Submitted by Cameron A. Grant
Despite the Denver Post report, a takings claim in this situation could prove challenging. Takings claims are claims by property owners against government entities for depriving an owner of property without just compensation. Among other things, the Fifth Amendment to the US Constitution includes the following language: “nor shall private property be taken for public use, without just compensation.” In a nutshell, a mineral owner must demonstrate that a local ordinance prohibiting oil and gas drilling deprives them of all economic benefit from their rights.
In his article in the Vermont Law Review, Timothy Riley provides a comprehensive explanation of the current state of takings law and the issue of municipal regulation of oil and gas. While courts in other states have considered this issue we have yet to see a successful regulator takings claim in response to drilling regulation. Colorado could join the vanguard and we may see new takings law develop as the interplay between the expansion of cities and towns with the exploding growth in oil and gas development.