Judge orders industries to pay royalties for public land extraction

Nick Bowlin

When energy corporations produce oil, gas or coal on public lands, they make royalty payments to the federal government and the states where production takes place. In 2016, the Obama administration closed a loophole that allowed companies to dodge those fees. The valuation rule was set to provide tens of millions of dollars to taxpayers, until then-Interior Secretary Ryan Zinke repealed it shortly into his tenure in 2017. Now, a federal judge has deemed that move illegal, putting the valuation rule into effect immediately. In a case brought by the states of California and New Mexico, U.S. District Court Judge Saundra Brown Armstrong found that Trump’s Interior Department failed to justify the repeal, which she called “arbitrary and capricious.” One of the strongest rebuttals of the Trump administration’s energy policies to date, this case could have serious implications for the West, home to nearly all public-land mining and drilling. Here are the key takeaways:..MORE

Bowlin gives us five takeaways, but this is the one that stands out to me: 

When it comes to deregulation, the Trump administration does not do its homework.
This ruling joins a broad trend of legal losses for the administration: Earlier this year, a judge found that it did not properly consider climate change impacts when leasing public land for oil and gas production. And just last week, a different judge ruled that the administration ignored environmental regulations when it rolled back a moratorium on public land coal leases. In this case, calling the rollback “wholly improper,” Armstrong found that the administration cut the rule without legally mandated justification or support. She questioned Zinke’s conclusion that the valuation rule posed an “unduly burdensome” obstacle to energy production. Armstrong also rejected the Interior Department’s reasoning that it would, at some point, write a replacement valuation rule, noting that “predicted future actions cannot be used to support a decision already made. “This particular repeal attempt was emblematic of other similar attempts by the Interior and other departments to overturn Obama-era regulations,” Kramer wrote. “They all share the same quality of being poorly drafted without the necessary background work that you need when you want to change or repeal a federal regulation.”

This raises several questions in my mind:

Did the political leadership at Interior set unrealistic timelines, creating a rush to completion where missteps were bound to happen?
Or, did the career types purposely take steps to guarantee the proposals would be thrown out by the courts?
And, how much of the blame should be aimed at the Justice Dept. for providing lackluster defenses of Interior's proposals?

Whatever the reason, or mix of reasons, a great deal of incompetency is on display, and some great opportunities are being flittered away.