Energy regulator dodges ethics reform

Rep. Dennis Bonnen, R-Angleton blamed aggressive lobbying by the Texas Railroad Commission and its supporters for the failure of his bill to reform the agency. (Harry Cabluck/AP)
Rep. Dennis Bonnen, R-Angleton blamed aggressive lobbying by the Texas Railroad Commission and its supporters for the failure of his bill to reform the agency. (Harry Cabluck/AP)

For the second session in a row, efforts to revamp the state agency in charge of regulating oil and gas producers have died in the Texas Legislature.

That means the Texas Railroad Commission won’t get a new name — it hasn’t had anything to do with railroads since 2005 — and recommended ethics changes won’t go into effect.

Rep. Dennis Bonnen, R-Angleton, who sponsored the House version of the bill and chairs the 12-member Sunset Advisory Commission, Wednesday blamed lobbying by the three-member Railroad Commission and their supporters.

“The aggressive lobbying of Railroad Commissioners was successful in convincing members (of the House) that the Railroad Commission wants no change on their ethics or otherwise,” he said.

The Senate approved a bill based on recommendations from the Sunset Advisory Commission, but Bonnen’s companion bill never made it out of the House Energy Resources Committee.

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A spokeswoman for the Railroad Commission did not return telephone and email messages Wednesday.

The Sunset Advisory Commission regularly reviews state agencies and recommends changes, which are then sent to the Legislature for action. The Railroad Commission first came up for review two years ago, but the bill failed to pass then, too.

Agencies that don’t pass Sunset review are generally reauthorized for at least an additional two years in a schedule bill — that’s what happened with the Railroad Commission after the 2011 session — but Bonnen said Wednesday he doesn’t know what will happen next.

“There are no guarantees it will go in the safety-net bill,” he said.

The Texas Oil & Gas Association said it was disappointed by the bill’s failure. “The Texas Railroad Commission has effectively overseen the oil and gas industry for generations and we hoped to end this session with certainty about the agency’s future,” the trade group said.

Passing the sunset bill “would have been far more assuring to keep the state’s regulatory agency for our industry in place,” the association said in a statement.

Luke Metzger, director of Environment Texas, said this year’s failure was a surprise.

“Along with passing the budget, reauthorizing state agencies is one of the fundamental things the Legislature is supposed to do,” he said. “They had already failed to do it last session. You would think they would have worked out the problems.”

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Although reauthorization through the Sunset process can be controversial, it’s unusual for an agency not to make it through on the first try.

Tom “Smitty” Smith, director of Public Citizen Texas, said this is the first time in 30 years he can remember an agency failing Sunset review twice.

He suggested the issue is a reflection of the power of the oil and gas industry.

“The oil and gas industry really runs Texas,” Smith said.

The Railroad Commission has adopted some changes suggested by the Sunset Commission, and Railroad Commissioners have said they agree with some of the others.

That included renaming the agency to better reflect its mission.

The Railroad Commission regulates oil and gas drilling and production, as well as coal and uranium mining and pipeline safety.

Its role has drawn more scrutiny as shale drilling accelerates across the state, with environmentalists and community activists worried that inadequate oversight could put residents at risk.

Exploration and production companies also want to be sure the agency can respond quickly to their needs.

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The Sunset Commission suggested the agency be renamed the Texas Energy Resources Commission; members of the Railroad Commission preferred Texas Energy Commission.

Even the name change proved controversial, as some legislators wanted to keep the old name.

But that paled in comparison to the battle over the ethics reforms.

The Sunset Commission recommended requiring Railroad Commissioners to resign before running for another office and limiting when, and from whom, they could collect campaign contributions. That was considered important because they draw contributions so heavily from the oil and gas industry, which they regulate.

Most other state agencies use the State Office of Administrative Hearings to settle disputes, but the railroad commissioners are the final arbiters for disagreements involving oil and gas issues.

The three commissioners protested the proposed ethics recommendations, and several members of the Energy Resources Committee appeared to agree, peppering Bonnen with questions during a four-hour hearing in late March.

Committee member Tom Craddick, R-Midland, is the father of Railroad Commissioner Christi Craddick. He did not return a telephone call from the Chronicle Wednesday.

Bonnen had urged that the restrictions stay in place throughout the lengthy hearings.

“I think we have a real problem with Railroad Commissioners raising funds from people with cases before them,” he said Wednesday. “I think the people of Texas want transparency.”