02-07 18:40 S.B. 247
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Severance Tax Revenue Amendments
2025 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: David P. Hinkins
House Sponsor:
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LONG TITLE
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General Description:
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This bill modifies provisions related to the use of severance tax revenue.
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Highlighted Provisions:
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This bill:
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▸ increases the percentage of severance tax revenue dedicated to the Utah Geological
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Survey Restricted Account.
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Money Appropriated in this Bill:
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None
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Other Special Clauses:
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None
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Utah Code Sections Affected:
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AMENDS:
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51-9-306, as last amended by Laws of Utah 2024, Chapter 25
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Be it enacted by the Legislature of the state of Utah:
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Section 1. Section 51-9-306 is amended to read:
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51-9-306 . Deposit of certain severance tax revenue for specified state agencies.
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(1) As used in this section:
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(a) "Aggregate annual revenue" means the aggregate annual revenue collected in a fiscal
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year from the taxes imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas,
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and Mining, after subtracting the amounts required to be distributed under Sections
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51-9-305, 59-5-116, and 59-5-119 and under Subsection 59-5-202(5)(c).
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(b) "Aggregate annual mining revenue" means the aggregate annual revenue collected in
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a fiscal year from taxes imposed under Title 59, Chapter 5, Part 2, Mining Severance
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Tax, after subtracting the amounts required to be distributed under Section 51-9-305
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and under Subsection 59-5-202(5)(c).
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(c) "Aggregate annual oil and gas revenue" means the aggregate annual revenue
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collected in a fiscal year from the taxes imposed under Title 59, Chapter 5, Part 1, Oil
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and Gas Severance Tax, after subtracting the amounts required to be distributed
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under Sections 51-9-305, 59-5-116, and 59-5-119.
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(d) "Average aggregate annual revenue" means the three-year rolling average of the
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aggregate annual revenue collected in a fiscal year from the taxes imposed under
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Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining:
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(i) after subtracting the amounts required to be distributed under Sections 51-9-305,
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59-5-116, and 59-5-119 and under Subsection 59-5-202(5)(c); and
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(ii) ending in the fiscal year immediately preceding the fiscal year of a deposit
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required by this section.
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(e) "Average aggregate annual mining revenue" means the three-year rolling average of
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the aggregate annual revenue collected in a fiscal year from the taxes imposed under
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Title 59, Chapter 5, Part 2, Mining Severance Tax:
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(i) after subtracting the amounts required to be distributed under Section 51-9-305
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and under Subsection 59-5-202(5)(c); and
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(ii) ending in the fiscal year immediately preceding the fiscal year of a deposit
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required by this section.
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(f) "Average aggregate annual oil and gas revenue" means the three-year rolling average
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of the aggregate annual revenue collected in a fiscal year from the taxes imposed
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under Title 59, Chapter 5, Part 1, Oil and Gas Severance Tax:
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(i) after subtracting the amounts required to be distributed under Sections 51-9-305,
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59-5-116, and 59-5-119; and
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(ii) ending in the fiscal year immediately preceding the fiscal year of a deposit
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required by this section.
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(2) After making the deposits of oil and gas severance tax revenue as required under
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Sections 59-5-116 and 59-5-119 and making the credits under Section 51-9-305, for a
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fiscal year beginning on or after [July 1, 2021] July 1, 2025, the State Tax Commission
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shall annually make the following deposits:
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(a) to the Division of Air Quality Oil, Gas, and Mining Restricted Account, created in
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Section 19-2a-106, the following average aggregate annual revenue:
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(i) 2.75% of the first $50,000,000 of the average aggregate annual revenue;
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(ii) 1% of the next $50,000,000 of the average aggregate annual revenue; and
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(iii) .5% of the average aggregate annual revenue that exceeds $100,000,000;
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(b) to the Division of Water Quality Oil, Gas, and Mining Restricted Account, created in
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Section 19-5-126, the following average aggregate annual revenue:
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(i) .4% of the first $50,000,000 of the average aggregate annual revenue;
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(ii) .15% of the next $50,000,000 of the average aggregate annual revenue; and
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(iii) .08% of the average aggregate annual revenue that exceeds $100,000,000;
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(c) to the Division of Oil, Gas, and Mining Restricted Account, created in Section
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40-6-23, the following:
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(i)(A) 11.5% of the first $50,000,000 of the average aggregate annual mining
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revenue;
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(B) 3% of the next $50,000,000 of the average aggregate annual mining revenue;
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and
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(C) 1% of the average aggregate annual mining revenue that exceeds
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$100,000,000; and
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(ii)(A) 18% of the first $50,000,000 of the average aggregate annual oil and gas
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revenue;
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(B) 3% of the next $50,000,000 of the average aggregate annual oil and gas
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revenue; and
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(C) 1% of the average aggregate annual oil and gas revenue that exceeds
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$100,000,000; and
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(d) to the Utah Geological Survey Restricted Account, created in Section 79-3-403, the
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following average aggregate annual revenue:
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(i) [2.5%] 5% of the first $50,000,000 of the average aggregate annual revenue;
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(ii) [1%] 1.5% of the next $50,000,000 of the average aggregate annual revenue; and
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(iii) .5% of the average aggregate annual revenue that exceeds $100,000,000.
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(3) If the money collected in a fiscal year from the taxes imposed under Title 59, Chapter 5,
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Severance Tax on Oil, Gas, and Mining, is insufficient to make the deposits required by
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Subsection (2), the State Tax Commission shall deposit money collected in the fiscal
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year as follows:
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(a) to the Division of Air Quality Oil, Gas, and Mining Restricted Account, created in
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Section 19-2a-106, the following revenue:
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(i) 2.75% of the first $50,000,000 of the aggregate annual revenue;
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(ii) 1% of the next $50,000,000 of the aggregate annual revenue; and
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(iii) .5% of the aggregate annual revenue that exceeds $100,000,000;
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(b) to the Division of Water Quality Oil, Gas, and Mining Restricted Account, created in
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Section 19-5-126, the following revenue:
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(i) .4% of the first $50,000,000 of the aggregate annual revenue;
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(ii) .15% of the next $50,000,000 of the aggregate annual revenue; and
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(iii) .08% of the aggregate annual revenue that exceeds $100,000,000;
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(c) to the Division of Oil, Gas, and Mining Restricted Account, created in Section
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40-6-23, the following:
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(i)(A) 11.5% of the first $50,000,000 of the aggregate annual mining revenue;
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(B) 3% of the next $50,000,000 of the aggregate annual mining revenue; and
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(C) 1% of the aggregate annual mining revenue that exceeds $100,000,000; and
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(ii)(A) 18% of the first $50,000,000 of the aggregate annual oil and gas revenue;
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(B) 3% of the next $50,000,000 of the aggregate annual oil and gas revenue; and
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(C) 1% of the aggregate annual oil and gas revenue that exceeds $100,000,000;
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and
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(d) to the Utah Geological Survey Restricted Account, created in Section 79-3-403, the
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following revenue:
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(i) 2.5% of the first $50,000,000 of the aggregate annual revenue;
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(ii) 1% of the next $50,000,000 of the aggregate annual revenue; and
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(iii) .5% of the aggregate annual revenue that exceeds $100,000,000.
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(4) The severance tax revenues deposited under this section into restricted accounts for the
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state agencies specified in Subsection (2) and appropriated from the restricted accounts
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offset and supplant General Fund appropriations used to pay the costs of programs or
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projects administered by the state agencies that are primarily related to oil, gas, and
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mining.
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Section 2. Effective Date.
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This bill takes effect on May 7, 2025.
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