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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 10/16/2018 - ITEMS RELATING TO THE CITY COUNCIL'S POSITION ON AAgenda Item 12 Item # 12 Page 1 AGENDA ITEM SUMMARY October 16, 2018 City Council STAFF Ginny Sawyer, Policy and Project Manager Carrie M. Daggett, Legal SUBJECT Items Relating to the CIty Council's Position on Amendment 74 and Propositions 109, 110, and 112. EXECUTIVE SUMMARY A. Resolution 2018-100 Expressing the City Council’s Opposition to Amendment 74, an Attempt to Amend the Colorado Constitution to Drastically Limit State and Local Government at a High Cost to Taxpayers and Urging the Citizens of Fort Collins to Vote “No” on this Ballot Issue. B. Resolution 2018-101 Expressing the City Council’s Opposition for the Passage of Proposition 109 Relating to Transportation Bonds and Urging the Citizens of Fort Collins to Vote “No” on this Ballot Issue. C. Resolution 2018-102 Expressing the City Council’s Support of Proposition 110, Authorizing a 0.62 Percent State Sales Tax to Fund Transportation Infrastructure, and Authorizing Related Bonds, and Urging the Citizens of Fort Collins to Vote “Yes” on this Ballot Issue. D. Resolution 2018-103 Expressing the City Council’s Opposition to the Passage of Proposition 112 Relating to Oil and Gas Setbacks and Urging the Citizens of Fort Collins to Vote “No” on this Ballot Issue. The purpose of this item is to consider City Council positions for statewide ballot measures up for election on November 6, 2018. These measures are Amendment 74, which would dramatically change state “takings” law; Proposition 109, which would bond $3.5 billion in transportation money to be repaid with existing revenue; Proposition 110, which would increase the state sales tax by 0.62% with those monies going to transportation; and Proposition 112, which would impose a mandatory 2,500 foot setback for all oil and gas production in the state. The Legislative Review Committee (LRC) took the following positions on the initiatives, which mirrored those of the Colorado Municipal League: Proposition/Amendment LRC position Amendment 74 Oppose Proposition 109 Oppose Proposition 110 Support Proposition 112 Oppose STAFF RECOMMENDATION Staff recommends adoption of the Resolutions. BACKGROUND / DISCUSSION As the November election draws near, there are several citizen-initiated measures on the state wide ballot, Agenda Item 12 Item # 12 Page 2 which will be decided on November 6. The Colorado Municipal League (CML) has done some analysis on issues of direct interest to local governments, identified as Amendment 74 and Propositions 109, 110, and 112. The Legislative Review Committee (LRC) has discussed and taken position on these four measures, which mirror those of the adopted positions of CML. Staff has provided background on the four measures, including CML’s position and associated City Legislative Policy Agenda (LPA) language, below. Additionally, attached is documentation detailing CML’s positions as attachments to this AIS. Initiative Number/Name Brief Summary CML/LRC Position Associated LPA Language Amendment 74 Requires state or local government to award “just compensation” to an owner of private property when a law reduces “fair market value” of a property. Drastic change to existing “takings” law in Colorado Oppose The LPA speaks to multiple positions that maintain Home Rule Authority. This initiative undermines that authority and could result in financial risk and unintended consequences. Proposition 109 Authorizes $3.5B in transportation bonds, paid for with existing revenue, no local share. Oppose LPA supports funding for the buildout of I-25, but does not directly speak to using existing funds to do so. Proposition 110 Raises state sales tax by 0.62% - all new revenue goes to transportation and maintenance projects, approximately $5M annually for Fort Collins Support The LPA supports alternative methods of funding transportation infrastructure needs and supports funding for the build out of Interstate 25 improvements, which may include a ballot measure. Proposition 112 Requires new oil and gas development to be set back 2,500 ft from “occupied structures” or “vulnerable areas” Oppose The LPA supports greater local control related to oil and gas development. This measure would require a code change and would significantly impact local property owners and developers. CITY FINANCIAL IMPACTS If passed, these four initiatives could have various positive and negative impacts on the City’s financial Agenda Item 12 Item # 12 Page 3 ATTACHMENTS 1. Amendment 74-CML position (PDF) 2. Proposition 109-CML position (PDF) 3. CML Executive Board Weighs In On Important Transportation Initiatives (PDF) 4. Proposition 112-CML position (PDF) EMPOWERED CITIES AND TOWNS, UNITED FOR A STRONG COLORADO 1144 Sherman Street, Denver, CO 