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So Much Tax Money, So Many Ways to Spend It February 18, 2008

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There is a gusher of tax money awaiting those who can figure out how to tap and spend it, and the environmentalists are working over time to lay claim to it.

We have written earlier about the severance tax and how it could grow to unimaginable sums of money if and when the oil companies figure out how to recover one million barrels of oil per acre from oil shale lands.

The environmentalist extremists have set their sights on that money and the power it would bring if only they could control it.  The Aspen Times reports:

Environmentalists introduced four ballot proposals Thursday to increase the taxes paid by the oil and gas industry as they seek to build support for a statewide campaign.

The move comes as state lawmakers and the governor are still considering whether to ask voters to increase the state’s severance tax this year.

The coalition, which includes Trout Unlimited, Environmental Defense, The Wilderness Society and others, wants to use the estimated $200 to $300 million the proposed hikes could generate to boost renewable energy, protect wildlife habitat and help communities impacted by the boom. Joe Neuhof, West Slope field director for the Colorado Environmental Coalition, said some coalition members have been involved in the Capitol discussions about whether to raise Colorado’s tax — the second-lowest in the West — but wanted to put forward their priorities for how the money should be spent as they continue to talk.

These people aren’t thinking small:

The four ballot proposals include different combinations of getting rid of the current tax exemption for small wells, adding an extra 3 percent tax for all oil and gas wells and setting a new 10 percent tax rate for wells that produce more than $300,000 a year. Some would also bar energy companies from deducting their property tax in calculating the severance tax they owe.

One of the more likely goals of imposing a 10% severance tax is to slow down or even stop oil and gas development in the state.  Oil shale recovery has been delayed in part because of technology, but also because the proposed technology is so expensive.  If the environmentalists could add an extra 10% to the costs of recovery, they might be able to make it impossible to recover oil shale economically until the price of a barrel of oil hit $150.

In addition, by putting a dollar threshold at which taxes begin to be collected, they can depress the production of working wells.   As the price of oil and gas inevitably rise, every well will hit that threshold, but the owners will want to curtail production to avoid the tax.

This just follows the usual pattern.  If there is to be a tax increase, wouldn’t it be better if the proceeds went to more normal government activities such as funding higher education, building prisons, or building and maintaining roads? 

Roads & Bridges Shut Out, Maybe February 5, 2008

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The Gazette isn’t very happy that Bill Ritter isn’t buying us new roads and bridges:

Switching from practical to principled arguments, of the big three issues competing for Ritter’s support, education and health care are not really government’s business; transportation is. Proponents for more government involvement in education and health care like to point out that the free market doesn’t work in those areas. Actually, it does, it just doesn’t work in ways those folks like. The market allocates limited resources to the places consumers deem them most needed.

Of course, Bill Ritter wants it both ways.  He wants the legislature to take the heat on the $100 “fee” while he goes to the voters on another subject.

Another Month, Another Tax January 18, 2008

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We’re curious if anyone has noticed a pattern with the Denver Post editorial pages.  Like clockwork they propose a new tax once a month.  The latest is a hefty Federal gas tax.

Usually, the author of these monthly tax increase articles is Bob Ewegen.  We have noted here and elsewhere that this monthly pattern exists with him.  This time, the author hid behind the “Denver Editorial Board” byline.  Care to bet this is Bob again?

Another Day, Another Carbon Tax January 11, 2008

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The left has figured out a method to raise taxes:

1.  Define something as a sin.  Smoking, Alcohol, Carbon.

2.  Come up with a new guilt tax and a way to spend it outside Government channels, claiming that it is “revenue neutral.”  The favored constituiency that receives these funds is never the constituiency that is paying the taxes.

3.  Put it on the ballot and hope it passes.

4.  Let an election cycle or two pass and repeat.

Colorado Confidential announced that the Carbon Tax Center is in the process of putting an issue on the ballot this year that supposedly will cost each household $42 a year.  These do gooders have supposedly done polling and found Coloradoans willing to pay this tax:

The group conducted a statewide poll on the proposals, the results of which will be released later this month. But McKinnon, a professor at the Colorado School of Mines, said that the data show support for the project among nearly all age and party groups.

They give away their game with the following comment

That is why the two “return” approaches discussed above — carbon dividends or tax-shifting — can turn the carbon tax into a progressive tax. Because income and energy consumption are strongly correlated, most poor households will get more back in carbon dividends than they will pay in the carbon tax. The overall effect of a carbon tax-shift could be equitable and perhaps even “progressive” (benefiting lower-earning households).

Carbon Taxes are a poorly disguised income redistribution scheme, and nothing else. 

From Jon Caldara’s Stealth Blog January 10, 2008

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You would think that it would take this author, in particular, less than five months to discover that Jon Caldara has his own blog.  Not only that, he is posting CUT announcements on that blog, but not here.  We’ll fix that, at least this time:

Great event coming up from the Colorado Union of Taxpayers(CUT).  On Thursday, January 17th, from 7am to 8:30am at the Panera Bread Company (1350 Grant Street) join the discussion, “What are they going to do to us?”  Hosted by newly appointed Senator Bill Cadman and newly appointed Representative Douglas Bruce.  The cost will be $10 for the continental breakfast and $30 for the 2008 CUT dues.  To RSVP call (303) 759-9936 or (303) 366-3408.

As we write this we were wondering if CUT has a cut rate dues schedule for bloggers.   Just a thought.  (Laughing hard.)  

Imagine An Oil Gusher January 6, 2008

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If one reads between the lines of a Durango Herald story, it is entirely possible that Colorado and Utah will be the beneficiaries of severance tax revenues beyond imagination if shale oil production comes on line.

