Move forward with mineral-leasing board
When the Mesa County Federal Mineral Leasing Board gathers today to begin reviewing applications for $1.6 million in mineral leasing money, it will be moving forward with an undertaking that has drawn the interest of state and local officials, and could become a model for other counties with significant mineral impacts.
The board may also be heading toward a confrontation with the U.S. Department of Interior officials in Washington, D.C., and that’s unfortunate. But it may be necessary to resolve a dispute over the handling of the money.
Until recently, counties in the West with abundant federal lands and impacts from the leasing of oil, gas and coal on those lands, received two sources of federal funds. One is known as PILT, or payment in lieu of taxes, which was designed for counties with large amounts of federal lands — which pay no property taxes — to make up for those property taxes.
The other pot of money, federal mineral leasing funds, comes from lease payments and royalties energy companies pay for extracting minerals from public lands. It was created to help communities cope with the impacts of mineral development.
However, the Interior Department has decided to subtract the amount of PILT money a county receives from its mineral leasing funds, although its justification for doing so is unclear.
To avoid a reduction in funds, the Colorado Legislature this year authorized the creation of federal mineral leasing districts, to be controlled by boards like the one in Mesa County, to receive and distribute the mineral leasing funds. Since they were to be separate entities from counties, the thinking was, federal authorities would have no reason for subtracting the counties’ PILT funds.
However, as The Daily Sentinel’s Gary Harmon reported this week, the Interior Department has informally said the plan won’t work. The mineral leasing districts created under the legislation are too closely linked to the counties, the agency said. They must be truly independent boards with no link to county government.
The three-member Mesa County Federal Mineral Leasing Board was appointed by the Mesa County commissioners. Commissioner Craig Meis is one of the board members.
In January, state lawmakers may have to tweak the legislation to change the makeup of the boards to comply with Interior Department preferences. Or Congress might have to give new direction to the Interior Department on how the funds are to be handled.
In the meantime, the local board should proceed with its examination of applications today, followed by distribution of this year’s $1.6 million, as Meis has suggested.
Not only is the board operating appropriately under existing legislation, but it has developed a unique and transparent process to encourage projects that will improve this region’s economic outlook. It is a process that should become a model for others. It needs to continue, even if that requires challenging Interior Department interpretations of how the two pots of money should be distributed.