Reining in Mineral Mismanagement on Public Lands

The second in a series looking at the five most significant natural resource reforms that were made during the Obama administration and the five reforms the next administration needs to tackle.

If public lands are owned by the American people, shouldn’t taxpayers get their fair share of profits from gas, oil, and minerals that private companies pull out of that ground and sell on global markets?

That’s the premise of the Project On Government Oversight’s work on holding the government accountable for the way it does business with companies that extract natural resources from public lands. Over the past eight years, the Obama administration has made some welcome progress on getting taxpayers more bang for the buck from natural resources, but there is still a long way to go.

Let’s look at one reform that was achieved in the past eight years and one that still needs to be made.

THE VICTORY: Troubled Minerals Management Service (MMS) is dissolved in 2011

The straw that broke the camel’s back for the MMS was the Deepwater Horizon oil spill in 2010. That disaster highlighted the agency’s ineffective oversight of the oil industry. However, problems at the MMS went back many years. Its cozy relationship with industry was well documented by the government, whistleblowers, POGO, and others.

The MMS’s alleged ethics violations included everything from agency officials going through the revolving door to lucrative industry jobs, to MMS employees accepting lavish gifts from the companies they were overseeing, as POGO’s Danielle Brian explained in her testimony to Congress in 2010.

Finally, the Interior Department dissolved MMS in 2011, setting up new agencies that separated Interior’s oversight and royalty-collecting functions, reducing the possibility of ethical conflicts of interest.

THE FIGHT GOES ON: Stop giving away minerals on federal lands for free

Believe it or not, a 150-year-old law allows companies that mine hard rock minerals—like gold, copper, and iron—to avoid paying any royalties to the U.S. government. The law, which passed in 1872 as part of an effort to develop the American West, is clearly outdated and has cost taxpayers billions of dollars in lost revenue over the years.

It’s past time to institute a federal royalty on hard rock minerals and stop this blatant giveaway of public natural resources.

Upcoming: The flawed Royalty-in-Kind program is terminated...and it’s time for taxpayers to get their fair share of profits from renewable energy.