Fracking decision pro: Justices make it clear state law trumps local law
Earlier this month, the Colorado Supreme Court made two landmark rulings that effectively ended the local “ban fracking” movement, declaring that bans or moratoriums on hydraulic fracturing by local governments are illegal.
The ruling seemed fairly simple and straightforward. Activists, perhaps because they had their talking points and press releases crafted before actually reading the unanimous decisions, quickly began claiming that the justices had issued a narrow ruling. In reality, it was just the opposite.
The rulings are quite broad and draw a bright line: Local jurisdictions cannot pass any regulations that conflict with state law.
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Local governments do have some say in the land-use process with regard to oil and gas wells, and that level of control has not changed. Local governments cannot, however, ban or impose a long-term moratorium on fracking or pass any rules that contradict or conflict with state law or regulations. That is a big deal and a huge blow to the anti-fracking movement, which has attempted to drive oil and gas out of Colorado by banning production at the county and municipal level.
It’s important to note, however, that there is a role for both state and local governments in oil and gas development, but both entities need to respect each other’s authority. In these rulings, the court articulated three legal principles that will directly impact the extent of oil and gas activity that local governments can regulate, as well as the method by which government regulations can be challenged.
First, the opinions made it clear that local governments may not enact land-use regulations that conflict with state law. Justice Richard Gabriel, writing for a unanimous court, states, “(I)n matters of statewide or mixed concern … state laws supersede any conflicting local regulations.” Gabriel also clarifies 50 years of somewhat ambiguous rulings by Colorado courts as to the precise formula for the operational conflict test, giving clear supremacy to the state’s interest whenever a conflict with a local government arises. We now know that any local government law that conflicts with state law by authorizing what state law forbids, or by forbidding what state law authorizes, is illegal.
Second, the Colorado Supreme Court made clear in its decisions that courts must employ the operational conflict test by simply comparing the language of the state law and local government law in question to see if there is any conflict. In making this analysis, there is no need for courts to require a trial or an evidentiary hearing — or even a deposition or other forms of discovery. As a practical matter, this means that operational conflict cases in the oil and gas context should be resolved on summary judgment within a few months of the filing of a complaint, rather than after years of discovery and hearings.
The factual issues raised by Longmont and Fort Collins, in an effort to show that their bans did not materially impede state law — the lack of interest in drilling in their jurisdictions, supposed alternatives to hydraulic fracturing, the parade of environmental horribles supposedly caused by fracking — are now plainly irrelevant to the operational conflict inquiry as a result of these rulings.
Finally, there has always been uncertainty in Colorado as to whether the same operational conflict standard applied to statutory counties and home-rule cities. These opinions put this issue to rest. As the court said in the Longmont decision, “(A) home-rule city is similar to a statutory county or town because in both cases, the validity of the local enactment turns on whether it conflicts with or is pre-empted by state law.” It’s now clear that the operational conflict test articulated in these decisions applies to all local governments within Colorado.
The importance of these decisions cannot be overstated. They are the final word on this matter, and these decisions cannot be appealed to a higher court. This was a question of state law, not federal law.
Having said all that, while this decision clarifies the legal ground, this does not change COGA’s or the industry’s desire to work with local communities to find workable solutions that follow the rule of law. When all parties want to find real solutions rather than just enacting bans, this process of local engagement can and will continue to be successful.
Dan Haley is president and chief executive of the Colorado Oil and Gas Association.
