2016 Colorado Revised Statutes
Title 39 - Taxation
Specific Taxes
Article 29 - Severance Tax
§ 39-29-109. Severance tax trust fund - created - administration - distribution of money - repeal

(1) There is hereby created in the state treasury the severance tax trust fund, also referred to in this section as the "fund", which the department of natural resources shall administer. The fund is to be perpetual and held in trust as a replacement for depleted natural resources, for the development and conservation of the state's water resources pursuant to sections 37-60-106 (1) (j) and (1) (l), 37-60-119, and 37-60-122, C.R.S., for the use in funding programs that promote and encourage sound natural resource planning, management, and development related to minerals, energy, geology, and water and for the use in funding programs to reduce the burden of increasing home energy costs on low-income households.

(2) State severance tax receipts shall be credited to the severance tax trust fund as provided in section 39-29-108. Except as otherwise set forth in section 39-29-109.5, all income derived from the deposit and investment of the money in the fund shall be credited to the fund. At the end of any fiscal year, all unexpended and unencumbered money in the fund remains in the fund and shall not be credited or transferred to the general fund or any other fund. All money in the fund is subject to appropriation by the general assembly for the following purposes:

(a) The severance tax perpetual base fund. (I) Repealed.

(I.5) There is hereby created in the state treasury the severance tax perpetual base fund, also referred to in this paragraph (a) as the "fund", which the Colorado water conservation board, also referred to in this paragraph (a) as the "board", shall administer. The state treasurer shall transfer moneys to the fund from the severance tax trust fund, as specified in this section. The moneys in the fund are continuously appropriated to the board for purposes authorized by this paragraph (a).

(II) One-half of the severance tax receipts credited to the fund for fiscal years commencing on or after July 1, 2009, shall be credited to the severance tax perpetual base fund and used for state water projects pursuant to sections 37-60-119 and 37-60-122, C.R.S.; except that the total amount of severance tax receipts credited to the severance tax perpetual base fund during the fiscal year shall not exceed fifty million dollars unless the cap established in subparagraph (III) of this paragraph (a) is exceeded. The authorization and contract for each project must require repayment of principal and interest to the fund, and moneys so repaid shall be credited to the severance tax perpetual base fund.

(III) For fiscal years commencing on or after July 1, 2009, the state treasurer shall transfer the moneys credited to the fund that are not credited to either the severance tax perpetual base fund or the severance tax operational fund to the small communities water and wastewater grant fund created in section 25-1.5-208 (4), C.R.S.; except that the maximum amount of moneys annually credited to the small communities water and wastewater grant fund shall not exceed ten million dollars.

(IV) to (IX) Repealed.

(X) (A) Notwithstanding any provision of this paragraph (a) to the contrary, the state treasurer shall transfer to the Colorado water conservation board construction fund, for use by the Colorado water conservation board, also referred to in this subparagraph (X) as the "board", thirty million dollars for the planning, design, and construction of the Rio Grande cooperative project. Of this amount, the board shall allocate up to ten million dollars for improvements associated with the Beaver Park reservoir, owned and operated by the division of parks and wildlife, and up to twenty million dollars for improvements to the Rio Grande reservoir, owned and operated by the San Luis valley irrigation district. The state treasurer shall transfer the moneys in two consecutive annual installments of fifteen million dollars on July 1, 2012, and July 1, 2013.

(B) Pursuant to section 37-60-122 (1) (b), C.R.S., the board may loan moneys in an amount up to ten million dollars to the division of parks and wildlife and up to fifteen million dollars to the San Luis valley irrigation district.

(C) Pursuant to section 37-60-121 (1) (b) (IV), C.R.S., the board may determine the amount of loan, or loan-to-grant ratio, for the second fifteen-million-dollar installment, as set forth in sub-subparagraph (A) of this subparagraph (X), commencing on July 1, 2013.

(D) All interest earned from the investment of moneys in the fund shall be credited to, and made a part of, the Colorado water conservation board construction fund. All funds not expended remain and are part of the Colorado water conservation board construction fund.

(XI) Repealed.

(XII) (A) Notwithstanding any provision of this paragraph (a) to the contrary, on July 1, 2013, the state treasurer shall transfer two million dollars from the fund to the Colorado water conservation board construction fund, and on July 1, 2016, the state treasurer shall transfer two hundred thousand dollars from the fund to the Colorado water conservation board construction fund, for use by the board to make a grant to the municipal subdistrict of the northern Colorado water conservancy district for the planning, design, and construction of the Windy Gap reservoir bypass channel project, as part of the Windy Gap firming project on the Colorado river.

(B) This subparagraph (XII) is repealed, effective July 1, 2020.

(XIII) Repealed.

