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SACRAMENTO, Calif. October 17, 2017 – California Attorney General Xavier Becerra, together with New Mexico Attorney General Hector Balderas, filed a lawsuit today against the U.S. Department of the Interior for unlawfully repealing a rule that ensures taxpayers and States receive fair value for oil, gas, and coal extracted from public and tribal lands. California and New Mexico apply their portion of these royalties towards public education.
“Fossil fuel companies are rejoicing at the giveaways that this Administration provides them on a regular basis. This is yet another example of the Trump Administration bending over backwards to please the oil, gas and, in particular, the coal industry,” said Attorney General Becerra. “The President has shown what side he is on, and it is not the side of American taxpayers. My job is to protect Californians against this Administration’s attempts to illegally roll back commonsense regulations that benefit the American people.”
Finalized in July 2016, the rule at issue – known as the Valuation Rule – replaced antiquated regulations that determine how much producers must pay in royalties for the oil, gas, and coal they extract from public and tribal lands. The Valuation Rule took effect on January 1, 2017.
Less than two months later, however, the Department of the Interior issued a notice attempting to postpone the Valuation Rule’s requirements. Attorneys General Becerra and Balderas filed suit, alleging that the Department acted unlawfully by postponing implementation of the Rule. On August 30, a Federal District Court agreed that the Department acted unlawfully.
Simultaneously, the Department began a process to repeal the Valuation Rule in its entirety. In public comments, Attorneys General Becerra and Balderas urged the Department of the Interior not to move forward with a repeal that would reopen loopholes exploited by coal companies and deprive taxpayers of a fair return on public resources. Nonetheless, the Department went ahead with the repeal without offering any reasoned basis for doing so. This is a violation of the Administrative Procedure Act and the Department’s authorizing statutes. As a result, Attorneys General Becerra and Balderas are filing suit today.
Since taking office, Attorney General Becerra has been committed to protecting the environment. Among other actions, he has filed a challenge to the EPA’s illegal delay of important national air quality control standards, and the EPA subsequently backed down; committed to doing everything in his power to defend the Clean Power Plan; and has expressed his strong opposition to the Trump Administration’s “review” of national marine sanctuaries and national monuments.