Shelby and Story counties to pursue U.S. Supreme Court action on local pipeline ordinance case

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The Shelby County Board of Supervisors voted Aug. 19 to petition the county's case against Summit Carbon Solutions to the U.S. Supreme Court. (Photo by Cami Koons/Iowa Capital Dispatch)
HARLAN – County supervisors in Shelby and Story counties voted Tuesday to pursue further legal action in their case against Summit Carbon Solutions pertaining to county-specific ordinances on hazardous liquid pipelines.
A U.S. district judge and federal appeals judges have previously ruled on the case in favor of Summit and now the counties are seeking a review of the rulings from the U.S. Supreme Court, though a Summit filing holds the ordinances would still be preempted by state laws.
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In Harlan, at the Shelby County Courthouse, landowners opposed to the pipeline gathered to thank the supervisors.
Sherri Webb, an affected Shelby County landowner, said Iowans across the state look to Shelby County and say 'I wish you were our supervisors.'
'Thank you,' Webb said, noting that it's no small feat to decide to appear before the Supreme Court.
'No matter what, I'm behind you guys,' Webb said.
Another landowner, Jan Norris who lives in Montgomery County and is a neighbor to the pipeline route, called the board a David standing up to a 'well-resourced and motivated' Goliath.
'Your constituents may not know how lucky they are, but I do,' Norris said. 'Because my board has chosen to play it safe and avoid the fight.'
Norris and Webb have been active at their respective county supervisor meetings since they first learned of the Summit project several years ago. The pipeline would connect to biorefineries across the state and transport liquid carbon dioxide through Iowa, Minnesota, Nebraska, South Dakota and to underground storage in North Dakota.
The two said the actions of the Board of Supervisors are important for maintaining local control and working toward standards they believe will be safer and better for their properties.
Norris said if the outcome of the case is reversed and in favor of the counties, it will benefit many Iowa counties, and other states impacted by the pipeline and similar projects.
'You guys are doing your job and you shouldn't be sued for doing your job,' Webb said.
Cindy Hansen, who lives in Ankeny but owns affected land in Shelby County with her sister, said the supervisors have restored some of the hope in the state that she had lost from the actions of the Iowa Utilities Commission and state legislators.
The Shelby County board said the cost of the lawsuits 'have mounted,' but have been covered by the county's insurer, ICAP, and by a fund the board created, shortly after it was sued by Summit in November 2022, that uses American Rescue Plan Act dollars to cover the costs.
A copy of both counties' letter of engagement, obtained by Iowa Capital Dispatch, shows fees for the endeavor would be capped at $60,000.
Mike Kolbe, one of the Shelby County board members, said the budget was a consideration in the decision, but with the fund and continued coverage from ICAP, Kolbe said the county can afford it 'with no cost to the taxpayers.'
Bryce Schaben, the chair of the Shelby board, said the feedback he has received from his community showed there was only one way forward.
'Everything we've heard is to do what we did today,' Schaben said following the meeting. 'When you get that kind of support, it's an easy decision.'
Schaben said if the Supreme Court follows the direction of the previous courts on the case, he will be confused.
'It's very confusing that the rulings don't want to make our counties safe,' Schaben said. 'That's what it comes down to.'
Ordinances in both counties established setbacks and permitting requirements for the pipeline company to construct in the county. Summit argued, and a federal judge in the Southern District of Iowa ruled, the ordinances were preempted by federal pipeline safety standards.
The counties appealed the case, and judges for the Eighth Circuit court of appeals concurred with the lower court, though one judge partially dissented on the case.
Story County supervisors approved the decision as part of a consent agenda and did not discuss the decision to engage the D.C. law firm on the suit.
Steve Kenkel, a former Shelby County supervisor who now serves as an adviser to the board on topics related to the pipeline, quoted Iowa Code where it directs county supervisors to 'protect and preserve the rights of their constituents.'
'That's what we're trying to do here,' Kenkel said. 'Without county zoning ordinances, the tools supervisors presently have in their tool box … will be tools of the past if this ruling is allowed to stand.'
Both counties voted to engage Kellogg, Hansen, Todd, Figel & Frederick P.L.L.C. to petition the Supreme Court.
Summit has sued several counties for similar county ordinance issues, including Emmet, Kossuth and Palo Alto counties. The later-filed cases have been paused while Shelby and Story counties' case was heard and then appealed. The two counties also petitioned the U.S. Court of Appeals for the Eight Circuit for an en banc rehearing of the case in July, which the court denied.
The other affected counties have requested stays through this process again as Shelby and Story counties decided to take the case to the Supreme Court.
Summit's legal team submitted a motion to lift the stay for these other counties, arguing that regardless of the outcome of the Supreme Court petition, the county ordinances would be preempted by state laws.
'Any county ordinance—including the one here—that attempts to impose additional permitting requirements, control pipeline routes, or regulate construction and operation is preempted by state law,' the motion said.
The Summit motion for leave of stay in Kossuth County also said certiorari from the Supreme Court was 'unlikely in general' and 'particularly unlikely' in Shelby and Story counties' case.
The motion holds that the Supreme Court could only review whether or not the ordinances were preempted by federal pipeline laws. Still in place, it argues, would be a piece of Iowa Code that gives the Iowa Utilities Commission the authority to set pipeline routes.
This was noted in the ruling from the Eighth Circuit. Here, the judges explained that a county would be inconsistent with state law, and therefore preempted, if it denied a local zoning permit application from the pipeline company to build on a location that had been approved by the IUC.
The appellate court decision notes some other states cede this power to local governments and might not be preempted as Iowa counties are.
Kenkel argued Tuesday that if the Supreme Court did not act in the counties' favor, the IUC would not be able to route the pipeline based on safety considerations. These and permitting and setback regulations, he said, would instead be up to the federal Pipeline and Hazardous Materials Safety Administration's rules.
State Auditor Rob Sand, a Democrat who is running for governor, stopped in Harlan Tuesday as part of his campaign tour across the state.
Among the things he was asked by the bipartisan crowd at Milk & Honey restaurant downtown: How would he protect property rights from such projects?
Sand said he does not support eminent domain for CO2 pipelines, 'period.' The comment was met with applause, especially considering some of the crowd had filed across the street to the restaurant after the board meeting.
Sand said there are two main reasons why he feels this way. He said he is 'deeply skeptical' that a carbon capture pipeline can be considered a common carrier and if 'there is a true public purpose' to the project.
'You can be a supporter of agriculture in the state of Iowa and a supporter of ethanol, and say that the carbon capture pipeline ain't it,' Sand said.
Sand said there are other options to sequester CO2 that have an established market.
Sand said Gov. Kim Reynolds' lack of action, or public opinion on the issue has been her 'single biggest failure.'
'Never in the state of Iowa, if there's a tremendous issue with lots of people showing up at the state capitol every single year for the legislative session, will I let five years go by before I decide to maybe share my opinion, only after a bill gets passed,' Sand said.
Reynolds, a Republican, is not seeking reelection.
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