Transparency lacking in Leeds School’s REMI report on 2,500-foot setback initiative

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Joel Dyer
Joel Dyer | Boulder Weekly

Honestly, at this point, I would have thought CU’s entire business school would be so embarrassed that everyone associated with the place would be screaming for an end to this whole REMI, oil-and-gas-spin scheme.

Guess not, because another industry-friendly “report” full of startling headlines was recently released into the click-bait universe.

The report in question is titled Colorado Oil and Gas Industry: Economic Assessment of 2,500-Foot Oil and Gas Setback Proposal and was generated, for lack of a better word, by the Business Research Division of the Leeds School of Business at the University of Colorado Boulder.

Sounds important.

And that my friends, is the whole point. It’s just another example of credibility-washing industry spin.

I can’t possibly rehash my entire multi-month, 10,000-word investigation into the Common Sense Policy Roundtables’ REMI operation at the Leeds School. It was called “Behind the Curtain: An inside look at the oil and gas industry/Republican ‘Redprint’ for turning Colorado from blue to red.”

So if you want all the sordid details you’ll need to revisit that piece from Sept. 17, 2015. For this most recent report, which is clearly an attempt to discredit the citizen effort to put a 2,500 setback — a buffer zone between oil and gas operations and homes, schools and hospitals — initiative on this November’s ballot, I’ll just recall a few of the high points.

REMI is the name for a particular program that is used all over the country to model regional economic data. It was developed by a company called Regional Economic Models Inc., hence the name, and has a decent reputation at doing the job it was built for. Obviously, it is only as accurate as the data fed into it. It is this potential for “garbage in, garbage out” that has led critics to claim that the program is sometimes used to create economic reports paid for by corporations who fill it with select data to create what amounts to corporate spin.

So how did REMI find its way to the Leeds School?

The Leeds School version goes like this: In 2013, three organizations who had secured the regional exclusive rights to the REMI program for a five-year period came to Leeds and contracted to pay the school $110,000 per year to run the program for them and produce reports. In addition, the school could use the program for its own projects at no cost. The three organizations were the Common Sense Policy Roundtable, Metro Denver Economic Development Corporation and Denver South Economic Development Partnership.

The last two of those are established business organizations with right-leaning tendancies. Common Sense Policy Roundtable (CSPR) is a Republican/oil and gas industry front group run by political operatives that calls itself a conservative think tank.

When I did my original investigation, I asked Richard Wobbekind, director of the Business Research Division at Leeds School of Business, if he knew who and what CSPR really was. He told me he did not. He went so far as to claim that if CSPR alone, without the other two more established business organizations, had approached leeds with the REMI proposal, they would have been turned down.

So that’s the Leeds version of things.

Here’s the real story: CSPR alone got the exclusive rights to REMI for five years. CSPR alone signed the contract with the Leeds School. The other two entities, which are hardly pure as snow politically, basically are in a relationship where they pay dues to CSPR to be in the loop on projects. But the final say on everything, including if a report ever gets released or the timing of that release, along with what gets studied, is controlled by CSPR. And the 2,000 documents we got from a Greenpeace open records request showed clearly that Leeds knew all of this.

Despite having this clear knowledge, all REMI reports up until my earlier investigation, claimed, in the fine print, that the work had been done for all three groups which it claimed owned the REMI exclusive license together and had together contracted Leeds to do the work. It was a classic case of credibility washing.

Who would take a report generated for CSPR alone, paid for by CSPR alone and created on software owned and controlled by CSPR alone seriously?

After all, CSPR was founded by and is run by Kristin Strohm, with help from a couple of political operatives who work for her husband Josh Penry’s consulting firm, EIS Solutions. Strohm and Penry are often referred to as the power couple of fracking.

Strohm’s day job is cofounder of the Starboard Group, the most powerful fundraising/consulting entity for the Republican party in the Western United States. CSPR actually pays Starboard group to rent her as its director. You may recall Penry as the former Republican state senator who left office to become an oil and gas consultant.

Like I said, you’d have to go back to the “Behind the Curtain” investigation to get the whole story on CSPR, Strohm and Penry.

