Coalition: States need mineral royalties

2013-04-28T22:30:00Z Coalition: States need mineral royaltiesBy LAURA HANCOCK Casper Star-Tribune The Billings Gazette
April 28, 2013 10:30 pm  • 

CASPER, Wyo. — Wyoming House Speaker Tom Lubnau has signed his name to a letter from a coalition representing lawmakers in 11 states that opposes the federal government’s withholding of some mineral royalties to energy-producing states as a result of the federal budget sequester.

In Wyoming, the amount that the feds are withholding amounts to $53 million.

“The Interior Department’s actions show a continued disregard of state’s rights and are designed only to maximize the negative impact on the American public by placing additional financial burdens on states,” the April 17 letter states. “The federal government is once again abdicating their responsibility and expecting states to bail them out.”

The state uses mineral royalties to fund K-12 schools, school construction, and the Budget Reserve Account, which feeds into the general fund. Also receiving a portion of mineral royalties are the University of Wyoming, the highway fund, county roads, cities and towns and community colleges.

The letter, which went to two congressional committees and an office in the Department of Interior, is from the Energy Producing States Coalition, of which Lubnau is immediate past chairman.

“The solution is political,” Lubnau said. “And so as many political allies as we can gain, the more effective our political approach can be.”

In addition to Wyoming, members of the coalition are from Alaska, Colorado, Idaho, Mississippi, North Dakota, Ohio, Oklahoma, Texas, Utah and Wisconsin. Members are like-minded legislators and it’s the legislators who are members, not the states they represent, said Roger Barrus, the coalition’s chairman and a member of the Utah House of Representatives.

They sent the letter to the U.S. Department of Interior’s Office of Natural Resources Revenue, the House Natural Resources Committee and the Senate Energy and Natural Resources Committee.

Sen. John Barrasso, R-Wyo., is a member of the Senate committee. His spokeswoman said he appreciates the coalition’s efforts.

“Sen. Barrasso and the rest of the Wyoming delegation will continue to work with Gov. (Matt) Mead and members of Congress on a plan forward,” the spokeswoman, Laura Mengelkamp, wrote in an email. “They’re currently considering all options and plan to make our case in every possible way.”

Mead had hoped to challenge the federal move, but has said Wyoming can't pursue a legal challenge against the decision, on the advice of the state attorney general.

Rep. Cynthia Lummis, R-Wyo., sits on the House Natural Resources Committee.

“Rep. Lummis appreciates state legislators’ involvement in issues that deeply affect them, and has sought their input while exploring possible legislative options,” her spokeswoman, Christine D’Amico, said in an email.

Patrick Etchart, a spokeswoman with the Interior Department Office of Natural Resources Revenue, couldn’t confirm receipt of the letter but sent a statement about withholding the money.

Etchart said that Congress passed the Budget Control Act of 2011, which requires across-the-board, automatic 5.1 percent spending reductions. Mineral royalties are not exempt.

In all, $110 million in mineral royalties will be withheld during the remainder of the fiscal year, which ends Sept. 30, the statement said.

The Office of Natural Resources Revenue “recognizes the hardships this may impose on states, but it is obliged to fulfill its mission in compliance with the law,” Etchart said in the statement.

During the current fiscal year, Wyoming was to receive $995 million in federal mineral royalties, of which $53 million represents about five percent. Companies pay royalties to the federal government when they use federal lands, such as terrain managed by the Bureau of Land Management or the U.S. Forest Service, to produce minerals.

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