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TABLE OF CONTENTS
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INTRODUCTION .................................................................................. 1
ISSUES PRESENTED FOR REVIEW ................................................. 3
STATEMENT OF THE CASE AND FACTS ........................................ 4
SUMMARY OF THE ARGUMENT .................................................... 10
ARGUMENT ........................................................................................ 12
I. The Longmont bans are impliedly preempted, just like
Greeleys ban was in Voss. .............................................................. 12
A. The State has a sufficiently dominant interest in regulating
hydraulic fracturing and the storage and disposal of E&P
Waste to preempt the Longmont bans. .........................................13
B. The Longmont charter amendment is inconsistent with and
irreconcilable with the State regulatory scheme. .........................19
II. Longmonts fracking ban is preempted by operational
conflict as a matter of statewide concern, or alternatively,
mixed statewide and local concern. ................................................ 29
A. Regulating hydraulic fracturing is a matter of statewide
concern..............................................................................................30
B. Even if considered a matter of mixed concern, Longmonts
fracking ban impermissibly conflicts with state law. ...................38
C. Longmonts claimed factual dispute does not undermine
the case for operational conflict preemption. ................................43
D. Longmonts E&P Waste storage and disposal bans are
preempted as matters of mixed concern. .......................................45
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III. Longmonts ban on hydraulic fracturing is void under the
Areas and Activities of State Interest Act because it prevents
the extraction and exploration of minerals. ................................... 47
IV. Longmonts ban on disposal of fracking fluids is void under
the federal Safe Drinking Water Act. ............................................. 48
CERTIFICATE OF COMPLIANCE .................................................... 51
CERTIFICATE OF SERVICE ............................................................. 52
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TABLE OF AUTHORITIES
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CASES
Banner Advertising, Inc. v. City of Boulder,
868 P.2d 1077 (Colo.1994) ..................................................................... 20
Bath Petroleum Storage, Inc. v. Sovas,
309 F. Supp. 2d 357 (N.D.N.Y 2004) .................................................... 49
Bd. Of County Commrs v. BDS Intl,
159 P.3d 773 (Colo. App. 2003) ................................................. 18, 25, 33
Bd. Of County Commrs v. Bowen/Edwards Assoc.,
830 P.2d 1045 (Colo. 1992) ............................................................ passim
City and County of Denver v. State of Colo.,
788 P.2d 764 (Colo.1990) ........................................................... 29, 30, 37
City of Denver v. Qwest Corp.,
18 P.3d 748 (Colo. 2001) ........................................................................ 36
City of Northglenn v. Ibarra,
62 P.3d 151 (Colo. 2003) ............................................................ 20, 29, 37
Colo. Min. Assn v. Bd. Of County Commrs,
199 P.3d 718 (Colo. 2009) .............................................................. passim
Gade v. Natl Solid Waste Mgmt. Assn,
505 U.S. 88 (1992) ................................................................................. 42
Johnson v. Jefferson Cnty Bd. of Health,
662 P.2d 463 (Colo. 1983) ...................................................................... 20
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Kemper v. Hamilton,
274 P.3d 562 (Colo. 2012) ...................................................................... 37
National Advertising Co. v. Department of Highways,
751 P.2d 632 (Colo.1988) ....................................................................... 40
Robinson Twp., Washington Cnty. v. Commonwealth,
83 A.3d 901 (Pa. 2013)........................................................................... 37
Town of Frederick v. N. Am. Res. Co.,
60 P.3d 758 (Colo. App. 2002) ............................................. 18, 25, 33, 40
Town of Telluride v. Thirty-Four Venture,
3 P. 3d 30 (Colo. 2000) ........................................................................... 46
Voss v. Lundvall Brothers,
830 P.2d 1061 (Colo. 1992) ............................................................ passim
Webb v. City of Black Hawk,
295 P.3d 480 (Colo. 2013) ................................................................ 29, 45
Wolfe v. Sedalia Water & Sanitation Dist.,
2015 CO 8 (Colo. 2015) .......................................................................... 12
STATUTES
42 U.S.C. 300f ........................................................................................ 48
C.R.S. 24-65.1-101 ................................................................................... 9
C.R.S. 24-65.1-202(1) ............................................................................. 47
C.R.S. 30-20-100.5 ................................................................................. 46
C.R.S. 30-20-101 .................................................................................... 46
