Posted on 10/29/2008 6:48:54 AM PDT by thackney
Starting this month, 50 percent of the royalties generated from state mineral leases issued after Dec. 1, 1979, will be placed in the Permanent Fund. That's an increase from the 25 percent that has been transferred since 2003.
The increase is due to the automatic repeal of a 2003 law that temporarily cut the rate at 25 percent, the state Department of Revenue said.
Under the state constitutional amendment in 1976 that created the Permanent Fund, an oil wealth savings account now worth about $28 billion, at least 25 percent of all mineral lease rentals, royalties, royalty sale proceeds and federal mineral revenue sharing payments and bonuses received by the state shall be placed in a permanent fund, the department said.
The Legislature in 1980, decided that 50 percent of the royalties from oil and gas leases issued after Dec. 1, 1979, would placed in the Alaska Permanent Fund. Many of the most productive North Slope leases -- for the Prudhoe Bay and Kuparuk River fields -- were issued well before that date.
In 2003, at a time when oil prices were low and the state was worried about revenue, the 1980 law was changed to the 25 percent.
(Excerpt) Read more at adn.com ...
is Alaska’s situation unique because the State actually owns vast lands ? There aren’t private property interests that own the oil reserves ? This oil revenue isn’t derived from US owned lands ?
Is this different from say, NH when they take fish or cut timber or quarry stone ? Is the difference in that every square inch of NH is owned as private property and most of Alaska is state owned?
Yes
There aren’t private property interests that own the oil reserves ?
There are Native Corporations, local natives owning land and mineral rights acting together. They keep their royalties and distribute among themselves.
This oil revenue isn’t derived from US owned lands ?
No. Royalties from ANWR, NPRA, OCS and other federal land and waters do not contribute to this fund.
Is the difference in that every square inch of NH is owned as private property and most of Alaska is state owned?
Yes, it is different.
I mentioned Florida because the Federal government has begun sending a portion of the royalties from the Federal Gulf Waters to the States that do have Offshore Production; Texas, Louisiana, Mississippi and Alabama.
Thanks a ton. Imagine the state sharing its income with the citizens any where else like that?
Not true.. Most of Alaska is federally OWNED LAND...
WHich is obscene. (that the federal gov't owns ANY land)..
I missed this one. Hosepipe is right. Most of Alaska is Federally owned. The state ownership is significant but definitely a minority share. Private ownership is less than 1%.
http://www.dnr.state.ak.us/kodiak/gis/raster/map_library/y2006/lris/map1_land_status_finished.pdf
So then I’m lost. How does Alaska to get revenue to distribute to its citizens from federally owned land ? Wouldn’t that be revenue to be shared amongst the whole country rather than just Alaskans? I agree that all the land should be held privately but unfortunately its not. I could see revenues from State owned land being shared by citizens of one state only but can’t see how federally owned land income can be shared only by the residents of a single state. I’m sure that the federal view on that land is that it isn’t controlled by a state but rather by them, representing all 50.
It doesn't. Very little oil is produced on federal land or water in Alaska. The majority of the oil production is from State Land. About 24% of Alaska is state owned but most importantly the section between the National Petroleum Reserve and ANWR on the North Coast is state owned. That is where Prudhoe Bay, Kuparuk and the other couple dozen fields mostly are located. The Cook Inlet area near Anchorage has some production as well but much less compared to the North Slope.
Wouldn’t that be revenue to be shared amongst the whole country rather than just Alaskans?
If ANWR or NPRA gets oil production, it will go to the federal treasury.
From what I have heard, Alaska manages to pressure oil companies to drill on state-owned land. As can be seen in the map linked to in #6, the northern end of the pipeline lies in a big chunk of state land.
When you say "manages to pressure" I guess you mean actually allow oil production compared to the Federally owned portions like ANWR.
The Federal government has done some lease sales in NPRA and after several years of exploratory drilling and finding oil, they have remained held up in the courts trying to get the permits to proceed with production.
The Federal government also has issued some leases in the Beaufort Sea. But after they paid their money they have been held up in the courts for interferring with Whales. One of the concerns is they are making hard on the Natives who hunt and kill the whales.
Shell nixes 2008 drilling {Shell out of time to prepare for Beaufort season}
http://www.freerepublic.com/focus/f-news/2037723/posts
This is some examples of the millions of acres the Democrats complained that oil companies had leased but had not started producing oil.
The feds have a program called “Payment in Liew of Taxes” (PILT) that gives some money to the states where the feds control the land. I know this is in effect in Wyoming (I live there) and that it works in a large part of the west where there are vast fed holdings. The theory is to reimburse the states for the taxes they do not receive on their lands and minerals that the feds own.
PILT is a political football that has to be voted on every budget and the percentage of the royalties to be returned to the states is always a point of contention.
I think Alaska is part of the PILT program, but they often get special recognition in legislation and handled differently.
The oil itself is a natural resource that belongs to the people of Alaska, not oil industries. Read more here. http://money.cnn.com/2008/08/29/news/newsmakers/palin_oil.fortune/?postversion=2008083009
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