States Receive Record $800 Million in Mineral Revenues

DENVER--A record $800 million was distributed to 35 states by the Minerals Management Service during 2000 as their cumulative share of revenues collected for mineral production on federal lands within their borders and from federal offshore lands next to their shores.

"Because of increased prices, we collected and, therefore, shared more revenues with the states," explained Tom Kitsos, MMS acting director. "Amounts vary according to production and market prices. $541 million was distributed to states in 1999, $559 million in 1998, and $617 million in 1997."

The MMS collects and disburses revenues from mineral leases on federal and Indian lands. Disbursements are made to states on a monthly basis as bonuses, rents, royalties, and other revenues are collected. A state is entitled to a share of the mineral revenues collected from federal lands that are within that state's boundaries. For the majority of federal lands, states and the Federal Government share the revenues: 50 percent to the state, 40 percent to the Reclamation Fund for water projects, and 10 percent to the General Fund of the U.S. Treasury. One exception, Alaska, gets a 90-percent share, as prescribed by the Alaska Statehood Act.

"The money is used at the states' discretion, without federal oversight, for a variety of purposes; oftentimes for schools, roads and other public works," said Kitsos.

Certain coastal states with federal offshore tracts adjacent to their seaward boundaries receive 27 percent of those mineral royalties as well. Remaining offshore revenues are deposited in special accounts of the U.S. Treasury, including the General Fund, the Land and Water Conservation Fund, and the Historic Preservation Fund.

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