Colorado Amendment Would Give Fossil Fuel Industry Unprecedented Power

If it passes next week as recent polls say it will, Colorado Amendment 74 would give the oil industry – and more -- the power to block state and local regulations on emissions, health and safety issues.

The text of Colorado Amendment 74, as shown on a sample ballot. Photo: Trillions

An amendment coming before the voters on November 6 could rip away any power Colorado’s citizens have to protect themselves against environmental harm from business of any kind. It would also create a nearly impossible situation to regulate businesses of almost any kind.

The reason the proposed new Amendment even exists is because of Proposition 112. That was created to require that any new oil and gas development projects had to be at least 2,500 feet – just under half a mile – from all “occupied buildings and other areas designated as vulnerable”.

The target in the case of Proposition 112 was fracking, which as it has expanded has found its way into areas dangerously close to public areas. As Trillions has noted in other articles such as “Fracking is Making People Sicker Than Anyone Expected” and “Fracking Chemicals A Serious Hazard for Children”, the dangers of having fracking operations anywhere near where people live, go to school, or work are well-researched and documented.

As reported in the March 2018 report, “Compendium of Scientific, Medical and Media Findings Demonstrating Harms of Fracking (Unconventional Gas and Oil Extraction”, the damage from fracking chemicals spilling out over land and into public drinking water supplies and into the air is dangerous and toxic. As the report notes, “as the number of gas wells increase in a community, so do rates of hospitalization, and community members experience sleep disturbance, headache, throat irritation, stress/anxiety, cough, shortness of breath, sinus, fatigue, wheezing and nausea.” The reports calls out high levels of benzene, a carcinogen, present in ambient air where drilling and fracking take place.  It says those levels ““are sufficient to elevate risks for future cancers in both workers and nearby residents” and that “animal studies show numerous threats to fertility and reproductive success from exposure to various concentrations of oil and gas chemicals, including at levels representative of those found in drinking water.”

Having 2500 feet between people live and a site where such chemicals are used and this kind of harm could happen seems more than reasonable. That plus a heavy grassroots campaign has given it an estimated 52% support, according to a Denver Post poll taken between October 12 and 17. The reason it is not any higher is blamed on heavy advertising from fracking companies to combat its passage.

Unfortunately for the gas industry, if Proposition 112 passes, it is estimated that 85% of the private and state-owned Colorado surface land would no longer be available for the oil and gas industry. That could create billions of dollars of lost virtual drilling rights on state- and privately-owned surface land in Colorado. That was too much for the industry to leave up to just a simple Proposition 112 battle.

Instead, they also came up with Amendment 74, a proposed amendment to the State Constitution.

What this amendment says is diabolically simple. It would amend the Colorado Constitution to include the following:

“Private property shall not be taken or damaged, or reduced in fair market value by government regulation for public or private use, without just compensation.”

The government is already prohibited from just seizing private property without due process and appropriate compensation. That’s both because of the U.S. Constitution as well as State regulations.. Even Rebecca Love Kourtis, a former Colorado Supreme Court Justice, said about this part of the proposed amendment that Colorado’s constitution already protects the rights of private property owners. So that makes the first part of the amendment mostly redundant with existing law.

What is far more important is that next clause about the potential to have private property “reduced in fair market value by government regulation for public or private use”. That sounds innocuous enough until one digs into the legal implications. What it actually does is give private property holders the right to sue local, county, and state governments for economic damages to their property – which includes companies – if a newly passed law or regulation would hurt them in any way that affects their “fair market value”.

So, if a new law were to be passed for something as simple as that a company might have to spend additional money to monitor emissions leakage on their premises – a fairly simple thing – this Amendment would give them the right to ask for compensation for that. If waste products from fracking liquids had to be gathered more effectively, or waste methane capped more effectively in a natural gas field, companies could sue for the additional costs to them.

Amendment 74 would of course not affect just the oil industry. If you happen to own a small business and the city government passes a zoning change which allows a direct competitor to move in close to you, the Amendment would allow you to sue for the impact to your business. If you have a house with a beautiful view of trees on an undeveloped land space owned by the county, and the county then rezones the area to allow the land to be used for a new housing development, you could sue for the loss of your view and your home’s lower property value.

If these arguments seem overly broad and ridiculous, there is a lesson to listen to in what happened in the State of Oregon over a decade ago. In 2004, that state passed a law very similar to the one in Colorado. As land use laws were passed afterward which caused both large and small restrictions on local businesses and property owners, in just a couple of years those affected filed $19.8 billion in lawsuits and other claims with the state. Local governments could not afford the fights, so they ended up halting enforcement of land use restrictions. That made things even worse, as many reasonable regulations were ignored, and important new ones were not even passed.

Fortunately for Oregon, it realized the mistake in passing the 2004 law and eventually repealed it only three years later.

The promotional campaign for Colorado Amendment 74 is unfortunately working. With an estimated 99.7% of the money backing the amendment coming from an oil and gas group and not that much money coming to contest it, the innocent-sounding Amendment 74 is winning voters’ minds. A poll conducted at the same time as the Proposition 112 poll showed 63% of voters supporting the amendment. Under the State Constitution, only 55% of voters have to say yes for an amendment to pass.

If the amendment passes as right now it appears it will, it would first of all render Proposition 112 powerless even if that too were also to pass.

Many also fear that if the proposed amendment does get ratified, it could become the new template for other locations around the country. As David Sirota, a journalist for Capital & Main, wrote on October 30, “[The amendment] is a model that could block all future state efforts to reduce fossil fuel extraction, carbon pollution, vehicle emissions, and climate change.” Sirota goes on to say that the amendment is “the most dangerous state constitutional amendment in American history”.