Lawmakers advance heavily-amended climate bill in compromise with Gov. Polis

Democrats drop SB-200 but revive some limits on polluters in HB-1266

The Colorado State Capitol dome peeks above the foliage at Civic Center Park on June 11, 2020. (Andy Bosselman for Newsline)

As the Colorado General Assembly scrambles to wrap up the 2021 legislative session, lawmakers on Monday formalized a sweeping overhaul to a major piece of climate-change legislation, clearing the way for the bill to pass with support from Gov. Jared Polis, who had previously threatened to veto it.

In an abbreviated hearing before the Senate Finance Committee, lawmakers voted along party lines to amend House Bill 21-1266, which was passed by the lower chamber last month, and advance it to the Senate Appropriations Committee.

The new version of HB-1266, a bill aimed at boosting the state’s environmental-justice efforts, includes several provisions salvaged from Senate Bill 21-200, which was backed by Democratic lawmakers and environmental groups but fiercely opposed by Polis, who said the bill would give “dictatorial authority” to state air-quality regulators. Sponsors of SB-200 announced the compromise after weeks of negotiations with the Polis administration.

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As amended, HB-1266 would enact stricter limits on greenhouse gas emissions from the electric, industrial, and oil and gas sectors, while similar limits proposed by SB-200 on the buildings and transportation sectors have been dropped. The new bill also preserves provisions that would establish an environmental-justice advisory board and allow regulators to collect permitting fees from greenhouse-gas emitters in order to better fund state climate efforts.

The agreement on the new bill follows more than two years of conflict between Polis and top Democratic lawmakers on how best to achieve the emissions reduction targets set by House Bill 19-1261, landmark climate legislation enacted by the General Assembly in 2019.

Democratic state Sen. Faith Winter, from Colorado’s 24th District. (Colorado General Assembly photo)

“Since (HB-)1261 was passed … we have been asking to make sure that three things happen: that there’s equity, measurability and enforceability, especially in the top five sectors,” state Sen. Faith Winter, a Democrat from Thornton and prime sponsor of SB-200, told her fellow lawmakers at Monday’s hearing. “What this bill does is establish the environmental-justice task force … and we are doing measurability in all five sectors as well, and we’re doing enforceability in three of the sectors.”

Will Toor, executive director of the Colorado Energy Office, had clashed with Winter and other Democratic lawmakers over the administration’s climate policymaking in hearings on SB-200, but he testified in support of the compromise bill on Monday. HB-1266, Toor said, will help the state achieve the emissions reductions outlined in a greenhouse-gas “roadmap” finalized by the Energy Office earlier this year.

“We see this as an implementation bill that aligns with the strategies in the roadmap,” Toor told lawmakers. “The language in this bill sets statutory requirements for the rulemakings that fine-tune and align with the goals and timelines in the roadmap action plans.”

Opposition from business groups

Signed into law by Polis in May 2019, HB-1261 committed the state to overall greenhouse-gas emissions reductions of 26% by 2025, 50% by 2030 and 90% by 2050. But the bill’s sponsors and supporters grew increasingly frustrated by the administration’s implementation of the bill at the Air Quality Control Commission throughout 2019 and 2020, prompting SB-200’s attempt to enact stricter sector-by-sector limits on polluters.

Polis expressed support for some parts of SB-200, including the environmental-justice and permit-fee provisions, and a spokesperson said in May that the governor was “open to … further codify(ing) near term GHG reductions for the oil and gas industry and large industrial polluters.” But in comments to the editorial board of the Colorado Springs Gazette, Polis threatened to veto the bill as written, saying it would grant the AQCC, whose members he appoints, “dictatorial authority over our economy.”

“We are appreciative of the work the legislature has done to date on our shared climate goals,” a Polis spokesperson said in a statement on HB-1266. “We celebrate the historic investment in green infrastructure in the recently passed transportation bill and we welcome the opportunity to keep that momentum going by reaching agreement on additional climate legislation this session. We appreciate the sponsors working with us on our shared objectives.”

Opponents of the bill included the Colorado Oil and Gas Association, the American Petroleum Institute and the Colorado Chamber of Commerce.

“The places where the administration had the biggest discomfort with (SB-)200 was trying to apply the traditional air regulatory approach to buildings and transportation,” Toor said. “We don’t know how to structure such a rule in anything other than a cap-and-trade program, which the administration is not supportive of.”

Lobbyists from business and industrial groups who testified at Monday’s hearing cried foul over the last-minute amendment process, and expressed concerns over the costs of new regulatory requirements. Opponents of the bill included the Colorado Oil and Gas Association, the American Petroleum Institute and the Colorado Chamber of Commerce.

“It’s very difficult for us to digest and respond to a 25-page amendment that we got at 6 o’clock in the morning,” said Geoffrey Hier, government relations director at the Colorado Rural Electric Association. “This is not fair, and we would request a lot more time and review on this, and possible postponing.”

Lawmakers indicated that HB-1266, which still faces several procedural votes in the Senate and one in the House, could undergo additional changes before being sent to Polis’ desk.

“There’s several stakeholders that are either in the room or listening, and we are viewing some possible amendments for second (reading),” Winter said prior to Monday’s committee vote. “We’re working very diligently on it.”

Environmental groups who championed SB-200, and who have challenged the Polis administration to act more aggressively on climate regulation at the AQCC, said that the new HB-1266 is a step forward, but there’s plenty of work left to be done.

“The combined bill is progress that will require emissions reductions from some of the state’s largest pollution sources and enact strong environmental justice provisions, and more will need to be done to put us on track to meet our climate goals,” Conservation Colorado executive director Kelly Nordini said in a statement. “The unprecedented coalition of more than 100 groups who came together to work for climate action will continue our to work together to hit our climate targets.”

“I think we’re in a good position to get pollution reduction in some sectors of the economy, as well as some important environmental justice wins,” Jessica Gelay, Colorado government affairs manager for environmental group Western Resource Advocates, said in an interview. “And we come back next year and we keep working on the buildings sector and transportation.”

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