To frack or not to frack, this is the question for N.C. Gov. Bev Perdue. The lame-duck governor could ultimately be the one who decides the state's fracking future.
Not surprisingly, the N.C. House of Representatives gave its approval of fracking Thursday, although drilling opponents are likely to see opportunity in the 66-43 vote, which largely fell on party lines. Republicans will need at least six more votes to override a gubernatorial veto should Perdue use that power in the next 10 days.
Supporters say the natural gas drilling would be a boon for a lagging economy, bringing hundreds of jobs and cash. Opponents point to numerous reports of fracking spills and environmental headaches in other states.
The unpopular governor, who announced in January that she would not be seeking a second term in 2012, has been difficult to pin down on this issue.
Perdue prompted some environmental angst in March when she said fracking can be done safely after an industry-guided tour of a drilling operation in Pennsylvania.
It remains to be seen, however, if she would side with state Republicans on Senate Bill 820, the measure that opens the door to legalizing the drilling in a few years after state officials build a regulatory structure.
The governor's office had little to say on the subject Friday. "She will review the bill when it gets to her desk," said Mark Johnson, deputy communications director for the governor's office. "That's our only statement at this time."
Many state Democrats have blasted GOP-steered fracking legislation as ushering in drilling too quickly, and leaving broad powers to a regulatory mining commission where the majority have a direct stake in the industry or have drilling experience.
Critics are also quick to note that, based on low natural gas prices and the state's very modest supply of the resource, drilling isn't likely to happen in North Carolina in the next decade regardless of whether lawmakers legalize the controversial technique.
"Unfortunately, the legislature seems committed to moving forward with fracking without getting essential questions answered about the potential impact on our water resources," said Molly Diggins, state director of the N.C. Sierra Club, in a statement Friday. "There's too much at stake to make a risky bet like this. The public deserves better."
The House version of the fracking bill that passed Thursday includes some divergence from the Senate bill, including the addition of two local government officials to the mining commission and additional consumer protections. It seems likely that Senate and House conservatives will manage to reconcile the differences in a matter of days.
Meanwhile, environmentalists are asking fracking opponents to contact the governor and urge her to veto the legislation.
Activists with Occupy Raleigh are planning a protest at the governor's mansion at 6 p.m. Monday to call for a veto.
As N.C. House of Representatives leaders prepare to debate the controversial Senate Bill 820, a GOP-backed measure that could open the state's borders to fracking in two years, environmental advocates are making the case for offshore wind as a cleaner alternative.
Leaders with Environment North Carolina say they will release their report (titled "Wind Mills, Not Spills—The environmental and economic benefits of offshore wind versus offshore drilling in North Carolina") Wednesday morning in the legislative building's press room in Raleigh.
The meeting will come hours after an 8:30 a.m. House environment committee session at the N.C. General Assembly, where Sen. Bob Rucho, R-Mecklenburg, will present his frack-backing legislation. The measure has already earned the approval of the full Senate and is expected to garner similar support in the Republican-controlled House.
Leaders have touted the natural gas drilling as a safe means of accessing underground gas stores in central North Carolina. The gas cache will power an economic rebirth for the recession-minded state, supporters say, even after a report from the U.S. Geological Survey last week projected the state's core shale deposits would meet the state's energy needs for less than six years.
Critics like Environment North Carolina have also pointed to multiple reports of environmental damage caused by fracking spills and operations in other states. Meanwhile, group Director Elizabeth Ouzts argued last week that solar energy creates nine times as many jobs while producing the same amount of energy as coal and gas.
The organization will release the report at 11 a.m. Wednesday, with comments expected from leaders like N.C. Rep. Pricey Harrison, D-Guilford, and Sen. Martin Nesbitt, D-Buncombe, as well as officials from the National Wildlife Federation and the Southern Environmental Law Center.
The N.C. Board of Elections has ruled that the mailers produced by the Durham Partnership for Progress were not coordinated with any candidates supported by the local SuperPAC.
