Senate Natural Resources & Economic Development met on April 8 to take up a number of bills. This report covers pending business and discussions concerning SB 1585 (Hughes), SB 1166 (Campbell), SB 900 (Alvarado), and SB 1263 (Birdwell). Part one of the hearing can be found here and part two of the hearing can be found here.


This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.


Vote Outs

SB 13 (Birdwell) (8-1)

  • New committee substitute
  • Tightens “shot group” on those on the boycott list
  • Boycott energy companies has been changed to refusing to deal with or engage with; is solely and primarily intended to penalize/limit fossil fuel energy
  • Prohibits a state agency from entering into a contract with a company for goods/services unless the contract includes verification they do not boycott energy companies
  • Narrows scope the comptroller is required to place on the boycott list; all companies changed to publicly traded financial services and banking/investment firms
  • Comptroller can request written verification from a financial company that they do not boycott energy companies
  • The bill does not retroactively apply
  • Lucio – You are satisfied this address concerns posted by my office? Has it clarified how it affects state contracting with HUBs and that it does not violate first amendment rights?
    • Yes
  • Hinojosa – Concerned about the intent bill; potentially could hurt our pensions/revenue income
    • Now applies only to publicly traded financial services and banking/investment firms
    • Does not change original element of the bill; if there is a significant impact to the portfolio, will be reported to the Comptroller
    • Hinojosa – So then this bill would not apply?
    • The state has the discretion to determine what should be done; why we narrowed the scope
    • Hinojosa – Still have concerns
  • Lucio notes that he is voting aye, but has Hinojosa’s concerns; will look at it before it comes to the floor


SB 1046 (Birdwell) (8-1)

  • New committee substitute
  • Adds Sen Nelson’s fiscal responsibility amendment to the bill; removes 5% GR on fee and waste disposal, and moves to federal
  • LBB scored the bill statically
  • Precludes high level storage; high level temporary storage or disposal would have to be approved by the legislature
  • Hinojosa – Satisfied with the wording


SB 1257 (Birdwell) (9-0)


SB 1261 (Birdwell) (8-1)

  • New committee substitute
  • Original spoke to direct and indirect; CS removes “indirectly”
  • State is only directly regulating greenhouse gases
  • Hinojosa – Thanks for the change


CSSB 518 (Kolkhorst) (6-3)

SB 676 (Springer) (9-0)

CSSB 700 (Buckingham) (9-0)

SB 818 (Powell) (9-0)

SB 952 (Hinojosa) (9-0)



SB 1585 (Hughes) (CS) – Relating to the designation of a property as a historic landmark by a municipality

  • Hughes – From last session, HB 2494 required a 3/4 vote at the initial commission plus the city counsel
  • Have seen some municipalities shopping around the vote to where they will be most successful; was supposed to give property owners more rights
  • Requires a municipality to designate one commission with sole authority to approve designations before they reach the city counsel
  • CS allows the property owner can protest upon being included in a historic district
  • CS allows religious organizations to be exempt from landmark designation
  • Companion in the House was unanimously voted out of committee


Jeffery Tahuahua Real Estate Council of Austin – For

  • Changes continue to expand on the work from last session
  • Changes ensure there is a level playing field for property owners who do not want to be included in a historic district
  • Last session, municipalities viewed creating a historic district as a loophole to designate property as a landmark
  • Still allows a clear process to move forward, but provides a threshold for property owners for due process


Linda Cangelosi, Self – For

  • Lives in a neighborhood that was “ensnared” in a historic district; was not initiated by the neighborhood
  • Leaves non-contributed properties to decide for those who are contributing
  • Causes property values to go down upon inclusion in a historic district; is inclusion without compensation
  • Birdwell – What is the difference between contributing and non-contributing?
    • Contributing houses are those included in the historical district, non-contributing are not
    • The non-contributing houses can participate in the process even though the rules do not apply to them
    • Contributing houses do not get the tax deduction and draws their property values down
  • Kolkhorst – Value goes down because you are in this district and you cannot make changes to the house? City tells you what you can/cannot do with the property
    • Yes, cannot demolish the house; buyers are not drawn to a house they cannot make changes to
    • Draws property values down in the entire neighborhood; entire system is flawed/abusive
    • Yes, the city says the neighborhood can impose a set of rules that is a zoning change on the property


