Dear Mayor Arndt and Councilmembers Gutowsky, Pignataro, Canonico, Peel, Ohlson, and Francis –
The Fort Collins Sustainability Group (FCSG) has been advocating for a large greenhouse gas (GHG) emitter fee or tax since the Council Finance Committee began discussing the topic of “Sustainable Funding” in the fall of 2021. Council as a whole will take up this issue during its work session on April 25th. We urge you to tell Finance Department staff at that meeting to include a large emitter tax in at least one of its sustainable funding scenarios for you to consider going forward.
The Sustainable Funding Work Session Item for April 25th does NOT include a large emitter tax in either of the two scenarios presented by staff. As we noted in our Letter to Council Finance Committee on Importance of Large Emitter Tax dated April 5th, neither of the two scenarios presented by staff then included adequate funding for the City’s “core” and “umbrella” climate programs. This situation has worsened since that time: the shortfall between the additional funding staff is proposing and the need has increased in both scenarios. This makes us ask yet again whether the Finance Department is fully on board with the City’s 2019 Climate Emergency Resolution and its climate goals.
At this point we are left wondering why staff seems to be so resolutely opposed to bringing a large emitter tax forward for serious consideration by City Council. In a recent meeting with the FCSG, staff members noted that revenue from a large emitter tax would likely phase out by the end of this decade. We pointed out, however, that if our community is successful in making the transition from natural gas heating to electric heating, any revenue from a fee or tax based on natural gas use would also be greatly diminished by the middle of the next decade. In the Work Session Item, staff notes that a large emitter tax “would discourage large emitters from locating to the Fort Collins community and [would] significantly impact those already operating in City limits.” Is staff really interested in attracting corporations that produce large quantities of unmitigated GHG pollution to locate to Fort Collins? We hope that councilmembers will get to the bottom of staff objections to a large emitter tax at the work session on Tuesday.
A large emitter tax would decrease or eliminate the funding shortfall referenced in the second paragraph, thereby helping Fort Collins meet its 2026 and 2030 GHG emissions reduction goals of 50% and 80%, respectively, compared to 2005 levels. Additionally, a large emitter tax would provide an economic incentive to the two corporations that would be subjected to the tax, Broadcom and Anheuser-Busch, to actually reduce their emissions as they are promising to do, and perhaps on accelerated timelines.
The FCSG agrees with Broadcom and Anheuser Busch that they should not be taxed on emissions lower than the EPA’s reporting threshold of 25,000 metric tons CO2 equivalent. This would reduce the potential tax collections reported by staff on page 95 of the Work Session Item. However, we also believe that Broadcom and Anheuser-Busch should pay a higher tax RATE if the EPA increases the Social Cost of Carbon per metric ton of CO2(e) as staff notes may occur in the near term. We suggest that if the Social Cost of Carbon does increase while the large emitter tax is in effect, the tax rate increase be limited to 10% per year.
The franchise fee and sales tax increases included in staff’s proposal to support climate initiatives are both regressive. Including a tax on the 2023 ballot that would make Fort Collins’ largest polluters pay for the damage they are causing to our climate could help build political support for the sales tax increase. Proposing such a tax would signal that Council believes that we are all truly in the fight for a livable climate together. We again urge you to move forward on Tuesday night toward allowing Fort Collins voters to make that choice in November.
Fort Collins Sustainability Group
P.O. Box 672
Fort Collins, CO 80522
Ph. 970-484-3141 https://focosustainability.org