Grand Junction, Fruita and other local entities shouldn't expect to see any grant money from the Mesa County Federal Mineral Lease District this year.
That's because all of the money that the district had to award is to go to Mesa County, which plans to put it toward the expansion of the Mesa County Detention Center.
And that happened because the county commissioners insisted that all of the $1.8 million that the district received last year from the U.S. Department of the Interior for the long-unpaid Anvil Points Naval Oil Shale Reserve Fund be sent to them exclusively, and not doled out in grants to anyone else.
"Although the Anvil Points money was not received by the (district) in its normal course of business from (the Colorado Department of Local Affairs), the (commission) emphatically believes that using the Anvil Points money to assist Mesa County in its efforts to address the countywide jail overcrowding problem is exactly the type of project that mineral leasing money ... is intended to be used for," County Attorney Patrick Coleman said in a letter to the district in March.
Instead, the mineral lease board — Craig Springer, Quintin Shear and Mesa County Commissioner John Justman — unanimously agreed to award the county only $1.5 million.
While some members of the district's board didn't particularly care for the tone of Coleman's letter, they agreed granting that money for the jail expansion was an appropriate use.
The district, whose mission is to dole out money the county receives in royalty payments from leases on federal lands, was created to allow the region to receive all of that money without seeing some of it offset by the PILT, or payment in lieu of taxes, money all counties receive.
Similar to lease royalty money, PILT payments come from the federal government based on the amount of land it has in any county to cover property taxes they otherwise would receive if the land were privately held. But federal law also requires that money to be deducted based on whatever royalty payments a local government receives.
The Anvil Points money is an old story, one that dates back to the 1940s. That's when the federal government was experimenting with finding ways to squeeze oil from shale on the Anvil Points site, which is located on the Roan Plateau.
That work, however, created a bit of a mess, requiring years of reclamation. Still, it made money, generating royalty payments to local governments, money that was held by the federal government until the cleanup was complete, which occurred in 2013.
But when the Interior Department finally was persuaded to pay out those final royalties from Anvil Points, it agreed to do so under a deal struck in 2008.
Under current state law dealing with how Colorado disburses federal lease payments, money from royalties are spread statewide. But because Anvil Points was in operation before that law was changed, all agreed to split it among the four impacted counties. Under that agreement, the counties most impacted by Anvil Points, Garfield and Rio Blanco, each received 40 percent, or $7.3 million apiece. The least impacted counties, Mesa and Moffat, got 10 percent each, or $1.8 million apiece.
The thing is, the mineral lease district wasn't established until 2011, three years after the distribution deal was struck.
The commissioners have not yet discussed, much less decided, if they will accept the $1.5 million from the district, or push for the full $1.8 million and any interest it's earned over the past year.
"The statutes by which the (district) was created specifically states that the (district) is responsible for (disbursing) funds received from the Colorado Department of Local Affairs, and the Anvil Points funds were paid to the (district) from the state treasury, not DOLA," Commissioner Justman said in an email to The Daily Sentinel on behalf of the entire commission, which also includes Commissioners Rose Pugliese and Scott McInnis.
"The Board of County Commissioners believes that the Anvil Points money is distinct and separate from the DOLA money that the (district) was formed to distribute, and that Mesa County was legally entitled to receive the Anvil Points money prior to the formation of the (district)," Justman added.
When the money was disbursed, it didn't go directly to the county because, at the time, it was believed it would cause its PILT payments to be cut for the year. That's why a bill approved by the Colorado Legislature last year called for the Anvil Points money to be distributed to the four counties or their federal mineral lease districts.
As a result, the district treated it like any other money it gets, putting half of it into a new savings account that the Legislature allowed it to create in another bill last year as a way of ensuring it has money for grants available in future years, as royalty payments diminish.
Since then, however, the county received confirmation from the Interior Department that any grant money it gets from the district would not offset its PILT payments.
Since the district was created, it's awarded more than $7.9 million in grants to various local governments and special districts around the county.
Last fall, for example, it awarded more than $250,000 in grants to such entities as the Grand Junction Fire Department and the town of Palisade.
This would be the first time the county itself received a grant from the district, and the Interior letter means that it now is free to apply for more grants.
Normally, the district awards grants twice a year, in the spring and fall. But because of this issue, it suspended both grant cycles for 2019.
It anticipated awarding up to $737,000, though up to half of that money may have been deposited into its savings account, called the permanent fund.
Meanwhile, the Mesa County Sheriff's Office is working to get whatever money it can for the planned jail expansion, which is projected to cost up to $20 million.
Currently, an architectural firm is to determine an exact cost of the project and put together blueprints for adding about 160 beds to the 490-bed jail, which has housed as many as 639 inmates at the same time.