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S.B. 55

             1     

MINERAL LEASE ACT AMENDMENTS

             2     
2000 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Sponsor: Leonard M. Blackham

             5      AN ACT RELATING TO MINERAL LEASE REVENUE; ALLOCATING MINERAL LEASE
             6      REVENUE FROM TRUST LANDS ACQUIRED THROUGH A LAND EXCHANGE WITH
             7      THE FEDERAL GOVERNMENT; TERMINATING A MANDATORY ANNUAL
             8      APPROPRIATION FROM THE GENERAL FUND TO THE BOARD OF REGENTS MADE IN
             9      LIEU OF AN APPROPRIATION OF MINERAL LEASE MONEY; CLARIFYING THE
             10      CONTENTS AND OPERATION OF THE MINERAL LEASE ACCOUNT; SPECIFYING USES
             11      OF THE PERMANENT COMMUNITY IMPACT FUND; MAKING TECHNICAL CHANGES;
             12      AND PROVIDING AN EFFECTIVE DATE.
             13      This act affects sections of Utah Code Annotated 1953 as follows:
             14      AMENDS:
             15          9-4-302, as last amended by Chapter 326, Laws of Utah 1995
             16          9-4-303, as last amended by Chapters 4 and 127, Laws of Utah 1993
             17          9-4-305, as last amended by Chapter 326, Laws of Utah 1995
             18          9-4-307, as last amended by Chapter 78, Laws of Utah 1993
             19          9-15-102, as enacted by Chapter 368, Laws of Utah 1999
             20          53C-3-201, as enacted by Chapter 368, Laws of Utah 1999
             21          53C-3-202, as enacted by Chapter 368, Laws of Utah 1999
             22          59-21-1, as last amended by Chapter 102, Laws of Utah 1999
             23          59-21-2, as last amended by Chapter 371, Laws of Utah 1999
             24          63C-4-103, as enacted by Chapter 371, Laws of Utah 1999
             25      REPEALS:
             26          59-21-4, as enacted by Chapter 368, Laws of Utah 1999
             27      Be it enacted by the Legislature of the state of Utah:


             28          Section 1. Section 9-4-302 is amended to read:
             29           9-4-302. Definitions.
             30          As used in this part:
             31          (1) "Acquired lands" is as defined in Section 53C-3-201 .
             32          (2) "Acquired mineral interests" is as defined in Section 53C-3-201 .
             33          [(1)] (3) "Bonus payments" [mean] means:
             34          (a) that portion of the bonus payments received by the United States government under the
             35      Leasing Act paid to the state under Section 35 of the Leasing Act, together with any interest that
             36      had accrued on those payments[.]; or
             37          (b) bonus payments collected by the School and Institutional Trust Lands Administration
             38      created by Section 53C-1-201 from the lease of:
             39          (i) minerals on acquired lands; or
             40          (ii) acquired mineral interests.
             41          [(2)] (4) "Impact board" means the Permanent Community Impact Fund Board created
             42      under Section 9-4-304 .
             43          [(3)] (5) "Impact fund" means the Permanent Community Impact Fund established by this
             44      chapter.
             45          [(4)] (6) "Leasing Act" means the Mineral Lands Leasing Act of 1920, 30 U.S.C. Sec. 181
             46      et seq.[, as amended].
             47          [(5)] (7) "Subdivision" means [any] a county, city, town, county service area, special
             48      service district, special improvement district, water conservancy district, water [or] improvement
             49      district, sewer improvement district, housing authority, building authority, school district, or public
             50      postsecondary institution organized under the laws of this state.
             51          Section 2. Section 9-4-303 is amended to read:
             52           9-4-303. Impact fund -- Deposits and contents -- Use of fund monies.
             53          (1) There is created an internal service fund entitled the "Permanent Community Impact
             54      Fund."
             55          (2) The fund consists of:
             56          (a) all amounts appropriated to the impact fund under Section 59-21-2 ;
             57          (b) [70% of the] bonus payments [in respect of the Department of the Interior oil shale
             58      prototype leases known as U-A and U-B] deposited to the impact fund pursuant to Subsection


             59      59-21-1 (2);
             60          (c) [70% of all other] bonus payments deposited to the impact fund pursuant to Section
             61      53C-3-202 ;
             62          (d) all amounts received for the repayment of loans made by the impact board under this
             63      chapter [or from the Community Impact Account]; and
             64          (e) all other monies appropriated or otherwise made available to the impact fund by the
             65      Legislature.
             66          (3) The state treasurer shall:
             67          (a) invest the monies in the impact fund by following the procedures and requirements of
             68      Title 51, Chapter 7, State Money Management Act; and
             69          (b) deposit all interest or other earnings derived from those investments into the impact
             70      fund.
             71          (4) The amounts in the impact fund available for loans, grants, administrative costs, or
             72      other purposes of this part shall be limited to that which the Legislature appropriates for these
             73      purposes.
             74          (5) Federal mineral lease revenue received by the state under the Leasing Act that is
             75      deposited into the impact fund shall be used:
             76          (a) in a manner consistent with:
             77          (i) the Leasing Act; and
             78          (ii) this part; and
             79          (b) for loans, grants, or both to state agencies or subdivisions that are socially or
             80      economically impacted by the leasing of minerals under the Leasing Act.
             81          (6) Mineral lease revenue collected by the School and Institutional Trust Lands
             82      Administration from the lease of minerals on acquired lands or the lease of acquired mineral
             83      interests that is deposited into the impact fund shall be used:
             84          (a) in a manner consistent with this part; and
             85          (b) for loans, grants, or both to state agencies or subdivisions socially or economically
             86      impacted by the leasing of:
             87          (i) minerals on acquired lands; or
             88          (ii) acquired mineral interests.
             89          Section 3. Section 9-4-305 is amended to read:


