Cooperstown Holstein Corporation, Appellant,v.Town of Middlefield, Respondent.BriefN.Y.June 3, 2014STATE OF NEW YORK QJnurt nf Apptaln APL-2013-00242. COOPERSTOWN HOLSTEIN CORPORATION, Plaintiff-Appellant, vs. TOWN OF MIDDLEFIELD, Defendant-Respondent. Appellate Division Case No. 515498. Otsego County Index No. 2011-0930. AMICUS CURIAE BRIEF ON BEHALF OF INDEPENDENT OIL AND GAS ASSOCIATION OF NEW YORK, INC. DANIEL A. SPITZER, EsQ. ALAN J. LAURITA, EsQ. CHARLES W. MALCOMB, ESQ. Of Counsel HODGSON RUSS LLP Attorneys for Independent Oil and Gas Association of New York, Inc. The Guaranty Building 140 Pearl Street, Suite 100 Buffalo, New York 14202 Telephone: (716) 856-4000 Facsimile: (716) 849-0349 Date of Completion: February 25, 2014. BATAVIA LEGAL PRINTING, INC.- Telephone (866) 768-2100 CORPORATE DISCLOSURE STATEMENT Pursuant to Rule 500.l(t) of the Rules ofPractice for the Court of Appeals of the State of New York, Proposed Amicus Curiae Independent Oil and Gas Association of New York, Inc. ("IOGA of NY") makes the following disclosure: IOGA of NY is a New York domestic not-for-profit corporation. It has no parents, subsidiaries, or affiliates. 1 TABLE OF CONTENTS .PAGE CORPORATE DISCLOSURE STATEMENT .......................................................... I PRELIMINARYSTATEMENT ............................................................................... 1 STATEMENT OF INTEREST ................................................................................. 2 BACKGROUND ....................................................................................................... 5 A. The Town of Middlefield Bans Oil And Gas Exploration And Production ..................................................................................... 6 B. The Oil, Gas And Solution Mining Law ("OGSML") And Its Preemption Provision ............................................................................ 6 C. The Mined Land Reclamation Law ("MLRL") And Its Preemption Provision ............................................................................ 8 D. The State Legislature Adopts Frew Run For The MLRL, But Not For The OGSML .......................................................................... 10 ARGUMENT .......................................................................................................... 12 POINT I. THE OGSML PREEMPTS ALL LOCAL REGULATION OF THE OIL AND NATURAL GAS INDUSTRY, WITH ONLY TWO SPECIFIC AND LIMITED EXCEPTIONS FOR POWERS GRANTED MUNICIPALITIES IN THE STATE CONSTITUTION ............................................................................... 12 A. The Plain And Unambiguous Language Of The OGSML Preempts Any Local Land Use Regulation Of Oil And Natural Gas Activities ...................................................................................... 12 1. The Zoning Power Is Preempted Under This Court's Recent Northern Mariana Islands Decision ........................................ 14 2. In Addition To The Plain Language Of The OGSML, An Evaluation Of The OGSML' s Preemption Provision As Against The MLRL' s Demonstrates That The OGSML Preempts The Zoning Power .................................................... 15 B. For Three Decades, The Only Appellate Court To Address The OGSML' s Preemption Provision Held That It Means What It Says, That All Local Regulation Of The Oil And Gas Industry Is Preempted, Save Two Limited Exceptions ......................................... 17 11 C. The Third Department Improperly Applied Case Law Interpreting The MLRL To The OGSML's Preemption Provision ....................... 18 1. The Legislature's Amendment Of The MLRL Post-Frew Run While Leaving The OGSML Untouched Demonstrates The Two Statutes Are Not To Be Interpreted In The Same Manner ...................................................................................... 21 2. The Third Department Erroneously Elevated The Legislatively-Created Zoning Power To The Same Level As The Constitutionally-Created Powers Over Local Roads And Taxes ................................................................................. 22 POINT II. ACCEPTING THE THIRD DEPARTMENT'S RATIONALE WOULD FURTHER VIOLATE THE RULES OF STATUTORY CONSTRUCTION BY RENDERING EXCEPTIONS TO THE OGSML'S PREEMPTION PROVISION MEANINGLESS ............. 24 POINT III. MUNICIPAL REGULATION OF THE LOCATION OF OIL AND GAS DEVELOPMENT IMPERMISSIBLY CONFLICTS WITH THE STATE REGULATORY REGIME ............................... 26 CONCLUSION ....................................................................................................... 36 111 TABLE OF AUTHORITIES PAGE STATE CASES Chwick v. Mulvey, 81 A.D.3d 161,915 N.Y.S.2d 578 (2d Dep't 2010) .......................................... 26 Commonwealth of the Northern Mariana Islands v. Canadian Imperial Bank of Commerce, 21 N.Y.3d 55, 967 N.Y.S.2d 876 (2013) ............................................... 14, 15, 21 Canso!. Edison Co. v. Town of Red Hook, 60 N.Y.2d 99, 468 N.Y.S.2d 596 (1983) ........................................................... 26 Cooperstown Holstein Corp. v. Town of Middlefield, 106 A.D.3d 1170, 964 N.Y.S.2d 431 (3d Dep't 2013), lv. granted 21 N.Y.3d 863, 972 N.Y.S.2d 535 (2013) .............................................................. 19 Gernatt Asphalt Prods. v. Town of Sardinia, 87 N.Y.2d 668, 642 N.Y.S.2d 164 (1996) ......................................................... 21 In re Jacob, 86 N.Y.2d 651, 636 N.Y.S.2d 716 (1995) ......................................................... 14 Lenape Resources, Inc. v. Town of Avon et al., Index No. 1060-2012 (Supreme Court, Livingston Cty. 2013) (attached hereto as Appendix A) .................................................................................... 1, 24 Majewski v. Broadalbin-Perth Cent. Sch. Dist., 91 N.Y.2d 577, 673 N.Y.S.2d 966 (1998) ................................................... 12, 13 Matter of Alonzo M v. New York City Dep 't of Probation, 72 N.Y.2d 662, 536 N.Y.S.2d 26 (1988) ........................................................... 13 Matter of Envirogas, Inc. v. Town of Kiantone, 112 Misc.2d 432, 447 N.Y.S.2d 221 (Sup. Ct., Erie Cty. 1982), aff'd 89 A.D.2d 1056 (4thDep't 1982) ..................................................................... 17, 18 Matter of Frew Run Gravel Prods. v. Town of Carroll, 71 N.Y.2d 126, 524 N.Y.S.2d 25 (1987) ............. 9, 10, 16, 17, 19, 20, 21, 24,26 IV Matter of Norse Energy Corp. USA v. Town of Dryden, 108 A.D.3d 25, 964 N.Y.S.2d 714 (3d Dep't 2013), lv. granted, 21 N.Y.3d 863, 972 N.Y.S.2d 535 (2013) .................................................. 18, 19, 25 Pajak v. Pajak, 56 N.Y.2d 394,452 N.Y.S.2d 381 (1982) ......................................................... 15 Patrolmen's Benevolent Ass 'n v. New York, 41 N.Y.2d 205, 391 N.Y.S.2d 544 (1976) ......................................................... 13 Robin v. Hempstead, 30 N.Y.2d 347, 334 N.Y.S.2d 129 (1972) ................................................... 17, 23 Rocovich v. Consolidated Edison Co., 78 N.Y.2d 509, 577 N.Y.S.2d 219 (1991) ......................................................... 24 Sunrise Check Cashing & Payroll Servs., Inc. v. Town of Hempstead, 20 N.Y.3d 481, 964 N.Y.S.2d 64 (2013) ........................................................... 23 Voss v. Lundvall Bros., Inc., 830 P.2d 1061 (Colo. 1992) ............................................................................... 29 STATE STATUTES N.Y. C.P.L.R. § 5225(b) .......................................................................................... 14 N.Y. ENVTL. CONSERV. LAW§ 23-0101 et seq ......................................................... 6 N.Y. ENVTL. CONSERV. LAW§ 23-0301 ................................................................. 32 N.Y. ENVTL. CONSERV. LAW§ 23-0303(2) ................................................... 7, 12, 15 N.Y. ENVTL. CONSERV. LAW§ 23-0305 ................................................................. 27 N.Y. ENVTL. CONSERV. LAW§ 23-0501 ................................................................. 27 N.Y. ENVTL. CONSERV. LAW§ 23-0503 ................................................................. 27 N.Y. ENVTL. CONSERV. LAW§ 23-2703 ................................................................... 8 N.Y. ENVTL. CONSERV. LAW§ 23-2703(2) ................................................... 9, 11, 16 N.Y. TOWNLAW § 261 ............................................................................................ 28 v N.Y. TOWN LAW§ 274-a ......................................................................................... 28 N.Y. TOWNLAW § 274-b ......................................................................................... 28 REGULATIONS 6 N.Y.C.R.R. pt. 550 et seq ....................................................................................... 6 6 N.Y.C.R.R. § 553.1 .............................................................................................. 27 6 N.Y.C.R.R. § 553.2 .............................................................................................. 27 6 N.Y.C.R.R. § 553.3(a) .......................................................................................... 28 6 N.Y.C.R.R. § 553.4 .............................................................................................. 28 OTHER AUTHORITIES 77 N.Y. JUR. 2D MINES AND MINERALS§ 10 .................................................... 32, 33 Letter, dated July 14, 1981 from New York Gas Group to the Hon. John G. McGoldrick, Senate Bill 6455-B ......................................................................... 