Drilling taxes eyed for road repairs | VailDaily.com

Drilling taxes eyed for road repairs

Bob Berwyn
Summit County correspondent
Vail CO, Colorado
Eric Drummond/Summit Daily NewsHighway crews replace a guardrail on Interstate 70 Wednesday. A ballot measure could mean better highway funding, using taxes diverted from water projects and forest-health programs.

DENVER, Colorado ” Colorado voters will be asked to divert oil and gas taxes from water projects and forest-health programs to pay for Interstate 70 improvements under an initiative approved for the November ballot.

Amendment 52 aims to redistribute as much as $90 million in severance taxes generated annually from drilling and other extractive industries, such as mining, to pay for highway upgrades in the state.

“Amendment 52 is a statewide solution to our transportation needs,” Republican state Rep. Cory Gardner said in a press statement. “This ad drives home the message that we can provide real solutions without raising taxes.”

Republican state Sen. Josh Penry and Republican state Rep. Frank McNulty are the other co-sponsors of the measure.

But the measure likely won’t pass without a fight from conservation groups, who contend it would take away money from key water supply and wildfire-protection projects.

“It’s a false choice. There are so many other programs that would be impacted,” said Becky Long, water coordinator with the Colorado Environmental Coalition.

She identified the Colorado Water Conservation Board’s underfunded instream flow program as one of the areas that could be hurt by the proposal.

The measure would freeze the amount of severance taxes designated for the Department of Natural Resources, with an adjustment for inflation, and funnel additional future revenue toward transportation projects.

The oil-and-gas boom in Colorado has sent severance-tax revenues soaring, leading to a number of recent proposals to tap the fund for other purposes.

About half of severance taxes currently support natural-resources initiatives, funding, among other things, the Colorado Avalanche Information Center and loans for community water projects.

The other half goes to the Department of Local Affairs, flowing back to local communities.

Severance taxes generated about $85 million for each of the departments in fiscal year 2007-’08.

Backers of the measure this week launched a series of TV spots touting its benefits, claiming it could raise $90 million for transportation next year and up to $1 billion in during the next decade.

The I-70 coalition hasn’t taken a position on Amendment 52, but will discuss the issue at a board meeting Thursday, said coalition director Flo Raitano.

Similarly, the Northwest Colorado Council of Governments also discussed the potential funding change at a council meeting last week, said its director, Gary Severson.

The move to re-allocate severance tax revenues may also throw a political wrench into Gov. Bill Ritter’s plan to find consensus on a severance tax hike, seen as a possible funding solution for higher-education needs.


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