             90           9-4-305. Duties -- Loans -- Interest.
             91          (1) The impact board shall:
             92          (a) make[, subject to the limitations of the Leasing Act,] grants and loans from the amounts
             93      appropriated by the Legislature out of the impact fund to state agencies and to subdivisions that
             94      are or may be socially or economically impacted, directly or indirectly, by mineral resource
             95      development for:
             96          (i) planning;
             97          (ii) construction and maintenance of public facilities; and
             98          (iii) provision of public services;
             99          (b) establish the criteria by which the loans and grants will be made;
             100          (c) determine the order in which projects will be funded;
             101          (d) in conjunction with other agencies of the state or of subdivisions conduct studies,
             102      investigations, and research into the effects of proposed mineral resource development projects
             103      upon local communities;
             104          (e) sue and be sued in accordance with applicable law;
             105          (f) qualify for, accept, and administer grants, gifts, loans, or other funds from the federal
             106      government and from other sources, public or private; and
             107          (g) perform other duties assigned to it under Sections 11-13-29 and 11-13-30 .
             108          (2) Monies, including all loan repayments and interest, in the impact fund derived from
             109      bonus payments may be used for any of the purposes set forth in Subsection (1)(a) but may only
             110      be given in the form of loans to be paid back into the impact fund by the agency or subdivision.
             111          (3) The average annual return to the impact fund on all bonus monies may not be less than
             112      [one-half] 1/2 of the average interest rate paid by the state on general obligation bonds issued
             113      during the most recent fiscal year in which bonds were sold.
             114          (4) (a) "Provision of public services" under Subsection (1)(a) includes contracts with
             115      public postsecondary institutions to fund research, education, or public service programs that[: (i)]
             116      benefit impacted counties or political subdivisions of the counties[; and].
             117          [(ii) are consistent with the purposes provided in Subsection 59-21-1 (1)(a)(ii).]
             118          (b) Each contract under Subsection (4)(a) shall be:
             119          (i) based on an application to the impact board from the impacted county; and
             120          (ii) approved by the county legislative body.


             121          (c) For purposes of this section, a land use plan is a public service program.
             122          Section 4. Section 9-4-307 is amended to read:
             123           9-4-307. Impact fund administered by impact board -- Eligibility for assistance --
             124      Review by board -- Administration costs -- Annual report.
             125          (1) The impact board shall administer the impact fund in a manner which will keep a
             126      portion of the impact fund revolving and shall determine provisions for repayment of loans.
             127          (2) In order to receive assistance under this part, subdivisions shall submit formal
             128      applications with such information as the impact board prescribes.
             129          (3) (a) The impact board shall establish criteria for determining eligibility for assistance
             130      under this part [which are consistent with the purposes of Section 35 of the Leasing Act].
             131          (b) Criteria for awarding loans or grants made from funds described in Subsection
             132      9-4-303 (5) shall be consistent with Subsection 9-4-303 (5).
             133          (c) Criteria for awarding loans or grants made from funds described in Subsection
             134      9-4-303 (6) shall be consistent with Subsections 9-4-303 (6) and 9-4-305 (1)(a).
             135          (d) In determining eligibility for loans and grants under this part, the impact board shall
             136      consider the following:
             137          [(a)] (i) the subdivision's current [federal] mineral lease production;
             138          [(b)] (ii) the feasibility of the actual development of a resource which may impact the
             139      subdivision directly or indirectly;
             140          [(c)] (iii) current taxes being paid by the subdivision's residents;
             141          [(d)] (iv) the borrowing capacity of the subdivision, its ability and willingness to sell bonds
             142      or other securities in the open market, and its current and authorized indebtedness, except that the
             143      impact board may not fund any education project which could otherwise have reasonably been
             144      funded by a school district through a program of annual budgeting, capital budgeting, bonded
             145      indebtedness, or special assessments;
             146          [(e)] (v) all possible additional sources of state and local revenue, including utility user
             147      charges;
             148          [(f)] (vi) the availability of federal assistance funds;
             149          [(g)] (vii) probable growth of population due to actual or prospective natural resource
             150      development in an area;
             151          [(h)] (viii) existing public facilities and services;


             152          [(i)] (ix) the extent of the expected direct or indirect impact upon public facilities and
             153      services of the actual or prospective natural resource development in an area; and
             154          [(j)] (x) the extent of industry participation in an impact alleviation plan, either as specified
             155      in Title 63, Chapter 51, Resource Development, or otherwise.
             156          [(2)] (4) The impact board may restructure all or part of the agency's or subdivision's
             157      liability to repay loans for extenuating circumstances.
             158          [(3)] (5) The impact board shall review the proposed usages of the impact fund for loans
             159      or grants prior to approval and may condition approval on [such] assurances [as] that the impact
             160      board [deems] considers to be necessary to ensure that the proceeds of the loan or grant will be
             161      used in accordance with [the provisions of] the Leasing Act and this part.
             162          (6) Any loan shall specify the terms for repayment and shall be evidenced by general
             163      obligation, special assessment, or revenue bonds, notes, or other obligations of the appropriate
             164      subdivision issued to the impact board pursuant to such authority for the issuance thereof as may
             165      exist at the time of the loan.
             166          [(4)] (7) The impact board shall allocate from the impact fund to the department those
             167      funds that are appropriated by the Legislature for the administration of the impact fund, but this
             168      amount may not exceed 2% of the annual receipts to the impact fund.
             169          [(5)] (8) The department shall make an annual report to the Legislature concerning the
             170      number and type of loans and grants made as well as a list of subdivisions which received this
             171      assistance.
             172          [(6) Notwithstanding anything to the contrary in this part, no loan or grant may be made
             173      to any subdivision that is not in compliance by January 1, 1983, with the directives of the State Tax
             174      Commission with respect to factoring.]
             175          Section 5. Section 9-15-102 is amended to read:
             176           9-15-102. Rural Electronic Commerce Communications System Fund -- Deposits and
             177      contents -- Interest -- Administration.
             178          (1) In order to preserve and promote communications systems, such as broadcast
             179      television, in the rural areas of the state, there is created a fund entitled the Rural Electronic
             180      Commerce Communications System Fund.
             181          (2) The fund shall consist of:
             182          (a) monies deposited to the fund under this chapter;