8, 12 Vl PRELIMINARY STATEMENT Before the Court is a straightforward matter of municipal preemption and statutory construction, not a philosophical debate on New York's energy policy. This appeal will tum on whether the Oil, Gas and Solution Mining Law ("OGSML") means what it says, and whether the principles of statutory construction must be followed, or if they can be discarded for convenience. The OGSML's preemption provision unequivocally states that all local ordinances relating to oil and natural gas development are preempted, except for those local powers specifically preserved. Zoning is not a preserved power. Nonetheless, certain lower courts have sanctioned temporary (moratoria) and permanent bans on all oil and gas development activities enacted using local zoning authority, relying on this Court's interpretation of an unrelated preemption provision enacted for different purposes under an entirely separate statute for a different industry, which separate statute, unlike the OGSML, specifically exempts the zoning power from preemption. As one lower court interpreting the OGSML noted, the statute's preemption provision is "quite broad" and local land use regulation, including the municipal zoning power, is specifically preempted by the statute's plain language. Lenape Resources, Inc. v. Town of Avon et al., Index No. 1060-2012 (Supreme Court, Livingston Cty. 2013) (attached hereto as Appendix A). It is only when courts consider inapplicable case law interpreting the preemption provision in the 1 Mined Land Reclamation Law ("MLRL"), that they reach a contrary conclusion. This Court should right the wrong perpetuated by certain lower courts, and should resist efforts to judicially redraft the OGSML statute-a redrafting that relies on a misunderstanding of the zoning power-and adhere to the plain language of the statute, following the rules of statutory construction that it set forth through several decades of precedent. STATEMENT OF INTEREST The first commercial gas well in the United States, arguably in the world, was drilled in the Village of Fredonia, Chautauqua County, New York in 1821 and produced until1858. The Drake Well, which is credited with starting the domestic oil industry, was drilled less than thirty miles from the New York border in Titusville, Pennsylvania in August, 1859. Throughout its history the State has controlled the regulation of the industry. See, e.g., Chapter 217 of the Laws of 1879 (flooding of oil sands); Chapter 25 of the Laws of 1909 (plugging of abandoned oil wells). Today, that uniform statewide regulation, indeed the very existence of the oil and gas industry in New York, is threatened by the decisions of the Otsego County Supreme Court and Appellate Division, Third Department. IOGA of NY is a trade association, formed to protect, foster, and advance the common interests of oil and gas producers, professionals, and related industries in the State ofNew York. IOGA of NY was formed in 1980 and today 2 has 335 members who represent approximately two hundred entities with thousands of employees who depend upon the oil and gas industry in New York for their livelihoods. In the same timeframe that they were forming IOGA ofNY, the leaders of the oil and gas industry in New York were working with members of the New York Legislature on revisions to the Environmental Conservation Law ("ECL"). At that time, many local municipalities were attempting to regulate the oil and gas industry through various local powers, including zoning. The industry and legislative leaders realized that the potential growth of the industry and the economy of New York was threatened by a patchwork of inconsistent regulation, often adopted and/or enforced by individuals without any requisite training or expertise. The New York State Legislature responded in 1981 by amending Article 23 of the ECL to preempt regulation of the oil, gas and solution mining industries and vest regulation of those industries in the New York Department of Environmental Conservation ("NYSDEC" or the "Department"). The Legislature only excepted two areas from preemption by the State, control by a local municipality over its roads and the rights of a local municipality under the Real Property Tax Law. Contrary to what has been suggested by others, not only "how" 3 but "where" the oil and gas industry would operate was placed in the control of the Department. Oil and gas wells are depleting assets and new wells must be constantly drilled to maintain production levels and the economic viability of the companies operating those wells. Local laws prohibiting that from happening will obviously adversely impact companies involved in the oil and gas industry and their employees, including the members ofiOGA ofNY. Such local laws, if upheld, also have the potential of adversely impacting development of the oil and gas resources in adjoining municipalities because oil and gas deposits do not follow municipal boundaries. A piecemeal pattern of local regulation and prohibition of oil and gas activities would keep the oil and gas industry from properly developing the oil and gas resources in New York and thus deny the areas ofNew York State where those resources are located the significant economic growth and benefit that would occur through such development. The Legislature recognized this when it amended the OGSML in 1981. Laws banning all oil and gas development prohibit wells the Department still allows and which, absent any such local law, could be drilled today. IOGA ofNY's members have a significant interest in developing oil and gas across the State. Municipal efforts to regulate the oil and gas industry, long understood by 4 the industry to be expressly preempted, significantly adversely impacts investment, hiring, and other economic activity and interests ofiOGA ofNY's members. IOGA ofNY and its members have a direct interest in litigation determining the validity of recent municipal forays into the oil and gas regulatory field. Municipal regulations, including local bans, would impede access to resources and leave important, highly technical regulatory matters to the judgment of local zoning authorities. BACKGROUND There has been much debate across New York about the wisdom of high volume hydraulic fracturing ("HVHF"), a form of natural gas extraction that has led to the current natural gas boom. Justified or not-and the wisdom ofHVHF is not an issue in this case-municipalities across the State have reacted to fears about HVHF by first enacting moratoria and then outright bans on all oil and gas development activities. Although non-high volume methods of hydraulic fracturing have been used successfully for decades in New York, the bans have been total (rather than addressing just HVHF) apparently because municipalities, like the Town of Middlefield, recognize that only the State has the authority to address the methodology of oil and gas extraction. 5 A. The Town of Middlefield Bans Oil And Gas Exploration And Production. In June 2011, the Town of Middlefield adopted a zoning law that bans all activities related to the exploration for, and the production and storage of, natural gas and petroleum (Town of Middlefield Local Law No. 1 (2011), herein the "Ban"). The Ban was adopted pursuant to the Town's authority under its zoning power, and its general police powers to regulate the use of land. (R. 98.) B. The Oil, Gas And Solution Mining Law ("OGSML") And Its Preemption Provision. The Legislature first enacted the OGSML, N.Y. ENVTL. CONSERV. LAW § 23-0101 et seq., in 1963. The OGSML was enacted in response to increased production, evolving technology, and a better understanding of environmental concerns related to oil and natural gas resources. The OGSML is contained within the New York Environmental Conservation Law ("ECL"), and the New York State Department of Environmental Conservation ("NYSDEC") is the agency responsible for promulgating implementing regulations. Consistent with its exclusive authority in this arena, NYSDEC has promulgated a detailed and comprehensive regulatory scheme. See 6 N.Y.C.R.R. Part 550 et seq. NYSDEC has also issued guidance documents, declaratory rulings, and a multi-volume Generic Environmental Impact 6 Statement, all of which are consistent with an exhaustive regulatory program governing every aspect of oil and natural gas operations in New York. Since its adoption in 1963, the OGSML has been periodically amended to remain current, address concerns of the Legislature, and ensure that New York's laws, rules, and regulations are able to protect human health and the environment, while also promoting the production ofNew York's indigenous oil and natural gas resources. The Legislature amended the OGSML in 1981, 2005, and most recently in 2008. The 1981 amendments were intended to preempt and supersede local regulation of the oil and natural gas industries and ensure that the field of oil and natural gas regulation was in the hands of the State Legislature and the NYSDEC. Specifically, the OGSML's preemption provision states: The provisions of this article shall supersede all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries; but shall not supersede local government jurisdiction over local roads or the rights of local governments under the real property tax law. N.Y. ENVTL. CONSERV. LAW§ 23-0303(2). The 1981 amendments vested the State with sole and exclusive authority to regulate the oil and natural gas industry, with two narrow exceptions. The OGSML specifically reserved local laws and ordinances related to local roads and rights under the real property tax law to local governments. All other local laws and ordinances are expressly preempted. These amendments were to ensure that the 7 NYSDEC had the sole and exclusive authority to regulate the oil and natural gas industry because that agency has been charged with having the expertise and experience necessary