A Memphis City Council committee delayed a final vote on a proposed ordinance that could hinder the Byhalia Pipeline project Tuesday, to allow time to strengthen the measure in anticipation of legal action by the company.
The latest draft of the ordinance considered by the Public Works, Solid Waste and General Services Committee Tuesday requires the council’s approval for the underground storage or transportation of hazardous materials, including by pipelines, and creates an evaluation process that involves several local government agencies.
Ordinance sponsors changed the focus from a measure aimed at stopping the Byhalia Connection Pipeline to one filling a regulatory gap that would protect the city’s water supply and most vulnerable communities.
Byhalia Connection Pipeline
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Councilman Jeff Warren, a sponsor of the ordinance, asked to delay a vote until the next meeting on May 4 to allow time to consult attorneys at the Memphis Light, Gas and Water Division and the mayor’s office.
“It will not prevent future development projects in Memphis, as long as they pose no risk to our aquifer and our people,” Warren said. “We should, and we can, collectively stand up to developers from outside of Memphis who would rather threaten litigation than comply with environmental and community review processes as outlined in this ordinance and requested by citizens.”
Last month, Mayor Jim Strickland said he was reviewing the project. Tuesday, he told the council in an email that he opposes the pipeline and would back efforts to “lawfully regulate” it.
“After careful review and detailed conversations with environmental scientists, I have great concerns that the Byhalia Pipeline would pose an unacceptable risk to our Aquifer,” Strickland said. “The risk of a leak in the pipeline is real, and any leak is likely to cause harm to the Aquifer. It’s a risk we should not take.”
Strickland told News Channel 3 in March he had placed a hold on the company’s application for permits from the city.
Byhalia Pipeline — a joint venture of Texas-based Plains All American Pipeline and Valero Energy Corporation — announced its plans for the Byhalia Connection Pipeline in 2019. The proposed route would connect the Valero Memphis Refinery and a Valero facility in Marshall County, Mississippi. The route runs through several Black neighborhoods, including Westwood, Whitehaven and Boxtown.
In an email to the council Monday, Roy Lamoreaux, vice president of Plains All American Pipeline, asked for a “mutual pause” on passing an ordinance in exchange for a pause on development. But Lamoreaux warned the council if they did pass an ordinance, a legal challenge from the company is “likely.”
“Byhalia Connection is willing to suspend development activities related to the pursuit of the currently proposed pipeline route and evaluate other options for the pipeline in an effort to address City Council and community concerns…” Lamoreaux said in the email. “We believe this eliminates the need and significant expense of litigation, while not preventing the city from pursuing an ordinance if needed later.”
Lamoreaux argued the ordinance wouldn’t hold up in court and would disrupt maintenance on existing pipelines.
Representatives for Plains did not respond to a call and an email seeking comment for this story.
Some council members like Worth Morgan worry about how the ordinance will affect businesses other than Byhalia Pipeline.
“This ordinance that we have in front of us, it has a longer and broader impact than just the Byhalia Pipeline decision,” Morgan said. “I’d like to have a better understanding of what businesses beyond pipelines and gas stations are going to be impacted by this law and subject to it in the future.”
The sponsors want to make sure the ordinance covers loopholes that Byhalia Pipeline may use to duck accountability in the event of a spill, George Nolan, senior attorney with the Southern Environmental Law Center, told the committee.
Nolan saw a red flag in Plains and Valero proposing the pipeline under the business name Byhalia Pipeline, LLC, a limited liability company registered in Delaware. He also pointed out that cleanup costs for a 2015 spill from a Plains pipeline in California is estimated at $460 million, according to a financial disclosure to the Securities and Exchange Commission filed last month. Nolan worries the company could skip the bill.
“Why are they putting this LLC between themselves and this particular pipeline? Who will pick up the tab if something bad happens, like it happened out in California,” Nolan asked the committee.
Ordinance supporters want to include steps in the evaluation process that require a company to show proof of financial responsibility and insurance to cover it, so the city isn’t stuck paying for a disaster.
But in the SEC disclosure, the company acknowledges its insurance may not cover the entire cost of future spills.
“We have in the past experienced and in the future may experience releases of hydrocarbon products into the environment from our pipeline, rail, storage and other facility operations,” the disclosure states. “We may also discover environmental impacts from past releases that were previously unidentified. The costs and liabilities associated with any such releases or environmental impacts could be significant and may not be covered by insurance.”
Justin J. Pearson, co-founder of Memphis Community Against the Pipeline, would’ve liked to see the ordinance passed today, but doesn’t mind that it will be strengthened with a more rigorous evaluation process.
“I think this decision allows for the gaining of a further understanding from the council, (and) I do believe they will choose the people and choose justice at this vote in two weeks.”
Carrington J. Tatum is a corps member with Report for America, a national service program that places journalists in local newsrooms. Email him at carrington.tatum@mlk50.com
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