“Mineral leasing funds provide a critical boost to Montana’s efforts to improve basic services like roads and schools,” said Rehberg, a member of the House Appropriations Committee.  “Unfortunately, a provision to cut these funds was slipped into the final Appropriations bill that passed last year.  I’m strongly urging the Bush Administration to discontinue this practice before mineral-rich western states are impacted.”

            Included within the Fiscal Year 2008 Consolidated Appropriations Act was a provision reducing the States’ share of receipts from mineral leasing activities on federal lands.  Specifically, this provision, called “net receipt sharing,” would require the federal government to deduct two percent from the states’ share to pay for the administration of the Minerals Leasing Program.  A similar policy in place from 1991 to 2000 cost states nearly $250 million in lost revenue. Montana stands to lose approximately $764,000 under the plan. 

            “It is unconscionable that the Department of the Interior and the Office of Management and Budget would propose to take money from states used to pay for important priorities, including educational improvements, to pay for program administration,” said Rehberg and 15 other members in a letter.  “This provision does not serve the taxpayers who fund the government nor does it serve the states that encourage energy production to happen within their borders.”

Letter:

The Honorable Dirk Kempthorne                                  The Honorable Jim Nussle

Secretary                                                                      Director

United States Department of the Interior                        Office of Management and Budget

1849 C Street, NW                                                      725 17th Street, NW

Washington, DC 20240                                                Washington, DC 20503

Dear Secretary Kempthorne and Director Nussle,

We are writing to urge you to avoid the inclusion of “net receipt sharing” as part of the President’s Budget for fiscal year 2009 for the Department of the Interior.  The proposal would reduce the States’ share of receipts from mineral leasing activities on public lands by two percent annually.  Previous budget documents have suggested that this reduction is necessary to defray administrative costs at the Department. 

We strongly disagree with this assertion and oppose the Department taking money that is rightfully owed to our states in order to pay for more federal bureaucracy.  It is unconscionable that the Department of the Interior and the Office of Management and Budget would propose to take money from States used to pay for important priorities, including educational improvements, to pay for program administration.  This provision does not serve the taxpayers who fund the government nor does it serve the states that encourage energy production to happen within their borders.

Similar policy, implemented in 1991 and initially repealed in 2000, led to the loss of nearly $250 million in States’ revenues.  The inclusion of this proposal in the fiscal year 2008 Consolidated Appropriations Act (P.L. 110-161) will once again allow for this harmful provision to have a negative impact on States. 

We strongly opposed the inclusion of this provision in the fiscal year 2008 Consolidated Appropriations Act.  We do not believe the measure received thorough consideration and believe that if it had received such consideration, it would have been removed.  We hope the Department of the Interior and the Office of Management and Budget will recognize the problematic nature of this provision and will avoid including the proposal in the President’s Budget for fiscal year 2009.

Thank you for your consideration of our request.