SENATE BILL NO. 492
INTRODUCED BY L. GROSFIELD, G. ROUSH, M. COLE, W. CRISMORE, T. KEATING
AN ACT ALLOCATING THE RESOURCE INDEMNITY AND GROUND WATER ASSESSMENT TAX PROCEEDS TO MINERAL DEVELOPMENT RECLAMATION PROJECTS WHEN THE BALANCE IN THE RESOURCE INDEMNITY TRUST TOTALS $100 MILLION; REVISING THE DISTRIBUTION OF RESOURCE INDEMNITY AND GROUND WATER ASSESSMENT PROCEEDS; REQUIRING RECLAMATION AND DEVELOPMENT GRANT PRIORITIZATION FOR RECLAMATION PROJECTS; AMENDING SECTIONS 7-6-2225, 7-6-2226, 15-37-117, 15-38-106, 20-9-231, 85-1-604, 85-2-905, 90-2-1104, 90-2-1112, AND 90-2-1113, MCA; AND PROVIDING EFFECTIVE DATES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 7-6-2225, MCA, is amended to read:
"7-6-2225. County hard-rock mine trust reserve account -- expenditure restrictions. (1) The governing body of a
county receiving an allocation under 15-37-117(1)(f)(e) shall establish a county hard-rock mine trust reserve account.
(2) Money received by a county pursuant to 15-37-117 or 90-6-331 must remain in the account and may not be appropriated by the governing body until:
(a) a mining operation has permanently ceased all mining related activity; or
(b) the number of persons employed full-time in mining activities by the mining operation is less than one-half of the average number of persons employed full-time in mining activities by the mining operation during the immediately preceding 5-year period.
(3) If the circumstances described in subsection (2)(a) or (2)(b) occur, the governing body of the county must shall
allocate at least one-third of the funds proportionally to affected high school districts and elementary school districts in the
county, and may use the remaining funds in the account to:
(a) pay for outstanding capital project bonds or other expenses incurred prior to the end of mining activity or the reduction in the mining work force described in subsection (2)(b);
(b) decrease property tax mill levies that are directly caused by the cessation or reduction of mining activity;
(c) promote diversification and development of the economic base within the jurisdiction of a local government unit;
(d) attract new industry to the impact area;
(e) provide cash incentives for expanding the employment base of the area impacted by the changes in mining activity described in subsection (2); or
(f) provide grants or loans to other local government jurisdictions to assist with impacts caused by the changes in mining activity described in subsection (2).
(4) Except as provided in subsection (3)(b), money held in the account may not be considered as cash balance for the purpose of reducing mill levies.
(5) Money in the reserve account must be invested as provided by law. Interest and income from the investment of funds in the account must be credited to the account."
Section 2. Section 7-6-2226, MCA, is amended to read:
"7-6-2226. Metal mines tax reserve account. (1) The governing body of a county receiving tax collections under
15-37-117(1)(f)(e) may establish a metal mines tax reserve account to be used to hold the collections. The governing body
may hold money in the account for any time period considered appropriate by the governing body. Money held in the
account may not be considered as cash balance for the purpose of reducing mill levies.
(2) Money may be expended from the account for any purpose provided by law.
(3) Money in the account must be invested as provided by law. Interest and income from the investment of the metal mines tax reserve account must be credited to the account."
