City budgets $0 this year for severance tax revenue

The city of Grand Junction is budgeting zero dollars for severance tax and federal mineral lease revenue this year.

Both taxes are paid by companies that extract natural resources. Severance taxes are from the state, and federal mineral lease taxes are levied by the federal government.

The city received $1.03 million in federal mineral lease dollars and $2.1 million in severance tax revenue last year.

Given a downturn in drilling activity since the beginning of last year, though, the city is budgeting conservatively, City Manager Laurie Kadrich said.

“Anything we’d get would be helpful,” Kadrich said.

She said the city will get some grants funded by severance taxes, including a grant for radios used by law enforcement.

A change in the distribution formula for severance tax helped bring down the amount of severance tax delivered to the city in 2009 compared to 2008, when the city took in $3.7 million in severance tax revenue.


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Grand Junction, CO 81501
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