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S.B. 55 Enrolled

                 

MINERAL LEASE ACT AMENDMENTS

                 
2000 GENERAL SESSION

                 
STATE OF UTAH

                 
Sponsor: Leonard M. Blackham

                  AN ACT RELATING TO MINERAL LEASE REVENUE; ALLOCATING MINERAL LEASE
                  REVENUE FROM TRUST LANDS ACQUIRED THROUGH A LAND EXCHANGE WITH
                  THE FEDERAL GOVERNMENT; PROVIDING THAT ADDITIONAL IN LIEU PAYMENTS
                  BE MADE TO COUNTIES OF THE FIFTH OR SIXTH CLASS UNDER CERTAIN
                  CIRCUMSTANCES; TERMINATING A MANDATORY ANNUAL APPROPRIATION FROM
                  THE GENERAL FUND TO THE BOARD OF REGENTS MADE IN LIEU OF AN
                  APPROPRIATION OF MINERAL LEASE MONEY; CLARIFYING THE CONTENTS AND
                  OPERATION OF THE MINERAL LEASE ACCOUNT; SPECIFYING USES OF THE
                  PERMANENT COMMUNITY IMPACT FUND; MAKING TECHNICAL CHANGES;
                  PROVIDING AN EFFECTIVE DATE; AND PROVIDING A COORDINATION CLAUSE.
                  This act affects sections of Utah Code Annotated 1953 as follows:
                  AMENDS:
                      9-4-302, as last amended by Chapter 326, Laws of Utah 1995
                      9-4-303, as last amended by Chapters 4 and 127, Laws of Utah 1993
                      9-4-305, as last amended by Chapter 326, Laws of Utah 1995
                      9-4-307, as last amended by Chapter 78, Laws of Utah 1993
                      9-15-102, as enacted by Chapter 368, Laws of Utah 1999
                      53C-3-201, as enacted by Chapter 368, Laws of Utah 1999
                      53C-3-202, as enacted by Chapter 368, Laws of Utah 1999
                      59-21-1, as last amended by Chapter 102, Laws of Utah 1999
                      59-21-2, as last amended by Chapter 371, Laws of Utah 1999
                      63C-4-103, as enacted by Chapter 371, Laws of Utah 1999
                  REPEALS:
                      59-21-4, as enacted by Chapter 368, Laws of Utah 1999
                  Be it enacted by the Legislature of the state of Utah:


                      Section 1. Section 9-4-302 is amended to read:
                       9-4-302. Definitions.
                      As used in this part:
                      (1) "Acquired lands" is as defined in Section 53C-3-201 .
                      (2) "Acquired mineral interests" is as defined in Section 53C-3-201 .
                      [(1)] (3) "Bonus payments" [mean] means:
                      (a) that portion of the bonus payments received by the United States government under the
                  Leasing Act paid to the state under Section 35 of the Leasing Act, 30 U.S.C. Sec. 191, together with
                  any interest that had accrued on those payments[.]; or
                      (b) bonus payments collected by the School and Institutional Trust Lands Administration
                  created by Section 53C-1-201 from the lease of:
                      (i) minerals on acquired lands; or
                      (ii) acquired mineral interests.
                      [(2)] (4) "Impact board" means the Permanent Community Impact Fund Board created under
                  Section 9-4-304 .
                      [(3)] (5) "Impact fund" means the Permanent Community Impact Fund established by this
                  chapter.
                      [(4)] (6) "Leasing Act" means the Mineral Lands Leasing Act of 1920, 30 U.S.C. Sec. 181
                  et seq.[, as amended.]
                      [(5)] (7) "Subdivision" means [any] a county, city, town, county service area, special service
                  district, special improvement district, water conservancy district, water [or] improvement district,
                  sewer improvement district, housing authority, building authority, school district, or public
                  postsecondary institution organized under the laws of this state.
                      Section 2. Section 9-4-303 is amended to read:
                       9-4-303. Impact fund -- Deposits and contents -- Use of fund monies.
                      (1) There is created an internal service fund entitled the "Permanent Community Impact
                  Fund."
                      (2) The fund consists of:

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                      (a) all amounts appropriated to the impact fund under Section 59-21-2 ;
                      (b) [70% of the] bonus payments [in respect of the Department of the Interior oil shale
                  prototype leases known as U-A and U-B] deposited to the impact fund pursuant to Subsection
                  59-21-1 (2);
                      (c) [70% of all other] bonus payments deposited to the impact fund pursuant to Section
                  53C-3-202 ;
                      (d) all amounts received for the repayment of loans made by the impact board under this
                  chapter [or from the Community Impact Account]; and
                      (e) all other monies appropriated or otherwise made available to the impact fund by the
                  Legislature.
                      (3) The state treasurer shall:
                      (a) invest the monies in the impact fund by following the procedures and requirements of
                  Title 51, Chapter 7, State Money Management Act; and
                      (b) deposit all interest or other earnings derived from those investments into the impact fund.
                      (4) The amounts in the impact fund available for loans, grants, administrative costs, or other
                  purposes of this part shall be limited to that which the Legislature appropriates for these purposes.
                      (5) Federal mineral lease revenue received by the state under the Leasing Act that is
                  deposited into the impact fund shall be used:
                      (a) in a manner consistent with:
                      (i) the Leasing Act; and
                      (ii) this part; and
                      (b) for loans, grants, or both to state agencies or subdivisions that are socially or
                  economically impacted by the leasing of minerals under the Leasing Act.
                      (6) Mineral lease revenue collected by the School and Institutional Trust Lands
                  Administration from the lease of minerals on acquired lands or the lease of acquired mineral interests
                  that is deposited into the impact fund shall be used:
                      (a) in a manner consistent with this part; and
                      (b) for loans, grants, or both to state agencies or subdivisions socially or economically

