HB 3105: The Texas Gas Drilling Regulation Bill

Have you heard about House Bill 3105 being considered by the Texas Legislature? If you are a property owner in north Texas, you need to be familiar with it.

Over the course of the past few years, it has become fashionable and politically correct for municipalities to pass rules which make it almost impossible for gas companies to drill for gas and petroleum within their city limits. Well, the Barnett Shale is located within the city limits of many cities in north Texas.

Of course municipalities will say things like, "We are trying to protect property values" or "We are trying to protect our citizens" or "We are trying to protect the children." I won't question the motives of those who create the regulations. What I do know is this:

1) Much of the gas is located within the city limits of a variety of cities.

2) Many property owners would love to lease their mineral rights to energy companies.

3) Some of the regulations that municipalities pass prevent drilling for gas within their city limits except in certain circumstances.

4) If a gas company can't drill for gas, property owners won't receive royalties.

Effectively, what municipalities are doing prevents property owners from being paid for their mineral rights. That is what House Bill 3105 seeks to remedy.

HB 3105 does not prevent municipalities from passing rules and regulations that prevents gas drilling. What HB 3105 does is it allows property owners, whose property value has been reduced by more than 25% because of a regulation passed by the municipality, to sue the municipality for the damage to their property caused by the regulation.

I read an article in the Dallas Morning News about this HB 3105. Here is a link to the article. In the article, the Mayor of Flower Mound, which is reported to have one of the most restrictive regulations on drilling, is quoted as saying, "We would have no way to prevent a gas well permit."

This sounds amazing to me. What Ms. Northern is effectively saying is that she does not mind enacting regulations that reduce property values by more than 25%. What she has a problem with is her city having to compensate property owners when they do something that reduces the property values.

How would you like it if I was to do something that reduced your property value by more than 25%? Would you not want to have the right to sue me for damage to your property? What most property owners don't realize is that the government often exempts itself from the rules that the rest of us have to follow. HB 3105 removes the immunity the government has related to damages from drilling regulations.

If you are a property owner whose property has been reduced in value because of an action by a governmental agency, I would love to hear about it. Maybe I can help you.

In the interest of full disclosure, I have a gas lease, and I would be highly agitated if the city did something that prevented me from receiving royalties on my mineral rights.