U.S. Markets open in 1 hr 34 mins

Feds cut $53 million in Wyoming mineral payments

Ben Neary, Associated Press

CHEYENNE, Wyo. (AP) -- The federal government has informed Wyoming officials that it will withhold more than $53 million in mineral payments to the state under the automatic federal budget cuts that started this month.

Gov. Matt Mead said Tuesday he received no advance warning before the state received word that the cuts will be implemented starting this month.

"There is no way to achieve adequate notice or give our state an opportunity to respond before the action is under way," Mead said. "As far as communications go, this method of passing along significant information that greatly impacts Wyoming gets a grade of F-minus or worse. It is not acceptable."

Mead stated he has asked the Wyoming Attorney General's Office for advice on the state's options.

"When the state reduced its budget by over 6 percent, it did not achieve its reductions by withholding mineral revenue due under state leases," Mead said in a prepared statement. "Similarly, the Department of Interior should not be able to meet its budget reduction by taking mineral revenues which belong to the states under the law."

Mead pledged to work with Wyoming's congressional delegation to try to restore the funding.

Wyoming, the nation's leading coal-producing state, gets 50 percent of the revenues from mineral leasing on federal lands in the state. That amounts to roughly $1 billion a year.

Gregory J. Gould, director of the Office of Natural Resources Revenue at the Interior Department, wrote to the Wyoming Treasurer's Office in Friday. Gould stated that the automatic federal spending cuts reduced budgetary authority for all federal accounts by about $85 billion.

Gould stated that his office intends to withhold the $53 million from Wyoming's monthly payments in five equal installments from March through July. He stated it's also possible that the state could see additional cuts in August and September if mineral revenues don't come through as projected.

The federal cuts follow congressional action last year that cut more than $700 million in Abandoned Mine Lands funding that Congress had promised Wyoming over coming years.

Wyoming Treasurer Mark Gordon said Tuesday that the opportunity to take money belonging to the state proved to be too tempting to the federal government.

"We are using every means necessary to make sure our state is made whole," Gordon said.