A unanimous Glenwood Springs City Council agreed Thursday to sign on to neighboring Pitkin County’s letter asking the Bureau of Land Management to cancel 25 oil and gas leases in Thompson Divide despite cautions from Garfield County Commission Chairman John Martin about possible fiscal implications should that happen.
“If the leases are withdrawn or canceled, it is a takings because there is a binding contract” between lease holders and the federal government, Martin told the council.
It’s an issue that may ultimately be decided in court, and damages could include requiring local governments that receive federal mineral-lease money to refund any funds distributed from those leases, he said.
“However much was received is how much you are going to be made to pay back,” Martin said, adding that would likely be accomplished through the withholding of future lease funds rather than an actual refund.
That would impact the county’s special federal mineral-lease district, which in turn makes grants to municipalities, fire districts and school districts in the county for various infrastructure projects and programs.
“You and the citizens are going to be paying that bill,” said Martin, who also noted that only three of the 25 Thompson Divide leases are in Garfield County.
City Council members said they’re willing to take the gamble, especially given the potential costs to Glenwood Springs’ tourism-based economy should the Thompson Divide leases eventually be developed and Four Mile Road and the city’s street network used as a heavy haul route to get to and from those gas wells.