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).
“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.”
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.