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<br />As you recall, the state of Wyoming, about a year ago, dedicated a <br />portion of its mineral severance tax revenues to water resource develop- <br />ment in that state. Wyoming created a 100-million-dollar continuing <br />water construction fund, utilizing mineral severance taxes, or a portion <br />of the mineral severance tax, in that state. That is something that we <br />should take a look at here. There are other avenues that we should <br />also explore. <br /> <br />I <br /> <br />The staff did review the mineral severance tax in Colorado. It is a <br />fairly low tax compared with other states,.and we believe. it is appro- <br />priate that a portion of that mineral severance tax be devoted to <br />water resource development. The mineral industry in this state has <br />created a great many problems for us, particularly in the coal develop- <br />ment areas of the state--such as in Moffat County and Delta County. <br /> <br />Throughout a good part of Colorago, coal development is continuing to <br />increase; and it has created a great deal of problems. We think it is <br />entirely appropriate that a part of the mineral severance tax be devoted <br />to the purpose of water resource development. We have prepared a'bil1 <br />along that line. <br /> <br />I want to emphasize again that there are other avenues which should be <br />explored, but we think this is a very fertile area for revenues to the <br />construction fund. <br /> <br />The bill that we have prepared would eventually contribute another two <br />million dollars to the construction fund, which would then give us an <br />annual fund in excess of three million dollars. We believe this is <br />reasonably adequate, if we do not have to come up with 10 percent front- <br />end money for federal projects. If that happens, then that is another <br />ball game entirely. <br /> <br />At this time, Mr. Chairman, I think we might open it up for discussion. <br /> <br />MR. STAPLETON: Well, Fred and I met with Larry at nine o'clock this <br />morning to discuss that, and we feel that there ought to be a committee <br />made up of interested groups in the state and some members of the Board <br />to meet and come back with some recommendations for the January '79 <br />meeting. So let's open it up for discussion. <br /> <br />MR. SHERMAN: .On the issue of funding of these projects, you ought to <br />know that the legislature has under way a study to look at the various <br />options and alternatives available to the state. That study is to be <br />completed by the end of the year for possible use in the next legisla- <br />tive session. I think it probably would be well for the Department of I <br />Natural Resources, the Colorado Water Conservation Board, and the <br />Attorney General's office and others to get involved in at least an <br />analysis of what they are coming up with. I know the Legislative <br />council is putting a great deal of emphasis on that study. They <br />funded it. I don't recall how much money was put into it, but it was <br />a rather considerable sum of money to evaluate that. <br /> <br />I have some general questions I would like to ask or comments that I <br />would like to add to what Larry has talked about. <br /> <br />-6- <br />