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Where do carbon storage rules stand in Indiana?

Indiana Farm Bureau policy expert explains what laws mean to landowners.

Tom J Bechman 1, Editor, Indiana Prairie Farmer

May 18, 2023

3 Min Read
PROTECT PROPERTY RIGHTS: If you own land, your rights extend below the surface. Jeff Cummins, Indiana Farm Bureau, answers questions about how these rights relate to storing carbon under your land. Tom J. Bechman

If no one has approached you about storing carbon below the surface of your fields, don’t be surprised if they do soon. Fortunately, enough rules and regulations are in place in Indiana to help you protect your property rights. The catch is knowing that you have rights, even below the surface, and that you are entitled to compensation if a company wants to store carbon under your cornfields.

The picture became clearer after the Legislature reached a compromise on a longtime request from a Vigo County, Ind., company seeking special treatment to store carbon or other materials hundreds or thousands of feet below the surface. Jeff Cummins, Indiana Farm Bureau’s director of state government relations, followed that fight and lobbied hard to protect landowner rights, especially over the past two years.

Here's an interview with Cummins explaining why these efforts were important:

What was the company in Vigo County seeking? It basically wanted to pay landowners a very small amount to store under their land and close courts to them. Under original legislation, landowners could not have sued or negotiated settlements.

What compromise was INFB able to help broker? Landowners will be paid at a reasonable rental rate annually for the life of the contract. The rate is based upon calculations from the Purdue University ag economics crop budgets, so that it is an equitable rate. In addition, a landowner has the right to negotiate and sue if necessary — the courthouse is still open. Plus, if the company does not receive their permit from EPA by July 2028, the original 2019 language allowing for this pilot project expires.

Why was it important to achieve the changes you just described? This is all about property rights. The company wanted to close the courthouse to landowners and control what happened. That is not fair to landowners and could have set a bad precedent. Neither side got everything they wanted here, but for our members, I consider it a victory because we upheld their rights to utilize and defend property rights.

Why should farmers and landowners outside of Vigo County care about this case? We all should care because it would have created a path for one company to get special treatment when it comes to a landowner’s underground property rights. Those rights are as important as any other rights to a landowner.

So where do rules on carbon sequestration stand everywhere else in Indiana? For every other company everywhere, legislation which began as HB 1209 in 2022 and passed into law stands as current law. The Legislature has charged the Indiana Department of Natural Resources with making specific rules to govern this process, and that should begin this summer.

What if a company gets many landowners to go along but some say no? Does eminent domain apply? No, eminent domain does not apply, but there is a rule which addresses this situation. If a company acquires permission from farmers of 70% or more of the project’s surface area, the other 30% are included and compensated, and the project proceeds. However, those holding the 30% can still exercise rights, including negotiating price.

About the Author(s)

Tom J Bechman 1

Editor, Indiana Prairie Farmer

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