80203  (p) 303-831-6411 / 866-578-0936  (f) 303-860-8175  www.cml.org To: Executive Board From: Sam Mamet, Executive Director Date: September 5, 2018 Subject: Amendment 74 (formerly Initiative #108), Oppose Summary Amendment 74 (formerly Initiative #108) is a change to the Colorado Constitution. It requires either the state or any local government to award “just compensation” to an owner of private property when a government law or regulation reduces the property’s “fair market value.” It is self-executing and effective upon the Governor’s declaration. Municipal Impact “Takings” law is well settled in Colorado, primarily as a result of the current language in our Constitution, which dates back to 1876, when Colorado was admitted into the Union of States. In fact, our language even goes beyond the federal 5 th Amendment because Colorado’s provision also covers damages, viewed as diminishing “economic value.” The notion of “fair market value” is a new variable, not defined, and likely can’t be further clarified because it is in the Constitution. No flexibility is granted to the General Assembly to implement this measure. Thus, only the State Supreme Court will be left to adjudicate such matters. Every municipal policy decision which turns on zoning, land use, liquor, marijuana and other forms of licensing, ordinance enforcement to protect public safety, affordable housing initiatives, environmental protection (especially when mandated by state or federal regulation), urban renewal and redevelopment, and prohibitions of undesirable uses such as an adult entertainment business in a neighborhood, right to farm ordinances, governmental decision making moratoria on certain industrial uses all will be subject to attack when a plaintiff alleges such a governmental action or regulation reduces a property’s fair market value. The amendment does not specify which regulations are implicated. Litigation costs will be significant, and definitely affect city and town budgets in a manner that existing programs and services may well be constricted or eliminated. Impacts upon municipal decision making will be extensive and damaging. The initiative was drafted by an attorney on behalf of Anadarko, Noble Energy, and several other producers both as a reaction to the setback proposal (Proposition 112, formerly Initiative #97) and to local government regulations some sectors of the industry feel are negatively affecting production. The Colorado Farm Bureau is identified as the major proponent “because farmers poll well,” but that organization has really became a pawn in a much bigger chess game. Local taxpayers and their local governments will be the collateral damage. This is all about specific oil and gas producers protecting their bottom line at the expense of Colorado’s citizens. There will be major consequences upon various state agencies like CDOT, DNR, and CDPHE. A whole new system of courts resolving property disputes may be required. This language will be the preferred legal “weapon of choice” for one property owner to sue another property owner. There is no levelling of the playing field for the “little guy” in this measure. Those with deep pockets will surely take advantage of 74 and go as far as they can. Proponents argue that existing legal protections are simply not enough. They have cited Boulder County’s GMO ordinance (restricting genetically modified crops), and Thornton’s water pipeline project in Larimer County as examples of government overreach. Staff Recommended Motion Because of the unknown consequences and severe fiscal and administrative impacts of 74 both upon the state and municipalities, the Colorado Municipal League does now oppose Amendment 74. The League is authorized to make cash and other contributions from private source revenues to an appropriate issue committee provided such contributions are expended from the special fund maintained by the League for such purposes. Such contributions shall not exceed private source revenues available to the League. The League is also authorized to make expenditures of staff time and other resources in the regular course and scope of the League’s work informing its membership and others. ATTACHMENT 1 EMPOWERED CITIES AND TOWNS, UNITED FOR A STRONG COLORADO 1144 Sherman Street, Denver, CO 80203  (p) 303-831-6411 / 866-578-0936  (f) 303-860-8175  www.cml.org To: Executive Board From: Morgan Cullen, Legislative and Policy Advocate Date: September 5, 2018 Subject: Proposition 109 (formerly Initiative #167), Oppose Summary If passed, Proposition 109 (formerly Initiative #167), sponsored by the Independence Institute and their “Fix Our Damn Roads” campaign, would require the state to raise $3.5 billion in bonds (without raising taxes or fees) with a maximum repayment cost of $5,200,000 over 20 years. All of the voter approved proceeds would be TABOR