Business Groups Underscore Importance of Fracking Ban Case

Supreme Court Will Decide Whether Local Governments Can Ban Access to Private Property

Contact:
Rich Coolidge
rcoolidge@eissolutions.com
(720) 420-4255


DENVER (Dec. 8, 2015) – On Wednesday, the Colorado Supreme Court will hear oral arguments to decide whether local communities, specifically Fort Collins and Longmont, can ban oil and natural gas drilling activities, including fracking, from their borders. 

Vital for Colorado, a broad-based coalition of Colorado businesses, associations and individuals, underscored the significance of this landmark case. 

“We feel confident that the Colorado Supreme Court will find that state regulations must be applied uniformly across the state, creating a consistent business climate and protecting private property rights,” said Vital for Colorado Board Chair and local attorney Peter Moore. 

Lower courts overturned a 2012 fracking ban in Longmont and a five-year fracking moratorium in Fort Collins from 2013. The state appeals court declined to weigh in and instead, deferred the matter to the Colorado Supreme Court. 

Kelly Brough, President and CEO of the Denver Metro Chamber of Commerce, said that permitting local rules to preempt state regulations would result in a patchwork of regulations across the state, making Colorado less attractive to current and prospective businesses.

“That would create an unpredictable business climate in our state, which has a ripple effect,” Brough said. “The oil and natural gas industry has a tremendous impact on our small and large businesses, nonprofits and labor organizations, all of which will be impacted by efforts to limit responsible energy development.” 

In Colorado, oil and natural gas operators work with both the surface owners and sub-surface owners to extract the resources. The operators financially compensate both for the minerals extracted from the subsurface owners and for the use of the surface land.

The Colorado Chapter of the National Association of Royalty Owners (NARO) represents many of the state’s 600,000 mineral owners. According to NARO’s Colorado president and Vital for Colorado board member Michelle Smith, these owners are watching the Supreme Court case closely. 

“Many Colorado families rely on these royalty payments for their livelihood or for their retirement and investment savings,” Smith said. “These kinds of local bans wipe out those savings and significantly increase the uncertainty for future financial planning.”

Similarly, surface owners also stand to lose financial opportunities if local governments ban fracking. Groups like the Colorado Farm Bureau recognize the opportunities available to their members, particularly in between growing seasons. 

“We’ve worked closely with Colorado’s oil and gas operators to strike the right balance between the impacts to our farmland and their right to responsible energy development,” said Colorado Farm Bureau Executive Vice President Chad Vorthmann. “These agreements benefit many of our family farms during the off-season and are the result of compromise versus unyieldingness.” 

The numerous stakeholder groups from state and local governments, to property rights owners, to contractors, to communities illustrate the breadth of the impact of Colorado’s oil and natural gas industry, which also permeates throughout the economy generating $25 billion in economic activity and supporting over 200,000 jobs. Upholding the hydraulic fracturing bans will have a negative impact on the industry that will be felt throughout the economy.

Since the original bans passed, Governor John Hickenlooper formed an oil and gas task force that travelled throughout the state collecting public and stakeholder input. This effort resulted in nine recommendations and new regulations aimed at striking a balance among the many stakeholders. The Colorado Oil and Gas Conservation Commission is expected to adopt and implement the final two recommendations early next year.

About Vital for Colorado
Vital for Colorado is a broad coalition of business and civic leaders formed to support responsible energy development.  More than 50,000 chambers, organizations, businesses and Coloradans have signed its pro-energy pledge. For more information, go to www.vitalforcolorado.com