Guest Opinion: Prop. 112 sets back much more than oil and gas industry
September 21, 2018
You may wonder why the owner of a crane and trucking company would be so concerned about a ballot proposal that relates to setbacks in the oil and gas industry. The simple fact is that the ramifications of Proposition 112 go well beyond those companies, businesses, and employees who directly work in or for the oil and gas industry. The ripple effect of passing this measure would be felt by every business and resident of our state.
In the case of my company, which is one of Colorado's oldest, our business is primarily transporting specialized loads and providing cranes in support of the construction and building industry. While I'm not directly in the oil and gas industry, I clearly appreciate the value of the energy industry to our state and local economies. The fact that the oil and gas industry currently generates $30 billion of activity in Colorado annually makes it one of the major engines for our economy.
According to experts, Proposition 112 will eliminate 85 percent of private and non-federal lands from future development. Such a move will severely limit future oil and gas development in our state. The business activity associated with the oil and gas industry not only fuels our economy but also generates substantial taxes that support state and local governments. A loss of tax revenue could lead to cuts in a wide range of programs or higher taxes for all of us.
Being in the transportation industry, I can relate to the engine comparison for the economy. In my eyes Proposition 112 would be akin to removing two sparkplugs from a six-cylinder engine in a car. In the case of an automobile, it will still run but the engine would misfire, sputter and lack acceleration. Similar to an automobile, our economy would still operate but lack the "spark" provided by the energy industry which would lead to a poorer performing economic engine that sputters and loses its acceleration related to growing jobs and businesses in our state.
For many businesses across the state, the passage of the proposition would create significant uncertainty. Businesspeople fear and dislike uncertainty and as a result they hedge or defer making investments whether it be improvements to their existing facilities, replacement or purchase of new equipment, or even whether they add or cut jobs.
In the case of the trucking industry and the 105,000 people that it employs in Colorado, the impact of a slowdown associated with the passage of the measure, would be felt by all of our companies and employees.
Recommended Stories For You
Our industry, which transports 79 percent of all of the goods in our state, would see less freight movement due to reduced demand for consumer goods, construction materials, office supplies, furniture, fuel and food. This drop in demand affects not only the jobs and finances of companies in our industry but also those many vendors and businesses, such as tire companies, truck dealers, insurance companies etc, whose major customers are trucking companies.
In addition to the immediate impacts, I am concerned about the longer term effects that Proposition 112 could have on our state. With the passage of this overreaching measure, our state would send a message to businesses considering a move to Colorado as well as businesses within our state that Colorado isn't the friendly business environment that it has been over the years.
Landing premiere companies and the good jobs that may go along with them is a highly competitive process among states and one can imagine other states pointing to Proposition 112 as a reason for those companies to avoid Colorado. Further, companies in our state, which are not in oil and gas, may view themselves as being at risk in the future from a similar excessive ballot initiative. Why should they make substantial investments and commit greater resources to the state when they may be the next industry that is effectively targeted?
As you consider Proposition 112, it's important to remember that what is at stake is much more than the oil and gas industry, it's really about whether voters will choose to set our overall economy back along with the welfare of our state and citizens.
Jeff Cummings is the president and CEO of Duffy Crane and Hauling, one of Colorado's oldest companies. He is a past chairman and current board director for the Colorado Motor Carriers Association, representing over 600 companies involved in trucking in Colorado.