exempt and excluded from state fiscal spending year limits. The proceeds would go solely to state road and bridge expansion, construction, maintenance, and repair on a specified list of over 60 projects in 15 specific transportation planning regions across the state. Municipal Impact Between March 28 th and June 13 th , the Colorado Municipal League conducted a statewide municipal transportation infrastructure survey among its 270 members. Over this two and half month period, the League received responses from 134 municipalities, roughly half of its entire membership. Among the survey’s respondents, CML was able to ascertain an aggregate $3 billion revenue shortfall needed for municipal improvements and another $750 million in municipal maintanence needs in Colorado. The survey results, illustrated a statewide demand for additional transportation revenue among Colorado’s local governments that is comparable to the $9 billion funding shortfall experienced at the state level. Proposition 109 does nothing to address the infrastructure and maintenance funding shortfalls experienced at the municipal and county level across the state. Furthermore, while Proposition 109 would obligate the state to issue $3.5 billion in transportation bonds to fund new state transportation projects - this is only a third of the amount identified by CDOT needed to finance their current backlog. The proposition also does not identify how the state would finance the bond payments if the measure were to pass, leaving that responsibility up to the Colorado General Assembly. Since the state is constitutionally required to balance its budget each year, the bonds would likely be funded through cuts to other existing state programs and services. Many of these potential cuts, such as K-12 and higher education funding, severance tax distributions, and energy impact grants (just to name a few) would have an adverse impact on municipal budgets across the state. Since the bonds will be paid back over 20 years, the size and scope of these cuts would only become more acute if a recession were to occur during this period. Staff Recommended Motion Because Proposition 109 does not offer a statewide solution to Colorado’s transportation challenges and given the pervasive challenges it will inevitably impose on the state budget, the Colorado Municipal League does now oppose Proposition 109. The League is authorized to make cash and other contributions from private source revenues to an appropriate issue committee provided such contributions are expended from the special fund maintained by the League for such purposes. Such contributions shall not exceed private source revenues available to the League. The League is also authorized to make expenditures of staff time and other resources in the regular course and scope of the League’s work informing its membership and others. ATTACHMENT 2 9/7/2018 CML Executive Board Weighs-In On Important Transportation Initiatives - CML http://www.cml.org/initiatives-transportation-positions/ 1/2 CML Executive Board Weighs-In On Important Transportation Initiatives This past week, the CML Executive Board voted unanimously to weigh-in on an issue that has been dogging Colorado’s cities and towns for more than two decades – transportation funding. At the board's direction, CML will be joining a broad coalition of public and private stakeholders across the state in support of Initiative #153, which would increase the state sales tax by 0.62 percent (or about 6 cents on a $10 purchase). If passed, all of the new revenue will go to fund transportation and maintenance projects across the state, with a significant portion going directly to Colorado’s municipalities. Although some board members were hesitant to raise the sales tax, a critical source of revenue for municipal government, the need for a comprehensive statewide solution that would solve Colorado’s long-term transportation challenges ultimately took precedence. For CML Executive Board Member and Denver Councilmember Kendra Black, the decision really came down to basic arithmetic. “For the past three decades, the 0.22 cent gas tax has remained flat while the rate of inflation and construction costs have continued to increase. The result is that the state and local governments are receiving only half the transportation dollars they once did. This is simply unsustainable.” This past spring, CML conducted a statewide transportation survey asking our 270 member municipalities to offer feedback on the challenges they have experienced at the local level and the results clearly substantiate Black’s assertion. Among the survey’s respondents, CML was able to ascertain an aggregate $3 billion revenue shortfall needed for municipal improvements and another $750 million in municipal maintenance needs in Colorado. Coupled with the transportation shortfalls experienced