Hearty tax collections could lead to $100M surplus for Eddy County at end of fiscal year
Tax collections well above budgeted projections could lead to a $100 million surplus Eddy County when the 2024 fiscal year ends in nearly five months, said Eddy County Finance Director Breanna Shields.
She offered a midyear budget review to the Eddy County Board of County Commissioners Feb. 6 and said the county collected 96% of its $260 million of budgeted revenue through Dec. 31, 2023.
Fiscal years in Eddy County start on July 1 and end on June 30.
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“We came into the year with a $37 million from the prior year,” she said.
Eddy County government is funded through several forms of tax collections, including oil and gas production and equipment, gross receipts taxes (GRTs) and property taxes.
Shields said county officials had budgeted $45.7 million in oil and gas tax collections when the 2024 fiscal year started.
Through December of last year, Eddy County collected $40 million in oil and gas taxes.
Shields said the county projected $3.9 million in monthly oil and gas tax collections during the current fiscal year.
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“That was based on (oil) prices at $65 a barrel and 16 million monthly (oil) production volume,” she said.
West Texas Intermediate (WTI) Light Sweet Crude Oil prices varied from around $70 a barrel to around $94 a barrel from July through December of 2023, according to the U.S. Energy Information Agency (EIA).
WTI is the world’s most traded liquid contract, noted the CME Group.
GRT’s are sales taxes imposed on business transactions and Shields said Eddy County met its budgeted projections of $33 million at the end of December.
Shields said property tax collections in Eddy County were budgeted at $23 million.
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Shields projected surpluses at the end of the current fiscal year for all tax collections.
She anticipates oil and tax collections totaling $103 million as EIA anticipates oil prices above $80 a barrel in the coming months.
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EIA was forecasting U.S. crude oil production to hit 13.3 million barrels per day this month. Production could decrease as 2024 moves on.
Shields forecasts GRT collections way above original projections and property tax collections could be $12 million above projections.
The Carlsbad Department of Development (CDOD) was working with potential developers to bring more businesses to Carlsbad to strengthen the tax base and add more GRTs, noted Jeff Campbell, director of business and marketing, in a December 2023 report.
Mike Smith can be reached at 575-628-5546 or by email at MSmith@currentargus.com or @ArgusMichae on X, formerly known as Twitter.
This article originally appeared on Carlsbad Current-Argus: $100M surplus predicted for Eddy County with robust tax collections
