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NM senator gets support for challenging Obama administration on sequestration

By   /   May 10, 2013  /   No Comments

CHALLENGING THE FEDS: New Mexico Sen. Tom Udall is getting support for legislation to reverse 5 percent cuts in mineral and energy royalties.

By Rob Nikolewski | New Mexico Watchdog

One day after New Mexico Watchdog learned that Democratic Sen. Tom Udall is introducing legislation challenging the Obama administration’s decision to use sequestration to seize 5 percent of mineral and energy royalties from states, Republican Gov. Susana Martinez voiced her support.

“The federal government should never have cut these royalty payments to begin with, as they don’t represent the traditional type of programmatic cuts that the sequester was seemingly designed to enforce,” Martinez spokesman Enrique Knell wrote in an e-mail to New Mexico Watchdog.

In late March, the Obama administration through the Department of the Interior contacted 35 states that have federal leases on state lands, informing them that due to sequestration 5 percent of their royalties from mineral and energy extraction (such as coal, oil and natural gas) would be forfeited.

The two states hardest hit are Wyoming (which will lose $53 million) and New Mexico (which would lose $26 million).

Early next week, Sen. Udall — along with Wyoming senators Mike Enzi and John Barrasso —will introduce the State Mineral Revenue Protection Act to try to reverse the decision.

“The agreement for mineral development needs to be honored,” Udall said by phone Thursday (May 9) from his Capitol Hill office. “These aren’t federal funds. These revenues should not be subject to sequestration.”

Gov. Martinez and officials in her administration have also complained and late Thursday afternoon, her spokesman said she “fully supports” Udall’s bill, adding she also “supports blocking the 2 percent federal collection fee, which costs New Mexico nearly $10 million for a service that costs the federal government a fraction of that.”

Udall says he hopes his bill will get assigned to the Senate Energy and Natural Resources Committee, where New Mexico’s other senator — Democrat Martin Heinrich — serves.

In an e-mail to New Mexico Watchdog, Heinrich wrote, “I disagree with DOI’s decision to sequester revenue under the Mineral Leasing Act and am pursuing an approach to fixing the problem that may not require legislation.”

Heinrich didn’t elaborate on what kind of solution he has in mind.

In 2012, New Mexico received about $488 million in mineral and energy extraction royalties from the Mineral Leasing Act.

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Rob Nikolewski is the National Energy Corrrespondent for Watchdog.org. He is based in Santa Fe, N.M. Contact him at rnikolewski@watchdog.org and follow him on Twitter @NMWatchdog.

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