at the county level, the collective local government discrepancy could easily meet or exceed the $9 billion funding deficit currently afflicting the state. If the projections are accurate, Initiative #153 appears to be the comprehensive solution the state needs to solve its infrastructure challenges. The initiative would distribute 45 percent of the revenue to the state highway fund for bond repayments for state projects and maintenance. The next 40 percent of the revenue would be allocated to the newly created Local Transportation Priorities Fund; this revenue would be divided between municipalities (50 percent) and counties (50 percent). The county-by-county and municipality-by- municipalities distributions will be based off of the current HUTF local distribution formula and each local government will have complete flexibility to spend those dollars on any transportation related purpose. ATTACHMENT 3 9/7/2018 CML Executive Board Weighs-In On Important Transportation Initiatives - CML http://www.cml.org/initiatives-transportation-positions/ 2/2 The final 15 percent of new revenue would be allocated to the newly created Multimodal Transportation Options Fund, with 85 percent of the funds allocated specifically by the state transportation commission for local multimodal projects. Before its’ 20-year expiration date, the sales tax is expected to raise more than $21 billion in new revenue for transportation, with more than $4.3 billion going directly to municipalities. Colorado’s cities and towns also would be eligible for nearly $3 billion in additional multimodal funding for things such as bus programs, bike paths, sidewalks, pedestrian bridges, and light rail. While the CML Executive Board did move to affirmatively support Initiative #153 this November, they chose to oppose another transportation-related initiative that also qualified for the ballot. The Independence Institute has put forward Initiative #167 asking voters to approve a $3.5 billion bonding measure to “Fix Our Damn Roads,” paid for with existing revenue and without raising taxes. The board decided to oppose this measure because it did not offer a long-term comprehensive solution to Colorado’s transportation challenges. All of the proceeds would go solely to the state highway fund to address state road and bridge expansion and maintenance without addressing any of the transportation challenges at the local level. Also, the board felt the $3.5 billion bonding measure would not even come close to addressing the $9 billion backlog of projects identified across the state by the Colorado Department of Transportation. Ultimately, the CML Executive Board decided Initiative #153 was the best approach to solving a significant structural deficiency within our state’s budget. With Colorado’s population projected to double by 2050, it is imperative that a comprehensive solution be taken now to ensure our state’s commuters and residents continue to enjoy the same quality of life we have all come to expect in Colorado. © 2013 Colorado Municipal League 1144 Sherman Street Denver, CO 80203 (p) 303-831-6411 or 866-578-0936 | (f) 303-860-8175 | cml@cml.org ATTACHMENT 3 EMPOWERED CITIES AND TOWNS, UNITED FOR A STRONG COLORADO 1144 Sherman Street, Denver, CO 80203  (p) 303-831-6411 / 866-578-0936  (f) 303-860-8175  www.cml.org To: Executive Board From: Sam Mamet, Executive Director Date: September 5, 2018 Subject: Proposition 112 (formerly Initiative #97), Oppose Summary Proposition 112 (formerly Initiative #97) is a statute. It requires new oil and natural gas development not on federal land to be located at least 2,500 feet from an “occupied structure” or “vulnerable area.” “Occupied structure” is defined to mean any building intended for human occupancy, including homes, hospitals, and schools. “Vulnerable areas” is defined to mean playgrounds, permanent sports fields, amphitheaters, public parks, public open space, public and community drinking water sources, irrigation canals, reservoirs, lakes, rivers, perennial or intermittent streams, creeks, and any other such locations as may be designated by the state or a local government. A local government is defined as any statutory or home rule county, city and county, city, or town (presumably including home rule municipalities although the measure is not explicit in this regard). Oil and gas development is defined rather generically and broadly, and does include the process of fracking. A previously plugged or abandoned well that comes back on line is considered new oil and gas development. The state or a local government can designate a larger distance. And, in the event two or more local governments with jurisdiction over the same geographic area establish different distances, the larger of the distances prevails. This measure is self-executing and applies to oil and gas development after its