The Common Sense Policy Roundtable put a price tag on limiting oil and gas development in five Front Range municipalities Tuesday: up to $1.85 billion in new local property taxes over the next 10 years.
The roundtable, a consortium of business groups, studied pending proposals before state and local officials, sales from recently completed wells in northern Colorado and property tax rates.
According to the research, Aurora could lose up to $944 million, Broomfield could lose up to $248 million, Commerce City up to $400 million, Erie up to $202 million, and Johnstown up to $52 million in the next 10 years.
The research comes as local governments have more authority to regulate oil and gas operations because of Senate Bill 181, which passed in the spring and was signed into law by Gov. Jared Polis.
Supporters of the fossil fuel industry have argued for years that the state cannot afford to lose the jobs or tax revenue from over-regulating one of the state's chief economic drivers.
Public schools could see up to $1.14 billion over the next 10 years from the proposed projects, "enough to raise teacher salaries in K-12 districts serving these communities by 31% to 42%," the Common Sense Policy Roundtable said in its report.
Municipal governments would see up to $258 million from oil and gas over the next decade, if all the projects are approved and current prices and production levels hold out.
Simon Lomax, CSPR’s energy resources fellow, who previously worked for energy industry interests, said the property tax assessment rate for oil and natural gas production is 12 times higher than residential property rates and three times higher than commercial property.
“That higher tax rate is a major factor behind these revenue estimates,” he explained in a press release about the report.
Chris Brown, CSPR’s director of policy and research, said the five municipalities were just a sampling.
“This is not an exhaustive list of municipalities where future energy development may take place, and these revenue estimates are not intended predict future tax revenues down to the very last dollar and cent,” he said in a statement. “Instead, we chose these communities to give policymakers and the public a better sense of how oil and gas development can grow a local government’s property tax base once energy production begins.”
Read the full report by clicking here.