Oil in Colorado’s political machine
The drilling industry spends tens of millions of dollars to influence opinions and campaigns.
The oil and gas industry in the past four years has poured more than $80 million into Colorado to shape public opinion and influence campaigns and ballot initiatives, creating a political force that has had broad implications throughout the state.
Environmentalists and industry officials alike call the effort one of the best-financed operations advocating for drilling in any state. Just two months ago, that political muscle came into play when the industry successfully lobbied Republican legislators to kill legislation tightening regulation in the wake of a fatal home explosion in Firestone that investigators have blamed on a severed gas pipeline.
Energy interests also have helped elect local city council candidates more favorable to allowing drilling near housing and blunted efforts across the Front Range to restrict drilling rights. Last year, industry forces played a role in keeping the state Senate in Republican hands. They spent heavily last year to convince voters across the state to make it harder to amend the state constitution, dealing a blow to antifracking activists’ hopes to curtail drilling through a statewide ballot initiative.
The new approach has been broad, sustained and effective in its reach, according to interviews and a review of industry documents, campaign-finance records and public remarks by an industry consultant who helped develop the strategy.
Details of the efforts in Colorado were disclosed by Mark Truax, a political consultant working for the state’s top drilling companies, during a speech to industry players in 2015. In two years, Truax said, the industry had knocked on 1.7 million doors in Colorado. It had profiled more than 3.9 million voters and flooded the airwaves, internet and mailboxes with targeted messages to Coloradans ranging from Democrats receptive to President Barack Obama’s support of natural gas to hunters and anglers interested in wildlife restoration.
Oil and gas interests mobilized after ending up on the losing side of local ballot issues in 2012 and 2013 seeking to restrict drilling and after realizing that environmentalists, such as billionaire Tom Steyer, were targeting Colorado. Steyer, founder of the political advocacy group Nextgen Climate, in 2014 paid for television ads and canvassing operations for then-u.s. Sen. Mark Udall’s losing campaign against Cory Gardner. This year, when Steyer announced he was putting up at least $25 million to mobilize voters in battleground states, he pledged resources would be devoted to Colorado.
“The old approach wasn’t working anymore,” said Chris Castilian, a former director of government affairs for Anadarko Petroleum who helped put together the industry blueprint for fighting back. “Every time we saw a ballot measure at the state or local level we would get a group of industry representatives together, and we would gather around a campaign table and hire a campaign manager and put up TV ads.”
The strategy was reactive and underfunded, Castilian said, and it showed in the results.
Campaign-finance reports filed by energy companies show that in 2012 they spent $455,000 on corporate political contributions in Colorado, mostly in a diffuse manner. From 2013 through 2016, they have poured an average of more than $20 million annually into financing Colorado political campaigns for politicians and ballot issues as well as a new, unprecedented public relations effort aimed at molding public opinion — a total in excess of $80 million.
To come up with the numbers, The Denver Post reviewed campaign finance contribution and expenditure reports from the Colorado Secretary of State’s Office from 2012 to 2016, annual political activity reports published by the state’s largest drilling companies, 990 nonprofit tax returns for industry groups and contributions to issue committees linked to industry.
Going back to 2012
In 2012, voters in Longmont turned out in force to ban fracking in their community. The same year, the fifth-richest member of Congress, Jared Polis, a Democrat from Boulder, began taking a personal interest.
“This can happen to anybody. It can happen to you. It can happen to your neighbor. It can happen to your congressman,” Polis said in an interview after he filed a lawsuit seeking to stop a fracking operation that had set up across the street from his 50-acre getaway in Weld County. “The laws in Colorado are outrageously out of touch in terms of protecting property.”
With at least four other Front Range municipalities pushing anti-fracking ballot initiatives in 2013 and Polis arguing for a statewide initiative for further restrictions, top energy producers in the state crafted plans to fight back.
