The Colorado Petroleum Association paid for a report that says if Colorado were to eliminate the corporate welfare currently given away to oil and gas corporations, Colorado taxes would rank second in the nation behind Wyoming. The message they’ve manufactured is that taking away their welfare will end up costing consumers more. I’m not buying it.
Here is the important fact: the ad valorem tax credit allows energy companies to subtract 87.5% of their property tax bills from the mineral taxes they owe the state. Why was the credit established? Gov. Ritter has provided that answer. The credit has its roots in the late 1970s when Colorado wanted to help the energy industry establish itself in the state. Does anyone seriously think the drilling industry isn’t established in Colorado? I agree with the Governor: enough is enough. Oil and gas companies are recording record profits every quarter. If the companies want to continue to do business in the state, they should pay what they owe.
Once the giveaway is canceled, the state will receive an additional $260 million in revenue. Gov. Ritter, looking ahead for our state, wants to use some of that money to underwrite “Colorado Promise” scholarships. That makes sense to me: oil and gas corporations pay their fair share and young Coloradans gain another avenue to further themselves.
There is an alternative ballot measure that would redirect the taxes to a different recipient: transportation (read: roads). This is a less optimal situation. Once the money is spent on roads, it’s spent. Roads need additional funding, that’s for sure, but Republicans are trying to do so without raising taxes. Here is my opinion: if our infrastructure needs investment, let’s invest in it. If nobody ever pays anything for the infrastructure, it’s going to fall apart and end up costing us more in the long-term. If the money is directed toward improving citizens’ future earning potential, I think the state sees a larger benefit from that in the long term. They’ll not only earn more, and therefore generate more revenue for the state, but they’ll produce more for the state during their careers, thanks on their increased education.
The oil and gas corporations want people to buy into their myth that eliminating their welfare would hurt their industry. I’ll expose that for the lie that it is: are the corporations fleeing Wyoming, where their taxes are higher, for Colorado? Of course not. The energy industry is thriving in Wyoming also.
Colorado deserves its fair share from the energy industry just like it does from every other industry. The time for giveaways is over.