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Fact-checking political ads about Proposition 112

Posted at 6:35 PM, Oct 11, 2018
and last updated 2018-10-11 20:56:06-04

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DENVER -- Proposition 112, the measure that would force new drilling and fracking projects back further from homes and schools across Colorado, is a polarizing topic for residents around the state. 

The hot-button issue has also seen its fair share of political ads as the November election nears, but are those ads telling the truth or are they scare tactics coming from both sides? 

On the one hand, supporters of Proposition 112 say the measure is all about health and safety. On the other, opponents argue that if the initiative passes, the consequences will have its most significant impact on our state economy. 

By now, you've likely seen the numbers that opponents are using to back that claim, so we asked an economist at DU if those numbers are fact or fiction. 

Fact-checking the ads: Colorado will lose 43,000 jobs in the first year if the initiative passes

Let's start with an ad from opponents of Proposition 112, which claims Colorado will lose $258 million in state and local tax revenue and as many as 43,000 jobs in the first year alone, should the initiative pass. 

The figures in that ad come from this study, done by the Independent Common Sense Policy Round Table. The group uses a well-known economic model called REMI to predict the future economic impact of Proposition 112. 

The first part of the claim — that Colorado will lose $258 million in state and local tax revenue — is a fact, according to DU economist Jack Strauss. 

"However, I think those numbers are a little bit high in the first year," Strauss said of the second claim — that Colorado would lose as many as 43,000 jobs in the first year alone after the initiative becomes law — and called it misleading. Here's why:

If Proposition 112 were to pass, supporters stress 50,000 existing oil and gas sites can still operate under the measure - only new fracking sites would be impacted. 

But Strauss said the number of jobs lost would significantly grow as times goes on, as wells that are currently being drilled or that have been drilled for several years will eventually start to run dry. 

Fact-checking the ads: Colorado will lose $230 million in tax revenue in the first year

Opponents of Proposition 112 also claim that the state will lose $230 million in tax revenue during the first year if the initiative becomes law, contradicting the figure of $258 million lost in state and local tax revenue. 

Why the different figures? 

The study done by the Independent Common Sense Policy Round Table shows the direct loss in state and local taxes would range between $201 and $258 million in the first year. 

You have to remember those figures are a prediction.

The ad used by opponents of the proposition took the most significant number from that prediction, so while it's a fact that the state could lose $258 million in the first year, it is also misleading because it doesn't give you all of the context from that study. 

Fact-checking the ads: More than 147,000 jobs will be lost across the oil and gas industry

Opponents of Proposition 112 also claim that if the initiative becomes law, Colorado would see a dip in jobs in the next 12 years. 

Strauss said it is impossible to predict true economic impact more than a decade into the future. 

But there is no denying that the oil and gas industry has a substantial economic impact for Coloradans. Many of those 147,000 jobs — 77 percent of them, in fact — are outside the oil and gas industry. Think retail, the hospitality industry and construction. 

These are all jobs the oil and gas industry essentially creates because it's seen as a primary employer in the state. 

But again, the ad is somewhat misleading because it uses the largest figure in the study's range. The study states that by 2030, there will be roughly 115,000 to 147,000 fewer jobs throughout all sectors of the economy. 

"Do they probably overplay their hand? The answer is 'yes,' however, it's pretty clear that even if you half these numbers, these are fairly large numbers," Strauss said. 

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