The federal royalty rate for trona was recently reduced from 6-percent to 4%. Industry has been pushing for royalty reductions for over a decade. But Powder River Basin Resource Council’s Jill Morrison says if anything, the royalty should be increased.
“Our position has always been that minerals are a finite resource. Once they’re removed they’re gone and we have that one chance to tax those minerals and get that fair market value because that’s what’s going to help balance our budget, both at the state and national level,” says Morrison.
The federal government will pay back mineral royalties that it withheld from states under the across-the-board budget cuts known as sequestration.
When sequestration went into effect earlier this year, the Department of the Interior started withholding 5 percent of states' share of the royalties, which are paid on resources like coal and oil extracted from federal lands. For Wyoming, that's amounted to more than $40 million.
On Monday, DOI announced that after a legal review, it's giving the money back.
A lawsuit filed by Tripower Resources says the energy company is not responsible for about $885,000 in back taxes from 2008 to 2010. Tripower says it did not own the wells from which these production taxes accumulated during the time period in question. But Campbell, Crook, and Converse Counties have listed the company as tax-delinquent. They’re applying taxes from current production to the owed back-taxes. Converse County treasurer Joel Schell says, according to statute, the current owner is responsible for any unpaid taxes.
Wyoming is scheduled to lose 53 million dollars in federal mineral royalties this summer along with other federal dollars due to the sequester.
Governor Matt Mead says higher than expected gas prices and other earnings will allow the state to overcome that loss of revenue. But during a news conference with reporters, Mead said that he will be worried if these federal cuts continue.