to regulate the oil and natural gas industries in a manner that is also protective of the environment. See, e.g., Letter, dated July 14, 1981 from New York Gas Group to the Hon. John G. McGoldrick, Senate Bill6455-B ("It is comprehensive and gives oil and gas people a single guide.") C. The Mined Land Reclamation Law ("MLRL") And Its Preemption Provision. The MLRL is set forth in Title 27, Article 23 of the New York Environmental Conservation Law. The MLRL applies only to extractive mining, not the exploration, production, and development of oil and natural gas. N.Y. ENVTL. CONSERV. LAW§ 23-2703. Extractive mining and natural gas development are two very different activities, with very different impacts. Thus, the Legislature saw fit to craft two different statutory and regulatory regimes to ensure the impacts from mining and the less significant impacts from oil and natural gas production and development would be adequately addressed. The MLRL' s preemption provision, as originally adopted in 197 4, was significantly narrower than the preemption provision found in the OGSML. The original version of the MLRL' s preemption provision provided: For the purposes stated herein, this title shall supersede all other state and local laws relating to the extractive mining industry; provided, 8 however, that nothing in this title shall be construed to prevent any local government from enacting local zoning ordinances or other local laws which impose stricter mined land reclamation standards or requirements than those found herein. N.Y. ENVTL. CONSERV. LAW§ 23-2703(2) (McKinney 1984) (providing the original 197 4 language of the preemption provision before the MLRL was amended in 1991) (emphasis added). The OGSML preempts all local laws and ordinances relating to the regulation of the oil, gas and solution mining industries except with regard to local roads and municipal authority under the Real Property Tax Law ("RPTL"). The MLRL's preemption provision was (and is) drastically different. It specifically allowed local governments to (1) enact local zoning ordinances, and (2) adopt local laws providing for stricter standards than those found in the MLRL. In other words, as originally adopted, the MLRL was meant to be a "floor," not a "ceiling." Municipalities could use their zoning powers and could adopt local laws requiring stricter mined land reclamation standards. The MLRL' s preemption provision contemplates significant local regulation, while the OGSML's does not. The 197 4 version of the MLRL' s preemption provision was interpreted by this Court in Matter ofFrew Run Gravel Prods. v. Town of Carroll, 71 N.Y.2d 126, 524 N.Y.S.2d 25 (1987). In Frew Run, a mining company sought to restrain the town's enforcement of the local zoning ordinance, which prohibited mining in a 9 certain district. The mining company argued that the local zoning ordinance was preempted by the MLRL. Given that the MLRL specifically exempted "local zoning ordinances" from preemption, it is no surprise that the Town of Carroll's zoning ordinance was upheld. Subsequently, some municipalities and courts have erroneously interpreted the Frew Run decision as narrowing or circumscribing the much broader preemption provision in the OGSML. The Court should right this wrong. D. The State Legislature Adopts Frew Run For The MLRL, But Not For The OGSML. After Frew Run was decided in 1987, the MLRL's preemption provision was amended in 1991, in effect, to codify, respond to, and clarify this Court's holding. The MLRL's preemption provision now provides as follows: 2. For the purposes stated herein, this title shall supersede all other state and local laws relating to the extractive mining industry; provided, however, that nothing in this title shall be construed to prevent any local government from: a. enacting or enforcing local laws or ordinances of general applicability, except that such local laws or ordinances shall not regulate mining and/or reclamation activities regulated by state statute, regulation, or permit; or b. enacting or enforcing local zoning ordinances or laws which determine permissible uses in zoning districts. Where mining is designated a permissible use in a zoning district and allowed by special use permit, conditions placed on such special use permits shall be limited to the following: 10 (i) ingress and egress to public thoroughfares controlled by the local government; (ii) routing of mineral transport vehicles on roads controlled by the local government; (iii) requirements and conditions as specified in the permit issued by the department under this title concerning setback from property boundaries and public thoroughfare rights-of-way natural or man- made barriers to restrict access, if required, dust control and hours of operation, when such requirements and conditions are established pursuant to subdivision three of section 23-2711 of this title; (iv) enforcement of reclamation requirements contained in mined land reclamation permits issued by the state; or c. enacting or enforcing local laws or ordinances regulating mining or the reclamation of mines not required to be permitted by the state. N.Y. ENVTL. CONSERV. LAW§ 23-2703(2). While the Legislature saw fit to amend the MLRL' s preemption provision in 1991, it left the OGSML's preemption provision untouched. Since no local zoning or other local laws-except with respect to roads and the rights under the RPTL-were ever permitted by the express language of the statute, the Legislature had no reason to clarify or disturb the OGSML' s preemption provision. 11 ARGUMENT POINT I. THE OGSML PREEMPTS ALL LOCAL REGULATION OF THE OIL AND NATURAL GAS INDUSTRY, WITH ONLY TWO SPECIFIC AND LIMITED EXCEPTIONS FOR POWERS GRANTED MUNICIPALITIES IN THE STATE CONSTITUTION. A. The Plain And Unambiguous Language Of The OGSML Preempts Any Local Land Use Regulation Of Oil And Natural Gas Activities. The OGSML was amended in 1981 to include an express supersedure and preemption provision that prohibits all local regulation of the oil, gas and solution mining industries, with but two exceptions for powers delegated to municipalities by the State Constitution: The provisions of this article shall supersede all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries; but shall not supersede local government jurisdiction over local roads or the rights of local governments under the real property tax law. N.Y. ENVTL. CONSERV. LAW§ 23-0303(2) (emphasis added). This amendment was meant to "give[] oil and gas people a single guide" and to foreclose local regulation of the oil and gas industry. See New York Gas Group Letter to the Hon. John G. McGoldrick, July 14, 1981 re: Senate Bill6455-B. In interpreting a statute, it is fundamental that a court should "attempt to effectuate the intent of the Legislature." Majewski v. Broadalbin-Perth Cent. Sch. Dist., 91 N.Y.2d 577, 583, 673 N.Y.S.2d 966, 968 (1998) (internal quotation and citation omitted). Doing so does not require guesswork, extrapolation, or a 12 balancing of policy factors; rather, as this Court has held on numerous occasions, "the clearest indicator of legislative intent is the statutory text, the starting point in any case of interpretation must always be the language itself, giving effect to the plain meaning thereof." Id. "[W]here the statutory language is clear and unambiguous, the court should construe it so as to give effect to the plain meaning of the words used." Patrolmen's Benevolent Ass 'n v. New York, 41 N.Y.2d 205, 208, 391 N.Y.S.2d 544, 546 (1976). "In construing statutes, it is a well-established rule that resort must be had to the natural signification of the words employed, and if they have a definite meaning, which involves no absurdity or contradiction, there is no room for construction and courts have no right to add to or take away from that meaning." Majewski, 91 N.Y.2d at 583, 673 N.Y.S.2d at 968 (quoting Tompkins v. Hunter, 149 N.Y. 117, 122-123 (1896)) (emphasis added). The OGSML' s preemption provision lists only two areas where local governments could continue to regulate, and zoning and other types of land use regulations are not included. "Where a statute describes the particular situations in which it is to apply and no qualifying exception is added, an 'irrefutable inference must be drawn that what is omitted or not included was intended to be omitted or excluded."' Matter of Alonzo M v. New York City Dep 't of Probation, 72 N.Y.2d 662, 665, 536 N.Y.S.2d 26, 28-29 (1988) (internal citation omitted). New York applies the rule of "expressio unius est exclusio alterius-where a statute mentions 13 certain exceptions and omits others, the Legislature intends that the omitted items should be excluded." McKinney's Cons. Laws ofN.Y., Book 1, Statutes§ 240; see In re Jacob, 86 N.Y.2d 651, 673, 636 N.Y.S.2d 716, 727 (1995). 