Anadarko Petroleum and Noble Energy, the top energy producers in the state, lead the way. Their campaign-finance records and political activity reports shows that since 2012, the companies are responsible for two-thirds of the money given to an industry political issue committee known as Protect Colorado, which has spent $30 million since 2013 on ballot initiatives and issues.
A public relations front group founded by the two companies in 2013 — Coloradans for Responsible Energy Development — also received more than $30 million in donations in its first three years of existence, according to its tax returns.
“Scaring people is easy and cheap. Providing factual information on a complex subject is difficult and expensive,” CRED and Protect Colorado spokeswoman Karen Crummy said in a prepared statement. CRED was created as an “education effort to present the public with the science and facts on fracking,” she said.
Crummy added that “Protect Colorado was formed when the energy industry was facing an onslaught of ballot measures and the very deep pockets of one Colorado Congressman who had hundreds of millions of dollars. These measures had the potential to put the industry out of business so we had to fight back.”
Driving the message for CRED is Oregon-based political consulting firm Pac/west Communications, which promised industry representatives more than just an aggressive fight at the ballot box. The firm, Castilian said, pledged when bidding for the job to work tirelessly to change the “hearts and minds of Coloradans.”
The industry helped shape the political makeup of city councils in Denver and Fort Collins and successfully defeated or headed off anti-fracking initiatives in Erie, Windsor and Loveland that cropped up after 2014, Truax, now a vice president at Pac/west, said in his speech.
By 2015, the industry in Colorado could mobilize as many as 400 canvassers to descend on small towns across the Front Range in as little as 24 hours’ notice, Truax told attendees at an Interstate Oil and Gas Compact Commission conference in Oklahoma City. He and other consultants had compiled a coalition of 40,000 people who could lobby against environmentalists and jam municipal phone lines at a moment’s notice.
Greenpeace recorded Truax’s speech and provided a copy of the recording to The Denver Post. A transcript previously was published in Boulder Weekly.
Truax described the political tools the team had amassed as giving industry purchasing power similar to a person who has the ability to walk into a Sears and tell the floor manager, “I want one of everything and put it in the truck out in the parking lot.”
Losses pile up
The losses have piled up for environmentalists. Last fall, voters approved “Raise the Bar,” a measure making it more difficult — some say nearly impossible — to place constitutional amendments on the state ballot. The oil and gas industry spent at least $4.3 million, according to state campaign finance records for a committee formed to back the measure.
Hopes to place restrictions on fracking through a constitutional amendment suffered a major setback. “We saw it as very unprecedented as we watched it unfold in Colorado,” said Jesse Coleman, a researcher for Greenpeace.
Environmental groups this year failed to get bills opposed by the industry out of the state Senate, which Anadarko and Noble helped last year keep in Republican hands by pouring nearly $1 million into political groups that paid heavily for mailers attacking Democratic candidates.
Republicans in the House this year filibustered a bill that would have forced state regulators to map oil and gas pipelines throughout the state, a measure Democrats pushed in the wake of the fatal home explosion in Firestone investigators have blamed on a severed Anadarko pipeline. Another bill that would have barred oil drilling from within 1,000 feet of schools also died in the state Senate this year.
“You can’t miss all the ads and brochures in the doors, but how they exert influence so they can continue to make profit is not as well known,” said state Sen. Matt Jones, a Democrat from Louisville. “The fact that they opposed, even this year, after the tragic Firestone deaths, any mapping of pipes is beyond the pale.”
Republicans said the mapping legislation posed an unnecessary burden on the industry and would usurp the authority of state regulators, who they contended are better able than politicians to discern the concerns of industry and the public. They also complained that the mapping bill amounted to little more than grandstanding by Democrats.
Lobbyist disclosure reports (first reported by the International Business Times) show that Anadarko lobbyists opposed the mapping legislation. The bill also drew opposition from other energy companies and professional associations. Lobbyists for Noble sought to amend the bill, the disclosure reports show.