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                  impacted by the leasing of:
                      (i) minerals on acquired lands; or
                      (ii) acquired mineral interests.
                      Section 3. Section 9-4-305 is amended to read:
                       9-4-305. Duties -- Loans -- Interest.
                      (1) The impact board shall:
                      (a) make[, subject to the limitations of the Leasing Act,] grants and loans from the amounts
                  appropriated by the Legislature out of the impact fund to state agencies and to subdivisions that are
                  or may be socially or economically impacted, directly or indirectly, by mineral resource development
                  for:
                      (i) planning;
                      (ii) construction and maintenance of public facilities; and
                      (iii) provision of public services;
                      (b) establish the criteria by which the loans and grants will be made;
                      (c) determine the order in which projects will be funded;
                      (d) in conjunction with other agencies of the state or of subdivisions conduct studies,
                  investigations, and research into the effects of proposed mineral resource development projects upon
                  local communities;
                      (e) sue and be sued in accordance with applicable law;
                      (f) qualify for, accept, and administer grants, gifts, loans, or other funds from the federal
                  government and from other sources, public or private; and
                      (g) perform other duties assigned to it under Sections 11-13-29 and 11-13-30 .
                      (2) Monies, including all loan repayments and interest, in the impact fund derived from bonus
                  payments may be used for any of the purposes set forth in Subsection (1)(a) but may only be given
                  in the form of loans to be paid back into the impact fund by the agency or subdivision.
                      (3) The average annual return to the impact fund on all bonus monies may not be less than
                  [one-half] 1/2 of the average interest rate paid by the state on general obligation bonds issued during
                  the most recent fiscal year in which bonds were sold.

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                      (4) (a) "Provision of public services" under Subsection (1)(a) includes contracts with public
                  postsecondary institutions to fund research, education, or public service programs that[: (i)] benefit
                  impacted counties or political subdivisions of the counties[; and].
                      [(ii) are consistent with the purposes provided in Subsection 59-21-1 (1)(a)(ii).]
                      (b) Each contract under Subsection (4)(a) shall be:
                      (i) based on an application to the impact board from the impacted county; and
                      (ii) approved by the county legislative body.
                      (c) For purposes of this section, a land use plan is a public service program.
                      Section 4. Section 9-4-307 is amended to read:
                       9-4-307. Impact fund administered by impact board -- Eligibility for assistance --
                  Review by board -- Administration costs -- Annual report.
                      (1) The impact board shall administer the impact fund in a manner which will keep a portion
                  of the impact fund revolving and shall determine provisions for repayment of loans.
                      (2) In order to receive assistance under this part, subdivisions shall submit formal applications
                  with such information as the impact board prescribes.
                      (3) (a) The impact board shall establish criteria for determining eligibility for assistance under
                  this part [which are consistent with the purposes of Section 35 of the Leasing Act].
                      (b) Criteria for awarding loans or grants made from funds described in Subsection 9-4-303 (5)
                  shall be consistent with Subsection 9-4-303 (5).
                      (c) Criteria for awarding loans or grants made from funds described in Subsection 9-4-303 (6)
                  shall be consistent with Subsections 9-4-303 (6) and 9-4-305 (1)(a).
                      (d) In determining eligibility for loans and grants under this part, the impact board shall
                  consider the following:
                      [(a)] (i) the subdivision's current [federal] mineral lease production;
                      [(b)] (ii) the feasibility of the actual development of a resource which may impact the
                  subdivision directly or indirectly;
                      [(c)] (iii) current taxes being paid by the subdivision's residents;
                      [(d)] (iv) the borrowing capacity of the subdivision, its ability and willingness to sell bonds

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                  or other securities in the open market, and its current and authorized indebtedness, except that the
                  impact board may not fund any education project which could otherwise have reasonably been funded
                  by a school district through a program of annual budgeting, capital budgeting, bonded indebtedness,
                  or special assessments;
                      [(e)] (v) all possible additional sources of state and local revenue, including utility user
                  charges;
                      [(f)] (vi) the availability of federal assistance funds;
                      [(g)] (vii) probable growth of population due to actual or prospective natural resource
                  development in an area;
                      [(h)] (viii) existing public facilities and services;
                      [(i)] (ix) the extent of the expected direct or indirect impact upon public facilities and services
                  of the actual or prospective natural resource development in an area; and
                      [(j)] (x) the extent of industry participation in an impact alleviation plan, either as specified
                  in Title 63, Chapter 51, Resource Development, or otherwise.
                      [(2)] (4) The impact board may restructure all or part of the agency's or subdivision's liability
                  to repay loans for extenuating circumstances.
                      [(3)] (5) The impact board shall review the proposed usages of the impact fund for loans or
                  grants prior to approval and may condition approval on [such] assurances [as] that the impact board
                  [deems] considers to be necessary to ensure that the proceeds of the loan or grant will be used in
                  accordance with [the provisions of] the Leasing Act and this part.
                      (6) Any loan shall specify the terms for repayment and shall be evidenced by general
                  obligation, special assessment, or revenue bonds, notes, or other obligations of the appropriate
                  subdivision issued to the impact board pursuant to such authority for the issuance thereof as may exist
                  at the time of the loan.
                      [(4)] (7) The impact board shall allocate from the impact fund to the department those funds
                  that are appropriated by the Legislature for the administration of the impact fund, but this amount
                  may not exceed 2% of the annual receipts to the impact fund.
                      [(5)] (8) The department shall make an annual report to the Legislature concerning the