1. The Zoning Power Is Preempted Under This Court's Recent Northern Mariana Islands Decision. The principles of statutory construction noted above were reiterated by this Court in Commonwealth of the Northern Mariana Islands v. Canadian Imperial Bank of Commerce, 21 N.Y.3d 55, 967 N.Y.S.2d 876 (2013). In Northern Mariana Islands, the outcome turned on statutory construction in the context of a turnover order under CPLR § 5225(b). The question posed was whether a turnover order may be issued to an entity that did not have actual possession of a debtor's assets, but whose subsidiary might have possession. The statute provided that a turnover order may be issued where an asset of a judgment debtor is held in the "possession or custody" of a third-party. The judgment creditor claimed "that the phrase 'possession or custody' inherently encompasses the concept of control" and thus the turnover order "is applicable to garnishees with constructive possession of a judgment debtor's assets." Id. at 60. This Court reiterated that the "starting point" in determining the expanse of a statutory provision is "the language itself." Id. (internal quotations and citation omitted). Because the plain language of CPLR § 5225(b) refers only to "possession or custody," excluding any reference to control, 14 the Court determined that this "absence ... is meaningful and intentional ... [and] the failure of the Legislature to include a term in a statute is a significant indication that its exclusion was intended." Id. at 60-61 (citing People v. Finnegan, 85 N.Y.2d 53, 58, 623 N.Y.S.2d 546, 549 (1995) ("We have firmly held that the failure of the Legislature to include a substantive, significant prescription in a statute is a strong indication that its exclusion was intended."); Pajak v. Pajak, 56 N.Y.2d 394, 397, 452 N.Y.S.2d 381, 382 (1982) ("The failure of the Legislature to provide that mental illness is a valid defense in an action for divorce based upon the ground of cruel and inhuman treatment must be viewed as a matter of legislative design. Any other construction of the statute would amount to judicial legislation."). That the zoning power was not listed as exempted from preemption is meaningful, and demonstrates that its exclusion was intended, especially in light of the Legislature's inclusion of the zoning power as being exempt from the MLRL's preemptive reach. 2. In Addition To The Plain Language Of The OGSML, An Evaluation Of The OGSML's Preemption Provision As Against The MLRL's Demonstrates That The OGSML Preempts The Zoning Power. The OGSML' s preemption provision provides that "all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries" are preempted. N.Y. ENVTL. CONSERV. LAW§ 23-0303(2) (emphasis added). The phrase "relating to" is extremely broad, and its ordinary and accepted meaning 15 encompasses land use laws and any other type of regulation that would in some way be connected to the subject-matter. This is why, when the Legislature determined to preserve this power in the mining context, it specifically exempted the zoning power from preemption. See N.Y. ENVTL. CONSERV. LAW§ 23-2703(2) (excepting local zoning from the preemptive reach of the MLRL ). That local zoning regulation was intended to be excluded becomes even more clear when the OGSML' s preemption provision is evaluated against the preemption language in the MLRL. The Legislature knows full well how to preserve the local zoning power; it did so in the MLRL, but did not do so in the OGSML. Moreover, in 1991, after the Frew Run decision, the Legislature amended the MLRL to codify, respond to, and clarify the preemption language, the effect of which was to clarify and continue the local zoning power in this arena. Significantly, during this process, the broad preemption clause of the OGSML was left untouched. Certain courts recently interpreting the OGSML's preemptive clause have engaged in judicial legislation by rewriting the OGSML to grant localities the hammer of exclusion by finding that zoning was not the type of power the Legislature intended to exclude, despite its obvious absence from a savings clause which addresses two powers (roads and real property taxes) also incidental to the oil 16 and gas industry. These courts have effectively done what the Legislature refused to do: narrow the reach of the OGSML's preemption provision. Where, as here, the State's policy of preemption is express and unambiguous, municipalities "lack[] authority to deal with the matter unless it is specifically empowered so to do in terms clear and explicit." Robin v. Hempstead, 30 N.Y.2d 347, 351, 334 N.Y.S.2d 129, 132 (1972) (internal quotation omitted, emphasis added). Even the courts applying the MLRL Frew Run analysis have never asserted that municipal power to regulate in a preempted arena is clear and explicit. B. For Three Decades, The Only Appellate Court To Address The OGSML's Preemption Provision Held That It Means What It Says, That All Local Regulation Of The Oil And Gas Industry Is Preempted, Save Two Limited Exceptions. In Matter of Envirogas, Inc. v. Town of Kiantone, 112 Misc.2d 432, 447 N.Y.S.2d 221, 222 (Sup. Ct., Erie Cty. 1982), aff'd 89 A.D.2d 1056 (4th Dep't 1982), the Appellate Division, Fourth Department applied the clear and unambiguous language of the OGSML' s preemption provision by invalidating provisions of the Town ofKiantone's zoning ordinance that attempted to regulate the natural gas industry. Despite the newly amended and comprehensive OGSML, the Town ofKiantone adopted, as part of its zoning code, an ordinance imposing bond requirements and permitting fees on oil and natural gas operators. The 17 operator had applied for and received the applicable permits from the NYSDEC, but the local zoning ordinance required additional bonding and permitting. The operator challenged these additional requirements in the local law and the trial court held that the preemption provisions in the OGSML, the same provision at issue here, demonstrated the unambiguous intent of the Legislature to preempt local regulation of the field of oil and natural gas. See id. at 222. Accordingly, the Town of Kiantone's local ordinance was invalidated as inconsistent with, and preempted by, the OGSML. See id. Until the recent municipal foray into the regulation of the oil and gas industry, the Envirogas decision was the only precedent interpreting the OGSML' s preemption provision. It interpreted the plain language of the OGSML and held that a zoning ordinance regulating the oil and natural gas industry was clearly preempted by the statute. The Appellate Division, Fourth Department got it right by following the rules of statutory construction and stopping at the plain meaning of the text. As was noted in the decision, "the policy and purpose behind the [OGSML] is not left to the imagination." Id. C. The Third Department Improperly Applied Case Law Interpreting The MLRL To The OGSML's Preemption Provision. In Matter of Norse Energy Corp. USA v. Town of Dryden, 108 A.D.3d 25, 964 N.Y.S.2d 714 (3d Dep't 2013), lv. granted, 21 N.Y.3d 863, 972 N.Y.S.2d 18 535 (2013) and its companion case Cooperstown Holstein Corp. v. Town of Middlefield, 106 A.D.3d 1170, 964 N.Y.S.2d 431 (3d Dep't 2013), lv. granted 21 N.Y.3d 863, 972 N.Y.S.2d 535 (2013), the Third Department affirmed the lower courts' reliance on cases interpreting the MLRL and upheld zoning ordinances, which banned all activities related to the exploration for, and the production or storage of, natural gas and petroleum. Specifically, the Third Department noted that it "fail[ ed] to find any meaningful distinction between the language of the supersession provision of the OGSML and that of the MLRL." Matter of Norse Energy Corp. USA, 108 A.D.3d 36, n.8, 964 N.Y.S.2d 722, n. 8. The two provisions read as follows: The MLRL's Preem);!tion Provision The OGSML's Preem);!tion Provision As originally adopted and as appeared at Unchanged since its adoption in 1981: the time the Court of Appeals decided FrewRun: The provisions of this article shall For the purposes stated herein, this title supersede all local laws or ordinances shall supersede all other state and local relating to the regulation of the oil, gas laws relating to the extractive mining and solution mining industries; but industry; provided, however, that shall not supersede local government nothing in this title shall be construed to jurisdiction over local roads or the prevent any local government from rights of local governments under the enacting local zoning ordinances or real property tax law. other local laws which impose stricter mined land reclamation standards or requirements than those found herein. 19 The MLRL's Preemption Provision As amended in 1991 following the Frew Run decision: 2. For the purposes stated herein, this title shall supersede all other state and local laws relating to the extractive mining industry; provided, however, that nothing in this title shall be construed to prevent any local government from: a. enacting or enforcing local laws or ordinances of general applicability, except that such local laws or ordinances shall not regulate mining and/ or reclamation activities regulated by state statute, regulation, or permit; or b. enacting or enforcing local zoning ordinances or laws which determine permissible uses in zoning districts. * * * c. enacting or enforcing local laws or ordinances regulating mining or the reclamation of mines not required to be permitted by the state. The OGSML's Preemption Provision No change following the 1991 Frew Run decision: The provisions of this article shall supersede all local laws or ordinances relating to the regulation of the oil, gas and solution mining industries; but shall not supersede local government jurisdiction over local roads or the rights of local governments under the real property tax law. These two preemption provisions are vastly different, and they have been afforded different treatment by the Legislature. Whereas the OGSML' s preemption provision preempts all local laws and ordinances relating to the oil and 20 natural gas industry, save two narrow exceptions, the MLRL does exactly the opposite. The MLRL specifically preserved the local zoning power and allowed local governments to more strictly regulate the mining industry. This important point was recognized by this Court in Gernatt Asphalt Prods. v. Town of Sardinia, 87 N.Y.2d 668, 683, 642 N.Y.S.2d 164, 173 (1996) ("[T]he Legislature expressly excluded [the zoning] authority from [the MLRL's] preemptive reach .... "). The 1991 amendments expanded upon this concept and spelled out a wide array of local regulation that was to be permitted. Given these two vastly different preemption provisions with separate purposes, it is improper to apply Frew Run and its progeny to the OGSML' s preemption provision. 