Amendments for SB25-040
Senate Journal, January 29
After consideration on the merits, the Committee recommends that SB25-040 be amended
as follows, and as so amended, be referred to the Committee on Appropriations with
favorable recommendation.
Amend printed bill, page 2, after line 1 insert:
"SECTION 1. Legislative declaration. (1) The general assembly
finds and declares that:
(a) Severance taxes provide a source of revenue to the state and the
state's political subdivisions;
(b) A portion of revenues derived from severance taxes is used to fund
the development and conservation of the state's water resources;
(c) Another portion of revenues derived from severance taxes is made
available to local governments to offset the impact created by nonrenewable
resource development;
(d) The state also relies on severance tax revenue to fund staff positions
in the department of natural resources and the department of local affairs;
(e) In times of need, the state has relied on severance tax revenue to
backfill the state budget, which depletes funding from programs that would
otherwise benefit local governments; and
(f) There is a need to study how the state can:
(I) Avoid using severance tax revenue to backfill the state budget in the
future;
(II) Begin to pay back the severance tax revenue previously used to
backfill the state budget; and
(III) Continue to fund water needs and grants to local governments
without relying on the revenues derived from severance taxes.".
Renumber succeeding sections accordingly.
Page 3, line 15, strike "WITH" and substitute "WITH, TO THE EXTENT POSSIBLE,".
Page 3, strike line 23 and substitute "BEEN SOCIALLY OR ECONOMICALLY
IMPACTED BY THE DEVELOPMENT, PROCESSING, OR ENERGY CONVERSION OF OIL
AND GAS OPERATIONS SUBJECT TO TAXATION UNDER ARTICLE 29 OF TITLE 39,
APPOINTED BY THE".
Page 4, line 15, after "NEEDS" insert "AND ENERGY IMPACT GRANTS
DISTRIBUTED PURSUANT TO SECTION 39-29-110 (1)(b)(I)".
Page 4, line 18, after "RECOMMENDATIONS." add "THE STUDY MUST FOCUS ON
IDENTIFYING WAYS TO ALLEVIATE THE NEED TO TRANSFER REVENUES DERIVED
FROM SEVERANCE TAXES TO THE GENERAL FUND AND TO REPLACE SEVERANCE
TAX REVENUE THAT WAS PREVIOUSLY TRANSFERRED.".
Page 5, after line 5 insert:
"(6) THE TASK FORCE SHALL BE FUNDED SOLELY WITH MONEY FROM
THE SEVERANCE TAX OPERATIONAL FUND CREATED IN SECTION 39-29-109
(2)(b)(I).".
Renumber succeeding subsection accordingly.
Agriculture &
Natural
Resources
Senate Journal, April 11
After consideration on the merits, the Committee recommends that SB25-040 be amended
as follows, and as so amended, be referred to the Committee of the Whole with favorable
recommendation.
Amend printed bill, page 5, after line 6 insert:
"SECTION 2. Appropriation. (1) For the 2025-26 state fiscal year,
$198,592 is appropriated to the department of natural resources for use by the
executive director's office. This appropriation is from the severance tax
operational fund created in section 39-29-109 (2)(b)(I), C.R.S. To implement
this act, the office may use this appropriation as follows:
(a) $192,566 for personal services; and
(b) $6,026 for operating expenses.
(2) Any money appropriated in subsection (1) of this section not expended prior
to July 1, 2026, is further appropriated to the department through December 31,
2026 for the same purpose.".
Renumber succeeding section accordingly.
Page 1, line 102, strike "FORCE." and substitute "FORCE, AND, IN CONNECTION
THEREWITH, MAKING AN APPROPRIATION.".
Appro-
priations
Senate Journal, April 14
SB25-040 by Senator(s) Roberts and Simpson, Bridges, Marchman, Pelton B.; also Representative(s)
McCormick and Martinez--Concerning the creation of the future of severance taxes and
water funding task force.
Amendment No. 1, Agriculture & Natural Resources Committee Amendment.
(Printed in Senate Journal, January 29, page(s) 96 and placed in members' bill files.)
Amendment No. 2, Appropriations Committee Amendment.
(Printed in Senate Journal, April 11, page(s) 813 and placed in members' bill files.)
Amendment No. 3(L.004), by Senator Roberts.
Amend the Agriculture and Natural Resources Committee Report, dated
January 29, 2025, page 2, strike lines 16 and 17 and substitute "FROM THE
SEVERANCE TAX PERPETUAL BASE FUND CREATED IN SECTION 39-29-109
(2)(a)(I.5).".".
Amendment No. 4(L.003), by Senator Roberts.
