EN-06-1-Energy Impact Funds, Dedicating To Source Communities

WHEREAS Energy and Mineral development activities in Colorado occur primarily in Western Colorado and The Colorado Department of Local Affairs distributes revenue derived from energy and mineral extraction statewide. These revenues come from State Severance Tax receipts and Federal Mineral Lease non-bonus payments; and

WHEREAS the purpose of the Energy and Mineral Impact Assistance Program is to assist political subdivisions that are socially and/or economically impacted by the development, processing, or energy conversion of minerals and mineral fuels. Funds come from the state severance tax on energy and mineral production and from a portion of the state’s share of royalties paid to the federal government for mining and drilling of minerals and mineral fuels on federally-owned land. The program was created by the legislature in 1977; and

WHEREAS history repeatedly demonstrates the cyclical nature of both mineral development and their attendant revenues, with the need to retain and invest a portion of these revenues during boom periods to be available for Energy Impact Assistance for both the front-end investments during upturns in energy and mineral development activity and when adverse fiscal impacts and revenue shortfalls occur during downturns; and

WHEREAS Pursuant to C.R.S. 39-29-110(1)(c) and 34-63-102(5.4)(c), the DOLA Executive Director, in consultation with the Energy and Mineral Impact Assistance Advisory Committee, sets the discretionary factor weights for the annual direct distribution of State Severance Tax and Federal Mineral Lease Proceeds

NOW THEREFORE BE IT RESOLVED that CLUB 20 supports the continued dedication of Federal mineral leasing royalties and State severance taxes to be returned to the source communities from whence the minerals were developed to help mitigate the adverse impacts associated with the development of those minerals; and

BE IT FURTHER RESOLVED that CLUB 20 strenuously opposes any proposal to thwart the provisions in both Federal and State statute establishing a priority for use of severance tax and Federal and State mineral leasing royalty funds; and

BE IT FURTHER RESOLVED that CLUB 20 objects to taxes which fall primarily on Western Colorado industries when the revenue is earmarked primarily for the benefit of Front Range urban areas and programs; and

BE IT FURTHER RESOLVED that CLUB 20 believes that using Energy Impact Funds to balance the State budget is irresponsible and does not recognize that the municipalities and counties with development and processing facilities are unable to have access to Energy Impact Grants, which creates animosity within communities; and

BE IT FURTHER RESOLVED that Club 20 believes the rate of taxation should be reflective to of the impacts which occur and the need to maintain a competitive business environment, to attract and retain investment from the energy industry, and that any proposed changes to the current tax structure should consider the total tax and regulatory burden for which the industry is responsible; and

BE IT FURTHER RESOLVED that CLUB 20 advocates distribution of a greater share, not less, of these mineral and energy related revenues directly to the local governments directly impacted by energy and minerals extraction activities; and

BE IT FURTHER RESOLVED that CLUB 20 insists that any proposals involving these funds should be developed in full consultation with West Slope legislators, community leaders and mineral industry representatives who stand to be adversely affected by such proposals.


Adopted March 31, 2006

Amended April 4, 2008

Amended March 22,2013

Renewed March 30,2018


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