Ritter’s policies threaten energy industry, GOP says

Posted by egable on June 23rd, 2008 filed in Energy development

Following a new economic forecast showing that oil and gas exploration is helping drive Colorado’s economy — as well as the state budget — top Senate Republicans are calling on Gov. Bill Ritter’s (D) administration to end its “assault” on the energy industry.

The Republicans accused Ritter of waging war on energy exploration at a time when it is credited with creating some of the state’s highest-paying new jobs, helping America pursue energy independence and generating surging tax revenue to the state.

“This administration seems to be waging war on one of the few sectors of Colorado’s economy that is booming right now,” said Senate GOP chief Andy McElhany in a statement. “What’s worse, they have launched an assault on the industry that is almost singlehandedly shoring up the state budget during a recession.”

Severance tax revenue from oil and gas production in Colorado has jumped nearly 20 percent over last year, to some $173 million. Next year, that figure is projected to more than double–to $356 million.

The governor’s budget office released its second-quarter 2008 revenue forecast last week, projecting an increase of more than $25 million for the state’s operating budget and fully $110 million more for transportation over and above what the budget office had predicted in March. Much of the increase is attributed to severance tax receipts from energy exploration.

Republicans charge that the administration seems oblivious to the severance-tax windfall because it has led the charge to rein in exploration in favor of pushing alternative energy sources like wind and solar power, which typically are costlier. Republicans say the administration also has overlooked the overall economic benefits of the industry. According to the state Labor Department, oil and gas exploration directly employed more than 7,000 Coloradans last year — at an average salary of $133,000.

The Ritter administration has opposed the development of large energy sources like the vast natural gas reserves known to exist under the Western Slope’s Roan Plateau. The administration also pushing a sweeping rewrite of regulations governing oil-and-gas exploration that critics say could cripple and curb some energy development in the state. And Ritter has personally endorsed a pending ballot issue that would dramatically raise taxes on oil and gas exploration.