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                  number and type of loans and grants made as well as a list of subdivisions which received this
                  assistance.
                      [(6) Notwithstanding anything to the contrary in this part, no loan or grant may be made to
                  any subdivision that is not in compliance by January 1, 1983, with the directives of the State Tax
                  Commission with respect to factoring.]
                      Section 5. Section 9-15-102 is amended to read:
                       9-15-102. Rural Electronic Commerce Communications System Fund -- Deposits and
                  contents -- Interest -- Administration.
                      (1) In order to preserve and promote communications systems, such as broadcast television,
                  in the rural areas of the state, there is created a fund entitled the Rural Electronic Commerce
                  Communications System Fund.
                      (2) The fund shall consist of:
                      (a) monies deposited to the fund under this chapter;
                      (b) monies deposited to the fund under [Subsection 59-21-4 (2)] Section 53C-3-202 ; and
                      (c) bond proceeds from the issuance and sale of revenue bonds authorized under Subsection
                  9-15-104 (2).
                      (3) The fund shall earn interest, which shall be deposited in the fund.
                      (4) Any unallocated balance in the fund at the end of a fiscal year shall be nonlapsing.
                      (5) The division may use fund monies for administration of the fund, but not to exceed 2%
                  of the annual receipts to the fund.
                      Section 6. Section 53C-3-201 is amended to read:
                       53C-3-201. Definitions.
                      As used in this part:
                      (1) "Acquired lands" means those lands acquired by the administration under the agreement.
                      (2) "Acquired mineral interests" means mineral interests acquired by the administration
                  pursuant to Section 3(F), (K), (L), or (M) of the agreement.
                      [(2)] (3) "Agreement" means the Agreement to Exchange Utah School Trust Lands Between
                  the State of Utah and the United States of America, signed May 8, 1998, as ratified by the Utah

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                  School and Lands Exchange Act of 1998, Pub. L. No. 105-335.
                      [(3)] (4) "Identified tracts" means the tracts identified in Section 3(F), (G), (J), (K), (L), and
                  (M) of the agreement, generally referred to as the Cottonwood Tract, Westridge Coal Tract, Ferron
                  Field, Mill Fork Tract, Dugout Canyon Tract, Muddy Tract, and North Horn Coal Tract.
                      [(4)] (5) "Subject mineral" means any mineral that is covered by the [Act of Congress of
                  February 25, 1920, known as the "]Mineral Lands Leasing Act["], 30 U.S.C. Sec. 181 et seq., as
                  amended through [the date of enactment of this part] May 3, 1999.
                      Section 7. Section 53C-3-202 is amended to read:
                       53C-3-202. Collection and distribution of revenues from federal land exchange parcels.
                      (1) The director is responsible for the collection of all bonus [bids] payments, rentals, and
                  royalties from the lease of:
                      (a) minerals on [the] acquired lands; and
                      (b) acquired mineral interests.
                      (2) The director shall [distribute]:
                      (a) except as provided in Subsections (3) and (4), no later than the last day of the second
                  month following each calendar quarter, distribute all bonus [bids] payments received during [each]
                  the calendar quarter from the lease of coal, oil and gas, and coalbed methane on the identified tracts
                  [not later than the end of the second month following the quarter] as follows:
                      (i) 50% to the United States [of America];
                      (ii) 12.16% to the Permanent Community Impact Fund created in Section 9-4-303 ;
                      (iii) 20% to the Constitutional Defense Restricted Account created in Section 63C-4-103 ;
                      (iv) (A) beginning on July 1, 2000, through June 30, 2001, 15% to the Mineral Bonus
                  Account created by Section 59-21-2 ; and
                      (B) beginning on July 1, 2001, 15% to the Rural Electronic Commerce Communications
                  System Fund created by Section 9-15-102 ; and
                      [(ii)] (v) 2.84% to the Rural Development Fund created under Section 9-14-102 ; and
                      [(iii) the remaining 47.16% as provided in Section 59-21-4 ; and]
                      [(b) all rentals and royalties received during each calendar quarter from subject mineral leases]

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                      (b) except as provided in Subsections (3) and (4), no later than the last day of the second
                  month following each calendar quarter, distribute all rentals and royalties received during the calendar
                  quarter from the lease of subject minerals on the acquired lands [not later than the end of the second
                  month following the quarter] and the lease of acquired mineral interests as follows:
                      (i) 50% to the Land Grant Management Fund created [under] by Section 53C-3-101 ;
                      (ii) 29.66% to the Mineral Lease Account created by Subsection 59-21-2 (3);
                      (iii) 10% to the Constitutional Defense Restricted Account created by Section 63C-4-103 ;
                      (iv) 7.5% to the Rural Electronic Commerce Communications System Fund created by
                  Section 9-15-102 ; and
                      [(ii)] (v) 2.84% to the Rural Development Fund created [under] by Section 9-14-102 [; and].
                      [(iii) the remaining 47.16% as provided in Section 59-21-4 .]
                      (3) Notwithstanding Subsections (2)(a), (2)(b), and (4), if the distribution required by
                  Subsection (2)(a)(iii), (2)(b)(iii), or (4) would cause the balance of the Constitutional Defense
                  Restricted Account to exceed $2,000,000, the director shall distribute to the Permanent Community
                  Impact Fund an amount equal to the difference between:
                      (a) what the total balance of the Constitutional Defense Restricted Account would be if, but
                  for this Subsection (3), a distribution described in Subsection (2)(a)(iii), (2)(b)(iii), or (4) was made;
                  and
                      (b) $2,000,000.
                      (4) Notwithstanding Subsections (2)(a) and (b), and except as provided in Subsection (3),
                  for fiscal years beginning on or after fiscal year 2000-01 the director shall deposit:
                      (a) the first $750,000 of distributions required by Subsections (2)(a)(iv) and (2)(b)(iv) into
                  the Rural Electronic Commerce Communications System Fund; and
                      (b) any amounts exceeding the $750,000 described in Subsection (4)(a) that would be
                  distributed into the Rural Electronic Commerce Communications System Fund but for this Subsection
                  (4) into the Constitutional Defense Restricted Account.
                      [(3)] (5) (a) The director may retain up to 8% of the monies collected under Subsection (1)
                  to pay for administrative costs incurred under Subsection (1).