             183          (b) monies deposited to the fund under [Subsection 59-21-4 (2)] Section 53C-3-202 ; and
             184          (c) bond proceeds from the issuance and sale of revenue bonds authorized under
             185      Subsection 9-15-104 (2).
             186          (3) The fund shall earn interest, which shall be deposited in the fund.
             187          (4) Any unallocated balance in the fund at the end of a fiscal year shall be nonlapsing.
             188          (5) The division may use fund monies for administration of the fund, but not to exceed 2%
             189      of the annual receipts to the fund.
             190          Section 6. Section 53C-3-201 is amended to read:
             191           53C-3-201. Definitions.
             192          As used in this part:
             193          (1) "Acquired lands" means those lands acquired by the administration under the
             194      agreement.
             195          (2) "Acquired mineral interests" means mineral interests acquired by the administration
             196      pursuant to Section 3(F), (K), (L), or (M) of the agreement.
             197          [(2)] (3) "Agreement" means the Agreement to Exchange Utah School Trust Lands
             198      Between the State of Utah and the United States of America, signed May 8, 1998, as ratified by
             199      the Utah School and Lands Exchange Act of 1998, Pub. L. 105-335.
             200          [(3)] (4) "Identified tracts" means the tracts identified in Section 3(F), (G), (J), (K), (L),
             201      and (M) of the agreement, generally referred to as the Cottonwood Tract, Westridge Coal Tract,
             202      Ferron Field, Mill Fork Tract, Dugout Canyon Tract, Muddy Tract, and North Horn Coal Tract.
             203          [(4)] (5) "Subject mineral" means any mineral that is covered by the [Act of Congress of
             204      February 25, 1920, known as the "]Mineral Lands Leasing Act["], 30 U.S.C. Sec. 181 et seq., as
             205      amended through the date of enactment of this part.
             206          Section 7. Section 53C-3-202 is amended to read:
             207           53C-3-202. Collection and distribution of revenues from federal land exchange
             208      parcels.
             209          (1) The director is responsible for the collection of all bonus [bids] payments, rentals, and
             210      royalties from the lease of:
             211          (a) minerals on [the] acquired lands; and
             212          (b) acquired mineral interests.
             213          (2) The director shall [distribute]:


             214          (a) except as provided in Subsections (3) and (4), no later than the last day of the second
             215      month following each calendar quarter, distribute all bonus [bids] payments received during [each]
             216      the calendar quarter from the lease of coal, oil and gas, and coalbed methane on the identified
             217      tracts [not later than the end of the second month following the quarter] as follows:
             218          (i) 50% to the United States [of America];
             219          (ii) 17.16% to the Permanent Community Impact Fund created in Section 9-4-303 ;
             220          (iii) 15% to the Constitutional Defense Restricted Account created in Section 63C-4-103 ;
             221          (iv) 15% to the Rural Electronic Commerce Communications System Fund created by
             222      Section 9-15-102 ; and
             223          [(ii)] (v) 2.84% to the Rural Development Fund created under Section 9-14-102 ; [and]
             224          [(iii) the remaining 47.16% as provided in Section 59-21-4 ; and]
             225          (b) no later than the last day of the second month following each calendar quarter,
             226      distribute all [rentals and royalties] bonus payments received during [each] the calendar quarter
             227      from the lease of subject [mineral leases] minerals on acquired lands, other than identified tracts,
             228      as follows:
             229          (i) 50% to the Land Grant Management Fund created by Section 53C-3-101 ;
             230          (ii) 47.16% to the Permanent Community Impact Fund created by Section 9-4-303 ; and
             231          (iii) 2.84% to the Rural Development Fund created by Section 9-14-102 ; and
             232          (c) except as provided in Subsections (3) and (4), no later than the last day of the second
             233      month following each calendar quarter, distribute all rentals and royalties received during the
             234      calendar quarter from the lease of subject minerals on the acquired lands [not later than the end of
             235      the second month following the quarter] and the lease of acquired mineral interests as follows:
             236          (i) 50% to the Land Grant Management Fund created [under] by Section 53C-3-101 ;
             237          (ii) 32.16% to the Mineral Lease Account created by Subsection 59-21-2 (3);
             238          (iii) 7.5% to the Constitutional Defense Restricted Account created by Section 63C-4-103 ;
             239          (iv) 7.5% to the Rural Electronic Commerce Communications System Fund created by
             240      Section 9-15-102 ; and
             241          [(ii)] (v) 2.84% to the Rural Development Fund created [under] by Section 9-14-102 [;
             242      and].
             243          [(iii) the remaining 47.16% as provided in Section 59-21-4 .]
             244          (3) Notwithstanding Subsections (2)(a) and (2)(c), if the distribution required by


