Increased Mill Levy Rate & Reduced Spending Balance COGCC’s Budget
Denver, CO (Aug. 04, 2020) - The Colorado Oil and Gas Conservation Commission (COGCC) today announced that the Commission has adopted the proposed mill levy rate increase during the Aug. 4 rulemaking Hearing. COGCC’s main revenue source is the mill levy, or Conservation Levy, and has been directly impacted by current market conditions. COGCC has reduced its spending, in addition to increasing the mill levy rate, to balance its finances and to be able to meet its statutory requirements to protect public health and safety in oil and gas development.
“This rulemaking exhibited two critical components of COGCC’s rulemaking process: responding to data and engaging diverse stakeholder discussions,” said COGCC Director Julie Murphy, “COGCC relies on collaboration and current data to develop solutions to many complex issues, such as the mill levy rate change. In fact, after Staff updated its oil and gas price and production projections, Staff recommended that the original recommended change to 1.7 mills be reduced to 1.5 mills, which revision was well received by stakeholders.”
COGCC’s mill levy increase from 1.1 to 1.5 mills will help to provide long-term stability for COGCC in a volatile market environment. Due to market conditions, the new mill levy increase coupled with reduced spending, allows COGCC to balance its finances and provide long-term sustainability. COGCC will monitor production and pricing to accommodate any changes in the marketplace.
“We want to thank all the stakeholders for their unanimous support of this mill levy increase,” said COGCC Chair Jeff Robbins. “COGCC must be good stewards of its finances - both revenues and spending, as local governments and neighborhoods count on us for environmental and public health protections, and operators depend upon us to review permits. The mill levy change and reduced COGCC spending will allow us to continue to provide services that are protective of public health, safety, welfare, wildlife resources and the environment as we continue to implement SB 19-181.”
SB 19-181 ensures that oil and gas development and operations in Colorado are regulated in a manner that protects public health, safety, welfare, the environment and wildlife resources. The COGCC is in the midst of reviewing its rules and procedures to evaluate what changes are required to reflect the new law’s requirements. The Commission has adopted three SB 19-181 rulemakings including the 500 Series allowing Administrative Law Judges (August 2019), Flowline rules (November 2019) and Wellbore Integrity rules (June 2020). The Commission will take up additional SB 19-181 rulemakings at future Commission hearings, including rulemakings around Mission Change, Cumulative Impacts and Alternative Location Analysis, which begins Aug. 24, 2020.
For More Information: To learn more about participating, upcoming hearings and the rulemaking schedule, visit the ECMC website.
Click here for the Cost-Benefit Analysis.