C.R.S. 34-24-101 .................................................................................... 23
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C.R.S. 34-60-101 ............................................................................ passim
C.R.S. 34-60-102(1) ...................................................................... 6, 24, 39
C.R.S. 34-60-102(1) (1984) ..................................................................... 14
C.R.S. 34-60-103(4) ................................................................................ 17
C.R.S. 34-60-103(6.5) ....................................................................... 22, 46
C.R.S. 34-60-104(2) .................................................................................. 7
C.R.S. 34-60-105(1) ................................................................................ 22
C.R.S. 34-60-106(11) ................................................................................ 7
C.R.S. 34-60-106(2) ................................................................................ 22
Colo. Sess. Laws, ch. 317, sec. 1 ................................................................. 6
Colo. Sess. Laws, ch. 320, sec. 1 ................................................................. 7
RULES
2 CCR 404-1 ................................................................................................ 4
Commission 2008 Rulemaking Statement of Purpose.................... 1, 7, 36
Commission Rule 100-Series Definitions .............................................. 4, 5
Commission Rule 205A ........................................................................ 4, 25
Commission Rule 305.c .............................................................................. 4
Commission Rule 308B .............................................................................. 5
Commission Rule 316C .............................................................................. 5
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Commission Rule 317.j ......................................................................... 5, 25
Commission Rule 317.s .............................................................................. 5
Commission Rule 318A ...................................................................... 14, 31
Commission Rule 325 ........................................................................... 5, 48
Commission Rule 341 ............................................................................... 32
Commission Rule 603 ................................................................................. 6
Commission Rule 604.c .............................................................................. 5
Commission Rule 805.c .............................................................................. 5
Commission Rule 900-Series...................................................................... 5
Commission Rule 908.h ............................................................................ 46
TREATISES
Phillip D. Barber, 1B Colo. Methods of Practice 14:4 (5th ed.
2011) ....................................................................................................... 17
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INTRODUCTION
Few public policy issues in Colorado have been the subject of more
intense debate, discussion, and regulatory activity in recent years than
the use of hydraulic fracturing in oil and gas drilling. The Colorado Oil
and Gas Conservation Commission engaged in a protracted and
controversial rulemaking wherein the appropriate level of regulation for
fracking was actively debated. See 2008 Rulemaking Statement of
Purpose, p.35 (discussing Rule 341) (available at
http://cogcc.state.co.us/RuleMaking/FinalRules/COGCCFinalSPB_12170
8.pdf).
That rulemaking was the epitome of a compromise in that it may
have pleased nobody. But it was the embodiment of the States best
judgment about how to balance the costs and benefits of fracking. Some
citizens, and some local governments think the State balanced those
costs and benefits incorrectly, and a few, including Longmont, simply
think the activity should be banned, at least within its borders. This
Court need not and should not resolve the ultimate policy debate about
fracking. Whatever the merits of Longmonts position are as a matter of
policy, since at least 1992, it has been clear local governments are not
empowered to prohibit drilling practices permitted by the State.
While the City of Longmonts ban on fracking is preempted under
several doctrines and statutes, the case can be resolved by a simple,
direct application of Voss v. Lundvall Brothers, 830 P.2d 1061 (Colo.
1992). As the Court emphasized in Voss, in the context of a home-rule
city (Greeley) using land-use authority to ban certain oil and gas
development practices, [t]here is no question that the efficient and
equitable development and production of oil and gas resources within
the state requires uniform regulation of the technical aspects of drilling,
pumping, plugging, waste prevention, safety precautions, and
environmental restoration. Id. at 1068 (quoting Bd. Of County
Commrs v. Bowen/Edwards Assoc., 830 P.2d 1045, 1058 (Colo. 1992)).
Unanimously, Voss held the home-rule citys attempt to ban oil and gas
drilling was preempted by the State regulatory system. Voss remains
good law. It must be followed here. The Longmont bans, like the Greely
ban before it, are preempted by state law and regulation.
2.
3.
Does the Areas and Activities of State Interest Act preempt the
City of Longmonts ban on hydraulic fracturing?
4.
