Opinion ID: 2768591
Heading Depth: 3
Heading Rank: 6

Heading: Court’s Order

Text: The court stated that because it could not determine from the landowners’ affidavits whether their property was located in the path of the proposed pipeline, they had failed to establish traditional standing. But the court concluded that they had established taxpayer standing to challenge L.B. 1161 and that the legislation was unconstitutional. Regarding standing, the court rejected the State’s arguments that our case law required the landowners to show that there was no better suited party to bring the action and that no illegal expenditure existed because TransCanada had reimbursed the State for all of the DEQ’s expenditures. The court concluded that in the case on which the State was relying, this court’s holding regarding “better suited” parties was limited to the claims dealing with a governmental body or Nebraska Advance Sheets 812 289 NEBRASKA REPORTS official’s failure to assess taxes.40 It determined that the requirement did not apply to illegal expenditure cases and that even if it did, we had also held there that no party is better suited than a taxpayer to challenge a failure to tax if the persons or entities directly and immediately affected by the omission have benefited from the act.41 The court concluded that under our case law, the landowners had standing because the case raised matters of great public concern and the group directly affected by L.B. 1161—pipeline carriers—had benefited from the act and had no incentive to challenge it. The court noted that the evidence showed a representative of TransCanada, the only pipeline carrier to invoke L.B. 1161’s provisions, testified for its passage. The court rejected the State’s argument that the landowners had lost standing to challenge an illegal expenditure after TransCanada reimbursed the State for the DEQ’s costs. The court noted that this argument was more properly characterized as a mootness challenge, but concluded that taxpayer standing should not turn on a manipulable factor like the repayment of public funds: “Nor should courts, in analyzing taxpayer standing, be required to resort to forensic accounting methods to determine whether all public expenditures have been reimbursed.” The court found that in response to the State’s invoices, TransCanada had reimbursed the State for over $5 million in costs. It concluded that our case law conferred standing on taxpayers to challenge illegal appropriations and that reimbursements do not divest them of standing. Regarding the landowners’ constitutional challenges, the court rejected all their arguments except one. It concluded that pipeline carriers are common carriers and that absent specific legislation, the PSC’s authority over them is absolute. It 40 See Project Extra Mile v. Nebraska Liquor Control Comm., 283 Neb. 379, 810 N.W.2d 149 (2012). 41 See id. Nebraska Advance Sheets THOMPSON v. HEINEMAN 813 Cite as 289 Neb. 798 concluded that the Legislature had unconstitutionally divested the PSC of control over pipeline common carriers and had delegated the routing decisions for them to the DEQ and the Governor. It rejected the State’s argument that routing decisions are not within the PSC’s constitutionally enumerated powers. The court also rejected the State’s argument that because a pipeline carrier could choose to comply with the PSC’s regulatory procedures, L.B. 1161 was not unconstitutional in every circumstance, which would defeat the landowners’ facial challenge. The court reasoned that the landowners’ challenge was limited to that part of L.B. 1161 that allows pipeline carriers to choose the DEQ’s review process and the Governor’s approval of a route. It concluded that L.B. 1161 completely divested the PSC of authority over carriers that make this election and thus violated article IV, § 20, of the Nebraska Constitution. It concluded that L.B. 1161 must be declared void, as well as the Governor’s approval of TransCanada’s route, because it was premised on an unconstitutional statute.