Section 3. Section 15-37-117, MCA, is amended to read:
"15-37-117. Disposition of metalliferous mines license taxes. (1) Metalliferous mines license taxes collected under the provisions of this part must, in accordance with the provisions of 15-1-501, be allocated as follows:
(a) to the credit of the general fund of the state, 58% of total collections each year;
(b) to the state special revenue fund to the credit of a hard-rock mining impact trust account, 1.5% of total collections each year;
(c) to the orphan share state special revenue account established in 75-10-743, 8.5% of total collections each year;
(d) to the ground water assessment account established in 85-2-905, 2.2% of total collections each year;
(e)(d) to the reclamation and development grants program state special revenue account, 4.8% 7% of total collections
each year; and
(f)(e) to the county or counties identified as experiencing fiscal and economic impacts, resulting in increased
employment or local government costs, under an impact plan for a large-scale mineral development prepared and approved
pursuant to 90-6-307, in direct proportion to the fiscal and economic impacts determined in the plan, or, if an impact plan
has not been prepared, to the county in which the mine is located, 25% of total collections each year, to be allocated by the
county commissioners as follows:
(i) not less than 40% to the county hard-rock mine trust reserve account established in 7-6-2225; and
(ii) all money not allocated to the account pursuant to subsection (1)(f)(e)(i) to be further allocated as follows:
(A) 33 1/3% is allocated to the county for planning or economic development activities;
(B) 33 1/3% is allocated to the elementary school districts within the county that have been affected by the development or operation of the metal mine; and
(C) 33 1/3% is allocated to the high school districts within the county that have been affected by the development or operation of the metal mine.
(2) When an impact plan for a large-scale mineral development approved pursuant to 90-6-307 identifies a
jurisdictional revenue disparity, the county shall distribute the proceeds allocated under subsection (1)(f)(e) in a manner
similar to that provided for property tax sharing under Title 90, chapter 6, part 4.
(3) The department shall return to the county in which metals are produced the tax collections allocated under
subsection (1)(f)(e). The allocation to the county described by subsection (1)(f)(e) is a statutory appropriation pursuant to
17-7-502."
Section 4. Section 15-38-106, MCA, is amended to read:
"15-38-106. Payment of tax -- records -- collection of taxes -- refunds. (1) The tax imposed by this chapter must be paid by each person to which the tax applies, on or before March 31, on the value of product in the year preceding January 1 of the year in which the tax is paid. The tax must be paid to the department at the time that the statement of yield for the preceding calendar year is filed with the department.
(2) The department shall, in accordance with the provisions of 15-1-501, deposit in the following order:
(a) 50% of the proceeds of the tax in the resource indemnity trust fund of the nonexpendable trust fund type;, except
that:
(a) 14.1%
(b) $366,000 of the remaining proceeds must be deposited in the ground water assessment account established by
85-2-905; and
(b) 10% of the proceeds must be deposited in the renewable resource grant and loan program state special revenue
account established by 85-1-604; and
(c) 30% of the proceeds must be deposited in the reclamation and development grants account established by
90-2-1104; and
(d) at the beginning of each fiscal year, there is allocated from the
(c) all remaining proceeds of the tax up to $200,000 to be deposited in the orphan share account established in
75-10-743.
(3) Each person to whom the tax applies shall keep records in accordance with 15-38-105, and the records are subject to inspection by the department upon reasonable notice during normal business hours.
(4) The department shall examine the statement and compute the taxes to be imposed, and the amount computed by the department is the tax imposed, assessed against, and payable by the taxpayer. If the tax found to be due is greater than the amount paid, the excess must be paid by the taxpayer to the department within 30 days after written notice of the amount of deficiency is mailed by the department to the taxpayer. If the tax imposed is less than the amount paid, the difference must be applied as a tax credit against tax liability for subsequent years or refunded if requested by the taxpayer."
Section 5. Section 15-38-106, MCA, is amended to read:
"15-38-106. Payment of tax -- records -- collection of taxes -- refunds. (1) The tax imposed by this chapter must be paid by each person to which the tax applies, on or before March 31, on the value of product in the year preceding January 1 of the year in which the tax is paid. The tax must be paid to the department at the time that the statement of yield for the preceding calendar year is filed with the department.
(2) The department shall, in accordance with the provisions of 15-1-501, deposit in the following order: the proceeds of
the tax in the resource indemnity trust fund of the nonexpendable trust fund type, except that:
(a) 14.1% $366,000 of the proceeds must be deposited in the ground water assessment account established by 85-2-905;
(b) 10% of the proceeds must be deposited in the renewable resource grant and loan program state special revenue
account established by 85-1-604; and
(c) 30% of the proceeds must be deposited in the reclamation and development grants account established by
90-2-1104; and
(d) at the beginning of each fiscal year, there is allocated from the
(b) 50% of the remaining proceeds of the tax up to $200,000 to be deposited in the orphan share account established in
75-10-743; and
(c) all remaining proceeds in the reclamation and development grants account established by 90-2-1104, for the purpose of making grants to be used for mineral development reclamation projects.
