From the Colorado Independent

Millions of dollars from special interests is going to support or fight three policy issues: a battle over how to pay for transportation needs, a makeover in the way the state draws its political boundaries, and a cap on payday loan interest rates.

But far and away the issue pulling in the most money is a ballot measure that would increase nearly fivefold the distance that oil and gas operations can drill from homes and other vulnerable areas like streams: Proposition 112, also known as Initiative 97.

As of Sept. 4, oil and gas companies have kicked in $21 million to an issue committee fighting the initiative so far this year, according to campaign finance reports filed with the Colorado Secretary of State. There are practically no limits on how much money an issue committee can accept or spend. The committee can then use this money to collect signatures, buy media ads and air its views on the TV and radio.

That $21 million is more than twice as much as the other three measures combined have raised. A little more than $9 million has flowed into the issue committees seeking to end partisan gerrymandering, pay for transportation projects and cap payday loan interest rates. And, rounding out the list of high-interest measures on what is going to be a crowded November ballot featuring 13 initiatives, the committees pushing for more K-12 school funding, private property protections and lifting campaign finance limits together netted $742,000 in contributions.

In total, all ballot measure campaigns, including those that failed to make the ballot, have raised $33 million. The majority of that amount, $28 million, has come from businesses and corporations. Individuals have chipped in about $2.7 million.

It’s not unusual for industry to heavily outspend nonprofit organizations or citizen groups, said Robert Duffy, a political scientist at Colorado State University. But, he argued, the practice raises questions about the direct democratic process — a process where voters get to decide key policy questions for themselves.

When one side has vastly more money to spend, “is that really consistent with notions of direct democracy?” Duffy told The Colorado Independent. “Or does that simply give business and wealthy individuals another way to sort of game the system?”

‘Last-ditch effort’

The fight against Proposition 112, previously known as Initiative 97, is being led by an industry-backed campaign with years of experience successfully blocking proposed regulations. And so far, that group, Protecting Colorado’s Environment, Economy, and Energy Independence, also known as Protect Colorado, has outraised its opponents 30 to one.

Protect Colorado raised $21 million as of Sept. 4, while the issue committee backing the proposed setback regulations, Colorado Rising for Health and Safety, also known as Colorado Rising, has raised $698,000 and spent almost all of it, leaving a $10,000 balance on the books. Protect Colorado has spent $12.6 million and has $8.6 million left to spend.

Proposition 112 would require that oil and gas drilling rigs be placed no closer than 2,500 feet from homes and other buildings like schools. The current setback is 500 feet for homes and 1,000 feet from school buildings.

“This is really a last-ditch effort to keep the threat at bay,” Anne Lee Foster, a volunteer with Colorado Rising, told The Colorado Independent.

But the industry has a successful history of defeating new regulations and taxes through the initiative process — and spending much more than its rivals to do so.

In 2008, Coloradans for a Stable Economy, a group backed by the oil and gas industry, spent about $12 million to defeat Initiative 58, which would have eliminated the property tax deduction that oil and gas companies claim on their severance taxes.

In 2014, when Protect Colorado first registered with the state, the group spent nearly $11 million opposing a 1,000-foot setback initiative, known as Initiative 88. Coloradans for Safe and Clean Energy, which backed the setbacks, spent about $2 million. Of this amount, $770,000 came from Congressman Jared Polis. Polis later pulled his support for the initiative after reaching a compromise with Gov. John Hickenlooper, who has mostly supported industry during his two terms in office.

Then, in 2016, there was a 2,500-foot setback initiative known as Initiative 78. Protect Colorado spent nearly $16 million opposing it. The backers, Yes for Health And Safety Over Fracking, spent about $521,000. The setback regulations never even made it on the ballot. All this spending helped make 2016 Colorado’s most expensive fight over ballot initiatives on record. Issue committees spent about $88 million that year.

Opponents say this year’s proposed setback regulations would crush the industry, citing a report by the Colorado Oil and Gas Conservation that found it would prohibit drilling across more than half the state. According to a study by Common Sense Policy Roundtable, a conservative-leaning think tank based in Greenwood Village, by 2030, Proposition 112 would cost $26 billion in state GDP, up to $1.1 billion in tax revenue, and up to 147,800 jobs. The estimates in the report use an economic simulation model by Regional Economic Models Incorporated, or REMI.

