The MMS's Minerals
Revenue Management Program is responsible for management of all revenues
associated with both federal offshore and onshore mineral leases. The
effort is one of the federal government’s greatest sources of non-tax
revenues.
While MMS’s
Offshore & Energy Minerals Management offices contend with all
aspects of offshore federal leasing, federal
onshore mineral leasing activities are managed by the Department of
the Interior’s Bureau of Land Management and the Department of
Agriculture’s U.S. Forest Service.
Indian mineral leases (which are not
federal leases and located only onshore) are administered by the Bureau
of Indian Affairs and the Bureau of Land Management. The MMS MRM, in
conjunction with the Bureau of Indian Affairs, provides revenue
management services for mineral leases on Indian lands.
Operationally based at the Denver
Federal Center in Colorado, the Minerals Revenue Management Program has
field offices near principal energy development areas in Texas, Oklahoma
and New Mexico to augment the program.
Some federal lands are leased to
individuals and companies for minerals development. Lease holders
competitively bid, initially pay a bonus, and subsequently rent, for the
right to develop these onshore and offshore lands.
If minerals are found, extracted and
sold, the federal government is entitled to a certain percentage of, or
royalty on, the production.
Using sophisticated, computerized
accounting systems, the MRM processes nearly $1 billion (mostly via
electronic funds transfers) each month. Bonuses, rents and royalties
from more than 67,000 leases can amount to several billion dollars each
year -- an amount that peaked to more than $23 billion in 2008 and has
averaged approximately $13 billion during the past five years. Totals
fluctuate with market prices, amount of production, and the number of
lease sales.
For offshore leases, the Minerals
Revenue Management Program distributes the collected money to U.S.
Treasury accounts. In recent years, annual deposits have included
nearly $900 million to the Land and Water Conservation Fund and $150
million to the Historic Preservation Fund. The remainder is sent to the
U. S. Treasury's General Fund. Additionally, a portion of royalties
from certain offshore federal leases, adjacent to seaward boundaries of
coastal states, are shared with those states.
Distribution of revenues associated
with onshore federal lands is generally split 50-40-10, with 49 percent
of the money going directly to the state within which the specific lease
was located. Forty percent is sent to the Reclamation Fund of the U.S.
Treasury. This special account finances the Bureau of Reclamation's
water projects in 17 western states. The remaining 10 percent goes to
the Treasury's General Fund. One exception, Alaska, gets a 90 percent
share of the revenues.
In Fiscal Year 2008, 35 states
received $2.59 billion as their cumulative share of onshore federal
leases.
Money collected for Indian mineral
leases is returned -- l00 percent -- to respective Indian tribes or
individual Indian mineral owners through the Office of Trust Funds
Management. |