To the Editor: Trona trustees respond to royalty reduction bill

To the Editor: Trona trustees respond to royalty reduction billThe following statement was released by Trona Joint Unified School District regarding the proposed “Non-Energy Solid Leasable Mineral Royalty Rate Reduction” regulation.

******

Lately, several members of Congress decided it is their duty to reduce potash royalties paid by soda ash plants in the United States. In addition, they want to give the Bureau of Land Management complete power in that decision.

Congress touts the need to do so stemming from competition by China in the global market. Reducing royalties will “strengthen U.S. production and export of natural soda ash, and will ensure that our domestic soda ash industry remains competitive and robust.” (News Review, Dec. 20, 2019)

However, in a report by the Department of the Interior, after a 2006 royalties reduction, there were few jobs created, no increased soda ash exports, and no increase in capital expenditures to enhance production.

Where do these potash royalties go? They are deposited in the U.S. Treasury, then distributed between the Department of the Interior and the states in which potash is mined.

In an email, Mitchell Leverette, of BLM reported, “Royalties for all mineral[s] that fall under the Mineral Leasing Act, which would include the Searles Lake minerals, are approximately 50 percent federal-50 percent state. I meant to say royalty payment allocations are approximately 50-50 state and federal.”

So, why should anyone, other than the industries, care that royalties paid to the U.S. government are reduced? A portion of royalties distributed to California goes to Trona Joint Unified School District, which is in immediate proximity to Searles Valley Minerals. A portion of those same royalties goes to Kern Community College District. In the past fiscal year, TJUSD received $4,159.274.40 from royalties, while Kern Community College District received $733,989.59 (California State Controller’s Office). These monies go directly to educational benefits for these two public school districts.

Throughout the history of our school district, potash royalties have been periodically adjusted at the discretion of the federal government. When they are reduced, our school district languishes, staff is reduced, and programs are dropped. However, the company continues to profit. The Department of the Interior continues to flourish.

The News Review article stated that Searles Valley Minerals experienced “millions of dollars in revenues lost from disrupted operations,” due to earthquakes this past summer. Trona Joint Unified School District also experienced losses. We now have our elementary and high school students at the elementary facilities due to damages to the high school site. Reimbursement by the state of California for disaster costs is yet to be determined. Reducing royalties received by Searles Valley Minerals would exacerbate an already dire situation.

A group of community members have been communicating with Rep. Paul Cook’s office regarding this issue. Now, it seems we need to get our point across to Rep. Kevin McCarthy, who represents Ridgecrest and the Kern Community College District.

Our suggestion has been that BLM not receive potash royalties paid by the companies. If their 50-percent allocation is eliminated, royalties paid by the industries would be reduced, while the states would not be affected. Five million dollars to the BLM is a “drop in the bucket,” but to Trona Joint Unified School District and Kern Community College District, it is vital operating funds. Eliminating the amount of royalties allocated to the Bureau of Land Management is a simple solution, but one that seems to have escaped the minds of our government representatives and the BLM.

Rep. McCarthy, we ask of you, as we have of Rep. Cook and others, to look beyond your limited scope. Make sure that your viewpoint and actions consider all parties affected by this issue.

Priscilla Benadom, president on behalf of Trona Joint Unified School District Governing Board

Story First Published: 2020-01-10