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Item 8ACITY OF SOUTH LAKE MEMORANDUM 1/12/2011 To: Shana Yelverton, City Manager From: Kenneth M. Baker, PDS Director Subject: Moratorium on the Acceptance of Gas Drilling Related Applications Action Requested: Consider Resolution 11 -005 — Declaring a 90 day moratorium on the acceptance or processing of applications for well permits and specific use permits to permit mineral extraction through oil and gas exploration or operations, and on acceptance or processing of applications for regulated or unregulated pipeline permits within the corporate limits of the City of Southlake. Background: Information: The purpose of this resolution is to place a 90 day moratorium of the acceptance or processing of applications for well permits and specific use permits to permit mineral extraction through oil and gas exploration or operations, and on acceptance or processing of applications for regulated or unregulated pipeline permits within the corporate limits of the City of Southlake. City Council, after due and careful consideration, has determined that the current regulations need to be reviewed to address environmental and land use compatibility issues created by oil and gas exploration and mineral extraction, development and transportation activities; and believes that it is necessary to review and update municipal ordinances and regulations to provide for a fair and equitable system of regulations relating to oil and gas exploration and mineral extraction, development and transportation so as to protect the property interest of mineral estate owners while protecting the rights, opportunities and property interests of surface estate owners. The City Staff will review all appropriate environmental, planning materials and development regulations to suggest changes, if appropriate, that would protect the interest of both mineral estate owners and surface estate owners while ensuring the highest degree of concern for the preservation of the public health, safety, morals and general welfare. The City staff shall complete their work and make their recommendations to the City Council within ninety (90) days following the adoption of this Resolution; or, if they should determine that this time period is not feasible, report back to the City Council with a proposed calendar within which they will complete their work. Financial Considerations: None Strategic Link: C1- Achieve the highest standards of safety and security Citizen Input/ Board Review: None Legal Review: The City has reviewed the attached resolution. Supporting Documents: Attached Resolution 11 -005 RESOLUTION NO 11 -005 AN RESOLUTION DECLARING A 180 DAY MORATORIUM ON THE ACCEPTANCE OR PROCESSING OF APPLICATIONS FOR WELL PERMITS AND SPECIFIC USE PERMITS TO PERMIT MINERAL EXTRACTION THROUGH OIL AND GAS EXPLORATION OR OPERATIONS, AND ON THE ACCEPTANCE OR PROCESSING OF APPLICATIONS FOR REGULATED OR UNREGULATED PIPELINE PERMITS WITHIN THE CORPORATE LIMITS OF THE CITY OF SOUTHLAKE; DIRECTING THE CITY STAFF TO INITIATE A COMPREHENSIVE REVIEW OF THE CITY'S ORDINANCES GOVERNING PROCEDURES FOR OIL AND GAS EXPLORATION AND OTHER FORMS OF MINERAL EXTRACTION, PRODUCTION AND TRANSPORTATION AND TO PROPOSE REVISIONS THERETO; PROVIDING FOR A METHOD OF REPEAL OF THIS MORATORIUM; PROVIDING A PROCEDURE FOR A VARIANCE FROM THIS MORATORIUM; AND PROVIDING THAT THIS RESOLUTION SHALL TAKE EFFECT IMMEDIATELY UPON PASSAGE. WHEREAS, the City of Southlake, Texas is a home rule city acting under its charter adopted by the electorate pursuant to Article XI, Section 5 of the Texas Constitution and Chapter 9 of the Local Government Code; and WHEREAS, the City Council of the City of Southlake is aware of an increased interest in oil and gas exploration and production in the North Central Texas area; and WHEREAS, the City Council of the City of Southlake has previously adopted Ordinance Nos. 880 -A and 480 -RRR governing oil and gas exploration and other forms of mineral extraction, production and transportation; and WHEREAS, the City Council has conducted such investigations as it deemed necessary to determine the state of regulations now applicable to oil and gas exploration and other forms of mineral extraction, production and transportation under the current ordinances and regulations of the City of Southlake; and WHEREAS, the City Council, after due and careful consideration, has determined that the current regulations may not be adequate to address environmental and land use compatibility issues created by oil and gas exploration and mineral extraction, development and transportation activities; and WHEREAS, the City Council believes that it is reasonable and necessary to update municipal ordinances and regulations to provide for a fair and equitable system of regulations relating to oil and gas exploration and mineral extraction, development and transportation so as to protect the property interest of mineral estate owners while protecting the rights, opportunities and property interests