Arif Panju, Institute for Justice Austin – For

  • Happened in their neighborhood
  • Reason preservationists are opposed to this bill because it prevents them from taking advantage of the process
  • Historic landmark commissions do this to prevent homeowners from demolishing their house
  • Is a good bill that provides due process for the homeowner
  • Seliger – Agrees with your position, but what about when the home has historic significance? Where are the discriminators when there is an actual historic property?
    • In that scenario, would be appropriate for a city to use historic landmark status rather than creating a district
  • Seliger – What about incentives in this process?
    • Personally advocates for voluntary preservation; an organization in D.C. provides easements for the façade of the house
    • Need a mechanism for homeowners who do not want to be involved in the district; can game the system to make the non-contributing to vote yes
    • Bill provides property right protections
  • Seliger – Was an issue a couple sessions ago when the statewide historical commission attempted to include the Westgate building just because it is old; underscores importance of this bill

HB 1585 left pending


SB 1166 (Campbell) – Relating to who may request a public hearing from the Texas Commission on Environmental Quality related to the construction of a concrete plant

  • Campbell – School, place of worship, licensed day-care center, hospital, or medical facility located within 440 yards of the proposed plant may request a hearing from TCEQ

HB 1166 left pending


SB 450 (Hancock) (CS) – Relating to the jurisdiction of the Railroad Commission of Texas over the injection and geologic storage of carbon dioxide

  • Hancock – Texas currently has permitting authority for Classes 1-5; have not applied to the EPA for primacy of Class 6 wells because split permitting jurisdictions of RRC and TCEQ
  • Consolidates jurisdiction of on-shore and off-shore Class 6 wells solely under the RRC
  • CS contains new language for the BEG; will review rather than directly perform measurement/monitoring functions
  • School land board may use a portion of existing fee collection revenue to contract with the BEG to perform these functions
  • Cannot be a conversation of a Class 1 well to a Class 6 well
  • Requires applicants to obtain a letter from TCEQ that the well will not impact/interfere with previously authorized Class 1 wells
  • Zaffirini – Was drafted with environmental groups and is supported by the oil and gas industry? Good bill
    • Yes


Ben Shepard, Permian Basin Petroleum Association – For

  • Based in Midland, committed to reducing emissions
  • Currently evaluating and investing in how to remove CO2 from the atmosphere
  • Supports this bill as it will streamline the state to apply for primacy of Class 6 injection wells


Scott Tinker, Bureau of Economic Geology – For

  • Increase related to offshore carbon storage is extremely likely in the next two years
  • Provides the opportunity for Texas to lead and establish a significant industry
  • Bureau will still serve as scientific advisor for MMV and storage of carbon dioxide
  • Will allow the school board to use existing fee collection revenue to contract with the BEG to perform these functions


SB 900 (Alvarado) (CS) – Relating to the safety of aboveground storage tanks

  • Alvarado – CS directs TCEQ to establish a program that addresses construction of the tanks and establishes performance/safety standards
  • Overviews the ITC fire and chemical explosion in Deer Park; created air quality concerns and underscored the need for further oversight
  • Program will use best practices including those from the American Petroleum Institute and National Fire Protection Agency
  • Thanks Texas Pipeline Association and other stakeholders for working on this bill


Cyrus Reed, Lonestar Chapter Sierra Club – On

  • Since Harvey, number large storage tanks in Houston have failed/caught on fire
  • Do not have performance standards for above ground storage tanks
  • Bill is tailored to cover issues like ITC, but should cover smaller tanks as well
  • Supports program, would like it to be in place within a year the bill becomes law
  • Suggests inspections/audit to occur every other year
  • Bill needs specific enforcement provision/language
  • Alvarado – Three primary safety measures foundation of the bill remote shut off values, overfull protection, fire suppression technology
  • Alvarado – Narrowly addresses types of tanks
    • Another important issue is that we saw a lot of roofs fail; important as the climate is changing


