Dems Set for One Last Swing at Oil and Gas Industry

May 8, 2013

H.B. 1267 seeks to increase fines from $1,000 per day to $15,000 per day for significant environmental violations

DENVER–Virtually every Democratic Party constituency emerged a winner in the 2013 legislative session, except one: foes of the oil-and-gas industry.

They’ll get one more chance Wednesday to salvage their agenda with House Bill 1267, a measure that would hike fines on industry rule-breakers.

The bill is scheduled to go before a conference committee hours before the General Assembly adjourns for the year.

State Rep. Mike Foote (D-Longmont) requested the conference committee after balking at business-friendly changes made to the bill by the Senate.

“The bill as amended doesn’t do anything to change behavior in my opinion,” said Foote, who sponsored the measure.

The legislation is the last surviving piece of a package designed to crack down on the oil-and-gas industry in reaction to the anti-drilling outcry in some Colorado communities. Introduced amid media fanfare and with strong support from the environmental movement, the measures sailed through committee hearings and seemed at times destined for the governor’s desk.

But the governor behind the desk is John Hickenlooper, a former geologist and longtime industry backer who opposed the bills from the outset. Once Democrats realized that he wasn’t going to budge, they began peeling off their support during Monday’s Senate floor votes.

House Bill 1269, which would have changed the pro-development mission of the Colorado Oil and Gas Conservation Commission, went down to defeat Monday after five Democrats switched sides to vote with Republicans against the bill.

House Bill 1316, which would have upended a commission ruling by increasing groundwater sampling in the Greater Wattenberg Area, lost 18-17 after three Democrats sided with Republicans. No Republicans supported either bill.

In April, a Senate committee killed a measure that would have enacted local-government fees on the industry. A House committee defeated a proposal that would have paid for a study on the impact of hydraulic fracturing on health concerns.

That leaves H.B. 1267, which would increase fines from $1,000 per day to $15,000 per day for significant environmental violations. The governor and industry officials have indicated they will support the hike, but they oppose the bill’s minimum daily fine requirement.

The Senate amended the bill to remove the minimum daily fine, but Foote refused to go along with the changes, arguing that the commission has been reluctant to impose the largest fines.

“Right now what they have is a certain sized hammer,” said Foote. “The bill is designed to give them a bigger hammer, but if they’re not going to use the bigger hammer, what’s the point? Right now they don’t even use the hammer that they have.”

State Rep. Carole Murray (R-Castle Rock) said the minimum daily fine is excessive, insisting that it would make Colorado a national outlier and send a message that the state is hostile to the drilling industry.

“No other state in the U S has a mandatory minimum fine,” said Murray. “The EPA doesn’t even have a  mandatory minimum fine. So we’re setting a precedent and making a statement about Colorado and how we feel about this particular industry.”

The Colorado Oil and Gas Association has amassed a bipartisan coalition of 122 local elected officials opposing the new regulations.

“We appreciate that you are using your influence as governor to seek a sensible energy balance–one that ensures rigorous regulation and enforcement, but in a way that is applied consistently and efficiently so that Colorado remains an attractive place to do business,” said a letter to the governor signed by 99 officials.

Meanwhile, Colorado Conservation executive director Pete Maysmith released a statement Monday saying he was “deeply disappointed” by the Senate defeat of the groundwater-testing measure, saying the vote puts “the needs of out-of-state oil-and-gas companies ahead of protecting our communities and neighborhoods.”

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