Data Debunks Millionaire Congressman on Shale Development and Property Values
Millionaire Boulder Congressman Jared Polis and other anti-energy activists have claimed oil and gas development in Colorado drives down property values in the areas where drilling takes place. But according to data from the county with almost half the state’s active oil and gas wells, the talking points of Polis and fringe groups like Food & Water Watch are simply not true.
In June, Rep. Polis claimed to have statistics supporting his belief that nearby oil and gas development drives down property values:
“A recent study shows it reduces your property values by 4 to 15 percent … In many cases, it can put you underwater on your mortgage.”
Rep. Polis is the financial backer of Safe Clean Colorado, a campaign that was pushing two anti-energy measures for the statewide November ballot. The Congressman pulled down those ballot measures after Gov. Hickenlooper agreed to establish a 21-member task force to examine state and local regulation of the oil and gas industry in Colorado. With the ballot fight postponed for now, Safe Clean Colorado revealed in an e-mail to supporters its new goal is lobbying the task force to endorse the group’s agenda.
To fact-check Rep. Polis, Energy In Depth contacted officials in Weld County, home to almost 22,000 of Colorado’s more than 52,000 active oil and gas wells, and a place where thousands of wells have been drilled in recent years. In response to the claim that nearby oil and gas development drives down property values, Weld County Assessor Chris Woodruff said:
“We haven’t seen that proximity to oil and gas operations has caused a loss in value. We’re not seeing that.”
In fact, Woodruff says increased drilling in Weld County is helping to drive home prices up. The county’s residential property values are roughly 4 percent higher than they were two years ago, according to data from the tax assessor’s office. But Woodruff says he expects a much bigger increase heading into 2015, and oil and gas development is a major factor:
“We expect at least a 20 percent increase in residential property values across the board in Weld County.
Because oil and gas is such an enormous component of the local economy, it’s driving up demand for housing.”
While Woodruff assesses the value of all property in Weld County, market data from home sales confirm the upward trend. The real estate site Zillow says Weld County experienced an 11.9% increase in home prices between July 2013 and August 2014, with a 5.1% rise forecast for the coming year. In a recent Denver Post report, Brian Lewandowski of the University of Colorado’s Leeds School of Business said oil and gas development in Weld County “has helped employment in the region grow more quickly than the state or nation, kept unemployment rates lower and propelled rapid home appreciation.”
Further evidence of the trend can be found in a statement from the Loveland-Berthoud Association of Realtors opposing a “ban fracking” initiative in Loveland. The Association did not mince words in their statement in opposition to the initiative:
“Many of the statements made by [anti-energy activists] have no factual basis and are simply allegations. There is no data that indicates fracking is harmful to human health, the environment or property values.”
The difference between what Rep. Polis claims and the reality of what’s happening in Weld County is stunning, especially considering the Congressman keeps a vacation home in Weld County. He famously called himself the “poster boy for reining in out-of-control fracking” after three wells were drilled across the road from his property near Berthoud.
The huge discrepancy prompted Energy In Depth to explore where the Congressman picked up his talking points. To start with, the “fracking drives down property values” talking point really belongs to the national anti-energy activist group Food & Water Watch, which according to the Colorado Statesman is one of the “major players behind the anti-fracking movement” in Colorado has “played a key role in supporting initiatives to ban or delay fracking in local communities.”
As for the “study” cited by the Congressman, he is likely quoting from a University of Denver paper which claims “a 5%–15% reduction in bid value for homes located proximate to fracking scenarios.” But the paper’s credibility crumbles almost immediately.
The “study” is based on telephone interviews with homeowners in Texas, Alabama and Florida – not Colorado. The findings are not even based on real home sales. Instead, the survey participants were asked a series of questions about a hypothetical home purchase and what would influence the price they were willing to pay. But reading the questions from the telephone is like reading talking points from an activist group [emphasis added]:
“[A]n energy company bought the rights to inject a pressurized mix of water, sand, and chemicals into a lower groundwater aquifer to try to recover natural gas trapped under the property you are looking at buying.”
Telling the survey participants that a company will inject chemicals directly into an aquifer is guaranteed to elicit a negative response, but it’s also completely inaccurate. Hydraulic fracturing along the Front Range takes place inside shale and other tight rock formations more than a mile underground, not inside groundwater aquifers.
To make matters even worse, the paper even cites the anti-industry movie Gasland and a Vanity Fair magazine article titled “A Colossal Fracking Mess. The Dirty Truth Behind the New Natural Gas” as objective and credible sources.
If Congressman Polis relies on sources like these, it’s no wonder his anti-energy talking points are completely at odds with reality. Then again, that’s hardly surprising when the central claim of the campaign he’s funding – i.e. “Current laws allow fracking anytime, anywhere in Colorado” – has been debunked in the strongest possible terms by the Denver Post:
“This is a lie in so many ways that it’s hard to know where to start.”
It’s clear that Rep. Polis and the campaign he’s funding – Safe Clean Colorado – don’t know or don’t care to know the facts about oil and gas development in Colorado. As Energy In Depth has noted before, let’s hope the task force members are ready, willing and able to sort fact from fiction under some intense political pressure. Because the Polis-backed campaigners and other anti-energy groups like Food & Water Watch – backed by millionaires and billionaires – are very clearly bringing the fight to them.