             245      Subsection (2)(a)(iii) or (2)(c)(iii) would cause the balance of the Constitutional Defense
             246      Restricted Account to exceed $2,000,000, the director shall:
             247          (a) reduce the distribution required by Subsection (2)(a)(iii), (2)(c)(iii), or both so that the
             248      distribution will cause the balance of the Constitutional Defense Restricted Account to be
             249      $2,000,000; and
             250          (b) distribute to the Permanent Community Impact Fund an amount equal to the difference
             251      between:
             252          (i) the sum of:
             253          (A) the bonus payments described in Subsection (2)(a) that, but for this Subsection (3),
             254      would be deposited into the Constitutional Defense Restricted Account under Subsection
             255      (2)(a)(iii); and
             256          (B) the rentals and royalties described in Subsection (2)(c) that, but for this Subsection (3),
             257      would be deposited into the Constitutional Defense Restricted Account under Subsection
             258      (2)(c)(iii); and
             259          (ii) $2,000,000.
             260          (4) Notwithstanding Subsections (2)(a) and (2)(c), if the sum of the distributions to the
             261      Rural Electronic Commerce Communications System Fund required by Subsections (2)(a)(iv) and
             262      (2)(c)(iv) exceed $750,000 in any fiscal year, the director shall distribute to the Permanent
             263      Community Impact Fund an amount equal to the difference between:
             264          (a) the sum of:
             265          (i) the bonus payments described in Subsection (2)(a) that, but for this Subsection (4),
             266      would be deposited into the Rural Electronic Commerce Communications System Fund under
             267      Subsection (2)(a)(iv); and
             268          (ii) the rentals and royalties described in Subsection (2)(c) that, but for this Subsection (4),
             269      would be deposited into the Rural Electronic Commerce Communications System Fund under
             270      Subsection (2)(c)(iv); and
             271          (b) $750,000.
             272          [(3)] (5) (a) The director may retain up to 8% of the monies collected under Subsection
             273      (1) to pay for administrative costs incurred under Subsection (1).
             274          (b) The administrative costs may be deducted prior to the distributions made under
             275      Subsections (2)(a) [and (b)] through (2)(c).


             276          (c) The director shall keep the administrative cost deductions in separate accounts.
             277          (d) (i) For purposes of this section, administrative costs:
             278          (A) include:
             279          (I) direct costs incurred by the administration [as well as]; and
             280          (II) out-of-pocket expenditures incurred by the administration that are directly attributable
             281      to leasing [and] or management of the acquired lands for subject minerals [and] or acquired
             282      mineral interests; and
             283          (B) shall be determined in a manner similar to that used by the federal government
             284      pursuant to 30 U.S.C. Sec.191(b).
             285          (ii) If the administration includes out-of-pocket expenditures under Subsection [(3)]
             286      (5)(d)(i) in determining its costs, those expenditures may not be included in its general calculation
             287      of direct costs.
             288          (e) (i) At the end of each fiscal year, the director shall reconcile the amount actually spent
             289      under Subsection [(3)] (5)(d) with the amount retained under Subsection [(3)] (5)(a).
             290          (ii) The director shall distribute any excess from the reconciliation pursuant to
             291      [Subsection] Subsections (2) through (4).
             292          (iii) The director may retain an amount sufficient to cover the expected administrative
             293      costs allowed under Subsection [(3)] (5)(d) for the subsequent fiscal year, less the expected
             294      deduction for the subsequent fiscal year under Subsection [(3)] (5)(a).
             295          Section 8. Section 59-21-1 is amended to read:
             296           59-21-1. Disposition of federal mineral lease monies -- Priority to political
             297      subdivisions impacted by mineral development -- Disposition of mineral bonus payments --
             298      Appropriation of monies attributable to royalties from extraction of minerals on federal land
             299      located within boundaries of Grand Staircase-Escalante National Monument.
             300          (1) [(a)] Except as provided in Subsections (2) through (4), all monies received from the
             301      United States under the provisions of the Mineral Lands Leasing Act, 30 U.S.C. Sec. 181 et seq.,
             302      shall:
             303          [(i)] (a) be deposited in the Mineral Lease Account of the General Fund; and
             304          [(ii)] (b) be appropriated by the Legislature giving priority to those subdivisions of the
             305      state socially or economically impacted by development of minerals leased under the Mineral
             306      Lands Leasing Act, for:


             307          [(A)] (i) planning;
             308          [(B)] (ii) construction and maintenance of public facilities; and
             309          [(C)] (iii) provision [for] of public services[; and].
             310          [(D) housing.]
             311          [(b) (i) To the extent determined necessary by the Legislature to provide for the purposes
             312      specified in Subsection (1)(a), the Legislature shall appropriate the money received from the
             313      United States either totally or partially to:]
             314          [(A) the Permanent Community Impact Fund established by Section 9-4-303 ;]
             315          [(B) the Board of Water Resources for loans under Section 73-10-23 ; or]
             316          [(C) counties, cities, towns, or other political subdivisions of this state socially or
             317      economically impacted by development of minerals leased under the Mineral Land Lands Leasing
             318      Act.]
             319          [(ii) Any balance of the money may be appropriated by the Legislature.]
             320          (2) Seventy percent of money received from [the United States attributable to the bonus
             321      payments on the Department of the Interior oil shale prototype leases known as U-A and U-B and
             322      70% of all other] federal mineral lease bonus payments[,] shall be deposited into the Permanent
             323      Community Impact Fund and shall be used as provided in Title 9, Chapter 4, Part 3, Community
             324      Impact Alleviation.
             325          (3) Thirty percent of [the] money received from [the United States attributable to bonus
             326      payments on its oil shale prototype leases described in Subsection (2) and 30% of all other] federal
             327      mineral lease bonus payments shall be deposited in the Mineral Bonus Account created by
             328      Subsection 59-21-2 [(1)](2) and appropriated as provided in that subsection.
             329          (4) (a) For purposes of [Subsections (4)(b) through (f)] this Subsection (4):
             330          (i) the "boundaries of the Grand Staircase-Escalante National Monument" means the
             331      boundaries:
             332          (A) established by Presidential Proclamation No. 6920, 61 Fed. Reg. 50,223 (1996); and
             333          (B) modified by:
             334          (I) Pub. L. No. 105-335, 112 Stat. 3139; and
             335          (II) Pub. L. No. 105-355, 112 Stat. [3139] 3247; and
             336          (ii) a special [service] district, school district, or federal land is considered to be located
             337      within the boundaries of the Grand Staircase-Escalante National Monument if a portion of the


