Page 1
April 11, 2022 HB 22-1348
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Fiscal Note
Drafting Number:
Prime Sponsors:
LLS 22-0306
Rep. Froelich; Caraveo
Sen. Winter
Date:
Bill Status:
Fiscal Analyst:
April 11, 2022
House Energy & Environment
Josh Abram | 303-866-3561
Josh.Abram@state.co.us
Bill Topic: OVERSIGHT OF CHEMICALS USED IN OIL & GAS
Summary of
Fiscal Impact:
☐ State Revenue
☒ State Expenditure
☐ State Transfer
☐ TABOR Refund
☐ Local Government
☐ Statutory Public Entity
The bill requires that oil and gas operators, and the manufacturers and distributers of
chemicals used in underground oil and gas operations, disclose specified information
to the Department of Natural Resources. The department must use the data to create
a web-based chemical disclosure list. The bill increases state expenditures beginning
in FY 2022-23, and are ongoing.
Appropriation
Summary:
For FY 2022-23, the bill requires an appropriation of $61,500 to the Department of
Natural Resources.
Fiscal Note
Status:
The fiscal note reflects the introduced bill.
Table 1
State Fiscal Impacts Under HB 22-1348
Budget Year
FY 2022-23
Out Year
FY 2023-24
Revenue
- -
Expenditures Cash Funds $61,500 $293,721
Centrally Appropriated - $56,383
Total Expenditures $61,500 $350,104
Total FTE - 3.2 FTE
Transfers - -
Other Budget Impacts - -
Page 2
April 11, 2022 HB 22-1348
Summary of Legislation
The bill requires that oil and gas operators, and the manufacturers and distributers of chemicals used
in underground oil and gas operations, disclose specified information to the Colorado Oil and Gas
Conservation Commission (COGCC) in the Department of Natural Resources (DNR). The bill sets
deadlines for compliance for both existing and new operators and manufacturers.
Manufacturers and distributers must disclose the trade name of chemical products, a list of the
chemical names and abstract service numbers, the estimated amount of each chemical used in the
product, and a description of the intended use. The disclosures must be accompanied by a written
declaration that the chemical product contains no intentionally added perfluoroalkyl or
polyfluoroalkyl (PFAS) chemicals. A manufacturer may decline the disclosure and file a trade secret
claim with supporting evidence to the COGCC. The COGCC must review the claim and determine if
the manufacturer has to disclose the chemical information.
Oil and gas operators using chemicals in downhole operations must disclose the date operations
commence, the county of the well site, the unique well identifier assigned by the American Petroleum
Institute, the trade names and quantities of chemicals used, and a written declaration that chemical
products used contain no intentionally added PFAS chemicals. Operators must also provide the
chemical disclosure list to all parties within a specified setback from the well site, to all public water
providers within specified distances or geographic features, and to the Division of Parks and Wildlife
in the DNR for well sites with proximity to high priority habitat or state wildlife areas.
The COGCC must use the information to create a chemical disclosure list for each applicable well site.
The list must include the names and chemical abstract service numbers and the total estimated amount
of each chemical in use at each well site. The list must be posted on a website accessible to the public
in a searchable and downloadable format. By July 31, 2023, the COGCC must adopt rules and
standards for the disclosure of chemical information to state or federal officials, contractors, health
care professionals, and scientists and researchers at institutions of higher education. The COGCC
must also prepare annual legislative reports to the General Assembly.
State Expenditures
The bill increases state expenditures in the Department of Natural Resources by $61,500 in FY 2022-23
and $350,104 in FY 2023-24 from the Colorado Oil and Gas Conservation and Environmental Response
Cash Fund. Expenditures are shown in Table 2 and detailed below.
Page 3
April 11, 2022 HB 22-1348
Table 2
Expenditures Under HB 22-1348
FY 2022-23 FY 2023-24
Department of Natural Resources
Personal Services - $270,801
Operating Expenses - $4,320
Capital Outlay Costs - $18,600
Office of Information Technology $61,500 -
Centrally Appropriated Costs
1
- $56,383
Total Cost $61,500 $350,104
Total FTE - 3.2 FTE
1
Centrally appropriated costs are not included in the bill's appropriation.
For FY 2022-23, the DNR will develop the infrastructure necessary to make a publically available
website of chemical disclosure information. The website will report data from the Colorado Oil & Gas
Information System, and interface with the COGCC Geographic Information Services Online
Interactive Map Tool. The Governor’s Office of Information Technology (OIT) will have about
500 hours of development hours to create and configure the database tables and reporting data entry
forms. This one-time cost for the OIT in FY 2022-23 is estimated at $61,500.
For FY 2023-24, the DNR will add staff support for website maintenance, processing data, forms
submission and review, compliance inspections, enforcement, and reporting. Staff will have ongoing
workload to develop and maintain disclosure forms, and to ensure data integrity and website
functionality. Based on data analyzed in an existing national chemical registry for hydraulic
fracturing, it is estimated that registering manufacturers and distributers, collecting disclosure
information, and evaluating and determining trade secret claims will require about 4,500 hours of staff
time, or about 2.2 FTE. Compliance inspections and enforcement are expected to require an additional
0.4 and 0.6 FTE, respectively.
Centrally appropriated costs. Pursuant to a Joint Budget Committee policy, certain costs associated
with this bill are addressed through the annual budget process and centrally appropriated in the Long
Bill or supplemental appropriations bills, rather than in this bill. These costs, which include employee
insurance and supplemental employee retirement payments, are shown in Table 2.
Effective Date
The bill takes effect upon signature of the Governor, or upon becoming law without his signature.
Page 4
April 11, 2022 HB 22-1348
State Appropriations
For FY 2022-23, the bill requires an appropriation of $61,500 to the Department of Natural Resources
from the Oil and Gas Conservation and Environmental Response Fund. This amount is then
reappropriated to the Governor’s Office of Information Technology.
State and Local Government Contacts
Information Technology Law Natural Resources
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit: leg.colorado.gov/fiscalnotes.