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Serving: OH

Pipeline predicament

The Bailey family, who farm near Marysville, Ohio, oppose having a proposed gas pipeline cross their protected farm.

When Don Bailey first heard that Columbia Gas was planning to bury an underground pipeline across his family’s farm, he wasn’t particularly worried. After all, the land is protected with an agricultural easement, and the Ohio Department of Agriculture helped the family fend off a proposed sewage pipeline in 2005. “I thought, ‘The ODA stood up for us before, so all we have to do is get them back out here,’” Don says. This time, however, the ODA is not working with the family to divert the pipeline development.

The protected farmland in question lies just south of Marysville, Ohio, in Union County, along a rapidly developing industrial corridor. Bailey’s uncle, Arno Renner, originally donated an ag easement on the farm to the ODA in 2003, giving up development rights worth more than $3.1 million, Don explains. “That was done primarily to ensure we’d have a farm to keep passing to the next generation.”

Renner died in 2007 and now part of the land is held in a family trust, with Don Bailey as trustee. Another parcel of the preserved farm is owned by Patrick Bailey, Don’s son. As the holder of the ag easement, ODA has responsibility for monitoring the land to ensure it remains in agricultural use, as specified in the easement, no matter who owns the land in the future.

As Don Bailey sees it, allowing a pipeline will cause permanent damage to the land for agricultural use, and he wants the ODA to enforce the easement by opposing the pipeline. However, according to the ODA, the terms of ag easements don’t prohibit easements for pipeline construction.

The ODA office of Farmland Preservation notes, “Historically, ODA has not had a preserved farm involved in a large utility matter before the Power Siting Board. The deed terms leave open the possibility of a utility easement being granted with our permission, and ODA’s current position is to not stand in the way of utility improvements that benefit public health and safety, while ensuring measures are taken to maintain preserved farms in predominantly agricultural use.”

That’s a different position than what the ODA took 15 years ago, Don points out.

When the city of Marysville proposed a sewage line through the property in 2005, the ODA, as the ag easement holder, refused to grant the city a right of way to bury the sewer line, saying the pipeline construction would likely cause irreparable harm to the preserved farm. After the ODA made it clear it would fight any eminent domain action to take a sewer line right of way across the preserved farm, the city rerouted the sewer line.

“We were tremendously encouraged by the state’s previous defense of our protected farm,” Don notes. “Now I’m just sickened to see how the winds have shifted.”

Easement interpretations

At the heart of the matter are varying interpretations of language in the ag easement, and the ODA’s approach to defending the easement. The ag easement on the Renner-Bailey land does specifically allow landowners to grant easements for utilities that serve the preserved farm, but it doesn’t address larger utility projects that serve areas beyond the farm.

That language is common in the state’s older ag easements, although more recent easements expressly prohibit landowners from granting any utility easements on protected ag land. Landowners with those newer ODA ag easements are required to forward all requests for utility easements to the ODA for consideration.

The ODA’s Office of Farmland Preservation explains how it is interpreting the older easement language: “It is silent about larger utility projects that service areas beyond the property, but we've determined that to mean the landowners come to us and the local sponsors (if it's a purchased easement) before granting or rejecting an easement so the parties weigh the pros and cons. The utility must negotiate a lease with landowners for the utility easement, otherwise the utility likely has the power to take the needed area by eminent domain.”

The Columbia Gas pipeline proposal, known as the Marysville Connector Project, is currently under consideration by the Ohio Power Siting Board. The Power Siting Board staff, in their project investigation report, refer to the Renner-Bailey ag easement, noting, “The easement held by ODA states that it does not preclude installation over or under the protected property for the purpose of providing gas. Farming activities would be able to resume within the pipeline easement following completion of construction.”

Don argues that the ag easement prohibits industrial or commercial activity on the protected farmland, so a gas pipeline crossing the farm would violate the terms of the easement. He’s also doubtful the land can be fully restored after pipeline construction.

