Under Industry Pressure, House Passes Amended Oil and Gas Bill

Chase Woodruff
Democratic lawmakers have again advanced their proposal to overhaul Colorado's oil and gas law — but not before adopting another round of conciliatory amendments lobbied for by the industry.

Senate Bill 181, which would strengthen health and safety rules and give local governments more authority to regulate drilling within their borders, passed the House on a third and final reading today, March 29, following nearly six hours of floor debate last night.

Democrats, who hold a seventeen-seat majority in the lower chamber, defeated a series of Republican amendments to substantially weaken the bill but adopted nearly a dozen others offered by House Speaker KC Becker and other Democrats.

"This has been a long road," Becker said on the House floor ahead of the vote. "I hope we did work for everyone last night that will move this issue forward but also put it to bed. There are important changes in this legislation for Colorado communities, for people in towns who've felt like they have not had a say in oil and gas."

While some of the approved amendments were small technical fixes or clarifications requested by state agencies, several others include major last-minute changes to the bill. Environmental and community activists, already disappointed by amendments adopted amid pressure from industry groups just before its final passage in the Senate, spent the last several days urging Becker to pass a "clean bill" without any further amendments. Still, with many of the bill's key provisions intact, activists welcomed its passage by the House this morning.

"Despite some concerning amendments, SB 181 is still a step in the right direction," Anne Lee Foster, spokeswoman for anti-fracking group Colorado Rising, said in a statement. "There were some very obvious loopholes granted to industry."

The most significant of the new amendments dramatically shifts course on the bill's proposed overhaul of the Colorado Oil and Gas Conservation Commission, the state agency that oversees drilling. Under the amended bill, the commission would shrink to five appointed members from its current seven, and the body would be professionalized, meaning seats on the commission would be full-time, salaried positions.

Activists worry that a professionalized COGCC, no longer made up of volunteer members from the public, would be too susceptible to industry influence. There's long been a revolving door between the agency's professional staff and the industry it oversees; its last three executive directors — Matt Lepore, David Neslin and Brian Macke — have all left the agency to accept positions within the industry. Unlike some other states, Colorado doesn't impose any revolving-door restrictions on former agency heads and commissioners, and the amended bill doesn't establish any new ones, though it does bar the appointment of commissioners who have a "conflict of interest with oil and gas development in Colorado."

Since SB 181's introduction last month, the oil and gas industry has strongly opposed a provision allowing the COGCC to put certain permits on hold while the new rules required by the bill are drafted, which supporters say is necessary to ensure that its health and safety impacts are felt immediately. An amendment adopted by the Senate had already attempted to address the industry's concerns, but on March 28 the House further weakened the language; the COGCC now may only "delay a final determination" on certain permits rather than "refuse" them.

"Rule-making will be critical in protecting Coloradoans and making sure 181 fulfills the new mandate of prioritizing health and safety," said Foster. "Colorado Rising will be there to empower communities and fight for  our environment and public health."

Another amendment placed further conditions on the kind of drilling regulations that local governments could enact, limiting rules to those that address "the surface impacts of oil and gas operations in a reasonable manner."

Instead of heading to the governor's desk to be signed into law, SB 181 will now have to return to the Senate, where the Democrats' slim majority means they can only afford to lose a single vote — and some bill supporters fear that amid the GOP's ongoing delay tactics, threats of recall elections and sustained pressure from the oil and gas lobby, its passage isn't a sure thing.

As of last week, the American Petroleum Institute had spent over $667,000 on TV and radio ads opposing the bill, which falsely claim that SB 181 would "shut down energy production in Colorado." The industry has also bankrolled online advertising campaigns through Facebook and other social-media platforms, and conducted an extensive lobbying effort targeting lawmakers at the Capitol.

Four Democrats in the House joined Republicans in voting against the bill's passage on March 29.

"I know it's been a struggle," Becker said prior to the final vote. "But I think these changes are important, necessary and reasonable."