As the Indy reported last week, several complaints had been filed with the Durham Board of Elections, which forwarded them to the state level, alleging that the Partnership was working in concert with Durham commissioner candidates Michael Page, Brenda Howerton, Joe Bowser and Rickey Padgett.
The Partnership has received more than $54,000 from Southern Durham Development, which is supporting the four candidates because of their stance on the 751 South project. The Partnership is tied to Southern Durham Development through Tyler Morris and Alex Mitchell, who work for both organizations.
The Partnership is an independent expenditure committee, also known as a SuperPAC, because it can raise and spend unlimited amounts of money to advocate for candidates as long as it does not coordinate with them.
Southern Durham Development is the company behind that development; incumbents Page, Howerton and Bowser voted to approve a controversial rezoning of land in the sensitive Jordan Lake watershed that made 751 South possible. Padgett, a captain in the Durham County Sheriff’s department, has also spoken in favor of 751 South.
If you’re a Durham County resident, you may have received campaign mailers supporting the slate of Michael Page, Brenda Howerton, Joe Bowser and Rickey Padgett for county commissioner. Here's the mailer:
That mailer was paid for by the innocuously named Durham Partnership for Progress. But innocuous it is not: DPP is actually an independent expenditure political committee—commonly known as a Super PAC—organized by developer Tyler Morris, a majority shareholder in Southern Durham Development.
And not coincidentally, DPP is bankrolled, so far, by Southern Durham Development, which plans to build the controversial 751 South project in the sensitive Jordan Lake watershed.
Also not coincidentally, Page, Howerton and Bowser—all incumbents—voted to approve a controversial rezoning that allowed 751 South to move forward. Padgett supports the project; he also applied for an appointment to the commission last year to fill the seat held by Becky Heron, who resigned because of illness. (The commissioners instead appointed Pam Karriker, who is not running for election.)
Morris is listed as DPP's assistant treasurer. Rhonda Sisk, the DPP treasurer, lists an address that is Southern Durham Development's company office.
Here is the statement of organization: statement_of_organization.pdf
The first donations to the DPP are from Southern Durham Development: $2,500 in-kind and $100 in direct funds. expenditures.pdf
The $2,500 went to pay for a survey by Public Policy Polling that asked several questions of potential voters, including if they would vote for commissioner candidates who support 751. The survey also asked if the developers should sue the City of Durham.
In February, six Durham City Council members voted unanimously to reject the developer's request that the city provide water and sewer service to the 751 South. Councilman Howard Clement was absent due to illness.
Super PACs such as the Durham Partnership for Progress can receive unlimited funds from unlimited sources and spend unlimited amounts of money, according to Michael Perry, director of the Durham County Board of Elections. The only stipulation is that the Super PAC must not directly or indirectly make contributions to candidate committees or other committees that make contributions to candidates. Super PACs cannot coordinate with candidates, although that distinction is often not apparent.
Durham Partnership for Progress complies with that requirement by stating on the mailer that it is not endorsed by any candidate.
The DPP Super PAC sets a troubling precedent in Durham. It can accept enormous amounts of money from the wealthy development community—including out-of-towners like Morris, who lives in Raleigh—and use it to influence local elections.
First-quarter campaign finance reports are due April 30, the contents of which could further demonstrate the reach and influence of the DPP Super PAC.
We were out of the office yesterday when D.R. Horton began returning mineral rights to homeowners in the Triangle.
A quick update in case you missed it: The deed corrections are being issued—47 and counting in Durham County alone. The one attached here includes the language that the rights "were inadvertently saved, excepted and reserved" by D.R. Horton. (Our emphasis.) unfracking.deed.pdf
It's incredulous that D.R. Horton, one of the nation's largest homebuilders, "inadvertently" granted mineral rights to 426 Triangle properties to its subsidiary, DRH Energy, but that's how the deed correction reads.
