Board works to protect state energy impact funds
October 7, 1999
The Board of Directors for the Associated Governments of Northwest Colorado (AGNC) met Thursday in Craig at the Moffat County Cooperative Extension Office. The focus of the meeting was to develop a plan to sway the Colorado Legislature to let the Energy and Mineral Impact Assistance Program continue as is.
The program establishes grant money, contributed by energy-based companies, for communities with energy industry-based economies.
Due to term limits in the Legislature, new legislators have a hard time understanding the program, according AGNC board members. Legislators are skeptical of the large amount of financial reserves in the program and why such a high percentage of the projects get funded. These factors give the appearance the fund is careless in its funding, members said.
“The Legislature believes the process isn’t efficient, due to the high percent funding rate,” said Steve Colby, with the Department of Local Affairs Denver office. “We’re dealing with new people in the Legislature that don’t understand how the program works.”
The program has such a high percentage of funding rates because for the past 20 years city and county governments eligible for the grants have cooperated with each other to form an order based on need. During one of the grant cycles a city or county that was not in need of a project or just had received money for a project would not apply for that particular grant cycle. This would increase the rate of grants issued since competition would be lower.
The excess money in the fund that legislators have there eyes on serves a specific purpose to communities that have economies based on the energy industry. The reserves are supposed to help communities that may go through a bust period due to a mine moving or going bankrupt.
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“Front Range legislators have trouble understanding that these areas are susceptible to boom-and-bust periods,” said Dave Ling, chairman of AGNC.
The AGNC board decided there is action that can be taken to protect the grant program. The board plans to contact the new legislators and explain the program to them and why it is vital to Northwest Colorado. The board also decided it would raise the cap on the amount allowed for the grants. Previously, grants were allowed to be $300,000. Grants will be raised to allow more money per grant. This would help communities be more creative with grant applications.
With the raise of the cap the board also decided to be more lenient with the required match percentage. Previously, communities applying for the grants had to match the grant with 50 percent of the money necessary to complete the project. Since the cap was raised might be harder for communities to match the amount of the grant.
Communities will also be able to apply for multi-year projects, allowing for more creativity in project development. The multi-year grants will allow communities to get grant money for one phase of the project, and then apply for another grant for additional phases of the project. This would allow funding of larger projects.
Board members hope that if more leeway is allowed in the grant application process projects that have more benefit to a community will be funded. They also want to encourage communities to apply for grants more often, thus lowering the success rate. The hope is that new legislators will then scrutinize the program less.
“It is not like we’re just trying to hoard this money for ourselves,” said Tim Sarmo, field representative for the Department of Local Affairs. “The program works and we need to make the new legislators know that.”
The AGNC board will send a letter to all of communities that would be affected by the changes in the grant policy and give them a week to comment on the recommendations. If the changes in policy are agreed on then the AGNC board will request a meeting with local legislators and the director of the Department of Local Affairs and enact the policy changes.