HB 1089 will allow the Department of Revenue to allocate revenue more fairly to areas impacted by Colorado’s energy boom
The General Assembly took action today to help local communities impacted by the unprecedented oil and gas boom occurring across Colorado. HB 1083, sponsored by State Representative Kathleen Curry (D-Gunnison), sets new criteria so more severance tax dollars are directed more equitably to communities that are experiencing the most oil and gas development.
“I appreciate the hard work of the interim committee on severance tax and federal mineral lease revenue, as well as the fine efforts of the working group to craft recommendations that will truly help those communities most affected by the energy boom. Their efforts and recommendations are reflected in this bill. Although I’m just a messenger, I’m honored to carry it. It will greatly improve how we distribute revenue to areas impacted most by oil and gas.”
In 2007, the Colorado Oil & Gas Conservation Committee approved 6,368 new permits for drilling, a new record. That represents an 8% increase from 2006. In Garfield County alone, there were 2,550 new permits issued. In all, there are over 31,000 active wells in the state, and over 40,000 that have been plugged. This is only the beginning of a long-term development plan by the industry.
“This is a good piece of legislation that recognizes impacts occur where employees live, drilling occurs, and where drilling will occur in the future,” said Rep. Bernie Buescher (D-Grand Junction). “Over time, this bill will improve the fairness of how severance tax and federal mineral lease money is distributed.”
The legislation reallocates revenue from the severance tax fund to counties not only based on the number of employees in the oil and gas sector who reside there, but also based on the number of permits filed, and the amount of production occurring. Additionally, it increases the number of non-industry representatives who serve on the mineral advisory committee, changes the reporting requirements that local governments must follow, and provides the Department of Local Affairs with more guidance for how to make grants equitably to ensure those counties that need the money most get it.
Local communities across the state are struggling with the impacts of this unprecedented boom: affordable housing is scarce, roads neeed to be repaired, schools need to be built, more public safety offcials are needed. HB 1083, which grew out of the Interim Committee to Study the Allocation of Severance Tax and Federal Mineral Lease Revenues, attempts to mitigate these problems.
The bill awaits final approval from the House before moving to the Senate for further debate.
-- Posted by staff