking that the court declare town laws are pre-empted by the Natural Gas Act and are therefore null and void when it comes to the construction of the compressor station. It also asked for a permanent injunction stopping the town from enforcing the laws against construction and asked the U.S. District Court to maintain jurisdiction in any further actions in the conflict.

Myersville argued that Dominion’s requests were excessive. The mayor and Town Council also argued that local laws are not pre-empted because Maryland has the right to establish its own rules for permitting under the Clean Air Act.

Judge Bennett chose not to declare that federal law pre-empted all of the town code, but held that the portions of the town’s laws affecting the siting, construction and operation of the compressor are null and void. Bennett denied Dominion’s request for a permanent injunction since the company did not prove there had been irreparable injury.

Bennett also decided that the U.S. District Court would maintain jurisdiction over the action.

“This declaration, however, does not extend to those pre-emption questions related to the Myersville Town Code of Ordinances provisions dealing with zoning and land use, which are currently pending before the Maryland Department of the Environment,” Bennett wrote.