• State Law Preempts Local Regulation of Hydraulic Fracturing
  • August 10, 2016 | Authors: Malcolm S. Mead; Adam B. Wiens
  • Law Firm: Hall & Evans, LLC - Denver Office
  • Despite competing views of the economic benefits and environmental impacts of hydraulic fracturing or "fracking," the Colorado Supreme Court issued two much anticipated opinions regarding whether the City of Longmont's ban and Fort Collins' moratorium on fracking and the storage and disposal of fracking waste within city limits are preempted by state law. Applying well-established preemption principles, Colorado's highest court concluded an operational conflict exists between Longmont's and Fort Collins' fracking bans and applicable state law. Consequently, the Court held Longmont's ban and Fort Collins' moratorium, which banned fracking and the storage and disposal of fracking waste within city limits, were preempted by state law.
    Longmont's ban and Fort Collins' moratorium were created pursuant to those cities' "home-rule" sovereignty under the Colorado Constitution that allows for certain ordinances to supersede a state statute. However, as recognized by the Colorado Supreme Court, when a home-rule ordinance conflicts with state law in a matter of statewide or mixed state and local concern, the state law supersedes that conflicting ordinance. In both cases, the Court held the ordinance/moratorium involved matters of mixed state and local concern.
    Colorado recognizes three forms of preemption: express, implied, and operational conflict preemption. Express and implied preemption are primarily matters of statutory interpretation, and apply when the legislature clearly and unequivocally states its intent to prohibit a local government from exercising its authority over the subject matter at issue or when it impliedly evinces its intent to completely occupy any given field of interest. Here, however, the court focused on "operational conflict" preemption, under which a state law will preempt a local regulation when the operational effect of the local regulation conflicts with the application of state law. Courts analyze operational conflicts by considering whether the effectuation of the local interest would materially impede or destroy a state interest.
    Applying these standards, the Court evaluated the respective statutory and regulatory schemes. The Court held the State Oil & Gas Conservation Act and the pervasive rules and regulations promulgated by the Oil & Gas Conservation Commission, which evince state control over numerous aspects of fracking, from the chemicals used to the location of waste pits, demonstrated the state's strong interest in the efficient and responsible development of oil and gas resources, including the uniform regulation of fracking. On the other hand, Longmont's and Fort Collins' ordinance/moratorium prevented operators from fracking even when in total compliance with state rules and regulations - rendering the state's rules and regulations "superfluous." Because the local ordinances materially impeded the effectuation of the state's interest, the Court held that the ban and moratorium were invalid and unenforceable.
    Nonetheless, each city's authority to regulate noise, lighting, traffic, and other common complaints from fracking operations remains intact. And the Court's ruling may not be the final word on fracking in Colorado. Opponents of fracking plan to place state-wide initiatives on the November ballot, initiatives which would expressly grant local governments authority to regulate fracking within city limits.
    Full text of opinions.... City of Longmont v. Colorado Oil & Gas Assoc., 2016 CO 29 (May 2, 2016), and City of Fort Collins v. Colorado Oil & Gas Assoc., 2016 CO 28 (May 2, 2016).