Montezuma County considers putting sales tax on ballot

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Montezuma County considers putting sales tax on ballot

Planners look to fill a gap as Kinder Morgan revenue declines
Kinder Morgan pays about half the property taxes in Montezuma County. This is the pumping plant on Goodman Point.
As demand for carbon dioxide increased, Kinder Morgan expanded its compression facility north of Cortez in 2013.

Montezuma County considers putting sales tax on ballot

Kinder Morgan pays about half the property taxes in Montezuma County. This is the pumping plant on Goodman Point.
As demand for carbon dioxide increased, Kinder Morgan expanded its compression facility north of Cortez in 2013.
KM’s tax contribution hits high in 2015

In 2015, property taxes collected from Kinder Morgan’s vast CO2 operation brought in half of all tax revenues for Montezuma County and its array of special districts.
But in 2016, the county is bracing for a significant drop in CO2 tax revenues due to the fall in oil prices. The price of CO2 rises and falls with oil prices because it is used for oil recovery from under-performing wells.
“We won’t know how much of a decrease until next year,” said county manager Melissa Brunner.
CO2 is not publicly traded, and the price is negotiated privately through individual contracts.
One clue are the CO2 royalty checks collected by the county from Kinder Morgan, which are tied to the price.
“They dropped by more than half,” said county assessor Scott Davis.
In April 2014 a royalty check came in at $36,115, he said. For April 2016 it was $15,334.
According assessor abstracts, since 2005 Kinder Morgan has been the largest contributor of tax revenues to the county. And the amount has steadily increased.
In 2005, oil-and-gas contributed 30 percent of the county revenues or $5 million – of which $4 million was derived from Kinder Morgan’s CO2 production.In 2008, oil-and-gas contributed 41 percent of county revenues, or 8.9 million – of which $7.2 million was paid by Kinder Morgan.By 2012, oil-and-gas contributed 54 percent of county revenues, or $17.5 million – of which $14.5 million was paid by Kinder Morgan.In 2015, oil-and-gas contributed 62 percent of county revenues, or $23 million — of which $18.6 million was paid by Kinder Morgan. Total tax revenues collected for 2015 were 37.1 million.“Kinder Morgan has been good to us,” Davis said. “They will be difficult to replace, but looking to the future, we have to think about diversifying the economy. Now is the time.”
jmimiaga@the-journal.com

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