Just before he signed Senate Bill 181, Democrats’ sweeping package of oil and gas reforms, into law at the State Capitol on Tuesday, April 16, Governor Jared Polis told a roomful of reporters and activists that he hoped a contentious chapter in Colorado political history was being brought to a close.
“Today, with the signing of this bill, it is our hope that the oil and gas wars that have enveloped our state are over,” Polis said.
That’s wishful thinking, to say the least, but it’s certainly true that the signing ceremony was an event years in the making. After more than a decade of frustration, pressure from environmental and community activists has finally forced a reckoning — a law that even its sponsors admit is an imperfect solution to the conflict between fast-growing suburbs north of Denver and the heavy-industrial fracking projects that Colorado’s oil and gas boom has brought to their doorsteps.
Few Colorado politicians have been as wrapped up in the issue as Polis, who famously bankrolled a pair of anti-fracking ballot initiatives in 2014 before agreeing to withdraw them under pressure from then-Governor John Hickenlooper and other top Democrats. In doing so, he managed to earn the distrust of both the industry and the fracktivists, and set both sides on the high-stakes collision course that has roiled state politics ever since.
Now, as Polis’s administration begins the long process of fully implementing the new law, the 2014 ballot fight will fade into history as an interesting counterfactual: What if Polis and his activist allies had gotten their way five years ago? What if Tuesday’s reckoning had come a lot earlier for the tens of thousands of Front Range residents who have been impacted by fracking?
Polis, then still a humble multimillionaire U.S. Congressman from Boulder, became one of those impacted residents in 2013, when Denver-based Sundance Energy began drilling near his “weekend home” in southern Weld County.
“This can happen to anybody,” he told the Boulder Daily Camera at the time. “It can happen to you. It can happen to your neighbor. It can happen to your congressman. The laws in Colorado are outrageously out of touch in terms of protecting property.”
After initially suing to block the project, Polis dropped his lawsuit and turned to the ballot box. With over $2 million worth of his help, environmental groups gathered enough signatures to place two initiatives on the 2014 ballot — and the oil and gas industry, along with its many allies in state government, panicked.
Both initiatives were proposed constitutional amendments, meaning that the legislature would not have been able to overturn them. The first would have created a mandatory 2,000-foot setback between new oil and gas wells and occupied structures unless a landowner waived the requirement.
The industry can be glad, at least, that this measure never became law. It bears a close resemblance to Proposition 112, the 2018 ballot measure that would have imposed a 2,500-foot setback — a measure that Polis opposed. SB 181 contains no new statewide setback provisions, though it does allow local governments to impose “reasonable” setbacks of their own.
While the exact impact of surface setbacks is a matter of some debate, given the widespread application of modern horizontal drilling techniques that allow operators to drill for miles in any direction underground, they’re a regulatory tool the industry has fought bitterly to oppose. When it comes to setbacks, the industry would surely prefer SB 181 to the 2014 ballot measures.
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The other ballot measure Polis sponsored in 2014, dubbed the Environmental Rights Amendment, would have enshrined a “public right to Colorado’s environment” into the state constitution and empowered local governments to enact strict regulations to safeguard that right.
In some ways, SB 181 goes further than either of the Polis-backed 2014 proposals. It gives local governments broad land-use authority to minimize the impacts of oil and gas development, from health and environmental risks to noise, odor, traffic and other disruptions caused by drilling. It removes a clause in state law that directed regulators to "foster" development, places a greater emphasis on health and safety considerations, and instructs state agencies to develop an extensive set of new rules aimed at disclosing flowline locations, managing abandoned wells, protecting air and water quality and more. While it's impossible to know exactly what impact the Environmental Rights Amendment might have had, SB 181 represents a far more comprehensive overhaul of state oil and gas law than the 2014 measure was likely to have accomplished on its own.
But the new law also contains what some activists are worried are significant loopholes, added late in the legislative process as industry-requested amendments. For example, it requires state and local regulations to be “necessary and reasonable” for protecting public health and the environment, a standard with no clear definition that could be subject to a wide range of interpretations by rule-making agencies and, eventually, the courts.
That means the full impact of Colorado's new oil and gas laws won't be known for months, or maybe even years. Whatever regulators and the courts decide, it's unlikely to satisfy both industry groups and environmental activists — which is why, contrary to Polis’s hopeful declaration on April 16, the fight isn’t nearly over yet.