DALLAS - Colorado Gov. John Hickenlooper has brokered a deal to bypass statewide ballot initiatives regulating oil and gas drilling in the state.
The agreement is designed to keep the contentious issue of hydraulic fracturing and disposal of toxic wastes out of this year's election politics. Hickenlooper is facing a tough battle for re-election in November against Republican Bob Beauprez.
The issue pitted Colorado's well organized environmentalists against the state's well-funded oil and gas producers backed by other business interests.
To resolve issues involving the use of hydraulic fracturing, or "fracking," of gas and oil shale in populated areas, Hickenlooper announced creation of a task force to propose rules to reduce land use conflicts near homes, schools, businesses and recreational areas.
"The work of this task force will provide an alternative to ballot initiatives that, if successful, would have regulated the oil and gas industry through the rigidity of Constitutional amendments and posed a significant threat to Colorado's economy," Hickenlooper said. "This approach will put the matter in the hands of a balanced group of thoughtful community leaders, business representatives and citizens who can advise the legislature and the executive branch on the best path forward."
The 18-member task force will be chaired by La Plata County Commissioner Gwen Lachelt and Randy Cleveland, president of XTO Energy, Inc. The group will have the power to make recommendations to the legislature with a two-thirds majority, or issue majority and minority opinions.
U.S. Rep. Jared Polis, D-Boulder, agreed to back off his push for ballot initiatives requiring setbacks of 2,000 feet from "occupied structures" by oil and gas producers. The current setback requirement is 500 feet. Oil and gas producers claimed the new rules would essentially eliminate fracking in the state. Colorado's economy is booming in large part because of expanded oil and gas production.
"Today's announcement is a victory for the people of Colorado and the movement to enact sensible fracking regulations," Polis said in a prepared statement announcing the deal. "For the first time, citizens will be on equal footing to the oil and gas industry, and able to negotiate directly for regulations that protect property rights, homes values, clean water, and air quality."
As part of the deal, the Colorado Oil and Gas Conservation Commission agreed to dismiss its lawsuit against the city of Longmont challenging a local ordinance restricting fracking and called upon all parties to pull down ballot initiatives on this topic.
As environmentalists circulated petitions to restrict fracking, the industry petitioned to withhold tax revenues from cities that banned the practice.
The Colorado Oil and Gas Conservation Commission that regulates oil and gas production in the state and the Colorado Department of Public Health and Environment have developed several rules on drilling and extraction since 2011. That included a year-long public process to develop the new 500-foot setback standard, which took effect last year.
The ballot initiatives campaign promised to be the most expensive in the state's history, with more than $10 million already raised. The oil and gas industry had vowed to spend up to $50 million to defeat the new regulations.
To head off the campaigns, Hickenlooper had sought a formula that could be approved in special session of the Colorado legislature. But after negotiating with parties involved in the dispute, he called off plans for the session on July 18 and announced his opposition to the proposed constitutional amendments limiting fracking.