Oil and gas fines bill dies over mandatory minimums impasse

Posted on: 8:04 am, May 8, 2013, by , updated on: 10:23pm, May 8, 2013

DENVER — Lawmakers met early Wednesday morning, the final day of the legislative session, to try one last time to save a bill that would increase fines on oil and gas companies that cause toxic spills or other environmental mishaps.

But they failed to resolve an impasse between the bill’s Democratic sponsors and the governor’s office and the industry over the inclusion of a mandatory minimum fine.

House Bill 1267 passed the House with higher mandatory minimum fines and a much higher maximum daily fine; but the Senate amended the bill, removing the mandatory minimum fine.

On Tuesday, the House sponsors opted not to concur with the Senate changes and instead form a conference committee to attempt to resolve the impasse.

When the conference committee got underway Wednesday morning, the four Democratic lawmakers on the six-member panel pushed through an amendment to set a mandatory minimum fine at $2,500 a day — a compromise, they argued, between no minimum fine and the $5,000 minimum proposed under the original House version of the bill.

“The attempt is to hold the worst offenders accountable,” said Rep. Mike Foote, D-Lafayette, the bill’s sponsor and a former prosecutor. “As someone who’s job has been to impose punishment for the last 10 years, I know that the threat of a maximum fine is meaningless unless the agency has a true intention to impose.”

Foote also argued that the minimum fines would only apply to serious mishaps.

“We’re only talking about the most serious of cases, the most serious adverse environmental impacts,” he said. “Those that involve the contamination of an aquifer, the contamination of groundwater or the evacuation of nearby homes due to a threat of explosion.”

But that amendment didn’t do much to resolve the impasse.

Later Wednesday morning, the Senate voted 19-16 to reject the conference committee’s changes, leaving the House an ultimatum: send the Senate’s version of the bill without any mandatory fines to the governor or let the bill die.

The House opted not to take any further action Wednesday; thus, the legislation is officially dead.

“If they’d bring it up for a vote, you’d see the same kind of bipartisan vote that we saw in the Senate,” said Sen. Greg Brophy, R-Wray. “But they know that. They don’t want to compromise. It’s ‘my way or the highway’ with them.”

All day Tuesday, representatives from Gov. John Hickenlooper’s office tried to reach a deal with the bill’s House sponsor, Foote and House Majority Leader Dickey Lee Hullinghorst, D-Boulder.

Hickenlooper, whose administration has resisted some key pieces of the Democratic package of bills aimed at tightening oversight on the oil and gas industry, wanted to be able to sign this bill into law, to have at least one win with environmental groups after siding mostly with the industry.

But the Democratic sponsors didn’t want to let that happen.

“The last thing I want to do is pass a law that looks like it’s doing something but really isn’t,” said Sen. Matt Jones, D-Lafayette, the bill’s Senate sponsor. “When I hear people say they’re going to get tougher fines, I don’t see it going that way.”

Throughout the day, the governor’s senior lobbyists appealed ot Foote, Hullinghorst and to House Speaker Mark Ferrandino, who Hickenlooper personally asked to help bring the bill to a vote.

“It’s pretty tough to bring a vote on the bill when the sponsor doesn’t want to have a vote,” Ferrandino said.

Minutes after the session adjourned sine die Wednesday afternoon, Hickenlooper issued an executive order to encourage the COGCC to reassess its application of oil and gas fines; but the current scale, allowing for fines between zero and $1,000 a day, will stay in place.

Around the same time, the Colorado Oil and Gas Association and Conservation Colorado both released statements — blasting each other over the death of H.B. 1267.

“COGA was supportive of the increase and thought this was an obvious area for collaboration and compromise,” said COGA’s Doug Flanders. “Despite multiple offers to find common ground, all were rejected.  There seemed to be more interest in a punitive message than a good bill.

“We are dumbfounded that the proponents of the bill would rather see no increase in oil and gas fines than to lose their minimum fine — which not one state agency in Colorado has, nor even the U.S. EPA. Instead of agreeing to a 1,500 percent increase in fining authority, we now have nothing.”

In it’s own press release, Conservation Colorado called Foote’s choice to kill the bill in the House “the right move” and blasted not just the industry but Hickenlooper as well.

“At times working in concert with the Hickenlooper Administration, the industry was able to defeat, or significantly weaken, measures that would have brought greater transparency and accountability to their operations and given equal weight to protection of environment, public health, and communities,” said Pete Maysmith, Executive Director, Conservation Colorado.