Jennifer Coffee, Texas Pipeline Association – For

  • Worked to craft around three main concerns of remote shut off values, overfull protection, fire suppression technology
  • Were concerned new regulations would not take into account for other storage facilities
  • CS intent is to indicate those differences should be taken into considerations; expect TCEQ will work with operators to ensure measures are tailored to them


Adrian Shelley, Public Citizen – On

  • One gap in the bill is the vulnerability these tanks have to rain; vast majority of roof damage after Harvey were excessive rainwater amounts
  • Are built withstand 10 inches of rain; several storms have exceeded that
  • Can expect more of these excessive rain events; found tanks with 6-inch roof drains did not see failure, but those with 4 inches did


Don Lewis, Texas Pipeline Association – For

  • TCEQ should have the ability to exercise judgement for the best practices out there
  • Legislature should not prescribe exact requirements in the program, agree elements should be under TCEQ’s judgement
  • Intent of bill is to allow TCEQ to use their expertise to hear public comment and figure out what the program rules should be
  • Supportive of an approach that would allow operators to use the industry standards that work best for their different operations


John Beard, Port Arthur Community Action Network – On

  • Port Arthur has experienced many instances where tanks have caught fire/collapsed
  • Bill needs some teeth to ensure companies do their due diligence to protect communities/employees/environment
  • Needs proper enforcement mechanisms and precautionary measures companies should take
  • Alvarado – Have an enforcement question for the resource witness


Dr. Bryan Shaw, Texas Oil & Gas Association – For

  • Safety is a primary concern of industry, this bill focuses on that
  • Appreciates TCEQ’s move to a different penalty structure that focuses on grave incidents
  • Bill would cover about 8,200 tanks; believes TCEQ already have enforcement authority, but if it does not will work with you on that


Kristi Juroch, TCEQ – Neutral

  • Alvarado – Can you speak to the enforcement issue that has been brought up?
    • Idea is to incorporate industry standards and then would look at potential violations and then that would be part of enforcement
    • Alvarado – So there is enforcement?
    • Yes

SB 900 left pending

SB 1263 (Birdwell) (CS) – Relating to funding for the Texas emissions reduction plan

  • Birdwell – TERP has become vital to bring areas into compliance with NACS
  • Last session, passed HB 3745 to extend the sources of funding
  • TERP funds are currently outside of the treasury and are not subject to appropriations
  • Became apparent transfer of State Highway Funds to TERP would require appropriations
  • Bill seeks to accomplish intent of HB 3745
  • Reworks the current transfer of funds between Fund 6 directly to the Texas Mobility Fund
  • CS brings TxDOT to the table to work with TCEQ
  • Sends 40% of all TERP funds to Fund 6 for CMAC projects; any unused funds will also be sent there
  • Nichols – Kept moving the expiration date, but was funds have not been used for their original purpose to clean air in non-attainment areas


Cyrus Reed, Lonestar Chapter Sierra Club – On

  • Have not seen the CS; will look at this further
  • Continue to have issues with high ozone levels and need this money to clean up the air
  • If we can find a compromise to ensure the money is spend cleaning up the air
  • Would prefer a compromise that leans more towards the traditional TERP program rather than mitigation; notes an old Hinojosa bill has a more preferrable structure
  • Birdwell – Trying to keep this uncomplicated as possible; are truing to make it where we do not have to constantly restructure/work on TERP
    • Does think it is important to have a trust fund outside of the budget; SB 1 added an annual report on the program to reconsider if they money is not spent
    • Birdwell – TxDOT cannot just spend on congestion unless it makes the standard of air better


Martha Lindor, BSF – For

  • Is a member of Texas Chemical Council
  • TERP is only tool available to mitigate NOx emissions
  • More dollars spent will reduce emissions and clean up air in non-attainment areas
  • Fully agrees 40% going to TxDOT is a good compromise
  • Important aspect is TxDOT’s annual report to TCEQ

SB 1263 left pending


Birdwell – Is possible we may have to vote on the floor going forward; will give advanced notice