(3) Each person to whom the tax applies shall keep records in accordance with 15-38-105, and the records are subject to inspection by the department upon reasonable notice during normal business hours.
(4) The department shall examine the statement and compute the taxes to be imposed, and the amount computed by the department is the tax imposed, assessed against, and payable by the taxpayer. If the tax found to be due is greater than the amount paid, the excess must be paid by the taxpayer to the department within 30 days after written notice of the amount of deficiency is mailed by the department to the taxpayer. If the tax imposed is less than the amount paid, the difference must be applied as a tax credit against tax liability for subsequent years or refunded if requested by the taxpayer."
Section 6. Section 20-9-231, MCA, is amended to read:
"20-9-231. Metal mines tax reserve fund. (1) The governing body of a local school district receiving tax collections
under 15-37-117(1)(f)(e) may establish a metal mines tax reserve fund to be used to hold the collections. The governing
body may hold money in the fund for any time period considered appropriate by the governing body. Money held in the
fund may not be considered as fund balance for the purpose of reducing mill levies.
(2) Money may be expended from the fund for any purpose provided by law.
(3) Money in the fund must be invested as provided by law. Interest and income from the investment of the metal mines tax reserve fund must be credited to the fund.
(4) The fund must be financially administered as a nonbudgeted fund under the provisions of this title."
Section 7. Section 85-1-604, MCA, is amended to read:
"85-1-604. Renewable resource grant and loan program state special revenue account created -- revenue allocated -- limitations on appropriations from account. (1) There is a renewable resource grant and loan program state special revenue account within the state special revenue fund established in 17-2-102.
(2) Except to the extent that they are required to be credited to the renewable resource loan debt service fund pursuant to 85-1-603, there must be paid into the renewable resource grant and loan program state special revenue account:
(a) all revenue of the works and other money as provided in 85-1-332;
(b) the interest income of the resource indemnity trust fund as provided in and subject to the conditions of 15-38-202;
(c) the excess of the coal severance tax proceeds allocated by 85-1-603 to the renewable resource loan debt service fund above debt service requirements as provided in and subject to the conditions of 85-1-619; and
(d) any fees or charges collected by the department pursuant to 85-1-616 for the servicing of loans, including
arrangements for obtaining security interests; and
(e) the resource indemnity and ground water assessment tax proceeds as provided in 15-38-106(2)(b).
(3) Appropriations may be made from the renewable resource grant and loan program state special revenue account for the following purposes and subject to the following conditions:
(a) The amount of resource indemnity trust fund interest earnings allocated to the special revenue account under 15-38-202(2)(a)(ii) must be used for renewable resource grants.
(b) An amount less than or equal to that paid into the account under 85-1-332 and only that amount may be appropriated for the operation and maintenance of state-owned projects and works. If the amount of money available for appropriation under this subsection (3)(b) is greater than that necessary for operation and maintenance expenses, the excess may be appropriated as provided in subsection (3)(c).
(c) An amount less than or equal to that paid into the account from the resource indemnity trust account plus any excess from subsection (3)(b) and only that amount may be appropriated from the account for expenditures that meet the policies and objectives of the renewable resource grant and loan program. If the amount of money available for appropriation under this subsection (3)(c) is greater than that necessary for operation and maintenance expenses, the excess may be appropriated as provided in subsection (3)(d).
(d) An amount less than or equal to that paid into the account from the sources provided for in subsections (2)(c) and (2)(d) and any excess from subsection (3)(c) and only that amount may be appropriated from the account for loans and grants for renewable resource projects; for purchase of liens and operation of property as provided in 85-1-615; for administrative expenses, including but not limited to the salaries and expenses of personnel, equipment, and office space; for the servicing of loans, including arrangements for obtaining security interests; and for other necessities incurred in administering the loans and grants."