He’s frustrated the ODA hasn’t done more to encourage Columbia Gas to look for a different route. “Some landowners may welcome utilities and transmission lines, and the opportunity to negotiate revenue. Not us,” Don says.

More utilities

The Baileys are also concerned that allowing the pipeline across their farm will give a green light to other utilities that want to come through the farm in the future.

“An ag easement shouldn’t be an open invitation to attract these kinds of developments because it’s the easiest and cheapest route,” says Patrick Bailey. “The intent of farmland preservation isn’t to create permanent low-cost utility corridors.”

While the Bailey family has no interest in taking their preserved land out of agricultural production, some landowners might.

Krista Magaw, steering committee chairman for the Coalition of Ohio Land Trusts and executive director of the Tecumseh Land Trust, says people who inherit or buy preserved farmland aren’t always as dedicated to farmland preservation as the original owner. She’s concerned that installation of the gas pipeline on the Renner-Bailey Farm might make other ag easements less secure.

“Some people could take that as a message that secondary owners don’t have to honor the original owner’s wishes,” she says. When landowners grant agricultural easements, they are relying on their easement holder to uphold the easement into the future, even if a future landowner no longer wants the easement, Magaw adds.

The intent of ag easements is to maintain land in agricultural production but they don’t necessarily prevent construction of utility projects such as pipelines, says Don Buckloh, senior information specialist with the American Farmland Trust. Ag easements can act as deterrents simply because pipeline developers realize ag easements add another party with ownership interest in the land — the easement holder. “There are two owners that the pipeline has to deal with,” Buckloh says.

That means the utility would owe compensation to both owners and, if they can’t agree on terms, the utility would have to deal with both owners in an eminent domain case to gain access to the property through the court system.

Ohio’s ag preservation laws don’t prevent use of eminent domain on farmland protected with ag easements. However, most ag easements do require the land be enrolled in the state’s Agricultural District program. Ag districts require an additional review of projects by the state director of agriculture if eminent domain is to be used on 10 acres, or 10%, of the total agricultural district land — whichever is greater.

The Baileys say they don’t want to be pushed into granting the pipeline easement under the threat of eminent domain, but if the ODA doesn’t object to the pipeline, they are left to protest the pipeline on their own. “This agricultural easement is supposed to be a permanent agreement,” Don Bailey says. “If the political will of the moment is all that really matters in determining whether or not ODA will uphold its end of the agreement, then I think a lot of people across the state are going to have serious questions about the viability of this program.”

The ODA Office of Farmland Preservation hasn’t commented specifically on the Renner-Bailey easement, but offers this explanation of how utility easements are to be handled: “If landowners are approached about a utility easement, they must consult with ODA and, if there is one, the local sponsor. ODA and the local sponsor will consider a number of circumstances, including the impact on the land and the health and safety needs of the community. ODA’s deed terms require the property remain in agricultural use, remain in CAUV [current agricultural use value], and be enrolled in an agricultural district.

ODA will determine if the proposal forces the landowner [to be] in violation of the deed terms to determine if permission is granted or denied. If granted, the landowner is permitted to enter into a lease agreement with the utility company, but is not required to do so. If denied, or if the landowner chooses not to enter into an agreement, the company could initiate an eminent domain action.”

The Office of Farmland Preservation also offered comments on eminent domain as it relates to preserved farms: “In general, eminent domain means those impacted acres are lost from preservation and, essentially, converted from agricultural use. The deed may require a landowner to reimburse ODA for the proportionate value of those acres extinguished from the deed. The goal of our program is simple — prevent conversion of agricultural acres to nonagricultural use. Whether ODA chooses to fight an eminent domain action depends upon the nature of the required use, the number of acres lost, and any other surrounding practical and legal issues after close consultation with legal counsel.”

Keck writes from Raymond, Ohio.

TAGS: Regulatory
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