1. The Legislature's Amendment Of The MLRL Post-Frew Run While Leaving The OGSML Untouched Demonstrates The Two Statutes Are Not To Be Interpreted In The Same Manner. A key point in this distinction is the Legislature's refusal to amend the OGSML after the Frew Run decision, as it did with the MLRL. In 1991, the Legislature amended the MLRL to codify and clarify the Frew Run decision, thus continuing to exempt the zoning power from preemption, while clarifying its use. Doing so, without touching the preemption clause of the OGSML, "supports the view that the Legislature has applied a higher standard in the OGSML." Commonwealth of the Northern Mariana Islands, 21 N.Y.3d at 63. The Legislature 21 left the OGSML preemption clause untouched; this Court should read it as it is written. The Legislature had an opportunity to do what the Third Department and lower courts have done; the fact that it did not amend the OGSML precludes any finding that the zoning power is included within the OGSML' s savings clause. 2. The Third Department Erroneously Elevated The Legislatively-Created Zoning Power To The Same Level As The Constitutionally-Created Powers Over Local Roads And Taxes. The Third Department's reference to zoning's inclusion in the Statute of Governments as somehow creating an elevated type of municipal power for preemption review purposes is misplaced. In comparison to other municipal authority, the zoning power-which traces its beginnings in New York to the early 1920s-is a relatively recent addition to the panoply of municipal powers, resting solely on the grace of legislative fiat, while local control over both roads and taxes is enshrined in the State Constitution, Article IX. By divining what powers the Legislature would or would not exclude without following the rules of statutory construction, the Third Department has impermissibly tread on the Legislature's turf. The Third Department's treatment of the municipal zoning power misunderstands the nature of municipal authority as outlined most recently by this 22 Court in Sunrise Check Cashing & Payroll Servs., Inc. v. Town of Hempstead, 20 N.Y.3d 481, 964 N.Y.S.2d 64 (2013). The Third Department implied that while the savings clause of the OGSML only listed municipal road and taxing powers, municipal zoning powers did not have to be listed to be excluded from preemption. The Third Department treated the zoning power as a "traditional" power, and held that zoning was somehow different from other "inconsistent local regulation" that could be preempted in a more general manner. This led to the conclusion that held that preemption of local zoning is somehow different from preemption of other forms of local regulation: "In the absence of a clear expression of legislative intent to preempt local control over land use, we decline to give the statute such a construction." But as this Court noted in Hempstead, the zoning power derives from a legislative enactment (e.g., Article 16 of the Town Law), thus it does not sit above municipal road and real property tax powers-which derive from a higher source, the State Constitution. Further, the Third Department's conclusion flies in the face of the plain language of the statute-by omitting zoning from the savings clause, the Legislature flatly stated its intent not to preserve that local power. The Third Department's treatment of zoning power as an almost sovereign power, elevating it above constitutionally supplied local powers, not only rewrites the OGSML, it differentiates between forms of local legislation in a way 23 unsupported by New York law. The OGSML should be applied as written and the Ban should be found to be preempted. POINT II. ACCEPTING THE THIRD DEPARTMENT'S RATIONALE WOULD FURTHER VIOLATE THE RULES OF STATUTORY CONSTRUCTION BY RENDERING EXCEPTIONS TO THE OGSML'S PREEMPTION PROVISION MEANINGLESS. A cardinal rule of statutory construction laid down by this Court holds that "all parts of a statute are intended to be given effect and that a statutory construction which renders one part meaningless should be avoided." Rocovich v. Consolidated Edison Co., 78 N.Y.2d 509, 515, 577 N.Y.S.2d 219, 222 (1991). And as the Lenape court acknowledged, if the OGSML is taken as written it "would tend towards the view that it does indeed preempt the Local Law at issue here." (See Appendix A.) But feeling compelled to apply the MLRL Frew Run analysis, the court followed the Third Department and interpreted the "relating to the regulation" language of the OGSML preemption clause as exempting all forms of regulation that are not directly concerned with the "how" of oil, gas, and solution mining. This position argued that the only local regulation that is to be preempted is that which attempts to regulate "how" oil, gas, and solution mining is conducted. Following this logic, since zoning affects only "where" the activity may take place as part of a municipality's traditional land use regulation, its effects on industry are merely incidental. 24 What the lower courts did in reaching this conclusion was to avoid discussing how zoning is an "incidental" power, but taxes and roads are not. Neither of the preserved powers would prevent oil and gas activities, the "incidental" zoning power shuts down an industry in that community. Applying this type of a distinction renders the OGSML' s savings clause absolutely meaningless. Under this analysis, there would be absolutely no need for a savings clause, given that the language "relating to the regulation" only applies to "the details or procedure of the oil, gas and solution mining industries." Matter of Norse Energy Corp. USA, 108 A.D.3d at 32. Neither local control of roads nor real property tax issues, the two beneficiaries of the OGSML savings clause, relate to the "details or procedure of the oil, gas and solution mining industries." Id. In other words, control over local roads and real property tax issues in no way relate to the "how" of oil, gas, and solution mining, and their effects could only be described as incidental. If zoning and its incidental effects can be excluded from the preemption clause without being mentioned, neither would the incidental impacts from local road and tax laws require special protection, and there would be no need for the savings clause. But the Legislature nonetheless included the savings clause, and that portion of the statute must be analyzed in order to determine the intent of the Legislature. The OGSML's preemption provision should not be interpreted in a way as to render a key part meaningless. Simply put, utilizing the 25 Frew Run analysis in the OGSML context, as the Third Department did, violates the rules of statutory construction and should be rejected. POINT III. MUNICIPAL REGULATION OF THE LOCATION OF OIL AND GAS DEVELOPMENT IMPERMISSffiLY CONFLICTS WITH THE STATE REGULATORY REGIME. Even if the express preemption provision in the OGSML is read to exclude the local zoning power, local regulation is impliedly preempted because it is inconsistent with the State's statutory and regulatory regime. "A desire to preempt may be implied ... from the fact that the Legislature has enacted a comprehensive and detailed regulatory scheme in a particular area." Consol. Edison Co. v. Town of Red Hook, 60 N.Y.2d 99, 105, 468 N.Y.S.2d 596, 599 (1983). "[T]he Legislature's enactment of a comprehensive and detailed regulatory scheme in an area in controversy is deemed to demonstrate an intent to preempt local laws." Chwick v. Mulvey, 81 A.D.3d 161, 169-170, 915 N.Y.S.2d 578, 585 (2d Dep't 2010). In addition, even where the Legislature has not preempted the field, local governments may not enact local laws that are inconsistent with State law and regulations. Consol. Edison Co., 60 N.Y.2d at 107. "Inconsistency is not limited to cases of express conflict between State and local laws. It has been found where local laws prohibit what would be permissible under state law or impose prerequisite additional restrictions on rights under State law, so as to inhibit the operation of the State's general laws." !d. at 108 (internal quotations and citations omitted). The OGSML 26 and implementing regulations are so detailed and comprehensive-including both the "how" and the "where"-that it has preempted the field, and any local law dictating location requirements irreconcilably conflicts with State law. The OGSML and the regulations NYSDEC promulgated thereunder regulate all aspects of oil and gas exploration, drilling, and production. This includes "how" and "where" these activities occur, and the municipal zoning power necessarily conflicts with such regulation. The argument that the "where" is left completely to the municipalities fails to understand the comprehensive nature of the State regulatory regime. The OGSML grants NYSDEC the authority to regulate extraction of oil and gas by geologically created drainage areas (pools). The OGSML grants the NYSDEC the authority to set the geographical boundaries for the pools, which are tailored to the geology. N.Y. ENVTL. CONSERV. LAW§ 23- 0305. Municipalities, on the other hand, regulate within artificially created political boundaries. The NYSDEC has the statutory authority over spacing unit location requirements and the power to issue drilling permits for spacing units. N.Y. ENVTL. CONSERV. LAW§§ 23-0501,23-0503. Regulations promulgated by the NYSDEC similarly provide locational requirements, setting geographic boundaries. 6 N.Y.C.R.R. § 553.1. State regulations also contain well setbacks from residences, public buildings, roadways, and rivers. 