“The Texas Railroad Commission (RRC) was created in 1891 under the administration of Governor James S. Hogg to regulate the railroad monopolies that had developed in the state. The commission was also given regulatory authority over terminals, wharves, and express companies. The commission consists of three members who are elected in statewide elections for six-year staggered terms, with one member elected every two years. The member up for election, by convention, always serves as chair of the commission.
In the 1920s, when oil and natural gas production developed in the state, the task of regulating the exploration, drilling, and production of oil and natural gas was assigned to the RRC in part because it was the only state regulatory agency at the time. When motor truck transport developed in the state, regulation of the rucking industry was also assigned to the RRC. In part because of federal rules and regulations, the original role of regulating railroads and the later role of regulating trucks have diminished to minor roles, reduced primarily to concern with safety issues. The regulation of the oil and gas industry is the RRC’s primary function today.
Many have been critical of the RRC over the years because of its close ties between the elected commissioners and the oil and gas industry they regulate. (See chapter on interest groups.) Large campaign contributions from oil and gas PACs have raised questions about the commission being co-opted by the industry it regulates. Also, like the agriculture commissioner, the RRC has the dual role of promoting oil and gas production in the state and regulating the safety and environmental aspects of the industry (for exaplme, promoting the development of pipelines to carry petroleum products as well as overseeing the safety of such pipelines.) A similar conflict may exist between the RRC’s task of regulating and promoting the mining of minerals (especially lignite coal) in the state.
The role of the RRC that most directly affects citizens in the state is that of setting the rates charged by local natural gas companies. Natural gas companies must have the rates they charge residential and commercial customers approved by the RRC. The RRC also regulates the safety of natural gas systems.
It has been suggested that the name of this agency be changed to better reflect it’s function. As discussed in the previous session of the legislature, the present name is confusing to voters and does not reflect its functions. Some say this voter confusion is useful to the oil industry in controlling the commission.”
Mora, Sherri, et al. The State of Texas: Government, Politics, and Policy. 1st ed., McGraw-Hill, 2010.