Work session on energy tax refunds June 14

June 13, 2011

In Noble Energy v. Colorado Department of Revenue, 232 P. 3d 293 (Colo. App., 2010), the Colorado Court of Appeals ruled in favor of Noble Energy for a refund of sales taxes that was incorrectly charged to oil and gas companies by fracturing companies during the taxable period of April 2002 through July 2005.

The Colorado Department of Revenue is currently in the process of auditing the claims for refund made by Noble Energy and other energy companies. Upon completion of each audit, the state will refund sales tax due the companies, and then will withhold that amount from future distributions to the County. The DOR estimates that $3.9 million dollars in refunds will need to be paid out during this upcoming fiscal year of July 1, 2011 – June 30, 2012.

The refunds will affect the sales tax revenues for recipients of the 1% sales tax in Garfield County. Those entities include: the Public Library District; Garfield County Emergency Communications; and municipalities; as well as certain functions of county government, specifically the Garfield County Sheriff’s Office, the Road and Bridge Department, Public Health, Extension and the distributions made to local non-profits by the county through the Human Services Commission.

There is a work session scheduled for Tuesday, June 14 at 9:00 a.m. for a discussion between the BOCC and the taxing entities relating to the repayment of the sales tax and the effects on their budgets.