Two states are challenging President Donald Trump’s administration’s decision to repeal a 2017 valuation rule for extracting coal, oil and natural gas from federal lands, Politico reports.
California and New Mexico filed a joint lawsuit Tuesday in the U.S. District Court for Northern California, alleging the Department of the Interior’s (DOI) attempt to repeal the 2017 “Consolidated Federal Oil & Gas And Federal & Indian Coal Valuation Reform Final Rule” is illegal.
“This is yet another example of the Trump Administration bending over backwards to please the oil, gas and, in particular, the coal industry,” California Attorney General Xavier Becerra, a Democrat, said in a statement. “My job is to protect Californians against this Administration’s attempts to illegally roll back commonsense regulations that benefit the American people.”
The rule was originally enacted to close a loophole allowing mineral companies to undervalue the minerals extracted from federal lands and pay less royalties to the government and Native American communities living nearby.
The DOI’s Office of Natural Resources Revenue (ONRR) found the rule overly stringent and a burden on royalty revenue streams, however.
“After the 2017 Valuation Rule was published, however, ONRR discovered several significant defects in the rule that would have undermined its purpose and intent,” the ONRR wrote Aug. 8 in the Federal Register listing announcing the repeal.
GOP Rep. and chairman of the House Natural Resources Committee Rob Bishop of Utah praised the move at the time for relieving the burden from small businesses.
“The Trump administration should be commended for beginning the process of reversing the impossible regulatory requirements imposed on energy development by this rule,” Bishop said in a statement. “Endless layers of regulation don’t yield greater returns for taxpayers, they paralyze economic activity. In this case, the rule hit marginal producers – the small businesses that support local economies – the hardest.”
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