             338      special [service] district, school district, or federal land is located within the boundaries described
             339      in Subsection (4)(a)(i).
             340          (b) Beginning on July 1, 1999, the Legislature shall appropriate, as provided in
             341      Subsections (4)(c) through [(f)] (g), monies received from the United States that are attributable
             342      to royalties from the extraction of minerals on federal land that, on September 18, 1996, was
             343      located within the boundaries of the Grand Staircase-Escalante National Monument.
             344          (c) The Legislature shall annually appropriate 40% of the monies described in Subsection
             345      (4)(b) to the Department of Transportation to be distributed by the Department of Transportation
             346      to special [service] districts [within] that are:
             347          (i) established by counties[:] under Title 17A;
             348          [(i) if the special service districts are:]
             349          [(A)] (ii) socially or economically impacted by the development of minerals under the
             350      Mineral Lands Leasing Act; and
             351          [(B)] (iii) located within the boundaries of the Grand Staircase-Escalante National
             352      Monument[; and].
             353          [(ii)] (d) The Department of Transportation shall distribute the money described in
             354      Subsection (4)(c) in amounts proportionate to the amount of federal mineral lease money generated
             355      by the county in which a special [service] district is located.
             356          [(d)] (e) The Legislature shall annually appropriate 40% of the monies described in
             357      Subsection (4)(b) to the State Board of Education to be distributed equally to school districts [if
             358      the school districts] that are:
             359          (i) socially or economically impacted by the development of minerals under the Mineral
             360      Lands Leasing Act; and
             361          (ii) located within the boundaries of the Grand Staircase-Escalante National Monument.
             362          [(e)] (f) The Legislature shall annually appropriate 2.25% of the monies described in
             363      Subsection (4)(b) to the Utah Geological Survey to facilitate the development of energy and
             364      mineral resources in counties that are:
             365          (i) socially or economically impacted by the development of minerals under the Mineral
             366      Lands Leasing Act; and
             367          (ii) located within the boundaries of the Grand Staircase-Escalante National Monument.
             368          [(f)] (g) Seventeen and three-fourths percent of the monies described in Subsection (4)(b)


             369      shall be deposited annually into the State School Fund established by Utah Constitution Article
             370      X, Section 5.
             371          Section 9. Section 59-21-2 is amended to read:
             372           59-21-2. Definitions -- Mineral Bonus Account created -- Contents -- Use of Mineral
             373      Bonus Account money -- Mineral Lease Account created -- Contents -- Appropriation of
             374      monies from Mineral Lease Account.
             375          (1) As used in this section:
             376          (a) "Acquired lands" is as defined in Section 53C-3-201 .
             377          (b) "Acquired mineral interests" is as defined in Section 53C-3-201 .
             378          [(1)] (2) (a) The Mineral Bonus Account is created within the General Fund.
             379          (b) [All bonus money received by the state under] The Mineral Bonus Account consists
             380      of federal mineral lease bonus payments deposited pursuant to Subsection 59-21-1 (3) [shall be
             381      deposited in this account].
             382          (c) The Legislature shall [appropriate] make appropriations from the Mineral Bonus
             383      Account in accordance with Section 35 of the Mineral Lands Leasing Act of 1920, 30 U.S.C. Sec.
             384      191.
             385          (d) The state treasurer shall:
             386          (i) invest the money in the Mineral Bonus Account by following the procedures and
             387      requirements of Title 51, Chapter 7, State Money Management Act; and
             388          (ii) deposit all interest or other earnings derived from the account into the Mineral Bonus
             389      Account.
             390          (3) (a) The Mineral Lease Account is created within the General Fund.
             391          (b) The Mineral Lease Account consists of:
             392          (i) federal mineral lease money deposited pursuant to Subsection 59-21-1 (1); and
             393          (ii) rentals and royalties from the lease of the following deposited pursuant to Section
             394      53C-3-202 :
             395          (A) minerals on acquired lands; or
             396          (B) acquired mineral interests.
             397          [(2)] (c) The Legislature shall make appropriations from the Mineral Lease Account as
             398      provided in Subsection 59-21-1 (1) and this Subsection [(2)] (3).
             399          [(a)] (d) [(i) Except as provided in Subsection (2)(a)(ii) and (2)(a)(iii), in addition to the


             400      appropriation under Subsection (2)(b)(ii), the] The Legislature shall annually appropriate 32.5%
             401      of all deposits made to the Mineral Lease Account to the Permanent Community Impact Fund
             402      established by Section 9-4-303 .
             403          [(ii) Except as provided in Subsection (2)(a)(iii) , the Legislature shall: (A) for the fiscal
             404      year beginning on July 1, 1999, and ending on June 30, 2000, appropriate 3% of all deposits made
             405      to the Permanent Community Impact Fund as provided in Subsection (2)(a)(i) to the Constitutional
             406      Defense Restricted Account created in Section 63C-4-103 ; and (B) for fiscal years beginning on
             407      or after July 1, 2000, appropriate 1% of all deposits made to the Permanent Community Impact
             408      Fund as provided in Subsection (2)(a)(i) to the Constitutional Defense Restricted Account created
             409      in Section 63C-4-103 .]
             410          [(iii) If the appropriation required by Subsection (2)(a)(ii) would cause the balance of the
             411      Constitutional Defense Restricted Account to exceed $1 million, the Legislature shall reduce the
             412      appropriation required by Subsection (2)(a)(ii) so that the appropriation will cause the balance of
             413      the Constitutional Defense Restricted Account to be $1 million.]
             414          [(b) (i) Except as provided in Subsection (2)(b)(ii), the Legislature shall appropriate 33.5%
             415      of all deposits made to the Mineral Lease Account to the Board of Regents for allocation to the
             416      state's institutions of higher education.]
             417          [(ii) (A) For the fiscal year beginning on July 1, 1996, and ending on June 30, 1997, the
             418      Legislature shall appropriate 20% of the mineral lease funds that would otherwise be appropriated
             419      to the Board of Regents under Subsection (2)(b)(i) to the Permanent Community Impact Fund.]
             420          [(B) For the fiscal year beginning on July 1, 1997, and ending on June 30, 1998, the
             421      Legislature shall appropriate 40% of the mineral lease funds that would otherwise be appropriated
             422      to the Board of Regents under Subsection (2)(b)(i) to the Permanent Community Impact Fund.]
             423          [(C) For fiscal years beginning on or after July 1, 1998, the Legislature shall annually
             424      appropriate as follows an additional 20% of the funds that would otherwise be appropriated to the
             425      Board of Regents under Subsection (2)(b)(i) until the Legislature appropriates 100% of the funds
             426      that would otherwise be appropriated to the Board of Regents:]
             427          [(I) the Legislature shall make an appropriation to the Department of Transportation as
             428      provided in Subsection (2)(f)(ii);]
             429          [(II) the Legislature shall make an appropriation to the Department of Community and
             430      Economic Development as provided in Subsection (2)(g);]


