Colorado Lets Towns Lose Oil, Gas Resources without Gaining Revenues

June 10, 2014

In a tug-of-war over who gets tax revenues collected on horizontal oil and gas wells that can extend 2 miles under- ground, Weld County scored a victory as a bill became law Saturday without the governor's signature.

It was only the third time ever that Gov. John Hickenlooper had neither signed nor vetoed a bill — simply letting it become law.

The law applies taxes at the wellhead and doesn't take into account from which municipalities and tax districts the oil and gas came. Many wellheads are located outside of town and city boundaries but extract resources from within those boundaries.

"We pleaded with the governor to veto it," said John Vazquez, mayor of the town of Windsor in Weld County. "But when we needed the governor to step up and protect small cities and towns, he fell short."

In a letter to the General Assembly, Hickenlooper noted that there were "concerns about the bill" and that he was urged to veto it.

"As a matter of good government, when carefully crafted legislation that simplifies the tax code passes with near unanimous support, that legislation should be allowed to become law," the governor said.

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