Does the Federal Safe Drinking Water Act preempt the City of
Longmonts ban on certain disposal techniques used with
hydraulic fracturing?
_________________________
Rule 100 Series Definition of Floodplain and revised Rule 603 available
at http://cogcc.state.co.us/RR_Docs_New/FloodPlain/FinalRule.pdf
6
wording added in 2007); Colo. Sess. Laws, ch. 320, sec. 1, at 1357 (HB
07-1341); CF, p.1876.
HB 07-1341 also made the states chief medical officer, the
executive director of the Colorado department of health and
environment (CDPHE), a permanent voting member of the
Commission, 34-60-104(2)(a)(I), C.R.S., and directed the Commission
to Promulgate rules, in consultation with [CDPHE], to protect the
health, safety, and welfare of the general public in the conduct of oil and
gas operations. 34-60-106(11)(a)(II), C.R.S. The rulemaking required
under these statutory changes was the most extensive rulemaking
hearing in the Commissions history. 2008 Rulemaking Statement of
Purpose, p.5.2 The 2008 rule amendments were intended to address
increased drilling activity extending into new areas of the state with
additional people and respond to public concern for the health, safety
and welfare of Colorados residents. Id., p. 1-2.
On November 6, 2012, Longmont residents voted in favor of Ballot
Question 300, which amended the Citys home-rule charter to create a
Available at http://cogcc.state.co.us/RuleMaking/FinalRules/
COGCCFinalSPB_121708.pdf
2
from enforcing the bans, but stayed the injunction during the pendency
of this appeal.
SUMMARY OF THE ARGUMENT
First, Longmonts bans are impliedly preempted by the States
dominant interest in regulating oil and gas development. Courts
consider a sufficiently dominant state interest in regulating a matter to
indicate an intent by the General Assembly to preempt conflicting local
government regulations. There is little question the Commission is
responsible for regulating the use of hydraulic fracturing and the
storage and disposal of associated waste and that the use of fracking is
prevalent in the Longmont area. Longmont simply banned what the
State has authorized, a paradigm case for implied preemption.
The Longmont bans impeded the state interest, regardless of
perceived health risks or benefits from fracking activity. Any doubt
about the Commissions authority to regulate fracking must be resolved
by deferring to the Commissions interpretation of its own authority.
Finally, hydraulic fracturing is a technical aspect of oil and gas
development, and as such, the statewide regulation of the activity
preempts local regulation.
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14
the natural resources of oil and gas in the state of Colorado, prevent
waste and protect correlative rights)). 3
The Commissions authority under the Act was compared to the
home-rule citys claimed authority to use land use regulation to ban the
drilling of oil and gas wells within city limits. The Court found there
was no question the Act evidences a significant interest on the part of
the state in efficient and fair development, production, and utilization of
oil and gas resources. Id. at 1065-66.
The Court concluded the States interest is sufficiently dominant to
override a home-rule citys imposition of a total ban on the drilling of
any oil, gas, or hydrocarbon wells within the city limits. Id. at 1068.
This was so [b]ecause oil and gas pools do not conform to the
boundaries of local government, Greeleys total ban on drilling within
the city limits substantially impedes the interest of the state in
fostering efficient development and production of oil and gas resources
in a manner that prevents waste and that furthers the correlative
rights of owners and producers in a common pool or source of supply to
15
a just and equitable share of profits. Id. The entire analysis in Voss
applies to Longmonts bans on oil and gas operations involving
hydraulic fracturing.
There is no legally meaningful difference between banning oil and
gas drilling, and banning hydraulic fracturing and the storage or
disposal of its associated waste. Other than calling for the court to
outright reverse the Voss decision, which this court cannot consider, the
defendants try mightily to create a difference between a total ban on
drilling in Greeley and Longmonts total ban on hydraulic fracturing
and other Commission-authorized activities. See Longmont Op. Br. at
23-25. For preemption purposes, there is no difference. Almost all wells
in the Longmont area, including the Greater Wattenberg Area, and in
all of Colorado, rely on hydraulic fracturing to be productive. CF, p.613
(Hydraulic fracturing . . . is now standard for virtually all oil and gas
wells in our state. Hydraulic fracturing has made it possible to get this
oil and gas out of rocks that were not previously considered as likely
sources for fossil fuels.); CF, p.623 (Most of the hydrocarbon bearing
formations in Colorado would not produce economic quantities of
hydrocarbons without hydraulic fracturing.).