effective date. Municipal Impact While not declared to be a matter of statewide concern, the preemptive nature of any distance limit less than 2,500 feet could certainly be construed to restrict both local control and home rule thereby limiting the ability of municipalities to negotiate MOUs with producers in which a smaller “setback” might be offered in exchange for other land use and zoning considerations, as an example. The official fiscal note accompanying the measure, which is required by state law, anticipates reduced severance and other tax revenues accruing to both the state and to local governments in the future. The industry itself has released various reports indicating that this measure will significantly restrict production activity in Colorado. Proponents argue that this measure will further protect the health, welfare, and safety of the citizens of the state. Staff Recommended Motion Because of the local control and home rule preemptive nature of Proposition 112 and its detrimental impact upon state and local government revenues, the Colorado Municipal League does now oppose Proposition 112. The League is authorized to make cash and other contributions from private source revenues to an appropriate issue committee provided such contributions are expended from the special fund maintained by the League for such purposes. Such contributions shall not exceed private source revenues available to the League. The League is also authorized to make expenditures of staff time and other resources in the regular course and scope of the League’s work informing its membership and others. ATTACHMENT 4 -1- RESOLUTION 2018-100 OF THE COUNCIL OF THE CITY OF FORT COLLINS EXPRESSING THE CITY COUNCIL’S OPPOSITION TO AMENDMENT 74, AN ATTEMPT TO AMEND THE COLORADO CONSTITUTION TO DRASTICALLY LIMIT STATE AND LOCAL GOVERNMENT AT A HIGH COST TO TAXPAYERS AND URGING THE CITIZENS OF FORT COLLINS TO VOTE “NO” ON THIS BALLOT ISSUE WHEREAS, state and local government services are essential to the citizens of Fort Collins; and WHEREAS, Amendment 74 has been written by certain out-of-state corporate interests to change the text of the Colorado Constitution, Article II, Section 15, which dates back to 1876, in a way that threatens basic governmental services; and WHEREAS, Amendment 74 declares that any state or local government law or regulation that “reduces” the “fair market value” of a private parcel is entitled to “just compensation” from that government; and WHEREAS, while Amendment 74 is shrouded in simple language, it has far reaching and complicated impacts; and WHEREAS, under the current Colorado Constitution, a property owner already has the right to seek compensation from state and local governments when their property is taken or damaged by those governments; and WHEREAS, Amendment 74 would expand this well-established concept by requiring the government – i.e., the taxpayers – to compensate private property owners for virtually any decrease whatsoever in the fair market value of their property traceable to any government law or regulation; and WHEREAS, Amendment 74 would create uncertainty because it is not clear what the language actually means or how it will be applied by the courts; and WHEREAS, Amendment 74 would severely limit the ability of Colorado’s state and local governments to do anything that might indirectly, unintentionally, or minimally affect the fair market value of any private property; and WHEREAS, Amendment 74 would drastically diminish the ability of our state and local governments to adopt – let alone attempt to enforce – reasonable regulations, limitations, and restrictions upon private property; and WHEREAS, Amendment 74 would place laws, ordinances, and regulations designed to protect public health and safety, the environment, our natural resources, public infrastructure, and other public resources in jeopardy; and -2- WHEREAS, Amendment 74 would directly impact zoning, density limitations, and planned development; and WHEREAS, Amendment 74 would make inherently dangerous or environmentally damaging activities prohibitively costly to attempt to limit or regulate, even in the interest of the public’s health and safety; and WHEREAS, any arguable impact upon fair market value – however reasonable or justified or minimal or incidental or temporary – resulting from state or local government action could trigger a claim for the taxpayers to pay or at least require the taxpayers to pay the costs to defend the claim in the courts; and WHEREAS, governments would be vulnerable to lawsuits for almost every decision to regulate or not to regulate, making regular government function prohibitively expensive for the taxpayer; and WHEREAS, similar efforts have been attempted and defeated in other states, such as the states of Washington and Oregon; and WHEREAS, the fiscal impact for similar