A series of reports from an advocacy group have made broad allegations that the three elected members of the Texas Railroad Commission are too closely tied to the oil and gas industry they regulate.
The nonprofit group Commission Shift in a series of reports undertaken with Texans for Public Justice alleges that the Railroad Commission is a “captured” agency – an agency that has become so tied to the industry that it regulates that it does not. can no longer supervise it effectively.
Among its many findings, the Shift Commission found that the three commissioners received more than 60% of their campaign donations from companies or individuals with direct or indirect ties to the oil and gas industry.
He also found that some members did not recuse themselves in votes involving companies with which they had personal or indirect ties through their businesses or investments.
Commission Shift calls for stricter rules on which commissioners withdraw from votes, more specific financial disclosures and campaign contribution rules prohibiting companies with cases on hold before the board of directors from donating to candidates or the commissioners. He also proposed that Texas adopt rules similar to Oklahoma’s, which require members of its oil and gas regulatory board to withdraw from the industry.
“Ultimately, I think it’s time to reform the conflict of interest policies at the Railway Commission,” said Virginia Palacios, executive director of Shift Commission.
The series of three reports highlights that the three commissioners have ties to the oil and gas industry. The bizarre Railroad Commission has little to do with trains and is Texas’ main regulator of the state’s massive oil and gas industry.
Unlike many other Texas regulatory boards, its members are elected in statewide elections. Many see the Railway Commission as a stepping stone to higher office.
In a series of three reports released in recent months, Commission Shift detailed the personal finances of each railroad commissioner, examining their personal finance reports that elected officials are required to file with the Texas Ethics Commission.
The three commissioners answered questions from the Dallas Morning News about the Shift Commission findings and their links to the oil and gas industry. All three did not respond to criticism from Commission Shift about their ability to regulate an industry in which they have an interest or said it does not change their judgment.
Some commissioners called the reports biased and one commissioner, Jim Wright, questioned the motives behind the groups funding the Shift Commission research.
The Laredo-based organization was founded about nine months ago. Its major donors, the Funder Collaborative on Oil and Gas, are nonprofit foundations affiliated with organizations that focus on the environment and conservation. Its fiscal sponsor is the Rockefeller Family Foundation, which also does environmental charitable work.
Palacios told the Dallas Morning News that his findings are all based on public documents he posted on his website.
Browsing through the reports, Commission Shift discovered close ties between Commissioner Christi Craddick and the oil and gas industry. This is not surprising given the last name.
Craddick is the daughter of the longest-serving member of Texas House, Rep. Tom Craddick, a former speaker. The Midland family has ties to several oil and gas companies, and Christi Craddick’s financial statements showed numerous oil leases and interests in fossil fuel companies.
Shift Commission estimated that Craddick has at least $ 1.5 million in oil and gas industry ownership, although that number may be much higher due to financial disclosure rules not requiring exact amounts in dollars.
“In accordance with the Texas Ethics Commission, my personal financial statements are fully disclosed to the letter of the law and available to the public,” Craddick said in a statement. “Texas Ethics Commission laws ensure the transparency of our public officials and maintain public confidence in our ability to govern appropriately, and I take these laws seriously. “
The reports also detail Wright’s holdings in oil and gas waste disposal companies, an industry the commission also regulates. In addition, he highlighted his attempts to promote the use of recycled petroleum by-products in road maintenance with the Texas Department of Public Safety.
Wright called some of the Shift Commission’s accusations “false and deliberately misleading” and its findings on its links to promoting the recycling of waste oil for road building “absurd.”
“As a candidate for office and now as the newest member of the Railway Commission, I base my decisions on what I think is best for the state and our citizens. Period, ”Wright said. “Maintaining the public trust, not to mention my own personal integrity, is important to me, and I am committed to following all rules and regulations set forth by state law and administered by the Texas Ethics Commission. . “
The Chairman of the Railway Commission, Wayne Christian, was the least exposed to the oil and gas industry, with connections much smaller and more indirect than those of Wright or Craddick.
“My entire investment portfolio consists of mutual funds and other similar accounts controlled without my input by a third-party manager registered with the United States Securities and Exchange Commission,” Christian said. “My personal financial statement (the quote used by Commission Shift) is a snapshot in time and may be different on any given day.”
Shift Commission and Texans for Public Justice reviewed campaign fundraising reports from the current and a former railroad commissioner, looking at the donations they received from 2015 to 2020. They found that 67% of Donations from these commissioners came from the oil and gas industry.
By comparison, the oil and gas industry accounted for about 21% of Gov. Greg Abbott’s campaign donations from 2017 to 2020, according to Texans for Public Justice.
“I think this is a big red flag for Texans, especially for people affected by oil and gas development,” said Palacios, head of the Shift Commission.
The series of reports comes as the Railway Commission faces the most scrutiny it has ever seen in recent memory. So far, commissioners have resisted harsh criticism following the deadly February freeze that killed at least 210 Texans.
The event led to the dismissal of all members of the Utilities Commission as well as the head of the Texas power grid operator, the Electric Reliability Council of Texas. But as elected officials, the railway commissioners have so far managed to escape the post-freeze guillotine. Christian, the chairman of the Railways Commission, is running for office next year and faces at least one challenger in the Republican primary as well as a Democrat, if he makes it to the general election.
The larger gas industry has also managed to avoid much of the blame. New regulations enacted during the freeze focused more on electricity providers and grid operations. Natural gas producers have had a great deal of leeway over weatherization standards, and even as winter approaches, the Railroad Commission has yet to take substantial action to boost the reliability of the vast gas infrastructure. natural from Texas.
The commission is expected to finalize the new weatherization regulations on November 30. One includes a loophole that would allow natural gas producers to avoid weatherization only by completing a one-page exemption request and paying a $ 150 fee that lawmakers have described as “the stub of” Achilles’ network reform.