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                      (b) The administrative costs may be deducted prior to the distributions made under
                  Subsections (2)(a) and (b).
                      (c) The director shall keep the administrative cost deductions in separate accounts.
                      (d) (i) For purposes of this section, administrative costs:
                      (A) include:
                      (I) direct costs incurred by the administration [as well as]; and
                      (II) out-of-pocket expenditures incurred by the administration that are directly attributable
                  to leasing [and] or management of the acquired lands for subject minerals [and] or acquired mineral
                  interests; and
                      (B) shall be determined in a manner similar to that used by the federal government pursuant
                  to 30 U.S.C. Sec.191(b).
                      (ii) If the administration includes out-of-pocket expenditures under Subsection [(3)] (5)(d)(i)
                  in determining its costs, those expenditures may not be included in its general calculation of direct
                  costs.
                      (e) (i) At the end of each fiscal year, the director shall reconcile the amount actually spent
                  under Subsection [(3)] (5)(d) with the amount retained under Subsection [(3)] (5)(a).
                      (ii) The director shall distribute any excess from the reconciliation pursuant to [Subsection]
                  Subsections (2) through (4).
                      (iii) The director may retain an amount sufficient to cover the expected administrative costs
                  allowed under Subsection [(3)] (5)(d) for the subsequent fiscal year, less the expected deduction for
                  the subsequent fiscal year under Subsection [(3)] (5)(a).
                      Section 8. Section 59-21-1 is amended to read:
                       59-21-1. Disposition of federal mineral lease monies -- Priority to political subdivisions
                  impacted by mineral development -- Disposition of mineral bonus payments -- Appropriation
                  of monies attributable to royalties from extraction of minerals on federal land located within
                  boundaries of Grand Staircase-Escalante National Monument.
                      (1) [(a)] Except as provided in Subsections (2) through (4), all monies received from the
                  United States under the provisions of the Mineral Lands Leasing Act, 30 U.S.C. Sec. 181 et seq.,

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                  shall:
                      [(i)] (a) be deposited in the Mineral Lease Account of the General Fund; and
                      [(ii)] (b) be appropriated by the Legislature giving priority to those subdivisions of the state
                  socially or economically impacted by development of minerals leased under the Mineral Lands
                  Leasing Act, for:
                      [(A)] (i) planning;
                      [(B)] (ii) construction and maintenance of public facilities; and
                      [(C)] (iii) provision [for] of public services[; and].
                      [(D) housing.]
                      [(b) (i) To the extent determined necessary by the Legislature to provide for the purposes
                  specified in Subsection (1)(a), the Legislature shall appropriate the money received from the United
                  States either totally or partially to:]
                      [(A) the Permanent Community Impact Fund established by Section 9-4-303 ;]
                      [(B) the Board of Water Resources for loans under Section 73-10-23 ; or]
                      [(C) counties, cities, towns, or other political subdivisions of this state socially or
                  economically impacted by development of minerals leased under the Mineral Land Lands Leasing
                  Act.]
                      [(ii) Any balance of the money may be appropriated by the Legislature.]
                      (2) Seventy percent of money received from [the United States attributable to the bonus
                  payments on the Department of the Interior oil shale prototype leases known as U-A and U-B and
                  70% of all other] federal mineral lease bonus payments[,] shall be deposited into the Permanent
                  Community Impact Fund and shall be used as provided in Title 9, Chapter 4, Part 3, Community
                  Impact Alleviation.
                      (3) Thirty percent of [the] money received from [the United States attributable to bonus
                  payments on its oil shale prototype leases described in Subsection (2) and 30% of all other] federal
                  mineral lease bonus payments shall be deposited in the Mineral Bonus Account created by Subsection
                  59-21-2 [(1)](2) and appropriated as provided in that subsection.
                      (4) (a) For purposes of [Subsections (4)(b) through (f)] this Subsection (4):

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                      (i) the "boundaries of the Grand Staircase-Escalante National Monument" means the
                  boundaries:
                      (A) established by Presidential Proclamation No. 6920, 61 Fed. Reg. 50,223 (1996); and
                      (B) modified by:
                      (I) Pub. L. No. 105-335, 112 Stat. 3139; and
                      (II) Pub. L. No. 105-355, 112 Stat. [3139] 3247; and
                      (ii) a special service district, school district, or federal land is considered to be located within
                  the boundaries of the Grand Staircase-Escalante National Monument if a portion of the special service
                  district, school district, or federal land is located within the boundaries described in Subsection
                  (4)(a)(i).
                      (b) Beginning on July 1, 1999, the Legislature shall appropriate, as provided in Subsections
                  (4)(c) through [(f)] (g), monies received from the United States that are attributable to royalties from
                  the extraction of minerals on federal land that, on September 18, 1996, was located within the
                  boundaries of the Grand Staircase-Escalante National Monument.
                      (c) The Legislature shall annually appropriate 40% of the monies described in Subsection
                  (4)(b) to the Department of Transportation to be distributed by the Department of Transportation to
                  special service districts [within] that are:
                      (i) established by counties[:] under Title 17A, Chapter 2, Part 13, Utah Special Service
                  District Act;
                      [(i) if the special service districts are:]
                      [(A)] (ii) socially or economically impacted by the development of minerals under the Mineral
                  Lands Leasing Act; and
                      [(B)] (iii) located within the boundaries of the Grand Staircase-Escalante National
                  Monument[; and].
                      [(ii)] (d) The Department of Transportation shall distribute the money described in
                  Subsection (4)(c) in amounts proportionate to the amount of federal mineral lease money generated
                  by the county in which a special service district is located.
                      [(d)] (e) The Legislature shall annually appropriate 40% of the monies described in