             431          [(III) the Legislature shall make the appropriations provided for in Subsection (2)(h); and]
             432          [(IV) the Legislature shall, after making the appropriations under Subsections
             433      (2)(b)(ii)(C)(I) through (III), appropriate the remainder of the funds that would otherwise be
             434      appropriated to the Board of Regents to the Permanent Community Impact Fund.]
             435          [(D) For fiscal years beginning on or after July 1, 1996, the Legislature shall appropriate
             436      an equivalent amount from the General Fund to the Board of Regents to replace the mineral lease
             437      monies the Board of Regents would have otherwise received under Subsection (2)(b)(i).]
             438          [(c)] (e) The Legislature shall annually appropriate 2.25% of all deposits made to the
             439      Mineral Lease Account to the State Board of Education, to be used for education research and
             440      experimentation in the use of staff and facilities designed to improve the quality of education in
             441      Utah.
             442          [(d)] (f) The Legislature shall annually appropriate 2.25% of all deposits made to the
             443      Mineral Lease Account to the Utah Geological Survey, to be used for activities carried on by the
             444      survey having as a purpose the development and exploitation of natural resources in the state.
             445          [(e)] (g) The Legislature shall annually appropriate 2.25% of all deposits made to the
             446      Mineral Lease Account to the Water Research Laboratory at Utah State University, to be used for
             447      activities carried on by the laboratory having as a purpose the development and exploitation of
             448      water resources in the state.
             449          [(f)] (h) (i) The Legislature shall annually appropriate [the following percentages] to the
             450      Department of Transportation 40% of all deposits made to the Mineral Lease Account to [the
             451      Department of Transportation, to] be distributed [as follows] as provided in Subsection (3)(h)(ii)
             452      to:
             453          (A) counties;
             454          (B) special districts established:
             455          (I) by counties;
             456          (II) under Title 17A; and
             457          (III) for the purpose of constructing, repairing, [and] or maintaining roads[,]; or
             458          (C) special districts established:
             459          (I) by counties;
             460          (II) under Title 17A; and
             461          (III) for other purposes authorized by statute[:].


             462          [(i)] (ii) [the Legislature shall annually appropriate to the] The Department of
             463      Transportation [25%] shall allocate the funds specified in Subsection (3)(h)(i):
             464          (A) in amounts proportionate to the amount of mineral lease money generated by each
             465      county; and
             466          (B) to a county or special district established by a county under Title 17A, as determined
             467      by the county legislative body.
             468          (i) (i) The Legislature shall annually appropriate 5% of all deposits made to the Mineral
             469      Lease Account to the Department of Community and Economic Development to be distributed to:
             470          (A) special [service] districts [within counties; and] established:
             471          [(ii) in addition to the appropriation under Subsection (2)(f)(i), the Legislature shall make
             472      the following appropriations from mineral lease funds that would be appropriated to the Board of
             473      Regents under Subsection (2)(b)(i) except for the appropriations provided in Subsection
             474      (2)(b)(ii)(C):]
             475          [(A) for the fiscal year beginning on July 1, 1998, and ending on June 30, 1999, the
             476      Legislature shall appropriate 5% of all deposits made to the Mineral Lease Account to the
             477      Department of Transportation to be distributed to special service districts within counties;]
             478          [(B) for the fiscal year beginning on July 1, 1999, and ending on June 30, 2000, the
             479      Legislature shall appropriate 10% of all deposits made to the Mineral Lease Account to the
             480      Department of Transportation to be distributed to special service districts within counties; and]
             481          [(C) for fiscal years beginning on or after July 1, 2000, the Legislature shall appropriate
             482      15% of all deposits made to the Mineral Lease Account to the Department of Transportation to be
             483      distributed to special service districts within counties.]
             484          [(g) (i) The Legislature shall appropriate the following percentages of all deposits made
             485      to the Mineral Lease Account to the Department of Community and Economic Development to
             486      be distributed as follows for the purpose of constructing, repairing, and maintaining roads, or for
             487      other purposes authorized by statute:]
             488          [(A) for the fiscal year beginning on July 1, 1998, and ending on June 30, 1999, the
             489      Legislature shall appropriate 2.5% of all deposits made to the Mineral Lease Account to the
             490      Department of Community and Economic Development to be distributed to special service districts
             491      within counties:]
             492          (I) by counties;


