I’ve been looking at TAD records and found that a Pantego resident was charged an average 2.35% tax rate as….
Pantego Resident Carrizo 1H well
2010 $660 tax value where resident paid $15 in taxes at 2.3% rate
2011 $460 $11 2.4%
2012 $180 and is scheduled to pay…. $ 4
Arlington Resident UTA Carrizo 14H well
2011 $160 tax value where resident paid $ 4 in taxes at 2.6% rate
2012 $140 and is scheduled to pay… $ 3.64
Driller Carrizo taxes paid on UTA Unit A 1H well (at 2.6% rate)
2009 $101,000 mineral taxes paid
2010 $ 48,000
2011 $ 33,000 and is scheduled to pay…
2012 $ 18,300
First Baptist Church Unit A 1H well (at 2.6% rate)
2008 not assessed although there was (Nov & Dec) production RRC# 244911 region 9
2009 $ 1,183 mineral taxes paid
2010 $ 697
2011 $ 529 and is scheduled to pay…
2012 $ 307
Grace Lutheran contested their mineral valuations and rec’d a 36% reduction….
Grace Lutheran UTA Unit B 24H well
2011 $618 mineral taxes paid and is scheduled to pay…
2012 0 (TAD has zero as assessed mineral value)
What a difference in TAD mineral valuations and taxes that two years (and two months) makes when your unit is developed at a later date. Grace paid 4.4 times less in mineral taxes than First Baptist. I’m sure they would have liked to have had the opportunity to have their unit be drilled first. (when the prices of NG were higher)
Could it be that the UTA unit A 1H-6H wells were (seismic) targeted as the best wells to be drilled first for their impressive Initial Production Rates for press releases, hype, bank loans…etc?
Those are two questions that neighborhood associations can fight over. In the meantime, I have a slew of questions regarding where Chesapeake warns on their website that in some cases folks may pay more in mineral taxes than what is received in royalty checks due to any shut in wells.
“It is possible, although not usual, to receive a tax statement that is higher than your royalty payments if you had wells shut in for some portion of the year. This could happen if producing wells were temporarily turned off while new wells were being drilled on the same site. When the well resumes production, royalty payments will resume and the balance will be restored.”
Since TAD values minerals on Jan 1, how does the royalty payments “catch up” to the appraised tax liabilities since TAD doesn’t go by production reports?
Does the driller remind TAD which wells were shut in or “choked down” on production due to low natural gas prices?
Does TAD reduce that tax liability in time for the October tax mailings, or do they decrease the mineral taxes owed by that amount for the following tax year?
If the later is the case, couldn’t that result in the residents getting a refund on overcharged mineral taxes?
I feel minerals valuations should be automated/tied to the RRC production reports system. especially now that dry gas is in the bust stage.
The fallout of how this catch up program works is soon to occur, and our leaders need to get ready for the concerns from mineral holders who have been charged for “estimated” production that has been either delayed by….
well shut ins,
distorted by severe production decline curves,
purposely choked down production, (I have not heard back from Mr Venables on that list),
or if the driller cannot afford to (rework the wells) boost production to “catch up” what TAD has assessed as a tax liability on mineral values.
There are alot of zero value mineral accounts on TAD for 2012, 2011, & 2010. I think TAD has taken a conservative valuation stance, but the city may also be missing out on tax revenues deserved which is why we must begin to tie mineral valuations to the Railroad Commission databases. This would also save the county in paying for Pritchard and Abbott services who do the mineral valuations.