On the other side of the issue, supporters say oil and gas drilling near residential areas and schools is a threat to public health and safety. A mother in Erie said a doctor found high levels of volatile organic compounds released from active oil and gas wells, including benzene and ethylbenzene, in her son’s blood (a top public health official later dismissed the findings). Benzene is a known human carcinogen. An explosion from an abandoned natural gas pipeline killed two men in Firestone last April. And since the explosion, there have been more than a dozen reported fires, leaks and explosions, according to the Colorado Oil and Gas Conservation Commission. There are roughly 55,000 active wells in Colorado.

“There are mothers and grandmothers and teachers and nurses and firefighters that are encountering a crisis at their doorstep,” Foster said.

Both candidates for Colorado governor, Democrat Jared Polis and Republican Walker Stapleton, oppose the setback measure. So does Gov. Hickenlooper. The state Democratic Party, however, supports the initiative. The state Republican Party opposes it.

Break down support for the setbacks geographically, and Boulder supporters make up the largest donor group based on location, contributing about $324,000 to increase the setback. Washington, D.C.-based donors come in second. Those supporters gave about $192,000. Top among them was Food & Water Watch, an environmental NGO. The committee raked in more money from individuals than from corporations; of the approximate $700,000 the group raised since the start of the year, more than half came from individuals.

In a news release, Chip Rimer, chairman of Protect Colorado, said, “We are confident that voters see this measure for what it is: an extreme proposal funded by those in Boulder and Washington, D.C., who do not have Coloradans best interests in mind.”

Colorado Rising most of its budget on petition-gathering, which proved to be an arduous task. First, the ballot initiative was challenged in court, but the dismissed in April. Then, Colorado Rising clashed with two of its signature gatherers, one of which the campaign claims was paid by the industry to stop collecting signatures. Meanwhile, signature gatherers faced protests from anti-setback demonstrators urging people not to sign petitions. Demonstrators carried signs that read: “This Petitioner Wants To Ban Fracking In Colorado. So does Vladimir Putin,” and “Save CO Jobs.”

As for Protect Colorado, most of its money came from Texas energy companies, many of which have offices in Colorado. Only one donation, in 2017, came from an individual and that was for $25. Top donors to this group include Anadarko, of Woodlands, Texas, which donated $5.8 million, Noble Energy Inc., of Houston, Texas, which donated $4.5 million, PDC Energy, of Denver, which donated $3.4 million, and Extraction Oil and Gas, of Denver, which donated $2.2 million.

Protect Colorado isn’t just spending that money to fight Proposition 112. It’s also pushing Amendment 74, previously known as Initiative 108, which would amend the state constitution to require property owners to be compensated for any loss in property value caused by government regulations. In other words, should the value of a property owner’s mineral rights be curtailed because of a setback law, that owner could be compensated. Protect Colorado spent over $4 million collecting signatures for Amendment 74. The next largest expense was on pro-industry television ads.

Protect Colorado’s website states Amendment 74 is a way to safeguard “private property from government confiscation.” The issue committee publicly supporting the measure, Committee for Colorado’s Shared Heritage, has raised only $33,800, of that $10,000 came from the Colorado Farm Bureau. There is also a $23,800 in-kind contribution from Pac/West, a communications firm with ties to Protect Colorado.

Environmental advocacy groups worry Amendment 74 would allow oil and gas companies and property owners with mineral rights to sue local governments for environmental regulations.

“This measure goes too far, and the list of unpredictable consequences is long,” said Jessica Goad, the deputy director for Conservation Colorado, in a news release.

Conservation Colorado, an environmental advocacy group, donated more than $2,000 to the issue committee called Save Our Neighborhoods, which is opposing the ballot initiative. In all, groups opposing the initiative have raised about $20,000. The top donor was Recht Kornfeld PC, a legal firm from Denver.

Goad added that oil and gas companies could force local governments to let them drill near hospitals and nursing homes and that noise restrictions, minimum wage laws, and safety codes would be challenged in courts.

“We can’t let property owners sue our governments over any regulation they disagree with.”

Read about transportation, payday loans and education funding ballot initiatives here.


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