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                  Subsection (4)(b) to the State Board of Education to be distributed equally to school districts [if the
                  school districts] that are:
                      (i) socially or economically impacted by the development of minerals under the Mineral Lands
                  Leasing Act; and
                      (ii) located within the boundaries of the Grand Staircase-Escalante National Monument.
                      [(e)] (f) The Legislature shall annually appropriate 2.25% of the monies described in
                  Subsection (4)(b) to the Utah Geological Survey to facilitate the development of energy and mineral
                  resources in counties that are:
                      (i) socially or economically impacted by the development of minerals under the Mineral Lands
                  Leasing Act; and
                      (ii) located within the boundaries of the Grand Staircase-Escalante National Monument.
                      [(f)] (g) Seventeen and three-fourths percent of the monies described in Subsection (4)(b)
                  shall be deposited annually into the State School Fund established by Utah Constitution Article X,
                  Section 5.
                      Section 9. Section 59-21-2 is amended to read:
                       59-21-2. Definitions -- Mineral Bonus Account created -- Contents -- Use of Mineral
                  Bonus Account money -- Mineral Lease Account created -- Contents -- Appropriation of
                  monies from Mineral Lease Account.
                      (1) As used in this section:
                      (a) "Acquired lands" is as defined in Section 53C-3-201 .
                      (b) "Acquired mineral interests" is as defined in Section 53C-3-201 .
                      [(1)] (2) (a) The Mineral Bonus Account is created within the General Fund.
                      (b) [All bonus money received by the state under] The Mineral Bonus Account consists of
                  federal mineral lease bonus payments deposited pursuant to Subsection 59-21-1 (3) [shall be deposited
                  in this account].
                      (c) The Legislature shall [appropriate] make appropriations from the Mineral Bonus Account
                  in accordance with Section 35 of the Mineral Lands Leasing Act of 1920, 30 U.S.C. Sec. 191.
                      (d) The state treasurer shall:

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                      (i) invest the money in the Mineral Bonus Account by following the procedures and
                  requirements of Title 51, Chapter 7, State Money Management Act; and
                      (ii) deposit all interest or other earnings derived from the account into the Mineral Bonus
                  Account.
                      (3) (a) The Mineral Lease Account is created within the General Fund.
                      (b) The Mineral Lease Account consists of:
                      (i) federal mineral lease money deposited pursuant to Subsection 59-21-1 (1); and
                      (ii) rentals and royalties from the lease of the following deposited pursuant to Section
                  53C-3-202 :
                      (A) minerals on acquired lands; or
                      (B) acquired mineral interests.
                      [(2)] (c) The Legislature shall make appropriations from the Mineral Lease Account as
                  provided in Subsection 59-21-1 (1) and this Subsection [(2)] (3).
                      [(a)] (d) [(i) Except as provided in Subsection (2)(a)(ii) and (2)(a)(iii), in addition to the
                  appropriation under Subsection (2)(b)(ii), the] The Legislature shall annually appropriate 32.5% of
                  all deposits made to the Mineral Lease Account to the Permanent Community Impact Fund
                  established by Section 9-4-303 .
                      [(ii) Except as provided in Subsection (2)(a)(iii) , the Legislature shall: (A) for the fiscal
                  year beginning on July 1, 1999, and ending on June 30, 2000, appropriate 3% of all deposits made
                  to the Permanent Community Impact Fund as provided in Subsection (2)(a)(i) to the Constitutional
                  Defense Restricted Account created in Section 63C-4-103 ; and (B) for fiscal years beginning on or
                  after July 1, 2000, appropriate 1% of all deposits made to the Permanent Community Impact Fund
                  as provided in Subsection (2)(a)(i) to the Constitutional Defense Restricted Account created in
                  Section 63C-4-103 .]
                      [(iii) If the appropriation required by Subsection (2)(a)(ii) would cause the balance of the
                  Constitutional Defense Restricted Account to exceed $1 million, the Legislature shall reduce the
                  appropriation required by Subsection (2)(a)(ii) so that the appropriation will cause the balance of the
                  Constitutional Defense Restricted Account to be $1 million.]

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                      [(b) (i) Except as provided in Subsection (2)(b)(ii), the Legislature shall appropriate 33.5%
                  of all deposits made to the Mineral Lease Account to the Board of Regents for allocation to the
                  state's institutions of higher education.]
                      [(ii) (A) For the fiscal year beginning on July 1, 1996, and ending on June 30, 1997, the
                  Legislature shall appropriate 20% of the mineral lease funds that would otherwise be appropriated
                  to the Board of Regents under Subsection (2)(b)(i) to the Permanent Community Impact Fund.]
                      [(B) For the fiscal year beginning on July 1, 1997, and ending on June 30, 1998, the
                  Legislature shall appropriate 40% of the mineral lease funds that would otherwise be appropriated
                  to the Board of Regents under Subsection (2)(b)(i) to the Permanent Community Impact Fund.]
                      [(C) For fiscal years beginning on or after July 1, 1998, the Legislature shall annually
                  appropriate as follows an additional 20% of the funds that would otherwise be appropriated to the
                  Board of Regents under Subsection (2)(b)(i) until the Legislature appropriates 100% of the funds that
                  would otherwise be appropriated to the Board of Regents:]
                      [(I) the Legislature shall make an appropriation to the Department of Transportation as
                  provided in Subsection (2)(f)(ii);]
                      [(II) the Legislature shall make an appropriation to the Department of Community and
                  Economic Development as provided in Subsection (2)(g);]
                      [(III) the Legislature shall make the appropriations provided for in Subsection (2)(h); and]
                      [(IV) the Legislature shall, after making the appropriations under Subsections (2)(b)(ii)(C)(I)
                  through (III), appropriate the remainder of the funds that would otherwise be appropriated to the
                  Board of Regents to the Permanent Community Impact Fund.]
                      [(D) For fiscal years beginning on or after July 1, 1996, the Legislature shall appropriate an
                  equivalent amount from the General Fund to the Board of Regents to replace the mineral lease monies
                  the Board of Regents would have otherwise received under Subsection (2)(b)(i).]
                      [(c)] (e) The Legislature shall annually appropriate 2.25% of all deposits made to the Mineral
                  Lease Account to the State Board of Education, to be used for education research and
                  experimentation in the use of staff and facilities designed to improve the quality of education in Utah.
                      [(d)] (f) The Legislature shall annually appropriate 2.25% of all deposits made to the Mineral

