Congressman urges federal reconsideration on mineral lease districts
U.S. Congressman Scott Tipton, R-Colo., issued a letter Nov. 30 supporting efforts by western Colorado counties to maintain control of payment-in-lieu-of-taxes and federal mineral lease money.
The letter comes on the heels of an October correspondence to Colorado Counties, Inc. from Ken Salazar, secretary of the U.S. Department of the Interior, challenging the autonomy of Federal Mineral Lease Districts set up by many Colorado counties in an effort to safeguard dwindling PILT payments.
“PILT was created to bridge the revenue gap many western counties face as the result of having large expanses of un-taxable federal lands,” Tipton wrote in the letter. “PILT is already historically under funded and rural communities have felt a tighter budget crunch than many areas.”
To assist Colorado counties in maximizing federal mineral lease funds and PILT payments, Gov. John Hickenlooper signed into law earlier this year Colorado House Bill 11-1218, also known as the Federal Mineral Lease Districts Act.
The law provides counties with the opportunity to transfer management of federal mineral lease funds from the county to independent district boards.
Moffat County established a federal mineral lease district in early August and appointed a board to manage about $1 million in anticipated federal mineral lease money.
The district encompasses unincorporated Moffat County.
In accordance with HB 11-1218 legislation, the board — consisting of president Darryl Steele, secretary Jean Stetson and board member Tom Mathers — adopted a service plan to:
• Annually distribute federal mineral lease funding to areas or projects socially or economically impacted by the development, processing or energy conversion of fuels and minerals.
• Solicit projects from eligible entities that fit the above criteria.
• Adopt a budget.
• Complete an annual audit.
Tinneal Gerber, Moffat County budget analyst, said the district received its $1 million in federal mineral lease money Aug. 31.
However, the board has been restricted from soliciting projects for those funds because of Salazar’s challenge.
“The district has received the money,” Gerber said. “We’ve really just put everything on hold, and it’s just sitting in that (district) account for now.”
Moffat County Attorney Jeremy Snow said members of the Colorado Legislature are currently drafting new legislation to amend the Federal Mineral Lease Districts Act.
“There hasn’t been an official determination, so this isn’t absolutely dead,” Snow said. “But basically, legislators are drafting changes they hope will satisfy Department of Interior concerns.”
State Sen. Jean White, R-Hayden, said new legislation is in the works.
“It’s going to be an early bill,” White said. “Meaning it will probably be introduced on the first day of the session, which is Jan. 11, 2012.”
White said there are three main amendments that will be added to the current legislation, if passed.
The first will make federal mineral lease districts a subdivision of the state to address the Interior Department’s autonomy concerns.
The new bill may also allow municipalities to be included as part of the district and allow districts to build up PILT and federal mineral lease funds in a reserve account, rather than forcing the districts to spend all of the money it receives each year.
But, Tipton doesn’t believe new legislation at the state level is necessary.
“While Colorado’s previous distribution method for these revenues included some direct payments to the counties, the district’s board of directors exercise a role separate from the county administration,” Tipton wrote in the letter. “I ask Secretary Salazar to join me in support of rural communities and reconsider the DOI’s position on augmenting counties’ PILT finds.”