NEWS 8 INVESTIGATES
Amid concerns about safety, possible conflicts of interest and allegations of corruption, state lawmakers set out again this legislative session to overhaul the Texas Railroad Commission. And for the second straight session, they failed.
Was it a failure to reach a political compromise or simply the oil and gas industry lobbying for the status quo? The oil and gas industry in Texas is recognized as one of the state’s most powerful.
The industry pumps up the economy by creating jobs. It generated $12 billion in state taxes last year. The elected, three-member Texas Railroad Commission sets and enforces the rules that govern the oil and gas industry.
"We work back and forth to work through problems,” said Bill Stevens, executive vice president of the Texas Alliance of Energy Producers. “That's one of the things that makes the Railroad Commission a great regulator."
But a series of News 8 investigations over the past five years has raised questions about the commission's alleged lax enforcement over a sometimes mismarked and decaying, even fatal, system of natural gas pipelines.
In a 2010 report called "Drilling for Dollars," the watchdog group Public Citizen outlined that about half of all Railroad Commissioners' campaign funds came from the oil and gas industry. The report alleged "a soft corruption of commissioners whose political futures are dependent on the amount of cash they can amass."
Also in 2010, The Texas Sunset Advisory Commission recommended an overhaul of the Railroad Commission citing the "appearance of conflicts" and "limited enforcement actions" taken by the commission.
State lawmakers pledged to adopt the Sunset Advisory Commission's recommendations. But the bill quietly died at the hands of House Energy Resources Committee Chairman, Jim Keffer, (R –– Granbury), who then told News 8 that lawmakers couldn't agree on reforms.
Now, in 2013’s legislative session, House Speaker Pro Tem Dennis Bonnen (R –– Angleton) spearheaded a new, less aggressive attempt at reforming the Railroad Commission.
"I do think the industry is very powerful. We've seen that in witness to the way things have happened with Sunset last session,” said Rep. Bonnen. “I hope we don't see it again this session.”
A 2013 Sunset Advisory Commission report recommended changing the agency's name; limiting campaign contributions; prohibiting sitting commissioners from running for another office; and requiring independent hearing examiners on contested oil and gas cases.
Bonnen authored the proposed legislation. Of particular concern was an incident two years ago, when two sitting Railroad Commissioners ran for the U.S. Senate while still raising money from the oil and gas industry.
"I think it's absolutely wrong that someone can run for a higher political office or different political office and raise money from the industry that they basically have a quasi-judicial role over," said Rep Bonnen.
And while Railroad Commissioners publicly endorsed the proposed reforms, Bonnen told News 8 commissioners were privately lobbying to weaken them.
Our camera was rolling at a recent meeting at which proposed reforms exposed a power struggle among commissioners. Then, two weeks ago, the 2013 proposed Railroad Commission reforms once again died a quiet death at the hands of Rep. Jim Keffer.
Keffer told reporters, again, his committee "couldn't agree on the bill." Rep. Bonnen was able to tuck one proposed reform into another bill. If signed into law, Railroad Commissioners will have to first resign before running for another elected office.
Otherwise, says government watchdog Andrew Wheat of Texas For Public Justice, the death of the reforms was predictable.
"This is the quintessential captured agency in the state of Texas,” said Wheat. “They are bought and paid for by the industry that they regulate and that really isn't regulation at all."
Rep. Bonnen says that while he's disappointed his reforms failed, he would rather no reforms pass than weak reforms. He vowed to try again next session.