Colorado Oil Town Still Fearful All their Prosperity Could Be Taken Away

Credit: Sherrie Pief/TheDCNF

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Sherrie Peif Contributor
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GREELEY, Colo. – A town that’s greatly benefited from hydraulic fracturing is in the midst of an identity crisis.

Greeley, one of the country’s fastest growing communities, is under attack from the environmental left, which is intent on drying up oil and gas exploration that just seven years ago bailed one northern Colorado city out of near economic disaster. Activists are backing a ballot initiatives to ban fracking for oil and gas across the state, putting towns like Greeley at risk.

“It could drive the largest takings lawsuit in the U.S.,” said Bill Jerke, executive director of the pro-oil and gas coalition Fostering Unity and Energizing Leadership. “As a group, they will put oil and gas out of business.”

Coloradans will be able to vote on several anti-fracking ballot initiatives this fall — all of which effectively ban the drilling technique. Jerke, a former Weld County Colorado commissioner and state legislator, said most of the fears around fracking are unfounded, but he still fears that if even one of those ballot initiatives pass, the state could spiral into an economic depression.

That’s bad news for towns like Greeley.

Bill Jerke

Sean Conway talks about the benefits of fracking. (Credit: Sherrie Peif /TheDCNF)

A Town Divided

Greeley is home to two distinct communities. On the east side of the city’s center are immigrants working for minimum wage or refugees, many who can’t read or write even in their native language. On the west side are three-car garage homes with BMWs and boats in the driveway.

Even Greeley-Evans School District 6, Colorado’s – which benefits greatly from the oil and gas production in the city and county – is divided. It’s near the bottom of the state in achievement, and as a result, 25 percent of its students are in six charter schools. For years, the charter schools have been accused of siphoning off of the “brightest,” students from the district.

Football field

A Greeley school’s football field (Credit: Sherrie Peif/TheDCNF)

Football field scoreboard

Greeley school’s football field is sponsored by an energy company that fracks in the region (Credit: Sherrie Peif/theDCNF)

Recently, the division became clearer.

Hundreds of active wells have been scattered throughout the community for decades, but a proposal for 22 wells on a 14-acre site in what’s known as the Triple Creek area, one of the more affluent neighborhoods, brought out eco-activists who were quick to jump on board to keep it out of west Greeley.

“Oil and natural gas laws and regulations are written by an industry that has one overpowering purpose: profit,” Greeley resident Megan Worley said at a special town meeting. “Industry in Greeley and the county create methane, a horrible greenhouse gas that causes climate change.”

Administrators and teachers from one charter school event opted to fight the proposed site as well, despite the fact their school has a brand new $150,000 bus donated by Noble Energy.

“We are known as the most fracked city in Colorado,” Worley said. “This hurts our ability to attract new residents, more college students and top companies. Greeley residents have a right to pure water, clean air and a healthy environment.”

Their plan to ban fracking nearly worked.

Planning commissioners — who usually have the final say in land-use issues in Greeley — denied the project based on inconvenience and fears over health and traffic concerns.

Commissioners praised the developer, the Denver-based Extraction Oil and Gas, for its due diligence in the more than two-year process, but they did not consider the property rights case landed Greeley in court more than two decades ago. The 1992 lawsuit is still used today as precedence in oil and gas cases.

Extraction Oil and Gas appealed to the Greeley City Council, and the opponents came out en masse. Carl Erickson, the chairman of environmental group Weld Air and Water, was a leading figure in the fight against the wells. In late May, Erickson announced his candidacy for the Weld County Commission, mostly on the promise to combat oil and gas production in the county.

“I believe we are living in the ‘boom’ and should remember the lesson that ‘boom’ is followed by ‘bust,’” Erickson wrote on his campaign website. “It’s a lesson that Colorado’s history has taught us again and again – gold, silver, copper, coal – all went through these cycles, leaving the aftermath to be taken care of by the next generation.”

City leaders didn’t agree.

“We have to protect the private property rights of the many citizens of Greeley who have mineral rights and have the rights to access them,” said Mayor Tom Norton. “And we have to do it in a way that is reasonable to a site that can be developed.”

The Greeley City Council overturned the planning commissions denial on a 5-2 vote, keeping decades-long compliance and traditions in place — for now.

