Legislators kill bill to increase fines for spills

DENVER — Though most of the controversial measures had already gone through the Colorado Legislature, lawmakers saved one for last on the final day of the 2013 session on Wednesday.

That happened when the Senate narrowly rejected changes to a bill to increase fines for oil and gas companies that spill fluids, despite a compromise worked out with Gov. John Hickenlooper’s office.

When HB1267 was approved in the House last month, it would have raised the maximum daily fine from $1,000 a day to $15,000, with a minimum set at $5,000 a day.

When the bill left the Senate earlier this month, it raised the maximum fine to $15,000 a day but imposed no minimum fine.

A conference committee of House and Senate members met early Wednesday to iron out the difference, negotiating a $2,500-a-day minimum fine.

But that didn’t sit well with 19 senators. They drew a line in the sand, voting to reject the compromise and stick to the version of the bill the Senate approved 30-5 to have no minimum daily fine.

That left the bill’s original sponsor, Rep. Mike Foote, D-Lafayette, with two options: agree to no minimum fine or kill his own bill.

He decided not to bring the matter back to the House, which resulted in its death.

Foote said the problem is the Colorado Oil and Gas Conservation, the state agency that oversees oil and gas drilling in Colorado. He said that nine-member panel historically has been reluctant to impose hefty fines, so having a higher limit was meaningless without a minimum.

“I thought we could get to a good bill, but I also don’t want to pass a bill that at the end of the day may look good but won’t accomplish anything,” Foote said. “The COGCC doesn’t impose the fine authority that they have right now, (and) there’s nothing that I’ve seen over the last several years that would make me think they would impose (a fine) anywhere close to $15,000 if they were given that ability.”

The freshman legislator said the commission far too often gives “discounts” to drillers that spill liquids and rarely imposes adequate fines on the industry.

“On these significant adverse impact cases, of which there are 10 of them over the past seven years, they don’t come close to fining what they could fine,” he said. “The operators should be called into account and have to pay a fine that’s much more in line with what the offense was.”

Some state senators, however, disagreed, saying the commission has routinely imposed fines in the hundreds of thousands of dollars.

Sen. Greg Brophy, R-Wray, said having a minimum fine won’t only impact the most egregious spillers, but also those who made the smallest of spills.

“It’s not really a compromise,” Brophy said. “We intended ... to raise the fines by a factor of 15. If that doesn’t get bad actors’ attention, I do not know what will.”

As a result of the bill’s demise, Hickenlooper signed an executive order Wednesday ordering the commission to review its enforcement penalty structure and how it imposes fines.

“Appropriate penalties for violations of rules on those developing oil and gas constitute one tool available to the commission,” Hickenlooper said in his order. “Penalties are designed to discourage violations and encourage prompt response in environmental or public health and safety concerns in the event that violations occur.”

In other matters on the final day of the session, lawmakers gave final approval to two marijuana-related measures.

One would place a question on this year’s ballot to impose as much as a 10 percent sales and 15 percent excise tax on the sale of marijuana products in the pot stores allowed under Amendment 64, which legalized the recreational use of the weed.

The other measure set regulations in place to oversee those stores, calling on the Department of Revenue to enact rules governing those stores much like it did for the sale of medical marijuana.


COMMENTS

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Frackenlooper gets to sign an executive order making him look reasonable, when his administration lobbied against this and all O&G rules from day one. He is way too close to the industry and forgets that he was elected by Democrats.

It would do little to keep the industry responsible.  The parachute incident is a perfect example.  Fine them all you want but once the water supply is fouled there is no bringing it back regardless of how much the fine might be.

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