of surface estate owners; and WHEREAS, it is important and necessary to preserve the status quo while a review and update of these regulations are being developed and implemented to ensure compatible land uses that do not negatively impact property values or neighborhood character; and WHEREAS, the City Council believes that the staff of the City of Southlake should undertake those studies or analyses necessary to prepare the appropriate recommendations for City Council action; and WHEREAS, notwithstanding the foregoing, the City Council of the City of Southlake recognizes that there may be individuals or businesses who have a legitimate reason to seek a variance from the requirements of this moratorium based upon the unique needs of their project and who are able to demonstrate that the approval of their project will not defeat the purposes of the City in adopting this moratorium. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SOUTHLAKE, TEXAS, THAT: SECTION 1 A moratorium is hereby imposed, effective immediately, on the receipt, processing, and approval of applications for Oil and /or Gas Well Permits and Specific Use Permits that would seek approval to conduct mineral extraction and /or oil and gas exploration and extraction within the corporate limits of the City of Southlake; in addition said moratorium extends to receipt, processing, and approval of applications for regulated or unregulated gas pipeline permits that would seek permission to install natural gas transportation lines by a non - franchised utility within the corporate limits of the City of Southlake. The moratorium shall be in place for the earlier of one - hundred eighty (180) days following the adoption of this resolution or upon passage of an amendment to the City's Ordinance Nos. 880 -A and 480 -RRR or other express action of the City Council lifting the moratorium. If no amendment or action is taken, the moratorium shall expire at 5:01 p.m. on July 17, 2011. The moratorium may be extended by the City Council for good cause shown. SECTION 2 The purpose of this moratorium is to maintain the status quo within the City until such time as the City has reviewed and, if necessary, amended its regulations regarding oil and gas exploration and mineral extraction, development and transportation. SECTION 3 The City staff are hereby directed to initiate and complete those studies and analysis necessary to determine what, if any, regulatory changes to the ordinances of the City of Southlake are reasonable and necessary to permit mineral extraction and oil and gas exploration, extraction and transportation without negatively impacting the interest of surface estate owners within the City. The City Staff are directed to review all appropriate environmental, planning materials and development regulations to suggest changes, if appropriate, that would protect the interest of both mineral estate owners and surface estate owners while ensuring the highest degree of concern for the preservation of the public health, safety, morals and general welfare. The City staff shall complete their work and make their recommendations to the City Council within one - hundred eighty days (180) days following the adoption of this Resolution; or, if they should determine that this time period is not feasible, report back to the City Council with a proposed calendar within which they will complete their work. The City staff shall solicit such input as they deem necessary and appropriate from all affected and interested parties in preparing their recommendations. SECTION 4 Any property owner who believes that the imposition of this moratorium causes a unique and unreasonable hardship upon his or her property or business shall have the right to request a variance and shall submit a written request to the City Council by transmitting same to the City Secretary's office. The request must provide the following information: a. A description of the property to be covered by the variance. b. An explanation as to why the application of the moratorium is unreasonable as applied to the applicant's property. C. A description of any negative impacts created by the moratorium provision. The City Secretary's office shall place the request for a variance on the agenda of the City Council for consideration at a public meeting. The applicant shall receive written notice of the date of the proposed hearing on the variance request. On the date that the item is set for hearing, the City Council shall conduct a public hearing on the variance request giving any individual who desires to present information or evidence to the City Council on the appropriateness or inappropriateness of the variance, the opportunity to appear before the City Council and present such information. At the conclusion of the hearing, the City Council, by majority vote, may approve a variance to the provisions of this moratorium resolution or may deny the request for variance. PASSED AND APPROVED THIS DAY OF , 2011. CITY OF SOUTHLAKE M Mayor ATTEST: City Secretary