Litigation over mineral revenues
by Ann Smart
Gazette Staff
Assemblyman Roy Neighbors attended the County
Commissioners meeting July 15 to explain Assembly
Bill 283. This bill requires the federal government to
pay a percentage of money it receives for the develop-
ment of minerals on federal land to the state in which the
lands are located.
For every dollar the federal gov-
ernment collects for the devel-
.. ::3
opment of minerals on fed- ,- ! I4
' N ,.
eral land, 50 cents is re- /i
i
turned to the state. The // ......
,tate of Nevada has re- i:
'eived $158,413,682 in ,;..,,!
:; $i:.. ?:.>.,. :.*:::::::i ;,;.
revenues from FY 1975- i .:' t!
/o to present. ' .... :::::::;::
Compensauonlncludes \\; :-:
royames on o11, gas, geo- i! i:?J /" ':::
thermal steam, sand and .:'':'':
gravel, and geothermal hot wa-
ter; rents for these lands and bonuses
for lands with geothermal resources, oil or gas. Goldbr
silver is not included.
The first $7 million received by the state is allocated
to the State Distributive School Account. These funds
are dispersed directly from this account to individual
school districts based on a formula that is "a basic
support for each district minus funds produced by taxes.
Some of the school districts in the areas where leases are
located do receive more money per pupil because of the
difference in the assessed valuation of the particular
county," according to Brenda J. Erdoes, State of Nevada
Legislative Counsel Bureau. Neighbors had requested
the bureau's review of the state's compliance in the
disbursement of these funds in 1995.
The $7 million level must currently be reached
before any funds in excess of this amount are dispersed
at the county level. The initial $10 million level was
lowered to $7 million in 1995. Reaching these levels
has been the problem in the past for counties to actually
receive revenue.
The proposed change, AB 283 with amendment,
would distribute the total compensation into 25 percent
to the State Distributive School Account and the re-
maining 75 percent to the county of origin general fund
account. The general fund allocation must be used for:
a) construction and maintenance of roads and other
public facilities; b) public
services; and c) planning
(NRS 328.470). Twenty-
five percent of the general
fund account is directed to
the County School District.
AB 283, as proposed to
be amended, would not re-
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duce the amount of money received by Nevada from the
federal government. Insteat, it would direct that money
to the counties in which the money is generated.
Neighbors has challenged Nevada's compliance with
federal laws in distribution of these funds. He believes
1. White Pine (6.28%)
2. Washo¢ (0.42%)
3. Pershing (0.79%)
4. Nye (17.97%)
5. Mineral (0.06%)
6. Lyon (0.01%)
7. Uncoln (5.78%)
$. Lander (1.55"/,)
9. Humbolt (0.04%)
10. Eureka (8.75%)
11. Esmeralda (0.42%)
12. Elko (2.55%)
3. Dongtas (o.oo)
14. Clark (3.04%)
15. Churchill (52.32%)
Total: 8.1 .Ullion •
that Nye County has a
right to bring litigation
against the State of Ne-
vada to obtain a fair share
of these revenues.
The commission
unanimously passed three
motions made by Com-
missioner Cameron
McRae that the district
attorney's office: 1) file
an. injunction against the
state treasurer for not be-
ing in compliance with
federal law on distribu-
tion of funds; 2) file a lawsuit to reclaim damages on
funds not received; and, 3) inquire if other counties
generating these funds would be interested in joining
Nye County in the proposed lawsuit against the state.
Funds are currently distributed
as shown in the chart below:
CURRENT LAW (NRS 328.450-470)
f
Initial $7 Million
State Distributive
School Account
(SDSA)
SDSA
Total Compensation
Excess of $7 Million
¢.
25%
11
25%
County School
District Fund
75%
I
75%
County General
Fund
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