Efforts to amend mineral leasing tax made difference | PostIndependent.com

Efforts to amend mineral leasing tax made difference

Efforts by county commissioners in northwest Colorado to change the way severance and federal mineral leasing tax is distributed have resulted in a big financial shot in the arm for those counties.Mesa County Commissioner Craig Meis applauded the efforts of his board and Garfield County commissioners and others to restructure how the state Department of Local Affairs counts employees of the oil and gas industry. DOLA uses those numbers to calculate how much money will be distributed.Last year DOLA convened a task force to look at distribution procedures, after local governments in northwest Colorado expressed concern over their decreasing revenues and over DOLA’s plan to hand out revenues to all counties in the state, not just those affected by mineral development.Meis and Garfield County Commissioner Larry McCown sat on the DOLA task force and the oversight committee along with representatives from DOLA and the oil and gas and coal industries. The task force also established a 45-day appeal period in which any government can lodge a complaint which is then reviewed and resolved by the oversight committee. Previously, there was no remedy if a local government detected an error in DOLA calculations.Meis said DOLA didn’t understand the nature of the oil and gas business and so undercounted employees, resulting in lower payouts to local governments.”They didn’t know where Battlement Mesa is, they thought it was part of Mesa County,” he said. “They didn’t know the difference between a tool pusher and a roustabout. It was a nightmare.”Garfield saw its highest jump ever in federal mineral leasing revenues this year, taking in $1.4 million, a 90 percent increase over the $740,750 collected in 2005. It also had a 79 percent increase in severance tax, receiving $3.7 million this year and $2.1 million in 2006.This year the state gave out $6.5 million in federal mineral leases and $16.6 million in severance tax revenues. The majority of that money went to governments in northwest Colorado.”We try to trade assets for assets to build healthy communities,” said Steve Colby with DOLA.However, the windfall had something of a downside because the tax distribution is divided according to a fixed amount per employee. Since more employees were counted this year, the amount of severance tax decreased per capita.Contact Donna Gray: 945-8515, ext. 510dgray@postindependent.com

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