6 N.Y.C.R.R. § 553.2. The regulations further include well spacing requirements to promote effective use, development, 27 and conservation of oil and gas, and contain provisions for NYSDEC to authorize exceptions to well spacing requirements to prevent waste. 6 N.Y.C.R.R. §§ 553.3(a), 553.4. These specific location requirements are part of what distinguishes the OGSML from the MLRL. The State, in a very comprehensive and detailed manner, regulates the "where" of oil and natural gas development. For this reason, the Legislature preempted the zoning power to ensure conflicting regulations would not be adopted. The zoning power directly conflicts with all of the above locational requirements. Zoning ordinances routinely include setbacks for allowed uses (see, e.g., N.Y. ToWN LAW§ 261), require special use permits, to which specific conditions may be imposed (see, e.g., N.Y. TOWN LAW§ 274-b), and require site plan review, which places a particular emphasis on the arrangement and layout of the allowed use (see, e.g., N.Y. TOWN LAW§ 274-a). Municipal land use regulation directly conflicts with the State regulatory regime, and that becomes more apparent when the full panoply of zoning powers is evaluated. Thus far, courts have dealt with exercises of the zoning authority to completely ban the use. But if oil and natural gas development were allowed in a district, subject to typical setbacks and other layout and arrangement requirements, the problem is better illustrated. In this 28 light, the Legislature's refusal to include "zoning" and land use regulation as an exception to the OGSML' s broad preemption provision is even more justified and purposeful. This inherent conflict is further illustrated by a review of the State's well-spacing and integration requirements. The OGSML's stated purpose is to protect the "correlative rights of all owners and the rights of all persons including landowners" and prevent waste, but the State's ability to achieve this goal is significantly impaired if municipalities' zoning powers are allowed to prohibit or dictate "where" oil and gas development may occur. The Colorado Supreme Court, evaluating a statutory and regulatory regime similar to New York's, found that a municipal ban on oil and gas drilling activities impermissibly conflicts with the state's regulatory structure. "Oil and gas are found in subterranean pools, the boundaries of which do not conform to any jurisdictional pattern . . . . Because oil and gas production is closely tied to well location, [a municipality's] total ban on drilling ... would conflict with the [state agency's] express authority to divide a pool of oil or gas into drilling units and to limit the production of the pool so as to prevent waste and to protect the correlative rights of owners .... " Voss v. Lundvall Bros., Inc., 830 P.2d 1061, 1067 (Colo. 1992) (invalidating a local ban on oil and gas drilling). 29 As noted above, natural gas resources are not static and natural gas pools do not correlate to municipal boundaries. Natural gas pools transcending municipal boundaries demonstrate the inherent problem with local regulation, as illustrated by the following hypothetical. Town A allows oil and gas development, while Town B does not. Both Town A and Town B sit atop a common natural gas reservoir. A landowner in Town A, where natural gas development and production is allowed, wishes to benefit from this natural resource. Because of other nearby natural gas wells in Town A, the State's well spacing requirements would prohibit ,T9WP~:4::-~I}pws;gi{:~pqg~~~; ari 11 iJi~·a:nc:Fprddueti oh:' DE"C.$pacingrequiremerits;:;Wiii.not' '~ii~;&\'~w~_,i·a~·-•iirii~.i'¥i-:dwiiJt'w~; _property.;- 30 ''Town,Bi...,.:h~~,l;)Cinfl ~q .().11 apq:gct~;' dfil nn:~and:'p'rodtlction . PI:Ci~@l~tfqris i'f¥!ui~ tllii;wf!ll ~ii l:i,e' c.onstructed Jn\T'6wn,B;·where,ft;iJ: B~s,ban:)Nali "·:.:: ·, .·• ... I· <; , .~ , : · {,_ :dtill iil·~·a ndtp'roduetrorr· 31 '''t.<;>,wt:r.~;. .... .h~~;q~nn~i!';piJ.'~nq,g~~~ drilnngo.an'd:;proauttioh The diagram above shows an even more serious consequence of municipal bans. In this case, Town B's ban effectively prevents Property Owner A from benefitting from the natural gas reserves beneath her property. Property Owner A is outside ofProperty Owner A1 'swell unit and is not required to be compensated. But even though natural gas drilling is allowed in Town A, the spacing requirements require the well to be in Town B. Local bans frustrate the OGSML' s purpose of protecting the correlative rights of all landowners. N.Y. ENVTL. CONSERV. LAW§ 23-0301. Before the advent of the OGSML and the State's spacing requirements, the production of natural gas was governed solely by the rule of capture. 77 N.Y. JUR. 2D MINEs AND MINERALS § 10. Since natural gas is a fugacious fluid which freely traverses real property and municipal boundaries, the law developed to vest title in natural gas only after it had been taken from the ground and reduced to possession. Thus, "[i]n the absence of statute or other public and reasonable regulation, in recognition of the fact that oil and gas will migrate across property lines toward any low pressure area created by production from the common pool, the rule of capture declares that the owner of a tract of land acquires title to the oil or gas that he or she produces from wells on his or her land even though a part of the oil or gas may have migrated from adjoining lands without incurring liability to the adjoining landowner for drainage." Id. 32 This situation created an incentive to "withdraw gas as fast as possible, before a competing producer gets it," which meant an incentive to drill multiple wells in close proximity to one another. !d. Landowners that lacked the ability to keep pace would have their resources drained to the benefit of their neighbors. New York's spacing requirements were adopted and incorporated into the OGSML for the express purpose of protecting landowners' correlative rights and preventing this race to the bottom. The spacing requirements recognize the area immediately around a well from where most of the extracted gas is expected to be drained. The OGSML and its implementing regulations ensure that landowners within this area (the "unit") are compensated. Since natural gas will migrate toward a low pressure area, natural gas will nonetheless be drained from properties outside of the spacing area. But this risk is mitigated by constructing an additional well in compliance with the spacing requirements. This system protects correlative rights by ensuring that landowners-including those outside of a well's spacing area-will be compensated for natural gas developed from their properties. The OGSML and its implementing regulations-provided they are uniformly applicable statewide and are not interrupted by municipal bans-achieve this goal. However, if municipalities are able to ban drilling within their borders, the OGSML' s ability to protect the correlative rights of landowners is frustrated, and landowners' resources may be drained by wells in a neighboring community. 33 This inherent conflict is illustrated by the following hypothetical. Town A allows oil and gas drilling and production, while Town B does not. Both Town A and Town B sit atop a common natural gas reservoir. Property Owner A (in Town A) and Property Owner B (in Town B) own adjacent properties that are separated by the town line. Because the natural gas pool sits below both properties, a well on Property Owner A's property would drain natural gas beneath property owned by Property Owner B. Property Owner A drills a well on its property far enough away from the town line to ensure that Property Owner B is outside of the applicable spacing area and is not a part of the well unit. Thus, Property Owner B is not required to be compensated. Since Property Owner B is prevented from drilling a well on her property in compliance with the spacing requirements, natural gas is being drained from her property, as the gas will migrate toward the low pressure area on Property Owner A's property. In essence, this interruption of the State's regulatory regime effectuates a return to the rule of capture in certain cases, and frustrates the State's ability to protect correlative rights. In some cases, allowing municipalities to ban drilling will allow landowners in adjacent communities to drain natural gas from neighboring properties without compensating the owners. 34 Town A- allows oil and gas drillingand production Town B- has banned oil and gas drillingand production Property Owner B Property ·owner B'st:eservesaredrained ·and n~ is n6heq~~~~t\ 1:~ be comp~nsi3t~d b.ecause he is outside the: well unit; OECprotecl:s-correlative rights by permitting a 11\fell em P~op~rty Owner B'5 prop~rty~ But Town B has p~ohibited .dtillingofa well. Thys, Property Owner A's weilwlll depiete•Property .Owner B1!;reseryes .withput comperisati,ng Property .6wner.•8. Essentially;themt,~ni~ipal ~ar1 hCjs ~aused ar~turn to the rule of capture in cert:a.ih circumstances. · . These scenarios are but a few examples of the inherent conflict that exists between the State regulatory structure and local regulation. To avoid these conflicts, the OGSML should be interpreted as written, and local governments must not be permitted to regulate in an arena entirely occupied by the State. 35 CONCLUSION The OGSML expressly preempts all local regulation of the oil and gas industry, except in two narrow circumstances. The rules of statutory construction require that the Court declare that the Town of Middlefield's Ban is preempted. The Court should not continue down the path of applying suspect case law interpreting an entirely different statute to the broad OGSML preemption language. Dated: February 25, 2014 Buffalo, New York 000!60.01299 Administrative 8888883vl HODGSON RUSS LLP Attorneys for Amicus Curiae Independent Oil and Gas rriation of New York, Inc. By: W&rtf_S) Daniel A. Spitzer, Esq. Alan J. Laurita, Esq. Charles W. Malcomb, Esq. The Guaranty Building 140 Pearl Street, Suite 1 00 Buffalo, New York 14202-4040 (716) 856-4000 36 APPENDIX A SUPRISME COURT OF'THI: .. STATE: OF NEWY.OFU< COUNTY OF. YVINGSTON. . LENAPE RESOURCES1 INC. v. TOWN OF AVON~. TOWN:O.F AVON TOWN BOARD, NEW)'OR~.STAte I)$..