language in Washington was estimated at $2 billion dollars for state agencies and $1.5 billion for local governments over the first six years; and WHEREAS, there were $4 billion dollars in claims in Oregon before the residents repealed a similar initiative three years after its passage; and WHEREAS, the constitutions of the United States and the State of Colorado establish well-tested protections governing the regulatory and physical taking of property interests by governments; and WHEREAS, the Council believes that Amendment 74 would have a significant detrimental impact on the work of the City of Fort Collins and its ability to promote the health, safety and welfare of the Fort Collins community, as well as the quality of life for Fort Collins residents and visitors. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the City Council opposes Amendment 74 and urges every registered voter to vote “NO” on Amendment 74 at the November 6, 2018, election. -3- Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 16th day of October, A.D. 2018. _________________________________ Mayor ATTEST: _____________________________ City Clerk -1- RESOLUTION 2018-101 OF THE COUNCIL OF THE CITY OF FORT COLLINS EXPRESSING THE CITY COUNCIL’S OPPOSITION FOR THE PASSAGE OF PROPOSITION 109 RELATING TO TRANSPORTATION BONDS AND URGING THE CITIZENS OF FORT COLLINS TO VOTE “NO” ON THIS BALLOT ISSUE WHEREAS, Proposition 109 (formerly Initiative #167) is a proposed statute that will appear on the November 2018 general election ballot; and WHEREAS, Proposition 109 would require the state to raise $3.5 billion in bonds (without raising taxes or fees) with a maximum repayment cost of $5,200,000 over 20 years and all of the voter approved proceeds would be TABOR exempt and excluded form stat fiscal spending year limits; and WHEREAS, the bond proceeds would go solely to state road and bridge expansion, construction, maintenance, and repair on a specified list of over 60 projects in 15 specific transportation planning regions across the state; and WHEREAS, Proposition 109 would obligate the state to issue $3.5 billion in transportation bonds to fund new state transportation projects, which is a third of the amount identified by the Colorado Department of Transportation as needed to finance their current backlog; and WHEREAS, Proposition 109 does not identify how the state would finance the bond payments, leaving that responsibility up to the Colorado General Assembly, which could result in cuts to other existing state programs and services; and WHEREAS, Proposition 109 does nothing to address the infrastructure and maintenance funding shortfalls experienced at the municipal and county level across the state, including within the City; and WHEREAS, the City Council believes it is in the best interests of the City for the Council to oppose the Proposition 109 and encourage the City's registered electorate to vote "NO" on such measure. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the City Council opposes Proposition 109 and urges every registered voter to vote “NO” on Proposition 109 at the November 6, 2018, election. -2- Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 16th day of October, A.D. 2018. __________________________________ Mayor ATTEST: _____________________________ City Clerk -1- RESOLUTION 2018-102 OF THE COUNCIL OF THE CITY OF FORT COLLINS EXPRESSING THE CITY COUNCIL’S SUPPORT OF PROPOSITION 110, AUTHORIZING A 0.62 PERCENT STATE SALES TAX TO FUND TRANSPORTATION INFRASTRUCTURE, AND AUTHORIZING RELATED BONDS, AND URGING THE CITIZENS OF FORT COLLINS TO VOTE “YES” ON THIS BALLOT ISSUE WHEREAS, a modern, safe and efficient 21st century transportation system is essential to Colorado’s quality of life and the health of our economy; and WHEREAS, Colorado’s population has grown nearly 60 percent since 1991, while state transportation spending per driver, adjusted for inflation, has been cut in half over that same time period; and WHEREAS, increased demands on our roads and bridges have resulted in increased traffic congestion, lost worker productivity and deep frustration among local citizens; and WHEREAS, the Colorado Department of Transportation has identified $9 billion in much-needed projects that lack funding; and WHEREAS, there has been a significant lack of resources available to local communities to address traffic congestion, maintenance needs and safety concerns; and WHEREAS, the failure to maintain roads and bridges adequately costs Coloradans on average of $468 per driver due to damage and unnecessary wear-and-tear to vehicles; and WHEREAS, truly addressing Colorado’s transportation challenges requires a dedicated, sufficient and guaranteed stream of revenue; and WHEREAS, a bipartisan, coalition of local elected officials, business leaders, labor unions, environmentalists, transit groups, and community activists have joined together to ask voters to raise the state sales tax by .62 percent, or about six cents on a ten-dollar purchase, for transportation needs; and WHEREAS, this measure will raise $767 million in its first year and allow for bonding of $6 billion for state projects; and WHEREAS, 40% percent of the new revenue will go to county and municipal governments to address local transportation needs and 15% will go to multi-model transit; and WHEREAS, Colorado voters will be able to vote on this statewide transportation solution on the November 2018 ballot. