In a change from typicality, the honor of the longest bill to become law for the 2025 Regular Session of the Louisiana Legislature was not the operating budget for most of government, HB 1. Instead, SB 244 by Republican state Sen. Bob Hensgens takes the cake, and for the better.
SB 244, just signed into law by Republican Gov. Jeff Landry, provides for a massive overhaul of matters energy and conservation; indeed, it renamed the Department of Energy and Natural Resources – itself just renamed 18 months ago – into the Department of Conservation and Energy come Oct. 1. It dipped its toe into many matters, predictably enough given its length, starting out at 66 pages just to reorganize the department, and then burst into a 227-page substitute bill as more stuff got piled on.
Aside from its reorganization focus, the most significant change it triggers comes in how legal questions surrounding land use for fossil fuel energy purposes are to be handled from Sep. 2027 on. Principally, it addresses legacy lawsuits, or legal actions taken against former owners of land used for fossil fuel extraction purposes for alleged environmental damage. It attempts to bring consistency and clarity to the area of legal controversy, mainly by putting more power in the hands of administrative processes at the expense of the judiciary. Courts could override only if they ruled for a much better plan for remediation using a much higher legal standard.
Besides streamlining the process that should reduce costs, it also reduces incentives to pursue “jackpot justice” by limiting damages and costs. In fact, if not found liable, defendants can recover costs from plaintiffs.
Landry signed the bill despite a rejection of passages he wanted that would have removed the option of having new rather than previous landowners pay for cleanup. He made an impassioned presentation to lawmakers in committee about that and other aspects of the bill. That request raised the alarm that a refusal to allow for indemnification would raise costs significantly by negating past contracts as well as apply to the future and allowing for expanded litigation as leverage for jackpot justice. Even absent those changes, the certainty for litigants and landowners provided in the bill won him over.
Despite dodging this bullet, some still are concerned about the new authority given to the department secretary, who essentially will moot the commissioner of conservation with the worry that this increases potential politicization of the job, with a special emphasis on using discretionary powers to facilitate carbon capture and sequestration projects possibly against local citizen or even landowner objections. That appears to be misplaced trust of the current arrangement considering the recent history of the commissioner’s office that became embroiled in an allegedly pay-to-play scheme that wasted millions of taxpayer dollars. If there’s a fear that DCE will be too forgiving of CCS because of federal funding driving the process that artificially stimulates the volume and profitability of CCS efforts, the issue of CCS regulation is best addressed by separate legislation that by and large the Legislature refused to pass this session.
Perhaps the least salutary aspect of the bill is its delayed implementation. Any suit filed prior to its taking effect would be subject to the present, more forgiving process for plaintiffs that encourage marginal and nuisance suits. But, better late than never.
Tort reform in respect to reducing vehicle and structure premiums perhaps was the topic tackled most vigorously by the Legislature this session, but this tort reform promises to create a more welcoming economic development environment. Fortunately, it crossed the goal line.
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