Section 8. Section 85-2-905, MCA, is amended to read:
"85-2-905. Ground water assessment account. (1) There is a ground water assessment account within the special revenue fund established in 17-2-102. The Montana bureau of mines and geology is authorized to expend amounts from the account necessary to carry out the purposes of this part.
(2) The account may be used by the Montana bureau of mines and geology only to carry out the provisions of this part.
(3) Subject to the direction of the ground water assessment steering committee, the Montana bureau of mines and geology shall investigate opportunities for the participation and financial contribution of agencies of federal and local governments to accomplish the purposes of this part.
(4) There must be deposited in the account:
(a) at the beginning of each fiscal year, 14.1% $366,000 of the proceeds from the resource indemnity and ground water
assessment tax, as authorized by 15-38-106, and 2.2% of the proceeds from the metalliferous mines license taxes, as
authorized by 15-37-117 and $300,000 of the interest earnings from the resource indemnity trust fund, as authorized by
15-38-202, unless at the beginning of the fiscal year the unobligated cash balance in the ground water assessment account:
(i) equals or exceeds $666,000, in which case an allocation may not be made and the proceeds must be deposited in the resource indemnity trust fund established by 15-38-201; or
(ii) is less than $666,000, in which case an amount equal to the difference between the unobligated cash balance and $666,000 must be allocated to the ground water assessment account and any remaining amount must be deposited in the resource indemnity trust fund established by 15-38-201;
(b) funds provided by state government agencies and by local governments to carry out the purposes of this part;
(c) proceeds allocated to the account as provided in 15-36-324 and 15-38-106; and
(d) funds provided by any other public or private sector organization or person in the form of gifts, grants, or contracts specifically designated to carry out the purposes of this part."
Section 9. Section 90-2-1104, MCA, is amended to read:
"90-2-1104. Reclamation and development grants account. (1) There is a reclamation and development grants special revenue account within the state special revenue fund established in 17-2-102.
(2) There must be paid into the reclamation and development grants account money allocated from:
(a) the interest income of the resource indemnity trust fund under the provisions of 15-38-202;
(b) the resource indemnity and ground water assessment tax under the provisions of 15-38-106;
(c) the the metal mines license tax proceeds as provided in 15-37-117(1)(e)(d); and
(d) the oil and gas production tax as provided in 15-36-324 and 15-38-106.
(3) Appropriations may be made from the reclamation and development grants account for the following purposes:
(a) grants for designated projects; and
(b) administrative expenses, including the salaries and expenses of personnel, equipment, office space, and other expenses necessarily incurred in the administration of the grants program. These expenses may be funded before funding of projects."
Section 10. Section 90-2-1112, MCA, is amended to read:
"90-2-1112. Eligibility requirements. (1) Except as provided under subsection (2), to be eligible for funding under the reclamation and development grants program, the proposed project must provide benefits in one or more of the following categories:
(a) reclamation of land, water, or other resources adversely affected by mineral development;
(b) mitigation of damage to public resources caused by mineral development;
(c) research, demonstration, or technical assistance to promote the wise use of Montana minerals, including efforts to make processing more environmentally compatible;
(d) investigation and remediation of sites where hazardous wastes or regulated substances threaten public health or the environment; and
(e) research to assess existing or potential environmental damage resulting from mineral development.
(2) If sufficient eligible and qualified applications satisfying the mineral development objectives provided for in
subsection (1) are not received or if there is a crucial state need to protect Montana's environment, the department may
evaluate and the governor may recommend that the legislature approve funding for projects in addition to those described in
subsection (1) that:
(a) enhance Montana's economy through the development of natural resources; or
(b) develop, promote, protect, or further Montana's total environment and public interest, including the general health,
safety, welfare, and public resources of Montana citizens and communities.