(XIV) Notwithstanding any provision of this paragraph (a) to the contrary, on July 1, 2015, the state treasurer shall transfer five hundred thousand dollars from the fund to the Colorado water conservation board construction fund, created in section 37-60-121 (1) (a), C.R.S., for use by the Colorado water conservation board, created in section 37-60-102, C.R.S., to continue the watershed restoration program.

(XV) Notwithstanding any provision of this paragraph (a) to the contrary, on July 1, 2016, the state treasurer shall transfer five million dollars from the fund to the Colorado water conservation board construction fund, created in section 37-60-121 (1) (a), C.R.S., for use by the Colorado water conservation board, created in section 37-60-102, C.R.S., in the amount of one million five hundred thousand dollars to continue the watershed restoration program, two million five hundred thousand dollars for the Bear Creek reservoir storage reallocation study, and one million dollars for the statewide water supply initiative update.

(XVI) Notwithstanding any provision of this paragraph (a) to the contrary, on July 1, 2016, and each year thereafter on July 1, the state treasurer shall transfer five million dollars from the fund to the Colorado water conservation board construction fund, created in section 37-60-121 (1) (a), C.R.S., for use by the Colorado water conservation board, created in section 37-60-102, C.R.S., for the board to fund studies, programs, or projects that assist in implementing the state water plan adopted pursuant to section 37-60-106 (1) (u), C.R.S.

(XVII) Notwithstanding any provision of this paragraph (a) to the contrary, an amount equal to nineteen million one hundred thousand dollars in the fund is restricted from being used for any purpose whatsoever, until such time that the joint budget committee, by a majority vote, releases the restriction on some or all of the money.

(b) The severance tax operational fund. There is hereby created in the state treasury the severance tax operational fund, also referred to in this paragraph (b) as the "fund", which the department of natural resources shall administer. The state treasurer shall transfer one-half of the severance tax receipts credited to the severance tax trust fund for tax years commencing on and after July 1, 1995, to the fund. Moneys in the fund shall be distributed as set forth in section 39-29-109.3.

(c) The water supply reserve fund. (I) There is hereby created in the office of the state treasurer the water supply reserve fund, also referred to in this paragraph (c) as the "fund", which shall be administered by the Colorado water conservation board. The state treasurer shall transfer moneys to the fund from the severance tax operational fund as specified in section 39-29-109.3 (2) (a). The moneys in the fund are hereby continuously appropriated, for purposes authorized by this paragraph (c), to the Colorado water conservation board, also referred to in this paragraph (c) as the "board". All interest derived from the investment of moneys in the fund shall be credited to the statewide account of the fund, which account is hereby created. Repayments of both the principal and interest on loans from the fund shall be credited to the fund. Any balance remaining in the fund at the end of any fiscal year remains in the fund. The board shall allocate moneys by grant or loan from the fund only for water activities approved by a roundtable pursuant to article 75 of title 37, C.R.S. The approving roundtable is the roundtable for the basin in which a proposed water diversion or nonstructural activity would occur. If the applicant is a covered entity, as defined in section 37-60-126, C.R.S., the board shall allocate moneys by grant or loan from the fund only if the applicant has adopted a water conservation plan, as defined in section 37-60-126, C.R.S. The board, in consultation with the interbasin compact committee created in section 37-75-105, C.R.S., shall establish criteria and guidelines for allocating moneys from the fund, including criteria that ensure that the allocations will assist in meeting water supply needs identified under section 37-75-104 (2) (c), C.R.S., in a manner consistent with section 37-75-102, C.R.S., and shall facilitate both structural and nonstructural projects or methods. Eligible water activities include the following:

(A) Competitive grants for environmental compliance and feasibility studies;

(B) Technical assistance regarding permitting, feasibility studies, and environmental compliance;

(C) Studies or analyses of structural, nonstructural, consumptive, and nonconsumptive water needs, projects, or activities; and

(D) Structural and nonstructural water projects or activities.

(II) On or before October 31 of each year, commencing with the year 2010, the board shall consult with the interbasin compact committee to produce the annual report required by section 37-75-105 (4), C.R.S., regarding how moneys in the fund were allocated in the previous twelve-month period.

(III) If the board notifies the state treasurer that a water storage study has been authorized pursuant to section 37-60-115 (11), C.R.S., on October 15, 2016, the state treasurer shall transfer two hundred eleven thousand one hundred sixty-eight dollars from the fund to the Colorado water conservation board construction fund, created in section 37-60-121 (1) (a), C.R.S., for use by the Colorado water conservation board, created in section 37-60-102, C.R.S., to implement the South Platte river water storage study pursuant to section 37-60-115 (11), C.R.S.