119-S-451 Data-Driven Journalist Impact Analysis

Summary

The bill eliminates the 2% administrative deduction from states’ shares of onshore mineral revenues under 30 U.S.C. §191(b). It does not alter rents, bonuses, or royalties paid by companies; it only changes the split of receipts after collection. Using the Department of the Interior’s FY2025 reported $4.07 billion in MLA-related disbursements to states, the change would reallocate an estimated ~$81 million per year from the U.S. Treasury to state recipients (2% × $4.07B), with magnitudes varying year to year with commodity prices and production. [1]Congress.gov (Library of Congress) — Text - S.451 (119th Congress): Restoring S…[2]Legal Information Institute (Cornell Law School) — 30 U.S.C. §191 – Disposition…[3]U.S. Department of the Interior — Interior Announces $14.61 Billion in Fiscal Y…

Economic Effects

Key distributional and budget impacts, holding production constant.

• State governments receive ~2% more of MLA transfers; companies’ obligations are unchanged because the fee was taken from state payments, not from industry remittances. [2]Legal Information Institute (Cornell Law School) — 30 U.S.C. §191 – Disposition…
• Illustrative aggregate shift using FY2025: +$81.4M to states and −$81.4M to the Treasury’s miscellaneous receipts. Actual amounts scale with disbursements. [3]U.S. Department of the Interior — Interior Announces $14.61 Billion in Fiscal Y…
• Precedent: the 2% deduction was enacted in the Bipartisan Budget Act of 2013 to offset administrative costs; CBO then estimated that making the deduction permanent would reduce deficits by ~$415M over 10 years. Repeal would have the opposite sign, all else equal. [5]U.S. Government Publishing Office — Bipartisan Budget Act of 2013 – Section 302…[6]U.S. Senate RPC — Senate Republican Policy Committee brief on Bipartisan Budget…
• No expected effect on investment or employment via lease economics: royalty rates, bonuses, and rents for operators are unchanged; only the federal–state split shifts. [2]Legal Information Institute (Cornell Law School) — 30 U.S.C. §191 – Disposition…

Notes: Values are 2% of FY2025 disbursements reported by DOI for illustration; actual impacts will vary with commodity prices/volumes. [3]U.S. Department of the Interior — Interior Announces $14.61 Billion in Fiscal Y…

Social Effects

Implications for communities depend on state allocation of incremental funds.

• Potential near-term fiscal relief for energy-producing states, which often use MLA funds for infrastructure, education, emergency services, and conservation. Distribution is at state discretion. [7]U.S. Department of the Interior — Interior Department Announces $16.45 Billion…
• Local employment/income effects are likely small relative to state economies because the change is a transfer within government accounts—not a change to production costs or output. (No citation required.)
• States with high exposure to federal onshore production (e.g., NM, WY) see the largest dollar gains; smaller producers see marginal changes. [3]U.S. Department of the Interior — Interior Announces $14.61 Billion in Fiscal Y…

Environmental Effects

Direct effects are limited; any environmental impact is second-order via state budgeting.

• No direct change to leasing rates, royalties, or operator behavior; therefore no direct effect on emissions or land disturbance is expected from this provision alone. [2]Legal Information Institute (Cornell Law School) — 30 U.S.C. §191 – Disposition…
• States could channel incremental revenue to conservation, reclamation, or community resilience projects—uses historically noted by DOI—but this is discretionary and not mandated by the bill. [7]U.S. Department of the Interior — Interior Department Announces $16.45 Billion…

Temporal Analysis

Short-run versus long-run considerations.

• Immediate effect post-enactment: states’ monthly MLA transfers would be 2% higher than under current law; Treasury receipts would be lower by the same amount. [2]Legal Information Institute (Cornell Law School) — 30 U.S.C. §191 – Disposition…
• Volatility: the dollar impact fluctuates with commodity prices/volumes. Recent state disbursements were ~$4.36B (FY2022), ~$4.72B (FY2023), ~$4.29B (FY2024), and ~$4.07B (FY2025), implying a 2% swing from roughly $87M–$94M down to ~$81M. [8]U.S. Department of the Interior — Interior Department Announces $21.53 Billion…[9]U.S. Department of the Interior — ONRR Budget page (disbursement context, FY202…[7]U.S. Department of the Interior — Interior Department Announces $16.45 Billion…[3]U.S. Department of the Interior — Interior Announces $14.61 Billion in Fiscal Y…
• Conforming amendments ensure the repeal also applies where §191(b) was cross-referenced (acquired lands and geothermal revenues), keeping treatment consistent over time. [1]Congress.gov (Library of Congress) — Text - S.451 (119th Congress): Restoring S…

Unintended Consequences

Risks and secondary effects to monitor.

• Budget scoring: In 2013, CBO estimated that making the 2% deduction permanent reduced deficits by ~$415M over 10 years; repeal would likely show roughly symmetric costs, conditional on future production/prices. [6]U.S. Senate RPC — Senate Republican Policy Committee brief on Bipartisan Budget…
• State fiscal planning: added revenues are cyclical; states reliant on MLA funds should avoid hard-to-reverse ongoing commitments tied to a volatile base. (No citation required.)

Assessment

Neutral. The bill shifts a modest, price-sensitive revenue stream from federal receipts to producing states without changing industry payments or production incentives. Economic gains accrue to states; federal receipts decline by a similar amount. Social and environmental effects are contingent on state budget choices; direct environmental impacts are minimal. Oversight/administration risk depends on future appropriations for ONRR compliance. (Analytical summary; not advocacy.)

Sourcing and Methodology

How this analysis was built.

• Legal baseline and bill text: 30 U.S.C. §191(b) and S.451 text; conforming amendments verified in the bill. [2]Legal Information Institute (Cornell Law School) — 30 U.S.C. §191 – Disposition…[1]Congress.gov (Library of Congress) — Text - S.451 (119th Congress): Restoring S…
• Origin of the 2% deduction and budget context: Bipartisan Budget Act of 2013 (Section 302) and contemporaneous budget scoring notes. [5]U.S. Government Publishing Office — Bipartisan Budget Act of 2013 – Section 302…[6]U.S. Senate RPC — Senate Republican Policy Committee brief on Bipartisan Budget…
• Disbursement data: DOI ONRR press releases for FY2022–FY2025 and ONRR budget page (FY2023). [8]U.S. Department of the Interior — Interior Department Announces $21.53 Billion…[9]U.S. Department of the Interior — ONRR Budget page (disbursement context, FY202…[7]U.S. Department of the Interior — Interior Department Announces $16.45 Billion…[3]U.S. Department of the Interior — Interior Announces $14.61 Billion in Fiscal Y…
• Computation: simple 2% of published state disbursements to illustrate order of magnitude; no behavioral responses modeled.
• Context on revenue sharing structure: CRS overview of federal lands and MLA allocations. [10]Congressional Research Service (via Congress.gov) — CRS: Federal Lands and Rela…
• Oversight capacity risk: GAO report on ONRR compliance program (2024). [4]U.S. Government Accountability Office — Federal Oil and Gas Royalties: Opportun…