Monday, February 25, 2013

Colorado Oil and Gas Conservation Commission Approves New Setback Rules

The following comes from a recent Capitol Close-Up, a legislative update from Amie Mayhew, Chief Executive Officer - Colorado Association of Home Builders:

On February 11th, the Colorado Oil and Gas Conservation Commission (“COGCC”) voted 8-1 to approve a new set of setback rules.  One substantive change is to the effective date in Rule 604, which will be August 1, 2013 rather than July 1, 2013. A brief summary of the rules as they impact CAHB members is below:

·                     Designated Setback Locations for Oil and Gas Locations will be 500 feet from building units, 1,000 feet from High Occupancy Building Units, and 350 feet from Designated Outside Activity Areas;

·                     Waivers are required from Building Unit owners within 500 feet of a proposed Oil and Gas Location in Urban Mitigation Areas.  If waivers cannot be obtained, the operator can seek a variance from the Director, and if not granted, have a hearing before the Commission;

·                     Rule 604(b)(2) exempts Existing Surface Use Agreements or Site Specific Development Plans;

·                     Rule 604(b)(3) exempts Surface Development after August 1, 2013 pursuant to a Surface Use Agreement or Site Specific Development Plan;

·                     Rule 604(c) Mitigation Measures will be required within Designated Setback Locations statewide.

CAHB also was persuasive in arguing for the inclusion of setback exception language (“grandfathering”) of Existing Surface Use Agreements or Site Specific Development Plans and for future Surface Development Pursuant to Surface Use Agreements or Site Specific Development Plans in the final Rules as adopted by the Commission in Rule 604(b)(2) and 604(b)(3).  COGCC staff did not include these two exceptions in their initial draft rules, and it was made clear that the inclusion of these exceptions was a result of CAHB’s efforts.  CAHB also succeeded in maintaining the exception for Existing Surface Use Agreements or Site Specific Development Plans as a mandatory exception through the use of the word “shall” rather than a permissive exception through the use of the word “may” as advocated by several parties and supported by some Commissioners.

Finally, CAHB, along with other parties and stakeholders, was influential in eliminating the consent requirement from adjacent land owners.  While waivers are still required in Urban Mitigation Areas, a variance process now exists, eliminating the veto power of adjacent land owners as the initial draft Rules had provided.

CAHB was extremely influential in both the stakeholder and the rule-drafting processes.  While firmly opposed to the setback distances, CAHB’s narrow definitions of High Occupancy Building Units in the 100 Series Definitions tied to other statutory definitions were incorporated, drastically reducing uncertainty in the application and impact of the 1,000 foot setbacks.

Please contact Amie Mayhew at the CAHB office with any questions or concerns you have.  Amie can be reached by phone at (303) 691-2242 or by e-mail at amie@hbacolorado.com.

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Disclaimer

The information contained in this blog is provided for informational purposes only. It is not legal advice and should not be construed as providing legal advice on any subject matter.