             493          (II) under Title 17A; and
             494          (III) for the purpose of constructing, repairing, or maintaining roads; or
             495          (B) special districts established:
             496          (I) by counties;
             497          (II) under Title 17A; and
             498          (III) for other purposes authorized by statute.
             499          (ii) The Department of Community and Economic Development may distribute the
             500      amounts described in Subsection (3)(i)(i) only to special districts established under Title 17A by
             501      counties:
             502          [(I)] (A) of the third, fourth, fifth, or sixth class;
             503          [(II)] (B) in which 4.5% or less of the mineral lease moneys within the state are generated;
             504      and
             505          [(III)] (C) that are significantly socially or economically impacted as provided in
             506      Subsection (3)(i)(iii) by the development of:
             507          (I) minerals under the Mineral Lands Leasing Act, 30 U.S.C. Sec. 191[, as a result of
             508      either];
             509          (II) minerals on acquired lands; or
             510          (III) acquired mineral interests.
             511          (iii) The significant social or economic impact required under Subsection (3)(i)(ii)(C) shall
             512      be as a result of:
             513          (A) the transportation within the county of hydrocarbons, including solid hydrocarbons
             514      as defined in Section 59-5-101 [, within the county,];
             515          (B) the employment of persons residing within the county in hydrocarbon extraction,
             516      including the extraction of solid hydrocarbons as defined in Section 59-5-101 [, of persons residing
             517      within the county, or both; and]; or
             518          [(B) for fiscal years beginning on or after July 1, 1999, the Legislature shall appropriate
             519      5% of all deposits made to the Mineral Lease Account to the Department of Community and
             520      Economic Development to be distributed to special service districts within counties meeting the
             521      requirements of Subsections (2)(g)(i)(A)(I) through (III).]
             522          [(ii) The executive director of the Department of Community and Economic
             523      Development:]


             524          [(A) shall determine whether a county meets the requirements of Subsections
             525      (2)(g)(i)(A)(I) through (III);]
             526          [(B) shall distribute the appropriations under Subsection (2)(g)(i) to special service
             527      districts within counties that meet the requirements of Subsections (2)(g)(i)(A)(I) through (III)
             528      as provided in Subsection (2)(g)(iii); and]
             529          [(C) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, may
             530      make rules:]
             531          [(I) providing a procedure for making the distributions under Subsection (2)(g)(ii)(B) to
             532      special service districts; and]
             533          [(II) defining the term "population" for purposes of Subsection (2)(g)(ii)(B).]
             534          (C) a combination of Subsections (3)(i)(iii)(A) and (B).
             535          [(iii)] (iv) For purposes of distributing the appropriations under this Subsection [(2)(g)(i)]
             536      (3)(i) to special [service] districts [within] established by counties under Title 17A, the Department
             537      of Community and Economic Development shall:
             538          (A) (I) allocate 50% of the appropriations equally among the counties meeting the
             539      requirements of Subsections [(2)(g)(i)(A)(I) through (III)] (3)(i)(ii) and (iii); and
             540          (II) allocate 50% of the appropriations based on the ratio that the population of each county
             541      meeting the requirements of Subsections [(2)(g)(i)(A)(I) through (III)] (3)(i)(ii) and (iii) bears to
             542      the total population of all of the counties meeting the requirements of Subsections [(2)(g)(i)(A)(I)
             543      through (III)] (3)(i)(ii) and (iii); and
             544          (B) after making the allocations described in Subsection [(2)(g)(iii)(A)] (3)(i)(iv)(A),
             545      distribute the allocated revenues to special [service] districts [within] established under Title 17A
             546      by the counties as determined by the executive director of the Department of Community and
             547      Economic Development after consulting with the county legislative bodies of the counties meeting
             548      the requirements of Subsection [(2)(g)(i)(A)(I) through (III)] (3)(i)(ii) and (iii).
             549          (v) The executive director of the Department of Community and Economic Development:
             550          (A) shall determine whether a county meets the requirements of Subsections (3)(i)(ii) and
             551      (iii);
             552          (B) shall distribute the appropriations under Subsection (3)(i)(i) to special districts
             553      established by counties under Title 17A that meet the requirements of Subsections (3)(i)(ii) and
             554      (iii); and


             555          (C) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, may
             556      make rules:
             557          (I) providing a procedure for making the distributions under this Subsection (3)(i) to
             558      special districts; and
             559          (II) defining the term "population" for purposes of Subsection (3)(i)(iv).
             560          [(h)] (j) (i) The Legislature shall annually make the following appropriations from the
             561      Mineral Lease Account:
             562          [(i)] (A) an amount equal to 52 cents multiplied by the number of acres of school or
             563      institutional trust lands, lands owned by the Division of Parks and Recreation, and lands owned
             564      by the Division of Wildlife Resources that are not under an in lieu of taxes contract, to each county
             565      in which those lands are located;
             566          [(ii)] (B) to each county in which school or institutional trust lands are transferred to the
             567      federal government after December 31, 1992, an amount equal to the number of transferred acres
             568      in the county multiplied by a payment per acre equal to the difference between 52 cents per acre
             569      and the per acre payment made to that county in the most recent payment under the federal
             570      payment in lieu of taxes program, 31 U.S.C. Sec. 6901 [or P.L. 97-258 as amended] et seq., unless
             571      the federal payment was equal to or exceeded the 52 cents per acre, in which case [no] a payment
             572      [shall] under this Subsection (3)(j)(i)(B) may not be made for the transferred lands; and
             573          [(iii)] (C) to each county in which federal lands, which are entitlement lands under the
             574      federal in lieu of taxes program, are transferred to the school or institutional trust, an amount equal
             575      to the number of transferred acres in the county multiplied by a payment per acre equal to the
             576      difference between the most recent per acre payment made under the federal payment in lieu of
             577      taxes program and 52 cents per acre, unless the federal payment was equal to or less than 52 cents
             578      per acre, in which case [no] a payment [shall] under this Subsection (3)(j)(i)(C) may not be made
             579      for the transferred land.
             580          (ii) Each county receiving money under Subsection (3)(j)(i) shall distribute the money to
             581      special districts established by the county under Title 17A.
             582          (iii) (A) Beginning in fiscal year 1994-95 and in each year after fiscal year 1994-95, the
             583      Division of Finance shall increase or decrease the amounts per acre provided for in Subsection
             584      (3)(j)(i) by the average annual change in the Consumer Price Index for all urban consumers
             585      published by the Department of Labor.


