Measure would nix tax credit for energy
Communities at ground zero of the Colorado energy boom won’t suffer under a ballot amendment that would direct severance tax money into college scholarships, a proponent told Club 20 on Saturday afternoon.
Opponents, though, maintain Amendment 58 could leave local communities without a tax base they had counted on for bonding and other purposes.
Amendment 58 is the measure that would eliminate a state tax credit given to energy companies because of the local property taxes they pay.
Backers say it would close a loophole and generate more than $300 million a year for the state, 60 percent of which would be placed into the Colorado Promise Scholarship Fund.
The remaining funds would be divided with 10 percent for renewable-energy projects, 15 percent to local communities for road and water projects and 15 percent to wildlife habitat.
That 15 percent earmark for local communities will be enough to help them deal with the effects of energy development, state Rep. Kathleen Curry, D-Gunnison, said.
Gov. Bill Ritter could have taken $100 million to $120 million a year to backfill local districts that would lose revenue under the proposal, said Rick Reiter of Coloradoans for a Stable Economy, which opposes the measure.
“But he chose not to.”
Natural gas producers will look for lesser-taxed areas over those with several property-tax-dependent school districts and special districts.
“If the producers vacate, those bonds will be destabilized,” Reiter said.
“It’s going to throw your West Slope special districts into chaos.”
Energy companies still have to go where the gas is, so the effect of taxation changes would be minimal, said Curry, who noted the measure will help overcome a $460 million deficit in the state’s higher education system.