New lease district has $500K for remediation

Scheme creates windfall for counties with federal mineral leases

La Plata County is putting out a call for volunteer board members to oversee a new district tasked with distributing money from mineral leases on federal land in the county.

State legislation passed last year and amended in April gives Colorado counties the option to create the federal mineral lease districts as a way to maximize money made from federal lands.

The county receives about $500,000 in federal mineral-lease revenue each year to be used to alleviate social, economic, public and financial effects of mineral development. The board of the new district, which would be independent from the county, would receive and select uses for that money.

Currently, La Plata County receives federal mineral lease money and payment-in-lieu-of-taxes. The federal government pays counties the latter funds to compensate for the property-tax revenue lost because federal lands aren’t taxable.

The idea is to make up for the impact on counties with major swaths of federal lands within their boundaries, said Joanne Spina, interim county manager.

But before the recent legislation, the federal government would give counties their portion of federal-lease revenue, then subtract that amount from the payment-in-lieu-of-tax money counties also receive. The federal government reasons that counties shouldn’t be paid once for loss of property-tax revenue and again for the loss of mineral lease revenue, Spina said.

However, under the new legislation, the county can receive federal lease funds and the full payment-in-lieu-of-tax money if the lease revenue is funneled into a district separate from the county.

The county will receive the same amount of federal funds, but the community as a whole gets a larger chunk of money, Spina said.

Eight Colorado counties, many of them abundant in natural gas and oil, already have created federal mineral-lease districts including Weld, Garfield, Routt and Rio Blanco counties.

In a work session Monday, county commissioners Bobby Lieb and Kellie Hotter supported trying to create the district with a five-member board.

Commissioners will appoint the board’s members.

The county will accept applications for the board positions until May 16 and the commissioners will make a final decision about the district May 30.

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