Campaign finance records show Anadarko gave $510,000 to the Colorado Economic Leadership Fund, which spent nearly $711,000, mostly on helping Republican senate candidates. Records show that fund spent more than $430,000 to help just two GOP candidates win their elections: Sen. Kevin Priola of Henderson and Sen. Jack Tate of Centennial.
Noble Energy last year gave $250,000 to Concerned Citizens for Colorado, which gave $380,000 to a Republican group that spent heavily in legislative races. That Republican group, Colorado Citizens for Accountable Government, spent nearly $700,000 opposing Democratic state senate candidate Rachel Zenzinger of Arvada. Zenzinger, buoyed by $150,000 in spending on her behalf from the advocacy group American Wind Action of Colorado, ended up winning the election.
Game plan from logging
The Colorado Supreme Court eventually overturned the fracking ban approved by Longmont voters. Gov. John Hickenlooper formed a task force to make recommendations on oil and gas drilling issues, and Polis agreed to pull back on his efforts for statewide voter initiatives to regulate the industry.
Castilian said that the push by Anadarko and Noble to change course wasn’t met with universal acclaim by other energy companies. He said nevertheless the companies were convinced they needed to take more direct control for a sustained statewide message instead of continuing to react when local skirmishes broke out. Castilian said he believes the industry’s political and public relations operation in Colorado is among the best financed in the country for energy forces. Had the industry not responded as it did, fracking likely would have been banned in Colorado, he said.
Noble and Anadarko representatives interviewed about a dozen firms to handle industry messaging before settling on Pac/west, Castilian said. The company had fought anti-logging initiatives that had embroiled the northwest. In that fight, Pac/west, with the backing of money from timber interests, launched a statewide campaign in Oregon that used mailers and phone calls to argue environmentalists and their lawyers were putting the lives of firefighters at risk, according to news reports.
Other industries have spent heavily on political issues in Colorado. For instance, Altria, which owns tobacco giant Philip Morris, put up $18 million last year to convince voters not to raise tobacco taxes. A 2013 report by Colorado Ethics Watch on oil industry spending on politics noted that the health care industry spent more on lobbying at the state legislature than all other industries combined between 2007 and 2012.
For oil and gas, the first notice that its new strategy was succeeding in helping the industry reclaim its political momentum came in 2014 when it succeeded in defeating a fracking moratorium in Loveland by 400 votes. The spending, and the wins, have kept rolling in.
The American Petroleum Institute also contributed $15 million last year to fight efforts by environmentalists to place on the statewide ballot measures that would give communities the ability to regulate oil and gas development and require 2,500-foot buffers between oil and gas infrastructure and homes, schools and hospitals. Environmentalists, which faced a barrage of “decline to sign” advertising financed by the industry, failed to get enough signatures to get those two initiatives on the ballot.
The fight may only just be beginning, however. Polis, the politician in the state who has pushed for the most severe restrictions on the oil and gas industry, is running for governor in the 2018 election. His chances to win the Democratic primary improved last week as U.S. Rep. Ed Perlmutter, D-arvada, dropped out of the race.
Chris Wright, chief executive of two Denver-based energy companies, called Polis’ entry “a huge risk” to the oil and gas industry. And the deadly Firestone explosion in April has reignited concerns over drilling’s proximity to communities, Wright added. “I think it’s a setback, absolutely. It’s an absolute human tragedy, people are dead,” he said.
The industry is aiming to convince the middle swath of the electorate to support the energy industry, said Wright, who leads Liberty Oilfield Services and Liberty Resources. Wright thinks it’s possible, as long as the industry doesn’t default back to the stance from several years ago of keeping quiet and out of the public debate.
Already, others are planning to tug voters in the other direction.
“They knew what was at stake,” said Rick Ridder, a political consultant with close ties to Polis. “They’ve got to stop a movement. You can throw millions of dollars at in issue but when people die because of your policies and practices, it doesn’t make a lot of difference. People are still going to be active against you.”