Colorado's Anti-Oil and Gas Bill Risks Jobs, School Funding

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Both the substance and the handling of a new Colorado bill to overhaul oil and natural gas regulation is raising concerns amongst Colorado voters.

SB 181, introduced last Friday by Senate Majority Leader Steve Fenberg, House Speaker KC Becker, and Governor Jared Polis—all Democrats from Boulder—would dramatically change the functioning of the oil and natural gas industry in Colorado. Amongst many other provisions, the omnibus bill:

  • Goes much farther than the voter-rejected Proposition 112 – it gives cities and counties the authority to regulate all aspects of oil and gas development, including siting, technical operations, and air monitoring. This enables the 2,500-foot setback restrictions (five times the current 500-foot statewide setback from residences) that voters decisively defeated at the ballot last November.

  • Creates a de facto moratorium on all existing and new oil and gas permits until every rulemaking in the bill is fully in effect. SB 181 requires a minimum of six rulemakings, which could easily take years to fully implement before the Colorado Oil and Gas Conservation Commission (COGCC) can resume permitting.  

  • Shifts the obligation of the COGCC from balancing energy development with public health and the environment to a charge to "regulate" oil and gas development. In addition, the Commission will no longer be required to consider cost effectiveness or technical feasibility during the regulatory process.

  • Reduces the number of members with oil and gas expertise on the nine-member COGCC from three to one.

Beyond the consistent anti-oil and gas stance of the bill—which has led both the Sierra Club and 350.org to enthusiastically endorse it—the lightning-fast transit from introduction on Friday to a hearing on Tuesday and the lack of consultation with oil and gas stakeholders has created the appearance of wealthy urban Democrats overruling the rural Coloradans whose livelihoods literally depend upon the oil and gas industries in that state.

As the Colorado Springs Gazette editorialized:

Boulder politicians do not represent hard-hat workers thankful for fracking jobs, people who work at the Suncor Energy refinery, or the men and women who transport oil and gas or work in other positions that support the industry. … Without a flourishing energy economy, underfunded schools will receive less money. Underpaid teachers will get even less. Hundreds of thousands of jobs, directly and indirectly tied to oil and gas, might be lost along with tax revenues they generate. Housing markets will suffer, and the state could go into a sustained recession. Those lowest on the economic ladder will suffer most.

Given the potentially huge impacts of this bill, the speed with which it’s being shoved through the Senate—it passed early Wednesday morning along party lines and is expected to be heard in the Senate Finance Committee as soon as tomorrow—is at best unseemly.

At worst, it’s a rebuttal of the voters’ will as Democratic legislative and executive leadership put their agenda above the needs of hundreds of thousands of Coloradans who depend upon a flourishing energy economy.

Speaking to oil and gas workers who rallied on Tuesday night against the bill, State Sen. John Cooke called the legislation “a sham …This was introduced Friday and we’re hearing it today, trying to stifle your voice and ramrod this through the Senate.”

Dan Haley, the president and CEO of the Colorado Oil and Gas Association, pointed out at the rally that more than $600 million in oil and gas revenues go to the state’s education system every year. The regulatory burdens enacted by this bill could well take a significant chunk out of that sum.

As the Colorado Springs Gazette editorialized, if enacted, this legislation “would devastate a disproportionate number of minority and low-income households, countering multiple decisions made by majority will in elections.”