(3) To be eligible for funding under the reclamation and development grants program, a project must:
(a) be technically and financially feasible;
(b) be the best cost-effective alternative to address a problem or attain an objective;
(c) comply with statutory and regulatory standards protecting environmental quality; and
(d) be from an applicant able and willing to enter into a contract with the department for the implementation of the proposed project or activity.
(4) A project is not eligible for funding under the reclamation and development grants program to the extent that the project is eligible for and can reasonably be expected to receive funding from other state or federal reclamation programs or any other program or act that provides funding to accomplish remedial action for environmental damage or if the project is permitted under Title 82, chapter 4 or 11.
(5) A proposed project is not eligible for funding under the reclamation and development grants program if there is a liable party who would be relieved of financial or legal responsibility and who can reasonably be expected to be held responsible."
Section 11. Section 90-2-1113, MCA, is amended to read:
"90-2-1113. Evaluation criteria -- priority. (1) Except as provided in subsection subsections (2) and (3), the
department shall consider the following criteria in evaluating eligible applications and in selecting projects to be
recommended to the governor for funding:
(a) the degree to which the project will provide benefits in its eligibility category or categories;
(b) the degree to which the project will provide public benefits;
(c) the degree to which the project will promote, enhance, or advance the policies and purposes of the reclamation and development grants program;
(d) the degree to which the project will provide for the conservation of natural resources;
(e) the degree of need and urgency for the project;
(f) the extent to which the project sponsor or local entity is contributing to the costs of the project or is generating additional nonstate funds;
(g) the degree to which jobs are created for persons who need job training, receive public assistance, or are chronically unemployed; and
(h) any other criteria the department considers necessary to carry out the policies and purposes of the reclamation and development grants program.
(2) (a) Subject to the conditions of this part, the department shall give priority to grant requests, not to exceed a total of
$600,000 in total for the biennium, from the board of oil and gas conservation. The board of oil and gas conservation shall
use a grant that received priority under this subsection (2)(a) only for oil and gas reclamation projects. A grant may not be
used for personnel costs or general operating expenses of the board of oil and gas conservation.
(b) Any unobligated fund balance of a grant that received priority under subsection (2)(a) remaining at the end of the current biennium must be included as part of the $600,000 limitation for the next biennium.
(c) The priority given to the board of oil and gas conservation under subsection (2)(a) does not preclude the board of oil and gas conservation from submitting additional grant requests. The department shall evaluate additional grant requests from the board of oil and gas conservation in accordance with the provisions of subsection (1).
(3) Subject to the conditions of this part, the department shall give priority to grant requests not to exceed a total of $800,000 for the biennium for abandoned mine reclamation projects. A grant may not be used for personnel costs or general operating expenses."
Section 12. Contingent voidness. (1) If House Bill No. 2 is not amended to reduce appropriations by $925,000 from the reclamation and development account and increase appropriations from the general fund by a like amount, then [section 4 of this act] is void.
(2) If Senate Bill No. 49 and [this act] are both passed and approved, then [sections 4 and 10] of Senate Bill No. 49 and [sections 1 through 3, 6, 7, and 9 of this act] are void, but [section 4] of Senate Bill No. 49 is effective if the funding switch described in subsection (1) of this section does not occur.
(3) If Senate Bill No. 249 and [this act] are both passed and approved, then [sections 1 through 9 of this act] are void.
Section 13. Effective dates. (1) Except as provided for in subsections (2) and (3), [this act] is effective July 1, 1999.
(2) [Section 5 of this act] is effective July 1 of the first year following the date that the governor by executive order certifies to the secretary of state that the resource indemnity trust fund balance has reached $100 million. The secretary of state shall notify the department of revenue, the department of administration, the code commissioner, and the legislative fiscal division of this certification.
(3) If the funding switch described in [section 12(1)] does not occur, then [section 8] is effective July 1 of the first year following the date that the governor by executive order certifies to the secretary of state that the resource indemnity trust fund balance has reached $100 million. The secretary of state shall notify the department of revenue, the department of administration, the code commissioner, and the legislative fiscal division of this certification.
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