~A,RTM~NT OF ENVIRONMENTAl C.ONSERVATION. Respondents.-Defendante Index No.: 1060'-2012 ina ~~ched ·aeclslon & Qrd~r/Jttdgme.ot..was gra.nted,. by the Honorable Robert 8 •. Wig.ofha an MarCh. ·tsr 201'3 and. ~· eotwed :i~ th~ .9ffl~ ~H{le ·ctef'k <).f t.h~ County ofUVInpatori an March 20.~ 2Q1{~. IV!arch.21., 2013 WEBSTER SZA:Nn t.Ur TO: REED SMITH LLP Micbf«ef P. Joy., s.q. A.tlo-m~Y-' fOr P($ntiff 225 f"lfth. Av.ehLi$ Pi~burgh,. ~A 1·$22Z ·CC: S~he11 1\4. N.~.le. Esq. ~rctt-Mt A.ttotoey G~~r Attotneys fer De · ant~ Town of Avon AtmtTiey fOr- D.efiindant N'fs. Dept Of En.viltitifn~:mt~tconse;vsficn ~nvlronm~f4tl .Pr.oteetlM $..ureay,. .AI!:r~.ny The· c·apJt<* Aibany., New YotiS 1'22~4-03.41· Al HODGSON RUSS;LLP Daniel A.. SpitZer, Esq~ AlaQ J •. Laurfta,, Esq~ Attomeya·.lbr lhfl Proposed Amlt)us CUifse.,.. lndeptJnifent Oh .and Gas Assooistlon ol New York {IOGA) The Guaranty Sidldfog. 1·40 Pead·Shet. SUite 100 Bufl\llo, New York 142tla4040 THJ:; O~,.TQ,. LAW Of..FrCE, PLLC ChriStopher: DentOn~ Esq. Attorneys lor Am/tJ,_, CfJriiiltJ·- Tioga Count.y•L81'lc1Qwnef3 Group ~1.1 take. Stteat Elmira, New· Yofk. 14·901 A2 STATE OF NEW YORK SUPREME COURT COUNTY OF LIVINGSTON LENAPE RESOURCES, INC., Petitioner-Plaintiff, -vs- TOWN OF AVON, TOWN OF AVON TOWN BOARD, NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION Respondents-Defendants. DECISION & · ORDER/JUDGMENT Index No. 1060-2012 Petitioner-Plaintiff Len ape Resources, Inc. ("Lenape") brings this combined Article 78/Declaratory Jud·gm~nt action seeking to.invalidate Avon Town Law T-A- 5-2012, entitled "Moratorium on and Prohibition o~ Gas and Petrol~um Exploration and ·~xtraction Activities, Underground Storage of Natural Gas, and Disposal of Natural Gas or Petroleum Extraction, Exploration and Production Wastes" (the "Local Law"). The declared intent of the Local Law is "to exercise the permissive 'incidental control' of a zoning law and land use law that is concerned with the broad area of land use planning and the physical use of land and property within the Town ..• " The law· effectively. prohibits all natural·gas drilling activities within the Town for one year, but does contain a grandfather clause excepting those activities· that. had already been ongoing when the law was. enacted. The. petition seeks to invalidate the Local Law on a number of grounds, with 10 separately pleaded causes of action, some purportedly under Article 78, some purportedly seeking a declaratory judgment. Lenape's primary· contention, which is ·properly raised in a declaratory judgment action, is that the Local Law is preempted. and superseded by State law, specifically .ECL 23-030~ (2), which is part of the "Oil, Gas andBolution Mining Law" ("OGSML",.ECL 23-0102, et seq.). On this, and indeed with respect to all of Lenape's· points; this Court is. constrained to disagree. with Lenape, and hold that the Local Law is valid. i. At the outset, three procedural matters must be addressed. First, the Tioga Co~J;J.ty Landowners Group and th~ Independent Oil and Gas Association of New York both filed motions for lea~e to fi~e amicus curiae briefs. There is little guidance · A3 in New York caselaw with respect to the granting of amicus applications, though it has been said that "[i]n cases involving questions of important pub~ic interest leave is generally granted to file a brief as. amicus curiae" (Colmes v Fisher, 151 Mise 222, 223 [Sup. Ct. Erie County 1934]). It appears that the Court's discretion to grant or d~~y amicus b~iefs is broad," an~ the central q·uestion is simply whether ~mici are of assistance to the Court. Here, both proposed amicus briefs primarily augment arguments already made by the parties; however, the Court has found them to be of some assistance, and therefore the motions are granted, and the briefs have been considered. The proposed amicus brief of the Concerned Citizens of Livingston County, however, has n.ot been considered, inasmuch as that group did not file a · motion for leave to serve an amicus brief. Second, this matter came before the Court by way of the motions to dismiss of both Respondents-Defendants Town of Avon and Avon Town Board ("Avon") and Respondent-Defendant New York State Department of Environmen~al Conservation ("DEC"). A motio~ to dis~iss, of course, is confined to the four corners· of the pleading soug~t to be dismissed, and evidence outside of the pleading generally may not be considered .(seeN. A. Berwin & Co., Inc. v American Safety Razor Corporation, 282 AD 922 [1st Dept 1953]; see generally Margerum v City i!flluffalo, 63 AD3d . 1574, 1579 [4'h Dept 2009]). Here, at least one of Avon's contentions- that the Local Law is a valid exercise of its zoning authority- relies.to sonie extent on factual . matters outside the fQur corners ofth.e Petition/Complaint. Accordingly, while the parties, in truth, appeared to have charted ~ summary judgment course anyway (see e.g. California Suites, Inc. v Ru8so Demolition Inc., 98 A.D3d 144 (1s.t Dept 2012]) the Coun:, out of an ~bundance of caution, notified all parties by letter dated March 13, 2013 that, pursuant to CPLR 3211 (c), it would be treating the motion as one for summary judgment, and invited further submissions (see e.g. Mtrahile v City of Saratoga Springs, 67 AD3d 1178, 1179 [3d Dept 2009]). None of the parties objected to the Court's proposed summary judgment treatment, and no further submissions were received . . Finally, DEC moved to dism.iss for lack of personal jurisdiction based upon Lenape's failure to properly serve the Attorney General (see CPLR 307,7804 [c]). At oral argument, Lenape's counsel acknowledged that service was not properly effected. Acco.rdingly, the proceeding is dismissed against DEC on this procedural ground. Wltile DEC urges the Court to nevertheless rule on its substantive · arguments, the Court declines the invitation, inasmuch as this would be tantamount to issuing an advisory opinion, which is not the proper {unction of a court oflaw. II. Turning to the.substantive issues, the preemption issue is the closest one 2 A4 presented. The OGSML "provide[s] for statewide regulation of operations with the primary goal of encouraging efficient use of a natural resource" Anschutz . Exploration Corp. v Town of Dryden, 35 Mise 3d 450, 463 [Sup Ct ThompJdns Co 2012]). Section 23-0303 (2) provides specifically that: "The provisions of this article shall supersede aU local laws or ordinances relating to the regulation of the oil, gas and solu~ion mining· industries; but shall not supersede local government jurisdiction over local r~ads or the rights of local governments under the real property tax law." . . Where, as here, a State statute contains an express preemption provision, "the resolution [of the] case turns solely upon proper stat~tory construction of ••• [the] preemption provision" ()'eople ex reL Spitzer v Applied Card Systems, Inc., 11 NY3d 105; 113 [2008], cit~ng Matter of Frew Run Gravel Prods. v Town of Carroll, 71 NY2d 1Z6 [1987]). On its face, the OGSML provision is quite broad, purportedly superseding "all local laws" which "relat[e] to" ''the regulation o( the oil, gas and solution mining industries," and excepting onlv lo,callaws relating to "local roads or the rights of local governments under the real property tax law." Thus, were this provisi~n considered in a vacuum, the Court would tend towards th~ view.that it does indeed preempt the Local Law at issue here. Caselaw, however, ~ompels the Court to reach a contrary conclusion. In .Frew Run (71 NY~d at 129), the Court of Appeals considered the issue of "whe~her the Mined Land Reclamation Law ["MLRL"] was intended to preempt the provisions of a town zoning law establishing a z~ming district where a sand and gravel operation is not a permitted use." The preemption provision of the MLRL . provided that: "For the purposes stated herein, this title shall supersede all other state and local laws relating to the extractive · mining industry; provided, however, that nothing in this title shall be construed to prevent any local government from enacting local zoning ordinances or other local laws which impose stricter mined. land reClamation standards or requirements than those found herein" (ECL 23-,-2703 [2]), Despite this provision, the Town of Carroll enacted a zoning ordinance that prohibited all sand and gravel inining operations, except by special permit in certain areas. The petitioner mining company, which had obtained a DEC permit to mine. 3 A5 sand and gravel within a prohibit~d use area of the Town, sued, claiming that the zoning ordinance was preempted by the MLRL provision set forth above. The Court of Appeals disagreed, holding that the preemption provision of the MLRL only preempted local laws that directly regulated the mode and method of extractive mining; zoning ordinances, the Court held, are concerned not with such regulation, but with general iand use planning. The Cour.t recognized that "[i]n this general · regulation Qf land use, the zoning ordinance inevitably exerts an incidental control over any of the particular uses or businesses which, like sand and gravel operations, may be allowed in some districts but not in o'thers" (Frew Run, 71.NY2d at 131). · Nevertheless, the Court concluded that "this incidental control resulting frQm the municipality's exerCise of its right to regulate