Commissioner James Rosales presided over the meeting as county judge pro tem in the absence of County Judge Barbara Shaw.
Four agenda items related to forms, permits and fees were placed on the agenda by Assistant County Attorney Betty Yarter and County Commissioner Tracey Schendel.
“Tracey is the one who brought this to the court,” Assistant County Attorney Betty Yarter said. “We are looking at four different agreements.”
Regarding the road and use agreement, Yarter said the court would need to set the dollar amount. DeWitt County currently charges $8,000 per well, Yarter explained noting that Bee County charges $9,500 per well.
“There is no guarantee that we will get anything from any of them,” Yarter said. “The fact is that they are using and abusing the roads – the oil companies – we need to have something in there for them to have to put back into the community.”
First up for consideration was the Karnes County Road Use Agreement which Yarter described as the “big dollar number.”
“It is strictly for roads,” Yarter explained. “All of this money will go back to the road and bridge department. None of this money comes into the general fund.”
County Treasurer Vi Malone said she believed that a special fund may need to be established for the fees.
County Auditor Lajuana Kasprzyk said that the funds can go directly to road and bridge, but if the funds are going to be used in the current fiscal year then it will be necessary to specify a special fund budget out of the road and bridge budget. If the funds are anticipated for future use, then the funds will be shown as a revenue line item in Road and Bridge, Kasprzyk explained.
“We are thinking about $9,500 per well site,” Commissioner Schendel explained. “That’s for each permit – each railroad commission permit. If they put four wells on one pad, it is for each individual well.”
Schendel explained that if an oil company or pipeline company doesn’t get the permit, the county can send the sheriff to assess fines.
Yarter said there was a $1,000 non-permit fee included with the agreement and a $5,000 fine can be assessed to a company who fails to obtain a pipeline permit before installing the pipeline. Also, Yarter said a road use agreement is required before a company can obtain a permit to construct access driveway facilities.
County Commissioner James Rosales said he had been waiting for the new Democratic primary election to conclude before bringing it up, but he has been in contact with a company that can assist the county with recouping road repair and construction costs from energy companies working in the county.
Rosales asked the court to delay taking action on the four items until the company could make a presentation before the court.
“Is this a legal firm?” asked Maurice Yarter, who was seated in the audience at the meeting.
“Yes,” Rosales answered.
“Is your proposal to contract this out rather than doing it in house?” Yarter asked.
“Basically, yes,” Rosales said. “She will be our lead person... She will take over everything that we have, of course she is going to need us, too... She is going to let them know how to direct us and how to direct us toward these oil companies and get every cent that we can get out of them because this is what what she lives and breathes.”
“I would recommend that if she is going to talk to anybody that she ought to be talking to Mr. Busselman or at least the county attorney’s office and Tracey,” Maurice Yarter said.
County Auditor Lajuana Kasprzyk encouraged the court to move forward.
“The sooner we do it, the sooner we will start collecting funds because we won’t be able to go backwards and collect,” Kasprzyk said.
The assistant county attorney said it may be possible to collect fees on wells already drilled.
“Other counties have found that they put in a retroactive agreement in Bee County and had immediate response and so forth with regard to getting back for two years,” Betty Yarter said.
Shanna Hall, who was in the audience at the meeting, made a comment in regard to delaying action on the items.
“I thought I might mention that it was Petrohawk that came in well over a year ago and offered an agreement and nothing in this county has been done,” Hall said. “If you do a railroad commission search you will find that over 2,000 wells have been drilled in this county and if you would multiply that by the $8,000 or $9,500, whichever you choose, we have lost over 10 to 15 million dollars worth of revenue to use toward our road and bridge repair. This was put on here over a month ago. In my opinion, two years ago, at least a year and a half ago, we should have been addressing this. The fact that it just keeps getting kicked down the road is unbelievable... what we are losing... These companies are just laughing at us because there is no type of paperwork or document or agreement to be signed in Karnes County.”
County Commissioner Carl Hummel thanked Hall for her comments.
“Thank you very much,” Hummel said. “You took the words right out of my mouth.”
Rosales asked the commissioners what amount the court should choose for the road use agreement.
Commissioner Hummel made a motion to approve the road use agreement establishing a fee of $9,500.
Commissioner Schendel seconded the motion, which carried on a 4-0 vote.
The next item for consideration was an item related to establishing permits and fees for oil and gas well drilling.
“We don’t have to put a fee on this,” Schendel said.
“You don’t have to put a fee on it,” Betty Yarter said. “I would suggest that you put a fee on it.”
“This is for the well bore, correct?” Hummel asked.
“Yes,” Yarter answered, explaining that one function of this fee would facilitate 911 emergency addressing of the well locations, so that emergency personnel can locate the locations in the event of an emergency.
“What would be a fair fee?” Schendel asked.
Betty Yarter suggested a $500 fee.
Schendel said he expected the drilling permit to be the higher amount.
“It’s tied to this,” Yarter said. “The road use agreement is what we need the big dollars for. This, basically, forces their hand to say that they’ve got all these documents in hand – one of them being the road use agreement, before they get to this point.”
Commissioner Pete Jauer questioned whether landowners should have to pay a fee to construct driveway access.
Commissioner Schendel said that landowner driveways would be exempted from fees.
“That is something that I omitted,” Yarter said, “and so I will have to address adding that to it – to omit a landowner’s use for going into his own land – or if he wants to put a culvert in.”
Schendel suggested a $500 fee and it could be changed if needed in the future.
Rosales said that $1,500 might be more appropriate.
“They are destroying the heck out of our roads,” Rosales said.
Betty Yarter said that one study recently completed for DeWitt County estimated that the cost to repair damage to county roads could be as high as $432 million over the next 20 years.
“$432 million is a hell of a lot of money,” Yarter said.
Rosales made a motion to approve the oil and gas fee at $1,500. Hummel seconded the motion which passed on a 4-0 vote.
Next up for consideration was the permit to construct access driveways.
Yarter explained a $1,000 penalty is attached the agreement for companies who fail to pay the permit fee.
Commissioner Hummel made a motion to approve a $500 fee for permits to construct access driveway facilities on Karnes County Right of Way. Commissioner Jauer seconded the motion which passed on a 3-1 vote. Rosales voted against stating that he believes that a higher fee should be assessed.
The court then considered an item for adopting Karnes County pipeline permit fees.
The proposed agreement requires that all piplelines be bored under the road and that cutting of county roads to install pipelines will be prohibited under the permits.
After some discussion, Commissioner Hummel made a motion to approve pipeline permit fees at a rate of $500. Commissioner Schendel seconded the motion which carried on a 4-0 vote.