Weld County Officials, Business Leaders Discuss Energy

May 28, 2012
By

GARDNER: “Talk about job creation, talk about getting this country back on its economic footing, this is where it starts.”

GREELEY – Congressman Cory Gardner (R-Yuma) turned up the heat on energy issues at a business roundtable and visit to a Colorado trucking company last Thursday as part of the GOP House Energy Action Team’s (HEAT) focus on the Environmental Protection Agency’s regulations.

Following a panel session between the Republican representative and local officials, businesses, and energy industry experts, Gardner, who was joined by Wyoming Congresswoman Cynthia Lummis, visited JBS Trucking in Greeley, “to learn how gas prices affect end users”—including JBS and its customers.

“Talk about job creation, talk about getting this country back on its economic footing, this is where it starts,” Gardner said, referring to the recent opening of Noble Energy’s Northern Colorado offices and the 300 employees expected to work there.

Noble Energy has announced plans this month to invest as much as $8 billion over the next five years, resulting in additional jobs. In addition, the company gave $5 million to Weld County school districts to convert regular school buses there to compressed natural gas.

Weld County has experienced a natural resources boon and a boom in its economic bottom line, perched above the Niobrara shale formation that has brought oil companies, industry jobs, and large property tax checks to the county’s coffers.

Just two oil and gas companies out of 31 in the county—Noble Energy and Anadarko—combined to pay Weld County $109 million in 2011 property taxes, the two largest payments in the county’s history.

That figure represents more than a doubling from 2010, when the two companies sent $48.2 million to the county, according to Weld County Commissioner Sean Conway. The 2011 figure could be doubled again for 2012, although Conway said those figures would not be known until May 2013.

Undercutting further developments and even hindering current growth are the maze of regulatory hurdles and economic trepidation engendered by an encroaching EPA, Gardner said.

“What we’ve seen over the past several years—economic uncertainty, regulatory uncertainty—and making it more difficult to access energy on public lands,” Gardner said, pointing to the contrast with private land development, which has soared.

Gardner emphasized that energy costs go beyond the immediate concerns of fuel costs, with the price of energy affecting everything from electricity to groceries, affecting working families’ kitchen table decisions.

“Because it’s not just the cost of fuel when you fill up your car, it’s not just the cost of electricity when you flip the light switch or the air conditioner on, it’s also what happens to things like basic needs in our households like food,” Gardner said, noting the rise in production and transportation costs of food associated with escalations in fuel prices.

Gardner criticized President Barack Obama’s environmental and regulatory policies, and believes that Weld County offered a great model for creating energy self-sufficiency and economic growth, something either missed or ignored by the current administration.

Lummis agreed.

“We had a chance to listen in a roundtable with the businesses that are here today about barriers to their ability to create new sustainable wage jobs and revenue for counties like Weld County, Colorado and Laramie County, Wyoming due to the opportunities we have to produce oil and gas in these areas,” said Lummis.

Companies’ razor-thin profit margins, often close to one percent according to Lummis, are threatened by an unforeseen and unpredictable “lack of certainty” in federal rules and regulations.

“Surprise pronouncements from Washington is an absolute non-starter,” Lummis said. What the businesses are looking for is “business climate certainty” that promotes capital deployment, she argued.

Greeley Mayor Tom Norton declared the city “open for business.” The county, Norton said, balances the environmental concerns with an equal measure of certainty, providing companies with a consistent framework of operation.

“Maintaining a reasonable level of control and a reasonable level of environmental regulation so that businesses can thrive and that we don’t strap them with the kinds of things that hold up business activity,” Norton explained.

Conway dubbed the success the “Weld County way.” The commissioner highlighted the property tax surge that looks to increase each fiscal year should the planned and potential investments in the county that could top $15 billion over the next few years come to fruition.

Conway estimated that the property tax windfall from oil and gas companies like Noble Energy and Anadarko means $300 less in tax assessments to the average taxpayer in the county. The county has decreased its mill levy because of the offsetting tax income from the resource development.

More importantly, Conway said, was that the county enjoyed no long or short-term debt, and was able to avoid employing a sales tax. In other words, Conway admitted, the “Weld County way” was really the product of a decades-long philosophy of “no debt.”

But the only thing that could jeopardize the growth, Conway said, are the regulatory “frustrations” that prevent job growth, as he related the feelings of the dozen companies that attended the roundtable earlier in the day. The roundtable was closed to the press.

Rodrigo Horvath, President of JBS Carriers, detailed the costs associated with rising fuel prices that his company faces. Horvath estimated that the trucking company purchases approximately 12 million gallons of diesel each year.

“We definitely do know how those price fluctuations makes [sic] to a business like that [JBS],” Horvath said. With aggregate fuel costs in the $350 to 400 million range per year, even a fraction of a penny change will affect the company’s bottom line, and the jobs of its’ employees.

“It’s huge,” Horvath said, referring to the fuel costs. He noted several of the company’s policies and technological adaptations to cut fuel consumption from idling trucks.

This post was written by

Michael Sandoval – who has written posts on The Colorado Observer.

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2 Responses to Weld County Officials, Business Leaders Discuss Energy

  1. zippy
    May 29, 2012 at 10:43 am

    Lots of elected officials for a ‘closed to press’ event. I think I’ll make sure CREW knows abut this one!

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