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                  Lease Account to the Utah Geological Survey, to be used for activities carried on by the survey
                  having as a purpose the development and exploitation of natural resources in the state.
                      [(e)] (g) The Legislature shall annually appropriate 2.25% of all deposits made to the Mineral
                  Lease Account to the Water Research Laboratory at Utah State University, to be used for activities
                  carried on by the laboratory having as a purpose the development and exploitation of water resources
                  in the state.
                      [(f)] (h) (i) The Legislature shall annually appropriate [the following percentages] to the
                  Department of Transportation 40% of all deposits made to the Mineral Lease Account to [the
                  Department of Transportation, to] be distributed [as follows] as provided in Subsection (3)(h)(ii) to:
                      (A) counties;
                      (B) special service districts established:
                      (I) by counties;
                      (II) under Title 17A, Chapter 2, Part 13, Utah Special Service District Act; and
                      (III) for the purpose of constructing, repairing, [and] or maintaining roads[,]; or
                      (C) special service districts established:
                      (I) by counties;
                      (II) under Title 17A, Chapter 2, Part 13, Utah Special Service District Act; and
                      (III) for other purposes authorized by statute[:].
                      [(i)] (ii) [the Legislature shall annually appropriate to the] The Department of Transportation
                  [25%] shall allocate the funds specified in Subsection (3)(h)(i):
                      (A) in amounts proportionate to the amount of mineral lease money generated by each
                  county; and
                      (B) to a county or special service district established by a county under Title 17A, Chapter
                  2, Part 13, Utah Special Service District Act, as determined by the county legislative body.
                      (i) (i) The Legislature shall annually appropriate 5% of all deposits made to the Mineral Lease
                  Account to the Department of Community and Economic Development to be distributed to:
                      (A) special service districts [within counties; and] established:
                      [(ii) in addition to the appropriation under Subsection (2)(f)(i), the Legislature shall make the

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                  following appropriations from mineral lease funds that would be appropriated to the Board of
                  Regents under Subsection (2)(b)(i) except for the appropriations provided in Subsection
                  (2)(b)(ii)(C):]
                      [(A) for the fiscal year beginning on July 1, 1998, and ending on June 30, 1999, the
                  Legislature shall appropriate 5% of all deposits made to the Mineral Lease Account to the
                  Department of Transportation to be distributed to special service districts within counties;]
                      [(B) for the fiscal year beginning on July 1, 1999, and ending on June 30, 2000, the
                  Legislature shall appropriate 10% of all deposits made to the Mineral Lease Account to the
                  Department of Transportation to be distributed to special service districts within counties; and]
                      [(C) for fiscal years beginning on or after July 1, 2000, the Legislature shall appropriate 15%
                  of all deposits made to the Mineral Lease Account to the Department of Transportation to be
                  distributed to special service districts within counties.]
                      [(g) (i) The Legislature shall appropriate the following percentages of all deposits made to
                  the Mineral Lease Account to the Department of Community and Economic Development to be
                  distributed as follows for the purpose of constructing, repairing, and maintaining roads, or for other
                  purposes authorized by statute:]
                      [(A) for the fiscal year beginning on July 1, 1998, and ending on June 30, 1999, the
                  Legislature shall appropriate 2.5% of all deposits made to the Mineral Lease Account to the
                  Department of Community and Economic Development to be distributed to special service districts
                  within counties:]
                      (I) by counties;
                      (II) under Title 17A, Chapter 2, Part 13, Utah Special Service District Act; and
                      (III) for the purpose of constructing, repairing, or maintaining roads; or
                      (B) special service districts established:
                      (I) by counties;
                      (II) under Title 17A, Chapter 2, Part 13, Utah Special Service District Act; and
                      (III) for other purposes authorized by statute.
                      (ii) The Department of Community and Economic Development may distribute the amounts

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                  described in Subsection (3)(i)(i) only to special service districts established under Title 17A, Chapter
                  2, Part 13, Utah Special Service District Act, by counties:
                      [(I)] (A) of the third, fourth, fifth, or sixth class;
                      [(II)] (B) in which 4.5% or less of the mineral lease moneys within the state are generated;
                  and
                      [(III)] (C) that are significantly socially or economically impacted as provided in Subsection
                  (3)(i)(iii) by the development of:
                      (I) minerals under the Mineral Lands Leasing Act, 30 U.S.C. Sec. [191, as a result of either]
                  181 et seq.;
                      (II) minerals on acquired lands; or
                      (III) acquired mineral interests.
                      (iii) The significant social or economic impact required under Subsection (3)(i)(ii)(C) shall
                  be as a result of:
                      (A) the transportation within the county of hydrocarbons, including solid hydrocarbons as
                  defined in Section 59-5-101 [, within the county,];
                      (B) the employment of persons residing within the county in hydrocarbon extraction,
                  including the extraction of solid hydrocarbons as defined in Section 59-5-101 [, of persons residing
                  within the county, or both; and]; or
                      [(B) for fiscal years beginning on or after July 1, 1999, the Legislature shall appropriate 5%
                  of all deposits made to the Mineral Lease Account to the Department of Community and Economic
                  Development to be distributed to special service districts within counties meeting the requirements
                  of Subsections (2)(g)(i)(A)(I) through (III).]
                      [(ii) The executive director of the Department of Community and Economic Development:]
                      [(A) shall determine whether a county meets the requirements of Subsections (2)(g)(i)(A)(I)
                  through (III);]
                      [(B) shall distribute the appropriations under Subsection (2)(g)(i) to special service districts
                  within counties that meet the requirements of Subsections (2)(g)(i)(A)(I) through (III) as provided
                  in Subsection (2)(g)(iii); and]

