Barton County and other oil-producing counties in Kansas will get back at least some of the state’s Oil and Gas Valuation Depletion Trust Fund (OGVDTF) money that was withheld last year, County Administrator said Monday.
The so-called “rainy day fund” was made up of taxes collected from oil and gas producers in each county. Its purpose was to make up shortfalls caused by drops in valuation. In the past, the state would return 14 percent of each county’s portion back to the county.
During the 2013 Kansas Legislative Session, a budget was passed that reduced the amount counties received from the fund, helping offset state budget shortfalls. But while counties still expected to receive 12 percent in 2013, the Legislature had a different interpretation of the bill, and refunded only 6 percent.
“Last October, Barton County received quite a bit less money than anticipated,” Boeckman said. The county received $192,104 when county officials were expecting over $397,000.
Oil-producing counties banded together and sued the state. Boeckman said that with help from the Kansas Legislative Policy Group (KLPG), the issue has been resolved and the county received a $200,000 check this month.
He also hopes the county will receive at least $390,000 more this October, and a similar amount in October of 2015.
“This goes into the general fund,” Boeckman said. However, he recommends transferring at least some of it into reserves for long-term county expenses after July 1.
According to the Kansas Association of Counties’ 2014 Legislative Summery:
On the last day of the Legislative Session (May 3), both chambers adopted the conference committee report on SB 245, which now contains the provisions relating to the OGVDTF. This substitute bill amends current law to credit 12.41 percent of FY 2013, FY 2014, and FY 2015 mineral severance taxes collected in counties with receipts in excess of $100,000 to the OGVDTF for distribution in FY 2014, FY 2015, and FY 2016. The bill abolishes the OGVDTF on July 1, 2016.
About 23 percent of the county’s tax revenue comes from oil and gas.
Commissioner Homer Kruckenberg asked if the funds are in danger of being taken away. “Can (Gov.) Brownback sweep that stuff away?”
Boeckman said once the county receives the money, that cannot happen. But, “2015 could be another story.”
Commissioner Jennifer Schartz commented, “I find it unfortunate that the counties had to sue the state, but sometimes you must use the law the make them do what’s right.”
Commission Chairman Kenny Schremmer noted Barton County joined the KLPG several years ago. It provides the advantage of helping counties to work together.
As for long-term plans for the funds, commissioners heard other reports on Monday. Barton County Sheriff Brian Bellendir’s report on jail operations included ongoing maintenance on the 10-year-old county jail, such as its 13 rooftop HVAC units. Later in the morning, Road and Bridge, Noxious Weed and Memorial Parks Director Dale Phillips discussed the options for selling and/or replacing the county’s sand dredge, which is more than 40 years old.