Twenty-one states sued President Biden and his administration Mar. 17 to overturn his decision revoking the cross-border permit of the Keystone XL crude oil pipeline project.
Biden had no legal authority for his decision, argued the states, led by Texas and Montana, in a complaint filed in the US District Court for the Southern District of Texas.
The plaintiffs asked the court to find Biden’s decision unlawful and to enjoin the administration from enforcing or implementing the Jan. 20 executive order on TC Energy Corp.’s Keystone XL.
Biden’s action halted the project after the 1.2-mile segment at the Canada-Montana border crossing had been built but before the 882 miles of line could be constructed from there to a pipeline connection in Steele City, Neb. From Steele City, an existing line would have taken the oil to the pipeline hub at Cushing, Okla.
The president has certain prerogatives in foreign policy, but where domestic law is concerned, he must abide by laws enacted by Congress, the states said.
Permit provision at issue
In his executive order, Biden cited environmental policy concerns, but as a matter of law, his decision relied on a provision in the 2019 permit granted by the Trump administration for the pipeline’s border crossing. That provision gave the president “sole discretion” to revoke the permit.
“But plaintiff states are not aware of any principle of law that allows the president to arrogate power to himself through some sort of pseudo-contract with a private party,” the states said.
A president cannot reallocate federal authority to himself through an arrangement with a private party, not without the acquiescence of Congress, the states said.
Section 501 of a 2011 law required the president to grant TC Energy’s application to construct and operate the Keystone XL border crossing or report to Congress why he believed the project disserved the national interest within 60 days of the law’s enactment.
“It created a default rule whereby Keystone XL should be authorized unless the president made specified findings. Importantly, he did not exercise either of those statutory dictates,” the states said.
"But as there appears to be no other statute authorizing the executive to approve or deny Keystone XL, the plaintiff states retain the power to approve the siting of pipelines within its sovereign territory,” the states said.
Fearing economic impacts
Biden’s order eliminated about 1,000 existing construction jobs and an additional 10,000 estimated jobs that were expected for pipeline construction. The plaintiff states stressed the wide economic impacts of the decision, including jobs, business opportunities, and state government revenues.
“Revocation of the Keystone XL permit will cost the plaintiff states and their communities tens of millions of dollars in annual tax revenue from the regulators, residents, and businesses facilitating the refining, transportation, and exportation of crude oil that would be moved and delivered by Keystone XL,” the lawsuit said.
The case is Texas v. Biden. Joining lead plaintiffs Texas and Montana in the lawsuit are Alabama, Arizona, Arkansas, Georgia, Kansas, Kentucky, Indiana, Louisiana, Mississippi, Missouri, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Utah, West Virginia, and Wyoming.