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF -2- FORT COLLINS that the City Council supports Proposition 110 and urges every registered voter to vote “YES” on Proposition 110 at the November 6, 2018, election. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 16th day of October, A.D. 2018. _________________________________ Mayor ATTEST: _____________________________ City Clerk -1- RESOLUTION 2018-103 OF THE COUNCIL OF THE CITY OF FORT COLLINS EXPRESSING THE CITY COUNCIL’S OPPOSITION FOR THE PASSAGE OF PROPOSITION 112 RELATING TO OIL AND GAS SETBACKS AND URGING THE CITIZENS OF FORT COLLINS TO VOTE “NO” ON THIS BALLOT ISSUE WHEREAS, Proposition 112 (formerly Initiative #97) is a proposed statute that will appear on the November 2018 general election ballot; and WHEREAS, Proposition 112 would require "new" oil and natural gas development (including a previously plugged or abandoned well that comes back online) not on federal land to be located at least 2,500 feet from an "occupied structure" or ''vulnerable area," with such terms defined as follows: "Occupied structure" is defined to mean any building intended for human occupancy, including homes, hospitals, and schools. "Vulnerable areas" is defined to mean playgrounds, permanent sports fields, amphitheaters, public parks, public open space, public and community drinking water sources, irrigation canals, reservoirs, lakes, rivers, perennial or intermittent streams, creeks, and any other such locations as may be designated by the state or a local government; and WHEREAS, the official fiscal note accompanying Proposition 112 anticipates reduced severance and other tax revenues accruing to both the state and to local governments in the future, and the oil and gas industry has released various reports indicating that this measure will significantly restrict production activity in Colorado; and WHEREAS, Proposition 112 would cause significant and unreasonable impacts to state and local governments and to the gas industry and would go farther than necessary for protection of the health, safety, and welfare of the citizens of the City; and WHEREAS, by precluding any distance limit less than 2,500 feet, Proposition 112 would restrict both local control and home rule, thereby limiting the City’s ability to negotiate agreements with producers in which a smaller "setback" might be offered in exchange for other land use, zoning and operational considerations, as an example; and WHEREAS, the City Council believes it is in the best interests of the City for the Council to oppose the Proposition 112 and encourage the City's registered electorate to vote "NO" on such measure. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the City Council opposes Proposition 112 and urges every registered voter to vote “NO” on Proposition 112 at the November 6, 2018, election. -2- Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 16th day of October, A.D. 2018. __________________________________ Mayor ATTEST: _____________________________ City Clerk situation. If Amendment 74 were to pass, the impacts would likely be negative due to increased liability of the City for decisions that result in a decrease to “fair market value” of any property. Things like zoning regulations, oil and gas setbacks, and numerous other decisions would fall under this law and the exact impacts are difficult to predict. For Proposition 109 and Proposition 112, the impacts could be negative to the City given constraints to the state’s budget that would result from both initiatives. With 109, the $3.5 billion of bonds will need to be repaid with existing revenues. This could result in tightening of other areas of the state budget, including areas from which the City receives funding. The impacts to local government from 112 are likely to be more direct, given that if this proposal passes, the state is expected to see a reduction in severance and other tax revenues. Proposition 110 represents a potential increased revenue source to the City, as part of the 0.62% sales tax increase is guaranteed to local government through the existing Highway User Trust Fund (HUTF) local distribution formula. The anticipated impact for Fort Collins is expected to be an additional $5 million annually for use on transportation projects.