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Petition to regulate oil, gas development in south-central Montana was unfairly denied, landowners' lawsuit claims

Petition to regulate oil, gas development in south-central Montana was unfairly denied, landowners' lawsuit claims

East Rosebud Creek

East Rosebud Creek winds out of the Beartooth Mountains in this aerial view.

A group of Stillwater County residents filed a lawsuit this week in an ongoing effort to create a zoning district regulating oil and gas exploration along the Beartooth Mountains.

The lawsuit claims that Stillwater County officials unfairly rejected the group's petition, which contained signatures of landowners. The county claims the petition should also include the signatures from mineral right owners, which may be different from surface land owners.

An organization called the Beartooth Front Coalition led the lawsuit, which was filed Monday. The co-plaintiffs are the Lazy Y Diamond Bar LP, Lana and Charles Sangmeister, William and Carolyn Hand, Margaret Barron and Doxey Ray Hatch.

“Stillwater County Commissioners have stonewalled us at every turn,” said David Katz, one of the landowners who has been blogging about the endeavor at Preserve the Beartooth Front.

Defendants are Stillwater County, its Board of County Commissioners and County Clerk Heidi Stadel.

The goal of the coalition is to create an 83,000-acre zoning district along the mountain front that sets conditional-use regulations for oil and gas exploration.

Katz said their proposed regulations aren't intended to ban oil and gas recovery, but to mandate things like water and soil contaminant testing, disclosure of fracking chemicals and payments by mining companies for increased county infrastructure use related to mining activity.

The effort started in 2014 when Energy Corp. of America showed interest in the region. Company CEO John Mork went so far as to suggest he would bring the Bakken to the Beartooths.

State law allows citizens to bring a zoning proposal to county governments through a petition containing 60 percent of the "affected real property owners." The lawsuit says the group did just that, said Katz, with around 550 landowners.

According to the lawsuit, Stillwater County Attorney Nancy Rohde issued an opinion that the petition needed to include 60 percent mineral interest-holders, rather than the landowners who hold only surface rights.

The coalition claims in its lawsuit that it's "virtually impossible" to collect the signatures of the area's mineral rights holders. The search would be prohibitively difficult, the filing said.

"Finding mineral owners requires individual research for each property, tracing ownership back to the point at which mineral rights were severed," the lawsuit states.

Stadel, the county clerk, and County Commissioner Maureen Davey referred inquiries to Rohde, who didn't return calls for comment.

Stillwater County Commissioners rejected the petition Jan. 30, based on Rohde's opinion, according to county minutes. In the meantime, commissioners are moving to pass a set of instructions for citizen-initiated zoning district petitions that specifically includes subsurface mineral rights.

The coalition's lawsuit claims that no other citizen-initiated zoning district in Montana has required signatures from mineral rights holders. Missoula and Ravalli counties both have dozens of these districts.

Casey Drayton, a Missoula County planner, said he didn't believe the signatures of mineral rights holders were required for the petition process there. 

However, not all citizen-initiated zoning districts deal with sub-surface minerals. If one were proposed today, Drayton said they would seek legal opinions.

Terry Nelson, Ravalli County planning administrator, also couldn't recall a petition that required subsurface rights owners to sign off on a zoning district of this kind.

"To my knowledge, only the surface rights owners have signed and been included in the percentages for the zoning petitions," he said in an email.

That includes a Ravalli County zoning district created in 1993 that prohibited mining but was amended in 2009 to allow a gravel pit, he said. Mineral rights owners were not required for that amendment.

Rohde did seek an opinion from the Montana Attorney General's Office through the Stillwater County process. In it, she wrote that “mineral interests, including fractional mineral interests, are real property interests and should be considered for purposes of obtaining 60 percent of owners,” according to the Stillwater County News.

The plaintiffs are asking a judge to rule that mineral interest-holders don't need to be included in the petition, just property owners. The lawsuit also requests that county commissioners be barred from passing a law to require that.

The county hasn't yet filed a response to the lawsuit.


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