As you might have heard by now, forlorn natural gas operator Trinity East has sued the City of Dallas for denying the three permits it was seeking to drill along the Trinity River in Northwest Dallas by the Irving border. Claiming breach of contract and even fraud, the company is saying it's owed millions of dollars above and beyond the $19 million it spent on leases for the three sites.
Anyone who's seen the filing knows this is a lawsuit with no legs. Yes, Trinity East leased the land, but guarantees about permits being awarded were not part of the deal. Those can't be bought so blatantly. Even Mary Suhm's secret memo un-earthed last February by the Dallas Observer made it clear that her assistance was not a guarantee and "not a legally binding agreement." The leases were one thing. The permits another. Trinity East thought it had the permits in hand when Suhm signed her memo. So did Suhm.
That's why citizens were told in 2012 that Trinity East permits were a "done deal" by sources in City Hall, including Mayor Rawlings, who seems to have known about the Suhm memo before the public did. There was just no way those permits were going to be denied. Suhm and the Mayor were not going to let that happen. That's why they called for the hearing and permit vote two days before Christmas. They thought no one would show and they could wrap it up. So it was a big surprise when the City Plan Commission voted to deny the TE permits. Undeterred, there was suddenly a call for an unprecedented, second "reconsideration vote" by the Plan Commission by the Mayor's representative on the same permits. But Trinity East lost that fight too, by a wider margin, in January of 2013. This time without any public hearing.
When the CPC denial came to the City Council in August of 2013, charter rules demanded it must be overridden by a super majority of 12. The vote to overturn the CPC's denial was 9 to 6, leaving the denial in place, but showing a majority of the current council in favor of granting the permits.
Then the strategy turned to adapting the new drilling ordinance to fit the Trinity East permits. If they couldn't make it through the front door, they could go in the back way. And so City legal staff tried to manipulate the City Plan Commission into carving out exceptions in the new draft ordinance that would allow that. Instead of a 1500-foot setback, they urged 1000 feet with a variance back to 500 feet. That would allow all Trinity East sites. Then they tried to ease the rules on park drilling, and even succeeded to some extent, softening a ban on surface drilling in parks that was part of the old ordinance.
Only Dallas residents working overtime and applying more scrutiny saved the day and got Plan Commission support for a new ordinance that did finally shut the door on all three Trinity East permits. And of course, that's when Trinity East, aided by the entire gas industry, decided to sue.
So you now have the weird situation where the same City Hall that was trying so desperately to win those permits for Trinity East is now being sued by the company for not being conspiratorial enough to subvert the public process. Yesterday, the city issued an statement saying the company's lawsuit lacked merit and, "The city will vigorously defend its right to exercise its regulatory powers to protect public health and safety as well as the environment."
But here's the thing. Since a clear majority of current Dallas City Council members voted for the permits, how much will power is there among this same group to now defend a position they didn't take? And since it was often the Dallas City Attorney's office leading the charge to manipulate the system on Trinity East's behalf, how well do you trust that same crew to "vigorously defend" the outcome they tried so hard to prevent?
Three are some legal principles involving the city's right to control its own zoning decisions which could motivate the city and/or the Texas Municipal League into such a defense. But you have to wonder how much heart they really have for a fight, of which right up until the last vote, they were on the same side as the company now suing them.
To make sure the City doesn't settle with Trinity East, citizens are going to have to persuade the three council members who voted with them for the new ordinance, but against them on the Trinity East permits to change their minds – Jennifer Staubach-Gates, Dwaine Carrawy and Mayor Ralwings.
That won't be easy. Rawlings was making the "I told you so" rounds in the media yesterday. The first sign that they might be serious about defending themselves is whether they'll hire an outside law firm with municipal law experience to represent them. If they put the same people in the City Attorney's office who were working in concert with Trinity to win those permits in charge of this fight, we're doomed. If they hire a competent firm with a reputation for toughness, you'll know they think there might be some points of law worth going to court for.
Longer term, it once again puts a spotlight n the need to elect additional allies of the six council members who've been reliable allies to citizens on this issue. This coming Dallas municipal election cycle in 2015 will see almost half the council seats up for grabs as incumbents are term-limited out. Stay tuned.