County receives small portion of royalties

by Jonathan Van Dyke

The 2008 fiscal year federal mineral royalties disbursement has been released, but Sublette County will be seeing very little of that money.

Of the $2.59 billion released to the states from primarily oil and gas development collections, Wyoming actually received $1.2 billion. However, that amount is then disbursed in a much lower allocation to the three incorporated towns.

“The amount that is generated compared to the amount that comes back [to the county] is pretty low,” said Dianne Burke, research scientist for the county commissioned Ecosystem Research Group (ERG).

“More funds do come back to the county, it’s just not nearly as traceable as the direct allocations.”

Pinedale received $170,428.24, Marbleton received $94,255.20 and Big Piney received $59,911.28 from the state through the allocated mineral royalty money.

Federal Mineral Royalties began to come back to the state through the efforts of former Wyoming U.S. Senator Cliff Hanson.

“At that time, when the program was instituted, 50 percent of the federal mineral royalty money was returned to the state,” Commissioner Joel Bousman said. “The intent of that money was to be used to address impacts generated in the area where the development took place and that was the intent of the program when it was set up.”

While it has been amended several times throughout the 1900s, the Mineral Leasing act was set up to collect on federal lands throughout the country on minerals ranging from cobalt to helium.

“The bulk of the royalty receipts do come from oil, gas and coal,” said Patrick Etchart, spokesperson of the federal Mineral Management Services. “[The leasing act collects] on any energy production that occurs on federal lands, and BLM does control the majority of those. We do collect royalties on national forest land and from the corp. of engineers.”

Due to a 2008 appropriations bill, the split between federal and the state is now 51 percent to 48 percent.

“The money goes to the state, but it’s up to the state to see how that money is spent, and whether it actually goes to address impacts or whether its used for other purposes,” Bousman said. “A year ago the amount of money returned to Sublette County was about .02 percent of the total monies returned for impact, which is essentially a zero amount returned.”

Wyoming state statute 9-4-601 gives the formula for allocations to the towns and cities from the royalty money. Essentially, all of the incorporated towns and cities receive allocations from 9.375 percent of $198 million, or approximately $18.56 million. A formula then takes into account school enrollment versus a statewide average and city/town population to allocate funds to every incorporated town or city in Wyoming.

Of the rest of the $1.2 billion, the state put about $500 million in a budget reserve account and the rest in a variety of state platforms like schools and highways that could inevitably trickle down to Sublette County.

For county officials, the battle must be won in the state legislature in order to get more money coming to one of the state’s top energy producing counties.

“And so it becomes a political issue with taking money away from other counties,” Bousman said. “The only way, in the big picture, that we’re going to ultimately have any success in getting more impact money to the county is for us to do a better job of documenting the impacts that are directly related to energy production.”

With the recent socioeconomic discussion with the governor completed, the county is now hoping to have some leverage in order to pry more information from the energy industry. U.S. Senator Mike Enzi’s office will be working with ERG to that end.

“We’re putting another request to the energy operators for that [impact] information,” Burke said. “The level of participation and responsiveness is probably going to pick up at this point.”