It's not exactly news that oil-and-gas companies involved in hydraulic fracturing spend freely on lobbyists and political-campaign contributions. A 2011 Common Cause study calculated that the fracking industry had spent close to $750 million over the previous decade seeking to influence federal legislation, such as the 2005 law that exempted fracking from regulation under the Safe Water Drinking Act.
But a recently released report by a liberal watchdog group claims that the industry is pumping cash into lobbying efforts in Colorado at a rate well in excess of most other sectors of the economy — and reaping the reward of a comparatively weak regulatory structure, riddled with loopholes.
"The oil-and-gas industry punches above its weight when it comes to influence on Colorado politics," claim the authors of "Spend, Baby, Spend," the scathing report from Colorado Ethics Watch. The report notes that while the industry accounts for only about 2 percent of the state's gross domestic product and less than 1 percent of its employment — just under 30,000 jobs, according to federal data, although the Colorado Oil and Gas Association claims it's more like 44,000 — the companies involved have spent far more on state lobbying than higher education, the telecom industry, agricultural interests or just about any other major business sector except health care.
Between 2009 and 2012, oil-and-gas interests funneled more than $800,000 to campaign contributions and pumped another $4.7 million into lobbying Colorado elected officials. And while results for the most recent legislative session aren't complete yet, the report pegs lobbying expenses for fiscal year 2013 as already over a cool million by the end of April.
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Among the biggest spenders over the past four years: Noble Energy ($700,602), Pioneer Natural Resources ($640,530), Shell Oil ($571,667), Encana ($415,857) and COGA itself ($402,867). Some of the companies that rank among the highest spenders — particularly Noble and Encana — also show up on recent lists of the companies responsible for the highest numbers of spills at their Colorado drilling operations.
Governor John Hickenlooper has boasted that Colorado's regulations for oil-and-gas development are among the toughest in the country. But "Spend, Baby, Spend" contends that in practice, the state's regulators are far more lenient than those in supposedly more energy-friendly states; for example, the maximum daily fine for spills that can be imposed in Texas is ten times higher than Colorado's limit.
"While it is not surprising that the oil-and-gas industry is a big lobbying player/contributor in Colorado politics," the report concludes, "the level at which this has influenced enforcement and collection of fines...as well as the implementation of protective policy, is shocking."
In a written response, COGA spokesman Doug Flanders notes that the report didn't include any comparative figures on the scope of lobbying by environmental groups and failed to mention that Colorado Ethics Watch supported one of the bills that the oil-and-gas business lobbied against. The industry's lobbying efforts have enjoyed "bipartisan support," Flanders stresses, and reflect "the Colorado model of balance and moderation, with a larger business coalition supporting the oil and gas industry as critical to the overall economic success of the state."