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                      [(C) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, may
                  make rules:]
                      [(I) providing a procedure for making the distributions under Subsection (2)(g)(ii)(B) to
                  special service districts; and]
                      [(II) defining the term "population" for purposes of Subsection (2)(g)(ii)(B).]
                      (C) a combination of Subsections (3)(i)(iii)(A) and (B).
                      [(iii)] (iv) For purposes of distributing the appropriations under this Subsection [(2)(g)(i)]
                  (3)(i) to special service districts [within] established by counties under Title 17A, Chapter 2, Part 13,
                  Utah Special Service District Act, the Department of Community and Economic Development shall:
                      (A) (I) allocate 50% of the appropriations equally among the counties meeting the
                  requirements of Subsections [(2)(g)(i)(A)(I) through (III)] (3)(i)(ii) and (iii); and
                      (II) allocate 50% of the appropriations based on the ratio that the population of each county
                  meeting the requirements of Subsections [(2)(g)(i)(A)(I) through (III)] (3)(i)(ii) and (iii) bears to the
                  total population of all of the counties meeting the requirements of Subsections [(2)(g)(i)(A)(I)
                  through (III)] (3)(i)(ii) and (iii); and
                      (B) after making the allocations described in Subsection [(2)(g)(iii)(A)] (3)(i)(iv)(A),
                  distribute the allocated revenues to special service districts [within] established by the counties under
                  Title 17A, Chapter 2, Part 13, Utah Special Service District Act, as determined by the executive
                  director of the Department of Community and Economic Development after consulting with the
                  county legislative bodies of the counties meeting the requirements of [Subsection (2)(g)(i)(A)(I)
                  through (III)] Subsections (3)(i)(ii) and (iii).
                      (v) The executive director of the Department of Community and Economic Development:
                      (A) shall determine whether a county meets the requirements of Subsections (3)(i)(ii) and
                  (iii);
                      (B) shall distribute the appropriations under Subsection (3)(i)(i) to special service districts
                  established by counties under Title 17A, Chapter 2, Part 13, Utah Special Service District Act, that
                  meet the requirements of Subsections (3)(i)(ii) and (iii); and
                      (C) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, may

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                  make rules:
                      (I) providing a procedure for making the distributions under this Subsection (3)(i) to special
                  service districts; and
                      (II) defining the term "population" for purposes of Subsection (3)(i)(iv).
                      [(h)] (j) (i) The Legislature shall annually make the following appropriations from the Mineral
                  Lease Account:
                      [(i)] (A) an amount equal to 52 cents multiplied by the number of acres of school or
                  institutional trust lands, lands owned by the Division of Parks and Recreation, and lands owned by
                  the Division of Wildlife Resources that are not under an in lieu of taxes contract, to each county in
                  which those lands are located;
                      [(ii)] (B) to each county in which school or institutional trust lands are transferred to the
                  federal government after December 31, 1992, an amount equal to the number of transferred acres in
                  the county multiplied by a payment per acre equal to the difference between 52 cents per acre and the
                  per acre payment made to that county in the most recent payment under the federal payment in lieu
                  of taxes program, 31 U.S.C. Sec. 6901 [or P.L. 97-258 as amended] et seq., unless the federal
                  payment was equal to or exceeded the 52 cents per acre, in which case [no] a payment [shall] under
                  this Subsection (3)(j)(i)(B) may not be made for the transferred lands; [and]
                      [(iii)] (C) to each county in which federal lands, which are entitlement lands under the federal
                  in lieu of taxes program, are transferred to the school or institutional trust, an amount equal to the
                  number of transferred acres in the county multiplied by a payment per acre equal to the difference
                  between the most recent per acre payment made under the federal payment in lieu of taxes program
                  and 52 cents per acre, unless the federal payment was equal to or less than 52 cents per acre, in which
                  case [no] a payment [shall] under this Subsection (3)(j)(i)(C) may not be made for the transferred
                  land[.]; and
                      (D) to a county of the fifth or sixth class, an amount equal to the product of:
                      (I) $1,000; and
                      (II) the number of residences described in Subsection (3)(j)(iv) that are located within the
                  county.

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                      (ii) A county receiving money under Subsection (3)(j)(i) may distribute the money to special
                  service districts established by the county under Title 17A, Chapter 2, Part 13, Utah Special Service
                  District Act, as determined by the county legislative body.
                      (iii) (A) Beginning in fiscal year 1994-95 and in each year after fiscal year 1994-95, the
                  Division of Finance shall increase or decrease the amounts per acre provided for in Subsections
                  (3)(j)(i)(A) through (C) by the average annual change in the Consumer Price Index for all urban
                  consumers published by the Department of Labor.
                      (B) For fiscal years beginning on or after fiscal year 2001-02, the Division of Finance shall
                  increase or decrease the amount described in Subsection (3)(j)(i)(D)(I) by the average annual change
                  in the Consumer Price Index for all urban consumers published by the Department of Labor.
                      (iv) Residences described in Subsection (3)(j)(i)(D) are residences that are:
                      (A) owned by:
                      (I) the Division of Parks and Recreation; or
                      (II) the Division of Wildlife Resources;
                      (B) located on lands that are owned by:
                      (I) the Division of Parks and Recreation; or
                      (II) the Division of Wildlife Resources; and
                      (C) are not subject to taxation under:
                      (I) Chapter 2, Property Tax Act; or
                      (II) Chapter 4, Privilege Tax.
                      [(i)] (k) [Beginning on July 1, 2000, the] The Legislature shall[, after making the
                  appropriations provided for in Subsections (2)(a) through (h) ,] annually appropriate [the remainder
                  of] to the Permanent Community Impact Fund all deposits [made to] remaining in the Mineral Lease
                  Account [to the Permanent Community Impact Fund] after making the appropriations provided for
                  in Subsections (3)(d) through (j).
                      [(3) (a) Until July 1, 1999, the Board of Regents may not:]
                      [(i) increase the total amount of federal mineral lease funds allocated during any fiscal year
                  above the amount allocated during the last fiscal year more than the percentage increase in the