The article talks about being able to produce one million barrels of oil per acre.  At today’s relatively low prices, that is $100 million dollars of production an acre.

In an effort to scoff at the level of production that can be reached, Randy Udall, Mark Udall’s brother seems to acknowledge that production could be 100,000 barrels a day.  Environmentalists always seem to grossly under estimate potential energy production, usually by a factor of 20, so assume 2 million barrels of oil a day.

Figure severance taxes to be somewhere in the neighborhood of $8 million a day and ramping up as the price of oil ramps up.

Does anyone really think that Colorado and the nation will not develop this oil?

Trying to Outguess Bill Ritter January 5, 2008

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Sometime next week, Bill Ritter will address the Colorado Legislature.  We’ve been trying to figure out which tax he plans to ask the voters to raise.

It won’t be a tax for transportation.  Democrats hate transportation.  We can rule that out.

Health Care?  Well, maybe.  It seems unlikely given that the Democrats expect to take the White House and hold Congress.  That almost certainly means that health care will be nationalized.  Since Ritter probably thinks that he has only one shot at raising taxes, it likely won’t be for health care.

We haven’t heard “It’s for the children” in quite a while.

Hmmm

We know!  He is going to raise taxes to pay for a cloth factory next to the Capitol building.  He will need it to supply all of the 2008 blue ribbon commissions that he will doubtless appoint.  Some blue ribbon will be left over for hair bows-for the children.

We could only hope that his scheme would be that benign.  It won’t be.

Property Tax Increase January 4, 2008

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Mike Saccone has a blurb on how Rep. Bernie Buescher, D-Grand Junction will attempt to defend the mill levy tax increase to voters next year.

He is going to play dumb:

Buescher said he knew the measure would prevent school district tax rates from falling in Mesa County, but he had no idea how severe it would be: “It would have been a harder vote if I had realized how much valuation was going to increase in Mesa County. But we didn’t have that number.”

By now, every legislator in the state should have figured out that the legislative council underestimates new tax revenues by a factor of 3.  10 billion vs 3.5 billion for Ref C. 

The Colorado Legislative Council’s estimates of the bill’s total impact during the current tax cycle increased from $48.2 million in April to $122.8 million in December.

Legislators may play dumb, or they may think voters are dumb.   Bill Ritter has announced that there will be a tax increase on the ballot in 2008.  He is just not sure which one.  Care to bet that Bernie Buescher votes for it?  Care to bet that its proceeds will be underestimated by one third, again?

Never Owned a Business – Part 3 December 31, 2007

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Rep Dianne Primivera wrote Improving the lives of middle class Coloradans.

It is quite apparent from her essay that Rep Dianne Primivera either doesn’t have the knowledge to be a state legislator or that she thinks voters lack the native intelligence to understand the depth of her deception.  Neither premise is appealing.

After having proposed an agenda that will raise taxes on Colorado citizens by at least 2 billion while claiming it won’t raise taxes at all, she wants full credit for cutting a single million dollars in business taxes.

If you’re a small business owner, you have enough to worry about without an overly complicated tax code. I will co-sponsor legislation that gives over 30,000 small businesses much-needed tax relief by raising the business personal property tax exemption from $2,500 to $7,000. We will also streamline the tax code so business owners pay taxes based on sales only, instead of navigating a complicated formula.

There are very few businesses which have start up costs for personal property of $7,000 or less.  Lawyers and accountants may benefit from this as they need only a computer, a desk and chair, and some office furnishings.  Anyone who has a real business with real requirements for store fixtures, point of sale software, or mechanized equipment will quickly exceed the $7,000.  We wonder if the Representative has ever owned a business, or known someone who has.

Because we are cynical, we would guess that the state has figured out that the cost of administering and collecting personal property taxes on really small businesses exceeds the revenue generated by those taxes.   Note that if a business has personal property of more than $7,000, it still pays taxes on the whole amount. 

The formula Rep. Primivera refers to is automated and allows for equipment depreciation.  The formula is applied by the taxing agency each year based on changes in equipment reported by the business.  A small businessman never sees or works with that formula, so this bill doesn’t cut down on paperwork.   

In short, this “tax cut” that she is trumpeting generates so little net revenue (and may result in negative net revenue) that it is a nuisance even to the tax collectors.  She has doubtless been told this, but wants credit for something she isn’t really willing to do – cut taxes.

Her essay is so misleading that we would call her a willing part of the Big Blue Lie Machine.   Integrity does not seem to be one of Rep Dianne Primivera’s strong points. 

Part 1 and part 2 of this essay are linked.

Better Living Through Higher Taxes – Part 2 December 30, 2007

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Rep Dianne Primivera wrote Improving the lives of middle class Coloradans. 

She has come up with a new trick.  She is going to spend a billion dollars without raising taxes.  Care to bet?

There is no more important time in a child’s education than the earliest years. Along with Governor Ritter, we plan to give our kids a smart start by making early childhood education available to every 4- and 5-year-old in the state.

If 12 years of education cost’s X dollars in each school district, is there any reason why 14 years of education won’t cost 17% more?  Of course, the legislature won’t raise taxes.  They will force local school districts to do so.

Now for the biggest magic act of all:

The Building Excellent Schools Today – or BEST -program will leverage $1 billion to repair and rebuild crumbling schools without raising taxes.

We guess that since Ref C there is a spare billion dollars laying around the Capitol.  Maybe we can get some of it spent on roads.  If this woman wants to claim that all of this can be accomplished without raising taxes, why did she vote for a tax increase in the guise of a property tax freeze?