Campaign Contributions to Texas Railroad Commissioners Raise Questions about Bias at Oil and Gas Regulatory AgencyPress Release | Oct 12, 2021

Latest report in the Captive Agency series reinforces need for ethics reforms 

LAREDO, TEXAS — Two thirds of the campaign funds raised by the three current Texas railroad commissioners across six years came from the oil and gas industry they are supposed to regulate, according to a report from Texans for Public Justice and Commission Shift. Lax conflict of interest restrictions on these kinds of donations raise questions about the independence of the Railroad Commission of Texas, especially as the agency considers rules to prevent another winter power outage disaster.

“It’s completely inappropriate for oil and gas regulators to take millions of dollars in campaign contributions from oil and gas companies,” said Andrew Wheat of Texans for Public Justice, co-author of the report. “The resulting potential conflicts are widespread. Lawmakers need to implement reforms to gain public trust.”

The report is the second in a series called Captive Agency, and it looks at Commission Chair Wayne Christian’s personal financial statements to spot where he may have potential conflicts of interest. This report also goes into greater detail on campaign contributions received by all three commissioners, and shares stories of cases where the commissioners made decisions while collecting campaign contributions throughout the duration of the case.

“The deadly winter storms and power outages were in part a result of the Railroad Commission’s failure to require gas companies to winterize their wells and pipelines,” said Virginia Palacios, executive director of Commission Shift and co-author of the report. “In order to prevent future disasters and to ensure a reliable energy grid, Texans want safeguards to limit the influence of oil and gas companies on state regulators.”

The first report focused on personal financial statements submitted by Railroad Commissioner Christi Craddick, demonstrating her close ties to the oil and gas industry she oversees.

“We need a state agency that holds the oil and gas industry accountable to the law. As a land and mineral owner, I’m counting on that, but the data in this report shows that the industry may have too much leverage over the commissioners’ decisions,” said David Todd, attorney, conservation historian and rancher in Colorado and Fayette counties.

Key Findings from the latest installment of Captive Agency:

•  67% of the campaign funds raised by the three current railroad commissioners across 6 years came from the oil and gas industry, which the commissioners oversee.
• Two sectors of the oil and gas industry in particular stand out for campaign contributions — wastewater disposal companies and pipeline companies.
• The commissioners decide many wastewater disputes involving competing interests that contributed hundreds of thousands of dollars to their campaigns.

Key Policy Recommendations from Commission Shift:

• Demonstrate no financial interest: Before serving, commissioners should be required to divest from the industries they regulate, as in Oklahoma.
• Limit campaign contributions: Railroad Commission candidate fundraising should be limited to the 18-month period preceding that election, with limits of $5,000 per election cycle , just like statewide judicial races. 
• Improve financial disclosure: Texas should dramatically increase the maximum values reported in personal financial disclosures, which currently max out at just “$44,630 or more.” 
• Strengthen and clarify recusal standards: Commissioners should recuse themselves from cases involving companies with which they have personal equity, income, business or if the company donated more than $1,000 to their campaign in the last election cycle.
• Use a neutral forum for contested cases: Move to independent hearings through the State Office of Administrative Hearings instead of in-house administrative law judges.

Read the first two reports in the Captive Agency series on the Commission Shift website, and follow us on Instagram, Twitter, Facebook and LinkedIn.

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Texans for Public Justice is an Austin-based non-profit organized in 1997 to take on political corruption and corporate abuses in Texas. Through research and public advocacy, TPJ participates in  debates on political reform, consumer protection, civil justice and corporate accountability.

Commission Shift is a Texas-based nonprofit building public support to hold the Railroad Commission of Texas accountable to its mission in a shifting energy landscape. We educate and organize a wide array of Texans to build support for changes at the Railroad Commission that improve the agency’s function, transparency, and accountability to the many people and places impacted by the oil and gas industry.