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17
imposed, there was no doubt that mining using these toxic substances
could result in environmental catastrophe, as the Summitville Mine
disaster from mining using cyanide polluted the nearby Alamosa River.
Id at 727. In the face of these negative externalities, the General
Assembly granted the Board extensive authority to authorize and
regulate mining operations proposing to utilize toxic or acidic chemicals
for mineral extraction. Id. at 728. Declaring Voss to be particularly
instructive, the court in Colorado Mining Association explained that
[s]ufficient dominancy is one of several grounds for implied state
preemption of a local ordinance[,] id at 724, and [d]ue to the
sufficiently dominant state interest in mineral processing utilizing such
chemicals, we find implied preemption in this case. Id. at 726.
B.
19
20
21
See, e.g., Colorado Office of State Planning and Budgeting, Dec. 22,
2014 Report, p.7 (discussing oil and gas industry in Colorado); available
at http://www.colorado.gov/cs/Satellite/OSPB/GOVR/1218709343298.
27
28
subject to local regulation. All three reasons call for implied preemption
to apply.
II.
29
The test for preemption is legal and does not call on courts to simply
weigh competing interests of the State and local government, contrary
to Longmonts gloss of City and County of Denver v. State, a case where
a local residency requirement for city employment was found to be a
local concern. See Longmont Op. Br. at 17-18 (citing City and County of
Denver as standing for local interests outweighing state interests).
That case applied standard operational conflict preemption analysis
and did not talk of local interests outweighing state interests.
Moreover, the Colorado Supreme Court has recently confirmed that the
state has a significant interest in both mineral development and in
human health and environmental protection. Colo. Mining Assn, 199
P.3d at 730.
30
P.2d at 1067. All parties agree with the applicability of these factors.
The district court independently analyzed the factors and found the
first three favored preemption and the fourth factor was not applicable.
These findings were sound. Order at 11-12; CF, 2048-2049.
First, the need for statewide uniformity in regulation of hydraulic
fracturing strongly favors preemption. Oil and gas development
represents a multi-billion dollar industry in Colorado as of 2012,
playing a prominent role in the state economy. See fn.8, supra. As the
Colorado Supreme Court noted in Bowen/Edwards, there is no
question that the efficient and equitable development and production of
oil and gas resources within the state requires uniform regulation of the
technical aspects of drilling, pumping, plugging, waste prevention,
safety precautions, and environmental restoration. 830 P.2d at 1058.
This need for uniform regulation stems from the reality that oil and gas
reserves do not conform to the boundaries of any particular local
government (e.g. the Greater Wattenberg Area underlies numerous
counties north of Denver, and thus the location and spacing of oil wells
is most efficiently controlled by State. See Commn Rule 318A). The
State has found uniform regulation of oil and gas reserves to be crucial
to efficient and fair production of resources. For example, without
31
only the portions of the well that did not underlie Longmont. As a
result, the Synergy well produced less oil and gas than it would have
produced had the entire well been fracked. Order at 12; CF, 2049. This
evidence of an extraterritorial impact is indicative of how a local ban on
oil and gas activity will have an impact outside the jurisdiction.
In addition, in Voss, the Supreme Court determined the City of
Greeleys ban on drilling had an extraterritorial impact because oil and
gas pools do not conform to the boundaries of local government. Voss,
830 P.2d at 1068. The Court reasoned that Greeleys total ban on
drilling within the city limits substantially impedes the interest of the
state in fostering the efficient development and production of oil and
gas resources in a manner that prevents waste and that furthers the
correlative rights of owners and producers in a common pool or source of
supply to a just and equitable share of profits. Id. Just as with
Greeleys ban, Longmonts ban affects the ability of nonresident owners
of oil and gas interests in pools that underlie both the city and land
outside the city to obtain an equitable share of production profits in
contravention of one of the statutory purposes of the Oil and Gas
Conservation Act. Id.
34
35
10
11
37
39
12
stated goals of the Oil and Gas Conservation Act. The conflict in this
case is an irreconcilable conflict.). A ban of what the State allows is a
paradigm conflict subject to preemption.
