Colorado Supreme Court justices Wednesday plunged into oral arguments as Front Range cities push to limit oil and gas development near people — a step toward resolving a long-running tussle over local versus state power to regulate industry.
The question is how far cities, towns and counties can go to shield residents under current law, which establishes an overriding Colorado interest in production of oil and gas.
Fort Collins voters in 2013 passed a five-year moratorium on fracking inside city boundaries, defying Gov. John Hickenlooper and state authorities, who contend locals lack the power to regulate oil and gas.
Longmont leaders in 2012 imposed rules for oil and gas activity. Colorado’s attorney general at the time, John Suthers, sued the city. Longmont voters responded by banning fracking.
The Colorado Oil and Gas Association and state have been fighting the ban and moratorium. COGA and state attorneys argue both are illegal because case law and regulations give only the state the right to regulate fracking.
Lower courts in Boulder and Larimer counties overturned the ban and moratorium. Longmont and Fort Collins pushed their cases to the Colorado Court of Appeals, asking to have the ban and moratorium restored. In August, the appeals court asked the high court to rule.
Justices peppered attorneys on both sides with questions Wednesday. And whether their ruling is narrow or broad — there’s no deadline for delivery of that written decision — attorneys anticipated greater legal clarity on a vexing issue spurred by the domestic drilling boom.
“We’re not saying local governments don’t have some authority to regulate land use impacts of oil and gas activity,” COGA attorney Mark Mathews said after making arguments. “They do have some authority. But they cannot ban what state law expressly authorizes.”
Fort Collins attorney Barbara Green pressed the case that the city’s moratorium on fracking — short for the hydraulic fracturing method of injecting chemicals, sand and water at high pressure to coax oil and gas out of shale — doesn’t “materially impede” industry in the city.
“There’s nothing in the act that says you have to be able to frack anywhere as fast as you can,” Green said after court was adjourned.
Longmont attorneys argued companies produced oil and gas for more than 100 years in Colorado without fracking and that, therefore, banning fracking doesn’t prevent production. They pointed to alternative methods companies use to produce oil and gas without fracking in New York under a statewide ban.
State lawmakers have granted the Colorado Oil and Gas Conservation Commission, not cities or counties, authority over industry operations. They’ve tasked COGCC with ensuring orderly development.
Facing questions from justices, Mathews challenged use of a legal test that a ban must “materially impede” industry operations to be illegal. Mathews also argued Fort Collins’ moratorium amounts to a ban, though with a time limit.
“The use of hydraulic fracturing is pervasive,” Mathews said, calling the separation of fracking from production in general meaningless.
Assistant attorney general Jake Matter, representing the COGCC, emphasized “the state has a significant interest in oil and gas production,” citing the 1992 Voss case, where the high court ruled Colorado’s interest in oil and gas development was sufficient to override a ban in Greeley.
“These bans negate the commission’s authority to regulate the chemical shooting and treatment of wells,” Matter said.
The justices noted changes in law and industry technology since that case. They asked whether Colorado’s interest is “sufficiently dominating” and what test they should use to decide.
Matter conceded the Voss decision didn’t totally pre-empt what locals can do without impeding state interests.
There are more than 51,000 active oil and gas wells in Colorado.
About 100 activists opposed to fracking in cities gathered at the courthouse. City and industry officials packed the room.
“Hydraulic fracturing is a heavy industrial process that poses serious risks to children and public health. Cities and towns have a right to protect people when companies want to do that,” Earthjustice attorney Mike Freeman said.
COGA president Dan Haley issued a prepared statement saying members “are confident that the Supreme Court will agree that the ban implemented in Longmont and the Fort Collins moratorium are illegal and pre-empted by current law. We are confident that the Supreme Court will provide further clarity regarding the primacy of the state in oil and gas regulation.”
Bruce Finley: 303-954-1700, bfinley@denverpost.com or @finleybruce