Another deed correction, however, does not include that clause. fracking.redacted.pdf
We have not seen deeds in which DRH Energy has returned mineral rights to homeowners.
The Indy reported on April 4 that D.R. Horton had stripped homeowners of their mineral rights—in some cases without the homeowners full understanding or knowledge of the ramifications of the deal. Many lenders and financial institutions won't back mortgages if the property doesn't include the mineral rights.
Last week the N.C. Attorney General's office asked D.R. Horton for additional information about its disclosure policy. Additional information is expected to be included in the consumer protection portion of a fracking report due to the Legislature next month.
We received an email today from D.R. Horton, one of the nation's largest homebuilders, explaining its disclosure policy about mineral rights. NC_Retention_of_Mineral_Rights_Fact_Sheet_1_.pdf
"D.R. Horton requires that its mineral rights reservation be disclosed to prospective homebuyers multiple times throughout their purchase experience," the document reads in part. "D.R. Horton also currently requires closing attorneys paid by D.R. Horton to conduct closings to provide a separate written disclosure for the buyers, discuss the disclosure with them and have the buyer sign the disclosure prior to closing."
As the Indy reported April 4, D.R. Horton has granted the mineral rights to at least 425 properties in the Triangle to its energy subsidiary, DRH Energy. That means DRH Energy can explore, drill, or mine for natural gas, oil and other hydrocarbons beneath those properties—starting at 501 feet—and would collect any revenue from the sale of those sources. If North Carolina legalizes fracking, which seems to be on the fast track after a bill
However, that's not the only downside for property owners or prospective homebuyers. Many financial lenders, including the State Employees' Credit Union, will not back mortgages on properties without the mineral rights included.
Although D.R. says it requires full disclosure of its mineral rights policy, that doesn't mean those disclosure are actually being made. One homebuyer interviewed by the Indy said she had never been told about the mineral rights; another said she was told only at closing. Other media have reported similar stories of homebuyers who felt they had not been fully informed of the ramifications of the severance of their mineral rights.
The N.C. Attorney General's office had asked D.R. Horton to explain its policy; it is expected Horton's comments and further analysis will be part of a fracking report due to the Legislature in early May. D.R. Horton wrote in today's document that it is working with the AG's office and the N.C. Real Estate Commission regarding concerns raised about this issue. "We are cooperatively reviewing our disclosures with them," the statement reads. "D.R. Horton intends to require an additional disclosure in a separate written document to be signed by our buyers prior to a contract."
And apparently D.R. Horton knows some legal shift is on the horizon:
"We expect that the adoption of a comprehensive regulatory framework by N.C. officials will result in lenders having fewer concerns or revising the standards for their loans. Regardless, D.R. Horton will continue to accommodate mortgage lenders' concerns in connection with their loans."
On Wednesday, a state senate committee chaired by Bob Rucho proposed lifting North Carolina's ban on fracking. There are several troubling provisions in the bill, including the invalidation of local ordinances prohibiting fracking. Town and city councils in Carrboro, Chapel Hill, Creedmoor, Durham and Pittsboro have passed resolutions that in some form oppose fracking.
Half of North Carolina voters have no opinion on fracking, according to a recent survey of 975 people by Public Policy Polling.
"The reaction for a plurality of North Carolinians, when asked about it, is 'huh?'" PPP stated in a press release.
Of those who did have an opinion, 27 percent oppose the controversial energy drilling practice, while 24 percent approve.
"The party lines on the issue are pretty predictable," PPP stated. "Republicans support it; Democrats and independents are opposed."
The automated telephone poll has a margin of error of +/- 3.14 percent.
The N.C. Attorney General's office sent a letter yesterday to lawyers for D.R. Horton about how the homebuilder notified prospective buyers that their properties would not include the mineral rights.
As the Indy reported on April 4, D.R. Horton, one of the nation's largest homebuilders, assigned the mineral rights of at least 425 properties in the Triangle to its energy subsidiary, DRH Energy.
