Colorado Supreme Court On ‘Martinez Case’, Reverses Appellate Court Decision

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Martinez Case
Colorado Supreme Court.

Western Wire will update this blog throughout the day as reactions pour in from across the state.

From the Colorado Supreme Court this morning:

The supreme court now reverses the division’s judgment and concludes that the Commission properly declined to engage in rulemaking to consider Respondents’ proposed rule. The court reaches this conclusion for three primary reasons.

First, a court’s review of an administrative agency’s decision as to whether to engage in rulemaking is limited and highly deferential. Second, the Commission correctly determined that, under the applicable language of the Act, it could not properly adopt the rule proposed by Respondents.

Specifically, as the Commission recognized, the pertinent provisions do not allow it to condition all new oil and gas development on a finding of no cumulative adverse impacts to public health and the environment. Rather, the provisions make clear that the Commission is required (1) to foster the development of oil and gas resources, protecting and enforcing the rights of owners and producers, and (2) in doing so, to prevent and mitigate significant adverse environmental impacts to the extent necessary to protect public health, safety, and welfare, but only after taking into consideration cost-effectiveness and technical feasibility.

Finally, in declining to engage in rulemaking, the Commission reasonably relied on the facts that it was already working with the CDPHE to address the concerns underlying Respondents’ propose rule and that other Commission priorities took precedence at this time.
Praising the decision:

Colorado Petroleum Council Executive Director Tracee Bentley:

“Today’s outcome is positive for all Coloradans. The court was right to deny a single out-of-state interest group – one that advocates for ending all energy development across the country – the ability to rewrite our state’s laws. This attempt to advance their extreme agenda into other states and against other industries would have put hundreds of thousands out of work and drain state and local coffers for education and other basic services.

“This case has dragged on for over five years and it’s time to focus on uniting to encourage energy development in the United States, and, specifically, in Colorado. We are confident in Colorado’s energy future and the ability of the Colorado natural gas and oil industry’s ability to continue to reshape the global energy balance, fueling an American manufacturing revival and leading the world in environmental progress.”

Dan Haley, President & CEO of the Colorado Oil & Gas Association:

“The Colorado Supreme Court, in a unanimous decision, reaffirmed the Colorado Oil and Gas Conservation Commission’s (COGCC) long-held practice of acknowledging multiple policy goals in deciding whether to accept or deny a petition for rulemaking. The Supreme Court upheld the Colorado way of doing business, which is to consider several different interests, including fostering the development of oil and natural gas while also protecting our health and safety.

“The plaintiffs in the Martinez v. COGCC case ignored, and attempted to disrupt, decades of regulatory precedent and legal oversight. The Colorado Oil and Gas Conservation Act (Act) directs the COGCC to consider multiple factors in making its decisions, including environmental priorities. Following the Act, which is existing Colorado law, the COGCC has enacted the most extensive and stringent regulations for the oil and natural gas industry in the country.

Colorado was one of the first states to require that operators disclose the chemicals in hydraulic fracturing, conduct pre- and post-drilling groundwater monitoring, and undertake comprehensive inspection and repair requirements to safeguard our workforce and our communities.

“The Supreme Court’s interpretation of the Act will continue to allow for development, while also protecting our environment. As Coloradans, we value the environment and our member companies are committed to health and safety.

Those who filed this lawsuit have said they want to ban oil and natural gas development in Colorado, so we’re happy to see the Supreme Court strike down this extreme effort and shortsighted agenda.

“While the current regulatory structure can be an arduous process for our companies, Colorado serves as a national model for oil and natural gas regulatory oversight.”

Vital for Colorado Chairman and CEO Peter Moore:

“This lawsuit was intended to effectively ban oil and natural gas development in Colorado by imposing a moratorium on permits that anti-oil and gas groups never would have allowed to be lifted,” Vital for Colorado Chairman and CEO Peter Moore said. “The lead plaintiff in the case admitted this was the goal in 2013 when the petition first was filed with the COGCC: “I think our chances are really good of getting a statewide moratorium, I mean a statewide ban, on fracking.”