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                  Consumer Price Index published by the United States Department of Labor for the last calendar year;
                  and]
                      [(ii) increase the total amount allocated more than 10% above the amount allocated during
                  the last fiscal year.]
                      [(b) If the total amount of mineral lease funds allocated to a recipient agency or institution
                  in any fiscal year is less than the total amount allocated for the last fiscal year, the allocation to that
                  agency or institution for the next fiscal year shall be increased by the amount of the reduction before
                  calculating and applying the percent limitation.]
                      [(c) (i) Higher education institutions shall expend the federal mineral lease funds apportioned
                  to them via institutional work programs.]
                      [(ii) The Board of Regents may approve those programs only when it is satisfied that a
                  majority of the funds will be expended for research, educational, or public service programs of benefit
                  to subdivisions of the state that are socially or economically impacted by the development of minerals
                  leased under the Mineral Lands Leasing Act in the planning, construction, and maintenance of public
                  facilities, and the provision of public services.]
                      [(d) (i) Except as provided in Subsection (3)(d)(ii), each institution of higher education is
                  entitled to an amount of mineral lease funds equal to the proportion of the total amount available that
                  the average number of full-time students enrolled during the preceding year at that institution bears
                  to the total enrollment of all institutions.]
                      [(ii) Enrollment at the University of Utah and Utah State University shall first be multiplied
                  by 1.25 and that product shall constitute the enrollment of the University of Utah and Utah State
                  University for the purposes of determining their proportionate allocation.]
                      [(4) The federal mineral lease funds allocated to the Water Research Laboratory at Utah State
                  University are in addition to any other money to which Utah State University is entitled under this
                  section.]
                      [(5) Federal mineral lease funds distributed by the Department of Transportation under
                  Subsection (2)(f) shall be allocated to county special service districts in amounts proportionate to the
                  amount of federal mineral lease money generated by the county in which a special service district is

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                  located.]
                      [(6) (a) Each county receiving money under Subsection (2)(h) shall give the money to a
                  school district or other special service district within the county.]
                      [(b) Beginning in fiscal year 1994-95 and in each year thereafter, the amount per acre
                  provided in Subsection (2)(h)(i) shall adjust to reflect changes in the rate of inflation as measured by
                  the Consumer Price Index.]
                      [(7)] (4) (a) Each agency, board, institution of higher education, and political subdivision
                  receiving money under this chapter shall provide the Legislature, through the Office of the Legislative
                  Fiscal Analyst, with a complete accounting of the use of that money on an annual basis. [This
                  accounting]
                      (b) The accounting required under Subsection (4)(a) shall:
                      [(a)] (i) include actual expenditures for the prior fiscal year, budgeted expenditures for the
                  current fiscal year, and planned expenditures for the following fiscal year; and
                      [(b)] (ii) be reviewed by the Economic Development and Human Resources Appropriation
                  Subcommittee as part of its normal budgetary process under Title 63, Chapter 38, Budgetary
                  Procedures Act.
                      [(8) All monies in or appropriated to the Targeted Allocation Fund shall be transferred to the
                  Permanent Community Impact Fund.]
                      Section 10. Section 63C-4-103 is amended to read:
                       63C-4-103. Creation of Constitutional Defense Restricted Account -- Sources of funds
                  -- Uses of funds -- Account balance limits.
                      (1) There is created a restricted account within the General Fund known as the Constitutional
                  Defense Restricted Account.
                      (2) The account consists of monies from the following revenue sources:
                      (a) monies deposited to the [fund from the Mineral Bonus Account] account as required by
                  [Subsection 59-21-2 (2)] Section 53C-3-202 ;
                      (b) voluntary contributions;
                      (c) monies received by the Constitutional Defense Council from other state agencies; and

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                      (d) appropriations made by the Legislature.
                      (3) Funds in the account shall be nonlapsing.
                      [(4) (a) The account shall earn interest.]
                      [(b) All interest earned on account monies shall be deposited into the General Fund.]
                      [(5)] (4) The account balance may not exceed [$1 million] $2,000,000.
                      [(6)] (5) The Legislature may annually appropriate monies from the Constitutional Defense
                  Restricted Account to the Constitutional Defense Council to carry out its duties in Section
                  63C-4-102 .
                      Section 11. Repealer.
                      This act repeals:
                      Section 59-21-4, Revenues from land exchange parcels -- Distribution.
                      Section 12. Effective date.
                      This act takes effect on July 1, 2000.
                      Section 13. Coordination clause.
                      (1) If this bill and H.B. 207, Use of Constitutional Defense Council Restricted Account, both
                  pass, it is the intent of the Legislature that in Subsection 63C-4-103(6)(b) of H.B. 207, Use of
                  Constitutional Defense Council Restricted Account, the language "from the Mineral Bonus Account"
                  be deleted and replaced with "pursuant to Section 53C-3-202".
                      (2) If this bill and S.B. 10, Community Impact Alleviation - Definitions, both pass, it is the
                  intent of the Legislature that in Subsection 9-4-307(1)(a)(iii) of S.B. 10, Community Impact
                  Alleviation - Definitions, the following language be deleted:
                      "that are consistent with the purposes of Section 35 of the Leasing Act".

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