             586          [(i)] (k) [Beginning on July 1, 2000, the] The Legislature shall[, after making the
             587      appropriations provided for in Subsections (2)(a) through (h) ,] annually appropriate [the
             588      remainder of] to the Permanent Community Impact Fund all deposits [made to] remaining in the
             589      Mineral Lease Account [to the Permanent Community Impact Fund] after making the
             590      appropriations provided for in Subsections (3)(d) through (3)(j).
             591          [(3) (a) Until July 1, 1999, the Board of Regents may not:]
             592          [(i) increase the total amount of federal mineral lease funds allocated during any fiscal year
             593      above the amount allocated during the last fiscal year more than the percentage increase in the
             594      Consumer Price Index published by the United States Department of Labor for the last calendar
             595      year; and]
             596          [(ii) increase the total amount allocated more than 10% above the amount allocated during
             597      the last fiscal year.]
             598          [(b) If the total amount of mineral lease funds allocated to a recipient agency or institution
             599      in any fiscal year is less than the total amount allocated for the last fiscal year, the allocation to that
             600      agency or institution for the next fiscal year shall be increased by the amount of the reduction
             601      before calculating and applying the percent limitation.]
             602          [(c) (i) Higher education institutions shall expend the federal mineral lease funds
             603      apportioned to them via institutional work programs.]
             604          [(ii) The Board of Regents may approve those programs only when it is satisfied that a
             605      majority of the funds will be expended for research, educational, or public service programs of
             606      benefit to subdivisions of the state that are socially or economically impacted by the development
             607      of minerals leased under the Mineral Lands Leasing Act in the planning, construction, and
             608      maintenance of public facilities, and the provision of public services.]
             609          [(d) (i) Except as provided in Subsection (3)(d)(ii), each institution of higher education
             610      is entitled to an amount of mineral lease funds equal to the proportion of the total amount available
             611      that the average number of full-time students enrolled during the preceding year at that institution
             612      bears to the total enrollment of all institutions.]
             613          [(ii) Enrollment at the University of Utah and Utah State University shall first be
             614      multiplied by 1.25 and that product shall constitute the enrollment of the University of Utah and
             615      Utah State University for the purposes of determining their proportionate allocation.]
             616          [(4) The federal mineral lease funds allocated to the Water Research Laboratory at Utah


             617      State University are in addition to any other money to which Utah State University is entitled under
             618      this section.]
             619          [(5) Federal mineral lease funds distributed by the Department of Transportation under
             620      Subsection (2)(f) shall be allocated to county special service districts in amounts proportionate to
             621      the amount of federal mineral lease money generated by the county in which a special service
             622      district is located.]
             623          [(6) (a) Each county receiving money under Subsection (2)(h) shall give the money to a
             624      school district or other special service district within the county.]
             625          [(b) Beginning in fiscal year 1994-95 and in each year thereafter, the amount per acre
             626      provided in Subsection (2)(h)(i) shall adjust to reflect changes in the rate of inflation as measured
             627      by the Consumer Price Index.]
             628          [(7)] (4) (a) Each agency, board, institution of higher education, and political subdivision
             629      receiving money under this chapter shall provide the Legislature, through the Office of the
             630      Legislative Fiscal Analyst, with a complete accounting of the use of that money on an annual basis.
             631      [This accounting]
             632          (b) The accounting required under Subsection (4)(a) shall:
             633          [(a)] (i) include actual expenditures for the prior fiscal year, budgeted expenditures for the
             634      current fiscal year, and planned expenditures for the following fiscal year; and
             635          [(b)] (ii) be reviewed by the Economic Development and Human Resources Appropriation
             636      Subcommittee as part of its normal budgetary process under Title 63, Chapter 38, Budgetary
             637      Procedures Act.
             638          [(8) All monies in or appropriated to the Targeted Allocation Fund shall be transferred to
             639      the Permanent Community Impact Fund.]
             640          Section 10. Section 63C-4-103 is amended to read:
             641           63C-4-103. Creation of Constitutional Defense Restricted Account -- Sources of
             642      funds -- Uses of funds.
             643          (1) There is created a restricted account within the General Fund known as the
             644      Constitutional Defense Restricted Account.
             645          (2) The account consists of monies from the following revenue sources:
             646          (a) monies deposited to the [fund from the Mineral Bonus Account] account as required
             647      by [Subsection 59-21-2 (2)] Section 53C-3-202 ;


             648          (b) voluntary contributions;
             649          (c) monies received by the Constitutional Defense Council from other state agencies; and
             650          (d) appropriations made by the Legislature.
             651          (3) Funds in the account shall be nonlapsing.
             652          [(4) (a) The account shall earn interest.]
             653          [(b) All interest earned on account monies shall be deposited into the General Fund.]
             654          [(5)] (4) The account balance may not exceed [$1 million] $2,000,000.
             655          [(6)] (5) The Legislature may annually appropriate monies from the Constitutional Defense
             656      Restricted Account to the Constitutional Defense Council to carry out its duties in Section
             657      63C-4-102 .
             658          Section 11. Repealer.
             659          This act repeals:
             660          Section 59-21-4, Revenues from land exchange parcels -- Distribution.
             661          Section 12. Effective date.
             662          This act takes effect on July 1, 2000.




Legislative Review Note
    as of 2-2-00 1:14 PM


A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel


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