“The state business community is grateful that the Colorado Supreme Court rejected this de facto ban, which would have caused tremendous damage across every sector of our economy and threatened many thousands of jobs. We welcome constructive dialogue about how best to build upon Colorado’s regulations, which are already recognized as the toughest in the nation. A good example of constructive dialogue is the oil and gas industry working with a broad coalition of stakeholders to effectively increase setback distances from schools. A business-like approach may not be possible because the national anti-oil and gas groups have proven time and again they are only interested in wrecking one of Colorado’s most important engines of job creation, economic growth, and tax revenue for public education and other basic services.”

State Sen. Jerry Sonnenberg:

“Today, Colorado has greatly benefited from the Supreme Court’s decision by reaffirming that the specific requirements and duties carried out by COGCC are consistent with the intent of current law. The oil and gas industry has done an excellent job of providing the people of Colorado energy while protecting our environment, and the safeguards put in place by the COGCC enable this state to continue to be one of the top places to live and raise a family.”

Mountains States Legal Foundation Executive Vice President Cristen Wohlgemuth:

“Today’s Supreme Court ruling restores common sense to energy exploration in Colorado, and upholds the economic rights and property rights of existing oil and gas property owners. Furthermore, this ruling protects Colorado taxpayers, potentially, from billions of dollars in liability for the government’s seizure of their property rights.”

Criticizing the decision:

Gov. Jared Polis:

“While I’m disappointed by today’s ruling, it only highlights the need to work with the Legislature and the Colorado Oil & Gas Conservation Commission to more safely develop our state’s natural resources and protect our citizens from harm. I’ve made transitioning to renewable energy a top priority because it is the best way to protect Coloradans’ health and safety, reverse the harmful effects of climate change that threaten our economy and our way of life, and boost our state’s economy by creating green jobs that can never be outsourced.”

Anne Lee Foster, Colorado Rising (Colorado Sun):

“The Supreme Court’s job is to decide what the law says, not if it is correct or moral,” Anne Lee Foster of the group Colorado Rising, which last fall backed a campaign to increase setback requirements for oil and gas activity, said in a statement. “This decision validates all of our concerns that the State is not adequately protecting public health and the regulations are insufficient.”

House Speaker KC Becker (Colorado Sun):

“Communities all up and down the Front Range and on the Western Slope, they want to know that health and safety is getting a serious look,” said House Speaker KC Becker, a Boulder Democrat. “That goes for air quality, water quality, citing, smells, odors, and you know, explosions.”

“I don’t think the existing law right now — the way COGCC is implementing it — gives a strong enough consideration to those things,” Becker added.

State Rep. Dominique Jackson:

“I am frustrated with this ruling, and I share the concerns of my constituents who are worried about protecting our air and water. At the legislature, we will continue working together to protect the health and safety of all Coloradans when it comes to oil and gas operations,” said Rep. Dominique Jackson.

State Sen. Mike Foote:

“While the just-announced Martinez decision is disappointing, it provides us at the #coleg an opportunity to finally put health and safety first with oil and gas. I am working on a bill to do exactly that.”

State Sen. Steve Fenberg:

“Yet another reason why legislative action to protect the health and safety of all Coloradans is imperative this session. #coleg #copolitics”

Colorado Attorney General Phil Weiser:

“The Colorado Supreme Court properly ruled today that the Colorado Oil and Gas Conservation Commission has the statutory authority and obligation to regulate oil and gas development as necessary to protect the public health, safety, and environment. In so doing, it also characterized the Commission’s action as a decision on the merits of the proposed rule and emphasized the discretion of the Commission on how it can choose to address this issue.

“Before I took office, the Attorney General’s office, representing the Commission, pursued an appeal in this case and argued for a more limited vision of its authority than the law provides. In this case, the Supreme Court appropriately recognized that the Commission has broad authority to regulate oil and gas development to protect the public health, safety, and environment.

“Moving forward, I will work with the Commission and other state agencies to ensure that oil and gas development in Colorado is consistent with the public health, safety, and environment. To do so, the Attorney General’s office will provide sound legal advice as the Commission develops appropriate protections and evaluates particular applications. Furthermore, I am committed to working with local communities—as they enter into surface use agreements and memoranda of understanding, for example—to provide technical assistance as they seek to protect the public health, the safety of their residents, and their local environment. Finally, should the legislature seek to clarify the mandate of the Commission, I look forward to working with it.”

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