BOARD OF COUNTY COM'RS v. COGCC

• Citation: 81 P.3d 1119
• Decision Date: 25 September 2003
• Docket Number: No. 02CA1879.,02CA1879.
• Parties: BOARD OF COUNTY COMMISSIONERS of LAPLATA COUNTY, Board of County Commissioners of Archuleta County, Board of County Commissioners of Las Animas County, Board of County Commissioners of Routt County, and Board of County Commissioners of San Miguel County, Plaintiffs-Appellants, v. COLORADO OIL AND GAS CONSERVATION COMMISSION, an Agency of the State of Colorado, Defendant-Appellee.
• Court: Court of Appeals of Colorado

81 P.3d 1119

BOARD OF COUNTY COMMISSIONERS of LAPLATA COUNTY, Board of County Commissioners of Archuleta County, Board of County Commissioners of Las Animas County, Board of County Commissioners of Routt County, and Board of County Commissioners of San Miguel County, Plaintiffs-Appellants, v. COLORADO OIL AND GAS CONSERVATION COMMISSION, an Agency of the State of Colorado, Defendant-Appellee.

No. 02CA1879.

Colorado Court of Appeals, Div. II.

September 25, 2003.

Rehearing Denied November 13, 2003.¹

Goldman, Robbins & Rogers, LLP, Jeffery P. Robbins, Lindsey K.S. Nicholson, Durango, CO, for Plaintiffs-Appellants.

Mary Deganhart-Weiss, County Attorney, Pagosa Springs, CO, for Plaintiff-Appellant Board of County Commissioners of Archuleta County.

Dodridge C. Shelby, County Attorney, Denver, CO, for Plaintiff-Appellant Board of County Commissioners of Las Animas County.

John D. Merrill, County Attorney, Steamboat Springs, CO, for Plaintiff-Appellant Board of County Commissioners of Routt County.

Steven J. Zwick, County Attorney, Telluride, CO, for Plaintiff-Appellant Board of County Commissioners of San Miguel County.

Ken Salazar, Attorney General, Carol J. Harmon, Assistant Attorney General, Denver, CO, for Defendant-Appellee.

Hall & Evans, LLC, Thomas J. Lyons, Denver, CO, for Amicus Curiae Colorado Counties, Inc.

Geoffrey T. Wilson, Denver, CO, for Amicus Curiae Colorado Municipal League. Kenneth A. Wonstolen, Denver, CO, for Amicus Curiae Colorado Oil & Gas Association.

ORDER REVERSED

Opinion by Judge CASEBOLT.

In this action seeking judicial review of an agency rule under the Administrative Procedure Act, § 24-4-101, et seq., C.R.S. 2002(APA), and for declaratory judgment under C.R.C.P. 57, plaintiffs, the Boards of County Commissioners of the Counties of La Plata, Archuleta, Las Animas, Routt, and San Miguel, appeal the order of the district court dismissing their action against defendant, the Colorado Oil and Gas Conservation Commission (COGCC), for lack of standing. We reverse the order, void the amendment to the rule adopted by COGCC, and declare the rights of the parties as set forth in this opinion.

Plaintiffs brought this action challenging the validity of an amendment to COGCC Rule 303(a), promulgated under COGCC's rulemaking authority pursuant to the Oil and Gas Conservation Act, § 34-60-101, et seq., C.R.S.2002 (OGCA). The amended rule, dealing with permits to drill for oil and gas, states, "The permit-to-drill shall be binding with respect to any conflicting local governmental permit or land use approval process." Plaintiffs asserted that this amendment was invalid on its face because it exceeded the scope of COGCC's authority; that it was an incorrect statement of law; and that COGCC's rulemaking did not meet the requirements of applicable statutory procedures.

Plaintiffs and COGCC filed briefs on the merits in the district court arguing the validity of the amended rule. However, the court did not reach the merits. Instead, it dismissed the case sua sponte for lack of standing, holding that there was no actual dispute to resolve because plaintiffs did not allege that the revision had occasioned actual impairment of their land use regulatory functions. This appeal followed.

I.

Plaintiffs assert the district court erred in dismissing their complaint for lack of standing. We agree.

Standing is a threshold question of law, see Hall v. Walter, 969 P.2d 224 (Colo. 1998),

and thus we review the district court's determination de novo. See Cloverleaf Kennel Club, Inc. v. Colo. Racing Comm'n, 620 P.2d 1051 (Colo.1980).

The standing question involves application of a two-part test to determine whether a plaintiff has asserted a legal basis on which a claim for relief can be predicated. First, the plaintiff must have suffered an injury in fact, and second, that injury must be to a legally protected interest as contemplated by statutory or constitutional provisions. The injury in fact requirement is a constitutional limitation. Douglas County Bd. of Comm'rs v. Pub. Utils. Comm'n, 829 P.2d 1303 (Colo.1992). Hence, unless the plaintiff has suffered such an injury, standing does not exist, and the case must be dismissed. Wimberly v. Ettenberg, 194 Colo. 163, 570 P.2d 535 (1977).

