Early this year, the Colorado Supreme Court ruled in favor of the oil and gas industry in Colorado. It reversed a decision by the Court of Appeals where the Colorado Oil and Gas Conservation Commission (COGCC) declined to consider a rule proposed by a group of environmental activists. The Supreme Court of Colorado held that regulators are not required to consider the impact of oil and gas development on public health and environment when deciding whether to approve drilling permits.
Public Trust Doctrine
A group of youth environmental activists that included Xiuhtezcatl Martinez of Colorado proposed a rule that would prevent the COGCC from issuing permits for drilling oil and gas unless it were proven that drilling could occur in a way that does not “impair Colorado’s atmosphere, water, wildlife, and land resources, does not adversely impact human health, and does not contribute to climate change.” The group argued the Public Trust Doctrine requires that Colorado act to preserve the atmosphere and provide a livable future for Colorado residents. The Commission however declined to engage in rulemaking to consider the activists’ proposed rule. It argued (1) the rule would have required the Commission to readjust the balance created by the General Assembly on no cumulative adverse effects, which it regarded as beyond its authority, and (2) the Commission was addressing these concerns with the Colorado Department of Public Health and Environment (CDPHE).
Colorado Court of Appeals’ Findings
The group of young activists unsuccessfully challenged the Commission’s ruling in Denver District Court. The Colorado Court of Appeals ruled in favor of the environmental group however. It found that language in the directive purpose of the COGCC was intended that development “be regulated subject to the protection of public health, safety, and welfare, including protection of the environment and wildlife resources.” The statutory language on the responsibilities that the Commission must balance comes into question. Among the arguments presented by the COGCC, is that the Act aims to foster oil and gas development in Colorado while preventing and mitigating adverse environmental impacts while taking into consideration cost-effectiveness and technical feasibility. The young activists led by Martinez argued the Court of Appeals correctly concluded the COGCC establishes the conditions public health, safety, and welfare rather than balancing test.
Supreme Court of Colorado’s Ruling
The Supreme Court of Colorado found that the Act’s statutory language is susceptible to interpretations by both the COGCC and the activists. Because the court found the language ambiguous, it sought out the Act’s statutory and legislative history for clarification. The Act was first passed in 1951 to for the protection of oil and gas in Colorado. Language was added in 1985, 1994, and 2007 to stress concerns for public health, safety, welfare, and the protection of the environment and wildlife resources. The Court stated it found legislative intent to promote multiple policy objectives “without conditioning one policy objective on the satisfaction of any other.” The Court found the Commission is required (1) to promote the development of oil and gas resources, and (2) to prevent and mitigate significant adverse environmental impacts to protect public health, safety, and welfare, but only after taking into consideration cost-effectiveness and technical feasibility.
The Supreme Court of Colorado held that the Commission’s decision to decline to consider the youth activists’ proposed rule was consistent with the Act, and the Commission had the authority to decide how best to carry out its duties. It ruled that the Colorado Oil and Gas Conservation Commission “was required to foster the development of oil and gas resources, protecting and enforcing the rights of owners and producers, and the Commission did not abuse its discretion in declining to engage in rulemaking” to consider the impact on the environment. It found no abuse of discretion in the Commission’s decision and reversed the previous judgment.
The Supreme Court of Colorado’s decision comes shortly after the election of Governor Jared Polis. Governor Polis’ campaign promised to invest more in energy and protect the environment and is pursuing the goal of the state reaching 100 percent renewable energy by 2040. Governor Polis stated he was disappointed with the Supreme Court of Colorado’s decision, and stressed the need to work with COGCC to develop the state’s natural resources and protect its citizens. This decision is a win for the oil and gas industry in Colorado but should also be taken in hindsight with the current political spectrum in Colorado.
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