I’ll just add that CSPR works with the Koch brothers and is one of the principal drivers behind oil and gas front group Vital for Colorado. CSPR’s board is comprised of oil and gas industry insiders and Koch adherents who attend the brothers infamous annual meetings where subjects such as “how to use the university system to further Koch’s conservative agenda” are discussed. CSPR’s board members are a collection of people with ties to CRED (the powerful oil and gas front group founded and funded by Anadarko Petroleum and Noble Energy, see page 12 for more) and Colorado Concern.

In other words, this most recent REMI report claiming that if Initiative #78’s 2,500-foot setback were to make the ballot and pass, the sky would fall, we’d all lose our jobs and our children would go hungry, was bought and paid for by operatives of the oil and gas industry/Republican Party with a few uber-wealthy, pro-natural gas Democratic Party donors tossed in for good measure.

And like I said, the other two business groups whose names appear on this report are hardly objective outsiders to all this oil and gas industry maneuvering to stop the ballot measures.

Consider that Metro Denver Economic Development Corporation is simply an affiliate of Denver Metro Chamber of Commerce, which puts it under the control of political operative Kelly Brough who is a member of Colorado Concern and on the boards of oil and gas front groups CRED and Vital for Colorado, which are spending millions of dollars in an effort to keep the 2,500-foot setback and community control initiatives off the ballot.

And you may recall from my recent reporting on the oil and gas industry’s Initiative #138 that it was put forward by Brough’s chamber’s energy industry director Scott Prestridge. Initiative #138 is the oil and gas industry’s attempt to prevent community control over its activities inside city limits. It’s literally the opposite of initiative #75 that gives communities local control.

And another thing that makes this report stink, for lack of a better word, is its ridiculous examination of the issue. All of the information about the impacts of a 2,500 foot setback came from a single source, the Colorado Oil and Gas Conservation Commission (COGCC).

Yep, that COGCC, the same oil and gas cheerleading agency whose primary job is to promote the industry. No, I’m not exaggerating. Go look at this week’s cover story on page 12. The COGCC is supposed to regulate the oil and gas industry but as shown in the recording from this week’s cover story, its members participated in a meeting where CRED explained how it is taking over city councils and spending millions to make sure ballot measures like #78 get defeated. The COGCC is as much an industry insider as CSPR.

Furthermore, the REMI report admits that statewide mapping is inadequate and so the COGCC had to do some guessing about how much area would be lost if the setback took effect.

And does anyone ever read these things? Good grief. This report is not only based mostly on an oil promoters guesstimates, it also contains this jewel. “Based on estimates provided by the COGCC, a 2,500-foot setback would curtail accessible drilling locations by 90.2%. Extrapolating this to a reduction in new production, coupled with the quickly depleting yields from existing wells, leads to deeper reductions in GDP, employment, and income compared to a baseline scenario. Assuming a 90.2% reduction in new production beginning in 2017…”

So let’s see, if 90.2 percent of surface is off limits to drilling because it’s within 2,500 feet of a home, school or hospital, then there must be a 90.2 percent loss in oil and gas production. Right?

Maybe in 1945, but not today. These wells are drilled horizontally through the tight shale formations. They can be drilled 2.5 to 3 miles in length if need be. So pushing back a well location an extra 1,500 feet doesn’t necessarily prevent production, it just means the well has to be drilled 1,500 feet longer.

Yes, some production will no doubt be lost with a 2,500-foot setback, but to claim that a 90.2 percent loss in surface area where drilling locations can be placed equals a 90.2 percent loss in production is silly.

Some wells will simply need to be longer and a bit more expensive, but that does not make them impossible to drill.

Everything about this REMI report shows it to be little more than an oil and gas industry product with about as much useful information as CRED’s TV ads, which continue to bend the truth so far my grandmother would have taken a switch to them for lying.

If you haven’t signed a petition for Initiative #78, you still have a few days but you better hurry. If you’re still searching your soul for a reason to sign it, the very fact that these guys are still pulling this REMI crap is justification enough. 

Note to CU: When you get caught, like you did with my earlier reporting, you are supposed to have the good sense to stop doing what you got caught at.

You can’t go on pretending that we don’t know the emperor has no clothes. The Leeds School and CSPR are naked, and frankly, it’s not an attractive sight.

In a normal setting, I’d predict that heads would roll over at the university. But this one is being run by a Republican oil man who happens to be a member of  Colorado Concern, the real puppeteer of Colorado politics. Hell, you Leeds guys will probably get a raise. Hope it’s worth it. This opinion column does not necessarily reflect the views of Boulder Weekly.