Local governments throughout Weld County got some major windfalls this week from the oil and gas industry, about double what they initially planned.
In total, Weld County and its local governments got word of more than $5.6 million in their share of state severance tax from the oil and gas industry, which is based on the number of industry employees in each area, and more than $2.6 million from federal mineral leases.
They were among the 502 municipalities statewide that received more than $61.9 million, according to a news release from the state Department of Local Affairs.
Weld County government and the city of Greeley, received the lion’s share of the distributions. Greeley will receive $1.44 million in its share of the severance tax and $686,815 from the federal mineral lease program.
Weld will get $2.29 million from its share of severance taxes, and $1.09 million from the lease program.
Municipalities typically plan for those distributions, but they always estimate low, given the varied amounts they get. Greeley, as an example, got as low as $314,537 in 2007, but bounced back in 2009 to a six-year high of $1.6 million.
Greeley, this year, budgeted only $500,000 for its share of the severance tax distributions.
“When you have that much variation, you’re better off, in my view, to look at capital kinds of needs and get your infrastructure in good shape, so when we have bad years, you don’t have to worry,” said Greeley Mayor Tom Norton.
Weld County, as an example, will infuse its capital program, as well, pumping money back into maintaining roads, especially in areas hard-hit by oil and gas traffic, such as the northeastern part of the county.
“Our priorities are going to be infrastructure like roads, which are receiving a disproportionate share of the impact in the terms of the activity,” said Sean Conway, Weld County commissioners chairman.
Specifically, Conway said improvements are slated for Weld County Road 49 as it stretches north to Colo. 14 from Interstate 76, as well as the intersection of Weld County Road 23 and Colo. 392 east of Windsor, which is considered a high-danger intersection.
Other roads may be the beneficiaries of extra maintenance, as well.
“We can do a lot in terms of maintenance,” Conway said. “Being able to grade a road or improve the shoulders on a road for a minimal amount of money means a lot to folks in northeastern Weld.”
Money going to the town of Eaton has already been spent, reports Gary Carsten, town administrator. Carsten budgeted $55,000 for Eaton’s share this year, and also got more than double their projection. The excess will cover the overage on a recent road project on Collins Avenue west of U.S. 85, which ran over budget.
“We like to put that back into the streets because of the pounding they take,” Carsten said.
Fort Lupton and Windsor governments, also plan on road projects with their excesses, their leaders report.
Evans, on the other hand, may save its excess, or possibly help the town pay off its long-term debt, said Mayor Lyle Achziger.
“We’re probably not going to run right out and spend it,” Achziger said.
Johnstown officials will likely use their portion —$211,842 combined — to help ward off the pain of $30,000 to $40,000 reduction in sales taxes, said town clerk/treasurer Diana Seele.
Last year’s distribution to Colorado communities was $54 million, the news release stated.
“These dollars bolster communities and represent partnership between all levels of government and the energy industry,” said Reeves Brown, executive director of the Colorado Department of Local Affairs, in the release.