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Grand Junction, CO Colorado
GRAND JUNCTION — Severance taxes — the taxes energy companies pay the state to extract natural resources — are paid mostly by companies operating on the Western Slope.
Rep. Kathleen Curry, D-Gunnison, told a gathering of Club 20 members and legislators Thursday that she’d like to see more of the money raised by severance taxes stay where it came from. Club 20 is a lobbying organization comprised of residents and business leaders from 22 western Colorado counties that bills itself as the “voice of the Western Slope.”
Colorado has taken in $965 million in the last five years from state severance taxes and federal mineral leasing (both paid by energy industries for their operations),
Curry said. Of that, $354 million has come back to the 16 counties, many on the Western Slope, that see 99 percent of the energy impacts.
Curry and 10 other legislators spent months tweaking the severance tax system as members of the state legislature’s Interim Committee to Study the Allocation of Severance Tax and Federal Mineral Lease Revenues. That work boiled down to three bill proposals that legislators and committee members presented to Club 20 members on Thursday.
Bill A, which Curry called “The DOLA (Department of Local Affairs) Bill,” discusses distribution of state severance tax dollars to municipal and county governments.
The bill would add two residents of areas impacted by severance tax-paying industries as well as the Colorado Department of Public Health and Environment’s executive director to the Energy Impact Assistance Advisory Committee. The committee would make recommendations to the DOLA executive director about assisting energy industry-impacted areas if the bill becomes law.
The bill proposal also encourages more checks and balances for the DOLA executive director and would require the director to distribute severance tax revenue to cities, towns and counties based on the number of employees in each place that work for companies that pay severance taxes.
Bill B regards how the state severance tax revenue’s operational account fund balance is divvied up. Currently, the Colorado Oil and Gas Conservation Commission gets up to 45 percent of the fund while the Division of Reclamation, Mining and Safety gets up to 30 percent. Bill B would decrease the commission’s maximum intake to 40 percent and decrease the division’s to 25 percent.
As a result, up to 5 percent of the fund balance would go to the Division of Wildlife and up to another 5 percent would go to the Division of Parks and Outdoor Recreation.
The bill would offer an additional $1.5 million to the Division of Wildlife and $1.2 million to the Division of Parks and Outdoor Recreation, according to Sen. Gail Schwartz, D-Snowmass Village. Schwartz said the changes allow more money to be spread around without depleting the operational account fund balance.
“It doesn’t decrease their share, it just gives them the ability to cut the pie in a few more slices,” Schwartz said.
Bill C, as Sen. Josh Penry, R-Grand Junction, described it, “is a great tool to hardwire money back to the (energy impacted) communities immediately.” The bill would allow severance tax-paying companies to pay up to $1 million in early taxes for roads, bridges, schools, water or sewage facilities, hospitals, police and fire buildings, and other infrastructure, as long as the amount is equal to taxes they’d pay in the future.
The state couldn’t take more than $5 million in these contributions each year between Jan. 1, 2009, and Jan. 1, 2014. A company would have that five-year window to strike a deal with communities. If the communities approved, DOLA’s executive director would have 90 days to issue a certificate of eligibility for pre-payment to the company.
DOLA wouldn’t have the ability to deny the certificate just because it didn’t approve of the infrastructure deal, according to Penry.
“We’ve taken away DOLA’s ability to be the gatekeeper,” Penry said.
The bill’s next stop is the state house, where the legislative session begins in January.
Reach Emily Anderson at eanderson@gjfreepress.com.
GRAND JUNCTION — Severance taxes — the taxes energy companies pay the state to extract natural resources — are paid mostly by companies operating on the Western Slope.
Rep. Kathleen Curry, D-Gunnison, told a gathering of Club 20 members and legislators Thursday that she’d like to see more of the money raised by severance taxes stay where it came from. Club 20 is a lobbying organization comprised of residents and business leaders from 22 western Colorado counties that bills itself as the “voice of the Western Slope.”
Colorado has taken in $965 million in the last five years from state severance taxes and federal mineral leasing (both paid by energy industries for their operations),
Curry said. Of that, $354 million has come back to the 16 counties, many on the Western Slope, that see 99 percent of the energy impacts.
Curry and 10 other legislators spent months tweaking the severance tax system as members of the state legislature’s Interim Committee to Study the Allocation of Severance Tax and Federal Mineral Lease Revenues. That work boiled down to three bill proposals that legislators and committee members presented to Club 20 members on Thursday.
Bill A, which Curry called “The DOLA (Department of Local Affairs) Bill,” discusses distribution of state severance tax dollars to municipal and county governments.
The bill would add two residents of areas impacted by severance tax-paying industries as well as the Colorado Department of Public Health and Environment’s executive director to the Energy Impact Assistance Advisory Committee. The committee would make recommendations to the DOLA executive director about assisting energy industry-impacted areas if the bill becomes law.
The bill proposal also encourages more checks and balances for the DOLA executive director and would require the director to distribute severance tax revenue to cities, towns and counties based on the number of employees in each place that work for companies that pay severance taxes.
Bill B regards how the state severance tax revenue’s operational account fund balance is divvied up. Currently, the Colorado Oil and Gas Conservation Commission gets up to 45 percent of the fund while the Division of Reclamation, Mining and Safety gets up to 30 percent. Bill B would decrease the commission’s maximum intake to 40 percent and decrease the division’s to 25 percent.
As a result, up to 5 percent of the fund balance would go to the Division of Wildlife and up to another 5 percent would go to the Division of Parks and Outdoor Recreation.
The bill would offer an additional $1.5 million to the Division of Wildlife and $1.2 million to the Division of Parks and Outdoor Recreation, according to Sen. Gail Schwartz, D-Snowmass Village. Schwartz said the changes allow more money to be spread around without depleting the operational account fund balance.
“It doesn’t decrease their share, it just gives them the ability to cut the pie in a few more slices,” Schwartz said.
Bill C, as Sen. Josh Penry, R-Grand Junction, described it, “is a great tool to hardwire money back to the (energy impacted) communities immediately.” The bill would allow severance tax-paying companies to pay up to $1 million in early taxes for roads, bridges, schools, water or sewage facilities, hospitals, police and fire buildings, and other infrastructure, as long as the amount is equal to taxes they’d pay in the future.
The state couldn’t take more than $5 million in these contributions each year between Jan. 1, 2009, and Jan. 1, 2014. A company would have that five-year window to strike a deal with communities. If the communities approved, DOLA’s executive director would have 90 days to issue a certificate of eligibility for pre-payment to the company.
DOLA wouldn’t have the ability to deny the certificate just because it didn’t approve of the infrastructure deal, according to Penry.
“We’ve taken away DOLA’s ability to be the gatekeeper,” Penry said.
The bill’s next stop is the state house, where the legislative session begins in January.
Reach Emily Anderson at eanderson@gjfreepress.com.