The injury in fact element of standing need not consist of a direct, pecuniary loss. In the context of administrative action, this element of standing does not require that a party suffer actual injury, as long as the party can demonstrate that the administrative action "threatens to cause" an injury. However, an injury must be sufficiently direct and palpable to allow a court to say with fair assurance that there is an actual controversy proper for judicial resolution. O'Bryant v. Pub. Utils. Comm'n, 778 P.2d 648 (Colo.1989).

The injury in fact element of standing is established when the allegations of the complaint, along with any other evidence submitted on the issue of standing, establish that a regulatory scheme threatens to cause injury to the plaintiff's present or imminent activities. Bd. of County Comm'rs v. Bowen/Edwards Assocs., Inc., 830 P.2d 1045 (Colo.1992)(Bowen/Edwards).

The injury is to a legally protected interest for which judicial relief is available if the legal basis for the claim creates a right or interest that arguably has been abridged by the challenged action. State Bd. for Cmty. Colls. & Occupational Educ. v. Olson, 687 P.2d 429 (Colo.1984). This means simply that the plaintiff must demonstrate the existence of a legal right or interest that arguably has been violated by the conduct of the other party. O'Bryant v. Pub. Utils. Comm'n, supra.

The plaintiff's interest can emanate from a constitutional, statutory, or judicially created rule of law that entitles the plaintiff to some form of judicial relief. Bowen/Edwards, supra.

Here, the broad question presented is the extent to which both local governments and the state can regulate oil and gas operations and development. The state has authority to regulate under OGCA, which is administered by COGCC. Plaintiffs have the authority to regulate land use and development within their jurisdictions under the Local Government Land Use Control Enabling Act, § 29-20-101, et seq., C.R.S.2002, and the County Planning Code, § 30-28-101, et seq., C.R.S. 2002. Both COGCC and plaintiffs have adopted regulations in these areas, including amended Rule 303(a) at issue here.

In Bowen/Edwards, supra, an oil and gas operator challenged the validity of La Plata County's land use regulations governing oil and gas operations, arguing that OGCA preempted any local regulation of those operations. Noting that state and local governments have distinct interests in regulating those operations, the supreme court held that local regulatory authority could be required to yield to the state's authority using preemption analysis when "the operational effect of the county regulations conflicts with the application of the state statute or state regulations." Bowen/Edwards, supra, 830 P.2d at 1059.

The court explained that operational conflict arises where the effectuation of a local interest would materially impede or destroy the state interest, and it indicated that the courts would determine the existence of such a conflict on an ad hoc basis under a full evidentiary record. See also Voss v. Lundvall Bros., Inc., 830 P.2d 1061 (Colo. 1992)

(home rule city could enact land use regulations, and if the regulations did not frustrate and could be harmonized with development and production of oil and gas in a manner consistent with stated goals of OGCA, city's regulations should be given effect); Town of Frederick v. N. Am. Res. Co., 60 P.3d 758 (Colo.App.2002)(applying operational conflict analysis).

In our view, plaintiffs have sufficiently alleged an injury in fact. In their complaint, plaintiffs asserted that the adoption of amended Rule 303(a) threatens to cause an injury to their protected interests because it is a denial of local governments' rights established by statute and case law to regulate the oil and gas industry. They also alleged that the rule infringes upon and restricts their land use regulatory authority; the rule may require them to litigate in various district courts to force operators' compliance with their regulations; and it may expose them to the risk of multiple, inconsistent determinations from various courts.

Essentially, plaintiffs asserted that COGCC improperly expanded the operational conflict standard articulated in Bowen/Edwards by providing that Rule 303(a) prevailed whenever there is any conflicting local governmental permit or land use approval process. See Maurer v. Young Life, 779 P.2d 1317 (Colo.1989)

(injury in fact requirement satisfied by allegations of harm to a governmental body's institutional interests through usurpation of authority by another governmental entity and interference by a reviewing agency with the authority of another agency to carry out its enforcement and policymaking functions); see also Douglas County Bd. of Comm'rs v. Pub. Utils. Comm'n, supra (PUC approval of utility upgrade derogates county's land use plan; thus, county's injury in fact sufficiently alleged).

As COGCC correctly asserts, plaintiffs have not pleaded specific facts under which a conflict between amended Rule 303(a) and their land use regulations has actually occurred. See Bowen/Edwards, supra

(determination of conflict made on ad hoc basis under developed evidentiary record).

However, plaintiffs' challenge to amended Rule 303(a) is a facial attack, not an as-applied attack. Plaintiffs did not request the district court, or this court, to resolve a specific conflict between the rule and any of their current regulations. Instead, they seek a determination concerning the validity of the rule when read against the supreme court's delicate balancing of state and local interests as reflected in Bowen/Edwards, supra, and its enunciation of the...