C.
matter of mixed state and local concern. As explained above, the proper
analysis for a matter of mixed concern is whether the local regulation
can be harmonized with the state regulation, not whether the judicial
branch agrees with policy judgments of the state or local government.
The analysis turns on the conflict or harmonization of regulations, not
on the perceived values of factual claims made by the state or local
governments.
Second, none of the alleged factual issues raised by Longmont are
material to the operational conflict preemption analysis. Take for
example the most important[] issue, according to Longmont, of
whether Longmonts ban on hydraulic fracturing has destroyed the
state interest in oil and gas development. Longmont Op. Br. at 41-43.
This asks the wrong question. The State has an interest in oil and gas
development through the use of hydraulic fracturing, which the State
has elected to regulate and authorize as an efficient and commonly used
well-completion process. The Longmont ban conflicts with the State
interest because the State allows and regulates, intentionally so, the
use of hydraulic fracturing. That it may be theoretically possible to drill
an oil and gas well without using hydraulic fracturing does not, legally,
reduce the conflict and resultant preemption. And, tellingly, Longmont
44
cannot point to any economically viable development of oil and gas wells
in Longmont not using hydraulic fracturing. Even assuming all the
facts Longmont marshals are disputed, they are simply not material.
D.
13
45
46
24-65.1-202(1)(d), C.R.S.
Thus, the AASIA, 24-65.1-202, C.R.S., provides an explicit and
exclusive means for local governments to ban oil and gas extraction and
exploration. Critically, no such ban may be enacted by a local
government unless the Commission first designates a defined area of oil
and gas development as an area of state interest that may be regulated
by the local government. 24-65.1-202(1)(d), C.R.S. It is undisputed
that the Commission has not done so in Longmont. CF, p.735. The
Citys ban on hydraulic fracturing is therefore void under AASIA. This
additional hurdle provides an alternative basis to affirm the court
below.
IV.
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50
CERTIFICATE OF COMPLIANCE
I hereby certify that this brief complies with all requirements of
C.A.R. 28 and C.A.R. 32, including all formatting requirements set forth
in these rules. Specifically, the undersigned certifies that:
The brief complies with C.A.R. 28(g).
Choose one:
x It contains 9,439 words.
It does not exceed 30 pages.
The brief complies with C.A.R. 28(k).
X For the party raising the issue:
It contains under a separate heading (1) a concise statement
of the applicable standard of review with citation to
authority; and (2) a precise location in the record (R.__,
p.___), not to an entire document, where the issue was raised
and ruled on.
For the party responding to the issue:
It contains, under a separate heading, a statement of
whether such party agrees with the opponents statements
concerning the standard of review and preservation for
appeal, and if not, why not.
X I acknowledge that my brief may be stricken if it fails to
comply with any of the requirements of C.A.R. 28 and C.A.R.
32.
_/s/ Michael Francisco____
51
CERTIFICATE OF SERVICE
This is to certify that I have duly served the foregoing upon all parties
herein electronically via Integrated Colorado Courts E-Filing System or
by U.S. Mail, postage prepaid, this March 5, 2015, addressed as follows:
Karen L. Spaulding, Esq.
Beatty & Wozniak, P.C.
216 16th Street, Suite 1100
Denver, CO 80202
KSpaulding@bwenergylaw.com
Eugene Mei, Esq.
Daniel E. Kramer, Esq.
City Attorneys
City of Longmont
408 3rd Avenue
Longmont, CO 80501
eugene.mei@ci.longmont.co.us
dan.kramer@ci.longmont.co.us
Phillip D. Barber, Esq.
1675 Larimer Street, Suite 620
Denver, CO 80202
phillipbarber@aol.com
Thomas A. Carr
Boulder County Attorneys Office
P.O. Box 791
Boulder, CO 80306
carrt@bouldercolorado.gov
52
robbins@grn-law.com
Kevin Lynch
Brad Arthur Bartlett
Sturm College of Law
2255 East Evans Ave., Ste. 33
Denver, CO 80301
klynch@law.du.edu
Eric Huber
1650 38th Street, Suite 102
Boulder, CO 80301
Eric.huber@sierraclub.org
/s/Linda Miller
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