By stripping the properties of the mineral rights, homeowners cannot control the mining, drilling or fracking activities beneath their properties. In addition, many banks and financial lenders, including the State Employees' Credit Union, Freddie Mac and Fannie Mae, will not back mortgages on properties that don't have mineral rights or on which the owners have signed leasing agreements to drilling companies.
The letter to D.R. Horton, written by Assistant Attorney General of the Consumer Protection Division, Lynne Weaver, states that it is "unclear when disclosures are first made to home buyers" about the mineral rights.
Weaver goes on to ask that D.R. Horton provide "a description of all oral and written disclosures" about the rights, and copies of any documents containing the disclosure.
The Indy has a received Horton sales contract from a local attorney; we are reviewing it. Check back for details.
When issuing an official press release from the N.C. Department of Environment and Natural Resources—or pretending to—it's wise to include the agency secretary's name.
That was among the tells when the Indy received a "press release" alleging that DENR has apologized for its controversial draft report on fracking, in which the agency said it could be done safely in North Carolina if the right protections were in place. The release also falsely stated that DENR had reversed its position.
More reasons to doubt the release's legitimacy:
A) That's too good to be true.
B) The email came from firstname.lastname@example.org (DENR addresses have a .gov suffix) and the "Office of Environmental Education and Public Affairs" (which does exist).
C) I sent the email to DENR for verification; an agency spokesperson said that the email is fake.
I then plugged the originating IP address into to several databases that trace these addresses, but the results were inconclusive; the email could have been sent from several computers or mobile devices, or the databases could be wrong. Nonetheless, the cities of origin came back as Clayton, Rocky Mount and Elizabeth City, so the best guess is "east of Raleigh."
As the Indy reported last week, the draft report contained 444 pages of scientific research that cast doubt on fracking—research that contradicted the report's political conclusion that it could be done safely.
A public hearing about the report is scheduled for 6:30 p.m. today at East Chapel Hill High School, 500 Weaver Dairy Road. DENR is also taking public comment via email until April 1: email@example.com
The Indy has long reported on the potential environmental and socio-economic damages from fracking. Readers could rightfully argue that we've been skeptical of fracking to the point of advocating against it.
But even if we agree with the underlying argument that fracking is a bad idea—issuing a fake press release? It's not a very convincing way to get your point across. Very 2008. Yawn.
And the name of the DENR Secretary is Dee Freeman.
When Americans for Prosperity praise a Democrat, it's never good news.
The überconservative group applauded Gov. Bev Perdue yesterday for her support of fracking, after she told WRAL-TV that it would be permissible in North Carolina if the controversial drilling method could be regulated.
"Governor Perdue should be applauded for this important change of her policy position on energy exploration," read a statement by Dallas Woodhouse, AFP-NC state director.
That's a big if, and one that other fracking states—Ohio, New York Pennsylvania, Oklahoma, Virginia and even, the big drilling kahuna, Texas—have largely failed to accomplish. Those states have experienced major environmental problems—contaminated drinking water wells and earthquakes, for starters—that have been linked to fracking. Nationwide, the evidence continues to pile up that fracking is environmentally harmful, releasing methane—a prime mover in greenhouse gas emissions—and wreaking serious wastewater disposal havoc on communities.
Perdue and N.C. Department of Environment and Natural Resources chief Dee Freeman visited Pennsylvania recently to tour fracking operation, The News & Observer reported. Shell Oil, which also debriefed Perdue and her entourage, has long purported that fracking is safe when properly regulated.
Did the dog and pony show tour other fracking sites, including a livestock operation that was quarantined in 2010 because wastewater from a nearby gas well leaked into a field and came into contact with the animals? Or the well in northeast Pennsylvania that experienced a blow out, releasing hazardous fracking fluids onto the ground? Did she see the energy companies discharge vast quantities of wastewater into rivers and streams, as they've repeatedly done in the past? Did she talk to residents who reportedly are suffering health problems from fracking?