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DENVER - A report Tuesday by a Montana-based research group said the economic impact of the fossil fuels industry comes from tax revenues, not energy-related jobs for workers who can be transient, and recommended maximizing those revenues by raising rates.

The report by Headwaters Economics said government data show energy-related jobs including coal mining jobs made up less than 3 percent of the total employment in Colorado, Montana, New Mexico and Utah and about 8.5 percent in Wyoming in 2008.

The study acknowledged the data might have missed some seasonal oil and gas workers or ones categorized in other industries.

Mining workers' annual wages are typically far higher than average, the study noted.

A PriceWaterhouseCoopers study in 2009 for the trade group Western Energy Alliance said the oil and gas industry alone provided at least 7 percent of jobs in each state, with Wyoming getting about 29 percent of its jobs - about 71,000 positions - from the industry.

Kathleen Sgamma, director of government and public affairs for the group, said the Headwaters study focused on a time of severe recession.

"Headwaters Economics research is always geared toward a certain agenda, and they continue to try to minimize the economic contribution of oil and natural gas, rather than celebrating the fact that it is one of several industries that together create significant jobs and economic activity across the West," she said.

Headwaters said it gets funding from grants, foundations and agencies, including the Bureau of Land Management.

Its report charted monthly changes in rig counts against changing oil and natural gas prices and concluded that price is the primary driver of development.

"It's price, not policy decisions, that determine the number of people employed in mining industries and the size of the paychecks they bring home," said the study's author, Julia Haggerty, adding that Colorado didn't see a significant difference after an overhaul of drilling regulations in 2008.

The report's recommendations included setting aside money to deal with environmental impacts and reforming distribution of energy revenue so that money goes not only to communities affected by mining or drilling but also to those flooded with industry workers.

It recommended raising tax rates on the industry and scrapping state revenue and spending limits, like Colorado's Taxpayer's Bill of Rights, that could force communities to forgo revenue. While oil and gas prices can fluctuate, tax revenues can accrue even after jobs leave, the study said.

Doug Flanders, director of policy and external affairs for the Colorado Oil and Gas Association, said any review of tax policies should be broad-based.

"To ensure a strong economic recovery in Colorado, we must continue to attract oil and gas company investment to the state. That requires stable taxes and sensible regulations and policies," he said.

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