“I’m mostly disappointed with the planning commission,” Councilmember Mike Finn said at the meeting. “The applicant worked with the staff they met all the standards laid out. I just don’t see any reason why, and it really bothers me that the planning commission wouldn’t look at it, go down the line and see that they met everything. … It really blows me away. … I have a hard time just because people in the neighborhood feel like they don’t want it. I’m sorry but they have rights to the oil and gas, it’s well defined. What I worry about is vote against this, and you just opening up a lawsuit. … It just blows me away that people don’t see it.”

Fracking Their Way Out Of Recession

Greeley is the county seat, epicenter and largest city in Weld County.  In 2009, Weld was one of the United States’ top-10 agricultural communities, with an unemployment rate of 11.5 percent, the Federal Deposit Insurance Corp. was shutting down banks, foreclosure rates were the highest in the state and car dealerships and restaurants were closing left and right.

The area just 50 miles north of Denver, spanning more than 4,000 square miles was among the nation’s hardest hit when the bottom fell out of the economy.

“We were not in an economic recession,” Weld County Commissioner Sean Conway said. “We were in an economic depression. One of the first things I had to do when I came into office was reduce our budget by $20 million.”

In 2010, however, residents learned that lying 2 miles below the surface, the Niobrara Shale was about to – almost overnight – transform everything.

“Today, we have families that were literally wondering how they were going to pay their mortgage in 2010 – how they were going to survive from day-to-day – that now, for the first time, are buying a new car,” Conway said. “They’re going on a family vacation. They have extra money to maybe buy a new pair of sneakers for their kids.”

Today, the county’s assessed value is $11.1 billion, up from $5.5 billion in 2009. An unemployment rate that was 11.5 percent just seven years ago, is now 3.1 percent, foreclosures are nearly nonexistent. Building permits are on the rise, and businesses are multiplying faster than most every other community in Colorado, with new car dealerships, hotels and restaurants popping up everywhere.

The county that is among the top five in the nation for wage growth, has more than 22,000 oil and gas wells to thank for its turnaround. It produces 89 percent of the oil and gas in Colorado.

Greeley drill site

Oil and gas is a huge part of Greeley’s economy, but some don’t like the site of future wells (Credit: Sherrie Peif/TheDCNF)

The Fight’s Not Over

The state Supreme Court recently sided with state regulators and energy producers against localities looking to ban fracking within their borders.

“Lundvall, Lundvall, Lundvall,” Conway said with a laugh as he spoke the name of the developer who brought the suit in 1992. That case was cited by the court in its decision against the cities of Longmont and Fort Collins. These cities wanted to ban fracking.

The Colorado Supreme Court – which upheld a lower court’s ruling striking down a 2012 voter-approved ban on fracking in Longmont – said “The Oil and Gas Conservation Act and the Commission’s pervasive rules and regulations … convince us that the state’s interest in the efficient and responsible development of oil and gas resources includes a strong interest in the uniform regulation of fracking.”

The court said the ban was “invalid and unenforceable.”

The court also said that Fort Collins’ five-year moratorium “materially impedes the effectuation of the state’s interest in the efficient and responsible development of oil and gas resources.”

Boulder and several mountain towns have said they will revisit their moratoriums after the May 2 ruling.

If voters approve anti-fracking ballot initiatives this fall, however, the state Supreme Court’s decision won’t help towns like Greeley against future environmentalist attacks.

One would allow local governments to regulate oil and gas development in their communities; one would allow residents to sue oil and gas companies for health issues they believe are related to operations in their area; a third would allow communities to define or eliminate the rights and powers of businesses in their boundaries.

A final proposal to expand the existing buffer zones to drill from 500 feet to 2,500 feet from homes, drinking water sources, lakes, rivers, streams or streambeds, creeks, irrigation canals, riparian areas, playgrounds, sports fields, public parks, open spaces or amphitheaters would render almost all areas in the state unavailable for new exploration.

“Most distressing about (this) is it’s being driven by out of state interests,” Conway said. “Those of us in Colorado need to come to the realization that Colorado has become the place to go to fight whatever kind of battle you want to fight.  Because of our low threshold in terms of signatures to get things on the ballot. And because were a relatively small state, it doesn’t take a lot of money to move the public.”

Watch TheDCNF’s interview with Sean Conway:

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Sherrie Peif