Gov. seeks increase in oil and gas fund payments

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GARDEN CITY, Kan. (AP) - Officials in Kansas counties that sued the state over disbursements from an oil and gas trust fund are praising Gov. Sam Brownback’s proposal to increase payments from the fund.

Nearly half of the state’s 105 counties, including all of the counties in southwest Kansas, sued the state last year over the amount of annual payments they received from the Oil and Gas Depletion Fund. Brownback announced in a news release Tuesday that a “misunderstanding” between counties and legislators prompted him to propose increasing payments by a total of $7.5 million, The Garden City Telegram reported (http://bit.ly/K9ITIu ).

“I understand the confusion and frustration by members of the Kansas House and counties in western Kansas,” Brownback said. “This is why I have agreed to propose increasing the payments to counties.”

The trust fund was created in 2005 to offset decreases in property tax revenues in oil- and gas-producing counties. When the value of leases drops 50 percent below a baseline threshold for two consecutive years, counties can use the trust fund payments as a financial cushion.

“I feel it was a mistake corrected, and thankfully so,” said Dave Jones, Finney County Commission chairman. “We appreciate all the efforts of area legislators and the governor’s staff for correcting it.”

Trust-fund payments are distributed in October, based on the previous fiscal year’s severance tax collections. Last year, the Legislature reduced the trust-fund payment from 12.41 percent to 6 percent. The confusion was over when the reduced payments would begin.

The counties argued they should have received the full amount last October, with the lower payments not starting until October of this year.

“I appreciate the willingness of the governor and his budget director to discuss and consider our request to correct technical errors in bill drafting last year that resulted in confusion and distribution of funds in an amount significantly less than anticipated by counties,” said Rep. Russ Jennings, R-Lakin.

Scott County Commissioner Jim Minnix said he’s waiting until the money is delivered.

“Not that I’m major skeptical, but I’d like to see it reinstated at the level the Legislature intended. I’m just kinda waiting for that to happen,” Minnix said. “I’m cautiously optimistic.”

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Information from: The Garden City (Kan.) Telegram, http://www.gctelegram.com

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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