Amend printed bill, page 5, after line 6 insert:
"SECTION 2. In Colorado Revised Statutes, 39-29-105, amend
(2)(b)(II) and (2)(d) introductory portion; and repeal (2)(c) as follows:
39-29-105. Tax on severance of oil and gas. (2) (b) (II) (A) With
respect to oil and gas there is allowed, as a credit against the tax computed in
accordance with the provisions of subsection (1)(b) of this section for each
taxable year commencing on or after January 1, 2024, but prior to January 1,
2026 2027, an amount equal to seventy-five percent of all ad valorem taxes
assessed during the taxable year in the case of accrual basis taxpayers or paid
during the taxable year in the case of cash basis taxpayers upon oil and gas
leaseholds and leasehold interests and oil and gas royalties and royalty interests
for state, county, municipal, school district, and special district purposes, except
such ad valorem taxes assessed or paid for such purposes upon equipment and
facilities used in the drilling for, production of, storage of, and pipeline
transportation of oil and gas.
(B) WITH RESPECT TO OIL AND GAS THERE IS ALLOWED, AS A CREDIT
AGAINST THE TAX COMPUTED IN ACCORDANCE WITH SUBSECTION (1)(b) OF THIS
SECTION FOR EACH TAXABLE YEAR COMMENCING ON OR AFTER JANUARY 1,
2027, BUT PRIOR TO JANUARY 1, 2028, AN AMOUNT EQUAL TO EIGHTY-SEVEN
AND FIVE-TENTHS PERCENT OF ALL AD VALOREM TAXES ASSESSED DURING THE
TAXABLE YEAR IN THE CASE OF ACCRUAL BASIS TAXPAYERS OR PAID DURING
THE TAXABLE YEAR IN THE CASE OF CASH BASIS TAXPAYERS UPON OIL AND GAS
LEASEHOLDS AND LEASEHOLD INTERESTS AND OIL AND GAS ROYALTIES AND
ROYALTY INTERESTS FOR STATE, COUNTY, MUNICIPAL, SCHOOL DISTRICT, AND
SPECIAL DISTRICT PURPOSES, EXCEPT SUCH AD VALOREM TAXES ASSESSED OR
PAID FOR SUCH PURPOSES UPON EQUIPMENT AND FACILITIES USED IN THE
DRILLING FOR, PRODUCTION OF, STORAGE OF, AND PIPELINE TRANSPORTATION
OF OIL AND GAS.
(c) For a taxable year beginning on or after January 1, 2026, but before
January 1, 2027, for each well that is not exempt from the state severance tax
pursuant to subsection (1)(b) of this section, there is allowed a credit against the
tax computed in accordance with the provisions of subsection (1)(b) of this
section in an amount calculated by the formula C = 0.65625 x GI x ML, where:
(I) C is the amount of the credit;
(II) GI is the gross income attributable to the well for the current taxable
year; and
(III) ML is the total of all mill levies, fixed not later than December 22
of the preceding calendar year pursuant to section 39-1-111, by all local
governments for property at the well's location.
(d) For a taxable year beginning on or after January 1, 2027 2028, for
each well that is not exempt from the state severance tax pursuant to subsection
(1)(b) of this section, there is allowed a credit against the tax computed in
accordance with subsection (1)(b) of this section in an amount calculated by the
formula C = 0.7656 x GI x ML, where:
SECTION 3. In Colorado Revised Statutes, 39-29-108, amend
(2)(e)(I) and (2)(e)(III)(B) as follows:
39-29-108. Allocation of severance tax revenues - definitions -
repeal. (2) (e) (I) Except as provided in subsection (2)(e)(II) of this section, for
the state fiscal years 2023-24 through 2026-27, the state treasurer shall credit
the discrete increased amount of severance tax for oil and gas production that
is attributable to the reduction of the credit against tax pursuant to section
39-29-105 (2)(b)(II) and 39-29-105 (2)(c) to the decarbonization tax credits
administration cash fund created in section 24-38.5-120 (2).
(III) As used in this subsection (2)(e), unless the context otherwise
requires:
(B) "Discrete increased amount of severance tax for oil and gas
production" means the amount of tax collected that is attributable to a twelve
and one-half percent reduction in the severance tax credit for oil and gas
production set forth in section 39-29-105 (2)(b)(II) for tax years beginning on
or after January 1, 2024, but before January 1, 2026. and a ten and nine hundred
thirty-five thousandths percent reduction set forth in section 39-29-105 (2)(c)
for tax years beginning on or after January 1, 2026, but before January 1,
2027.".
Renumber succeeding section accordingly.
Amendment No. 5(L.005), by Senator Roberts.
Amend printed bill, page 4, line 7, after the period add "EVERY MEETING OF THE
TASK FORCE MUST BE OPEN TO THE PUBLIC AND INCLUDE AN OPPORTUNITY FOR
PUBLIC TESTIMONY.".
As amended, ordered engrossed and placed on the calendar for third reading and final
passage.
House Journal, May 1
14 Amendment No. 1, by Representative McCormick:
15
16 Amend reengrossed bill, page 4, line 17, strike the second "AND".
17
18 Page 4, strike line 23 and substitute "GOVERNOR; AND
19 (X) THE EXECUTIVE DIRECTOR OF THE DEPARTMENT OF LOCAL
20 AFFAIRS OR THE EXECUTIVE DIRECTOR'S DESIGNEE.".
21
22 As amended, ordered revised and placed on the Calendar for Third
23 Reading and Final Passage.
24