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MMS Distributes Record $23.4B to States, Tribes, Federal Accounts

The Interior Department's Minerals Management Service (MMS) distributed a record $23.4 billion to state, Native American and federal accounts from onshore and offshore energy production during fiscal year (FY) 2008, which ended Sept. 30, up from $11.6 billion in FY2007 and nearly double the previous high of $12.8 billion in FY2006, according to Interior Secretary Dirk Kempthorne.

Kempthorne attributed the record disbursements from royalties, rents and bonuses to higher energy prices and more than $10 million in bonus bids paid by companies to lease tracts for offshore exploration on the Outer Continental Shelf in the Gulf of Mexico and Alaska, as well as from onshore lease sales.

A record $2.59 billion was disbursed to 35 states as their share of federal revenues collected from energy production within their borders, compared to $1.97 billion in FY2007 and the previous high of $2.2 billion in FY2006. Among the states receiving revenues from the MMS, the largest portion, $1.27 billion, went to Wyoming, up from $925 million in FY2007. New Mexico received $614.8 million; Colorado, $178.4 million; Utah, $173 million; and California, $103 million. Other energy-producing states sharing significant revenues included Louisiana with $49.5 million; Montana with approximately $49 million; Alaska with more than $38.5 million; North Dakota at $23.4 million; and Texas, which received approximately $21.7 million.

A total of 15 states received no distributions, and three states -- Tennessee, Indiana and South Carolina -- received less than $300 each. The full list is available at

The disbursements to the states represent their combined share of revenues collected from energy production on federal lands within their borders, and from federal offshore oil and gas tracts adjacent to their shores. Coastal states with producing federal offshore tracts within three miles of their state waters receive 27% of royalties generated in those areas. In addition, MMS funds various special-use accounts, including $2 billion contributed to the Reclamation Fund for water projects, $897 million to the Land and Water Conservation Fund and $150 million to the Historic Preservation Fund.

Another $17.3 billion was disbursed to the U.S. Treasury, and $534 million was disbursed to 34 Native American Tribes and 30,000 individual Native American mineral owners, Kempthorne said.

MMS has disbursed more than $200 billion to federal, state and Native American accounts since it was established in 1982.

FY2008 marked the second full year that MMS distributed funds from geothermal energy production directly to the individual counties where that production occurs. The Energy Policy Act of 2005 mandated that 25% of receipts from geothermal energy production be disbursed directly to counties where that production occurs, in an effort to increase use of that alternative energy resource. MMS distributed about $9.1 million -- more than double the $4.3 million distributed in FY2007 -- to counties in California, Idaho, New Mexico, Nevada, Oregon and Utah.

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