land. use through zoning is not the type · of regulatory eilactnient relating to the 'extractive mining industry' which the Legisl~ture could h'ave envisioned as being within the prohibition of the statute." Lenape contends that Frew Run is distinguishable, because the preemption provision there specificaliy exempted "local zoning ordinances or other local laws· which impose stricter mined land reclamation standards or requirements than those found hereln" (ECL 23-2703 12]). That argument, however, ignores the fact that the Court of Appeals did not rest its decisioil in Frew Run on the zoning law clause of the MLRL preemption provision, which applied only to reclamation activities, not to mining activities in general, which was what the Petitioner in Frew Run wished to conduct. Rather, th.e Court of Appeals rested its decisio~ on the first clause of the · MLRL provision, holding that "supersession is expressly limited to laws 'relating t~ · th~ extractive mining industry' " and that laws of generai .applicability" 'which determine permissible uses in zoning districts' " do not suffici.ently "relat[e] to" mining so as to be preempted (Troy Sand & Gravel Co., In_c. v Town of Nassau, 101 AD3d.1505 , 957 NYS 2d 444, 448 [3d Dept 20121). In this Court's view, the Court of Appeals' decision h'l Frew Run is flawed, in that it ignores the maxim expressio uhius est exclusio alterius. The fact that land reclamation was expressly subject to tighter zoning controls by .municipalities should· have led to the conclusion that extractive mining operations were not. But that is not what the Court of Appeals held, and its intetpretation of the primary clause of the statute in Frew Run is strong persuasive precedent for the interpretation of the OGSML provision at issue here. The reasoning of Frew Run compels the conclusion that local zoning ordinances; such as the Local Law at issue, do not "relat[e] to the regulation of the oil, gas. and solution mining industries" within the meaning of the OGSML (ECL 23-0303 [2]). That conclusion is further buttressed by the only other two lower courts to have considered loca~ zoning laws similar to the Local Law here. In both cases, the courts determined that zoning ordinances similar to the Local Law at issue her~ were not preempted by the OGSML (see Anschutz Exploration Corp., supra; Cooperstown Holstein Corp. v Town 4 ·A6 of Middlefield, 35 Misc3d 767 (Sup Ct Otsego Co 2012]). Petitioner's reliance on Matter of Envirogas, Inc. v Town of Kiantone (112 Misc2d 432 [1982], affdfor reasons stated 89 AD2d 1056 [4'h Dept 1982]) is also misplaced. There, a municipality enacted an ordinance requiring oil and gas producers to pay a bond and permit fee in order to operate within the town. As the Anschutz Exploration Corp recognized, that sort of ordinance smacks of industry regulation, which is not permitted by Frew Run, as opposed to legitimate land use planning, which is. Accordingly, the Court concludes that Avon is entitled to summary judgment dismissing Lenape's first cause of action, sounding in express preemption. Because the statute at issue contains an express preemption clause, "it is unnecessary to consider the applicability of the doctrines of implied or conflict preemption" (Applied Card Systems,. Inc., 1.1 NY3d at 113). Thus, Lenape's secmid cause of action is dismissed as well. Because the third and fourth causes of action also rely on the argu~ent that the Local Law is preempted by the OGSML, they, too, are subject to dismissal. m. Lenape's remaining contentions do not merit extended discussion. In its fifth cal}se of action, Lenape alleges that tJJ_e moratorium constitutes an "Unreasonable Use of [Avon's] _Police Power." However, the Local Law at issue was not enacted pursuant to Avon's general police ·powers; rather, as Avmi's papers establish (and Lenape does not truly challenge), the Local Law was duly enacted pursuant to the town's zoning authority. Thus,. contrary to Lenape's contention, Avon did not need to -demonstrate a "dire "need" for the moratorium, as may be required where a moratorium is imposed pursuant to a town's general police power (see Cellu(ar Telephone Co. v Village of Tarrytown, 209 AD2d 57,66 (2d Dt:pt 1995]). Rather, a zoning enactment need only be "reasonably related to and in accord with a comprehensive plan governing land use" (id.). Mo.reover, "it is well settled that the enactment of a moratorium upon certain land use or development within a municipality will be considered a valid stopgap or interim measure where it is reasonably designed to temporarily halt deve~opment while the municipality considers, inter a~ia; comprehensive zoning changes" (id.). Judged by those . standards, this Court concludes that the Local Law is valid. Indeed, under the Court of Appeals decision in Gernatt Asphalt Products, Inc. v Town of Sardinia (87 NY2d 668, 675 [1996]), in which the Court, applyin,g Frew Run, held that a Town could outlaw all mining within its borders, it would appear that Avon could completely prohibit all gas drilling. If Avon is empowered to comvletely eliminate gas drilling within its borders, then it would seem that, a fortiori, it is empowered to. 5 A7 halt such drilling temporarily. Lenape's sixth cause of action claims that the local law violates the ex post facto clause. This claim is frivolous. The.fact that Lepape may have been engaging in activiti~s in the past w.hich may now be outlawed in the future does not violate the · ex post facto clause. If conduct that was formerly legal could not be made illegal in tlie future, the Penal Law could never be expanded to cover new crimes. The ex post facto clause prohibits· only the making past conduct prospectively criminal; that is not the case here. Lenap·e contends in. its seventh cause of action .that Avon enacted the Local Law in violation of the prQvisions of the State Environmental Quality Review Act (SEQR:A) because it is a Type I action requiring full SEQRA review. However, as ·Avon notes, a moratorium such as this constitutes only a Type ll action under SEQRA (see 6 NYCRR § 617.5), and thus did not require a determination of significan·ce. In its eighth cause of action, Lenape contends that the enactment of the moratorium is arbitrary and capricious. Th~ cases it cites, however, involve . administrative determinations, not legislative enactments. As set forth above, the Court concludes that the Local·Law was a valid exercise of Avon's zoning authority. With respect to the ninth cause·ofaction, Lenape bears a "heavy burden" of· demonstrating that the Local Law is in·consistent with Avon's comprehensive plan (Infinity Consulting Group, Inc. v Town of Huntington, 49 AD3d 813,814 (2d Dept 20081). As Avon notes, Lenape did not even include the Town's comprehensive plan in its submissions in support of the Petition, begging tlie question of how the court could possibly determine how the Local Law was blconsistent with said plan. Avon, however, did submjt the comprehensive plan, and th:e Court concludes tbat.ther.e is· no "clear conflict" between the Local Law and the plan. Finally, Lenape's taking claim, asserted in its tenth cause of action, is not ripe,. inasmuch as it bas failed tQ e~baust all of its administrative remedies under the Local Law (see Murphy v New Milford Zoning Commn., 403 F2d 342 (2d Cir 2005)). Accordhigly,upon Lenape's Verified Petition and Complaint; sworn to the 14th day of December, 2012, together with the. exh.bits annexed .thereto; Lemipe's Memorandum of Law in Support of the Verified Petition and Complaint, dated November 14, 2012; the Town of Avon's Motion to Dismiss and S~pporting Affidavit of Michael P. McClaren, sworn to December 21,2012, together with the exhibits annexed thereto; the Affidavit of David LeFeber, sworn to December 18, 2012, together with the exhibits annexed thereto; the Town of Avon's Response to 6 A8 r Petition & Objections in. Points of Law & Memorandum in Support of Motion, dated December 21, 2012, together with the exhibit annexed thereto; the Minutes of the Avon Town Board Meeting Regarding Zoning M.oratorium, held December 8, 2011 (two volumes); the.Motion and supporting papers of Tioga County Landowners Group, dated January 25, 2013, for leave to file amicus curiae, and the accompanying amicus brief; the Motion and supporting papers of Independent Oil and Gas Association of New York, dated ianuary 22,2013, for leave to file amicus curiae, and the accompanying amicus brief; the DEC's Motion to Dismiss and ·accompanying Memorandum of Law in Support, dated January 17, 2013; the Affirmation of Stephen M. Nagle, sworn to January 17, 2013,.in support of DEC's motion, together with the exhibits annexed thereto; Lenape's Brief in Opposition to Defendants' Motion to Dismiss, dated January 28, 2013, together with the exhibits annexed thereto; the Reply Memorandum of Law in Support of DEC's Motion· to Dismiss, dated January 31, 2013; and the Court's notice dated March 13, 2013, that . the motion would be considered one for summary judgment; and upon any and all. other papers and proceedings had herein,. it is hereby ORDERED that the motions of Tioga County Landowners Group and the Independent Oil and Gas Association of New York for leave to file briefs amicus curiae are granted; and it is further · · · . ORDERED that Avon's motion to dismiss is converted to a·motion for summary judgment; and it is further ORDERED, ADJUDGED AND DECREED that the motion of DEC to dismis·s for lack of personal jurisdiction is granted; and it is further ORDERED, ADJUDGED AND DECREED ·that the converted motion of the Town of Avon for summary judgment is granted and the Petition/Complaint against Avon dismissed. Dated: March 15, 2013 Geneseo, New York on. ob~rt B. Wiggins · Acting Supreme Court Justice 7 A9.