2015 Regular Session
By: Senator(s) Gandy, Burton, Fillingane, Montgomery
AN ACT TO CREATE THE MISSISSIPPI MINERAL RIGHTS REFORM ACT OF 2015; TO REQUIRE REGISTRATION OF SEVERED MINERAL INTERESTS IN THE OFFICE OF THE CHANCERY CLERK OF THE COUNTY IN WHICH THE MINERAL INTEREST IS LOCATED; TO PROVIDE FOR FORFEITURE TO THE STATE OF ANY SEVERED MINERAL INTEREST NOT SO REGISTERED; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. (1) This section shall be known and may be cited as the "Mississippi Mineral Rights Reform Act of 2015."
(2) (a) Except as provided in paragraph (b) of this subsection, from and after January 1, 2016, every owner of a fee simple interest in minerals, hereafter referred to as a mineral interest, in lands in this state, which interest is owned separately from the fee title to the surface of the property upon or beneath which the mineral interest exists, shall record in the land records of the office of the chancery clerk in the county where the mineral interest is located a verified statement, in triplicate, setting forth the owner's address, interest in the minerals, and both (i) the legal description of the property upon or beneath which the interest exists, and (ii) the book and page number of the instrument by which the mineral interest is created or acquired. No statement may be recorded which contains mineral interests from more than one (1) governmental section unless the instrument by which the mineral interest is created or acquired includes mineral interests from more than one (1) governmental section. The chancery clerk shall file with the county tax assessor a copy of each document so recorded within sixty (60) days after recordation in the office of the chancery clerk.
(b) This section shall not apply to the following owners of mineral interests: (i) the United States of America; (ii) the State of Mississippi; and (iii) any American Indian tribe or band owning reservation lands in this state.
(3) If the owner of a mineral interest fails to record the verified statement required by this section before January 1, 2016, as to any interests owned on or before December 31, 2015, or within one (1) year after acquiring the interest as to interests acquired on or after January 1, 2016, the mineral interest shall forfeit to the state after notice and opportunity for hearing as provided in this section.
(4) (a) The Director of the Department of Geology of the Department of Environmental Quality shall notify the last owner of record in the land records of the chancery clerk of a hearing on an order to show cause why the mineral interest should not forfeit to the state absolutely. The notice shall be served in the same manner as provided for the service of summons in a civil action under Rule 4 of the Mississippi Rules of Civil Procedure and shall contain the following:
(i) The legal description of the property upon or beneath which the interest exists;
(ii) A recitation that the statement of severed mineral interest either did not comply with the requirements specified by this section for such a statement or was not recorded within the time specified in this section, or both; and
(iii) That the court will be requested to enter an order adjudging the forfeiture of the mineral interest to be absolute in the absence of a showing that there was substantial compliance with laws requiring the registration of severed mineral interests. For the purposes of this section, substantial compliance with laws requiring the registration of severed mineral interests means:
1. That the records in the office of the chancery clerk specified the true ownership of the severed mineral interest during the time period within which the statement of severed mineral interest should have been recorded with the chancery clerk, or that probate, divorce, bankruptcy, mortgage foreclosure, or other proceedings affecting the title had been timely initiated and diligently pursued by the true owner during the time period within which the severed mineral interest statement should have been recorded; and
2. That all taxes relating to severed mineral interests had been timely paid, including any taxes that would have been due and owing under this section had the interest been properly recorded as required by this section within the time specified in this section. For the purposes of this section, "timely paid" means paid within the time period during which tax forfeiture would not have been possible had a real property tax been assessed against the property.
(b) After the mineral interest has forfeited to the state pursuant to this section, a person claiming an ownership interest before the forfeiture may recover the fair market value of the interest, either:
(i) As an alternative claim raised in the hearing on the order to show cause why the mineral interest should not forfeit absolutely, with fair market value to be determined and paid as provided in this subsection; or
(ii) In a separate action brought as follows: An action may be commenced within six (6) years after entry of judgment under this section to determine the ownership and the fair market value of the mineral interests in the property both at the time of forfeiture and at the time of bringing the action. The action shall be brought in the manner provided for an action to determine adverse claims, to the extent applicable. The person bringing the action shall serve notice of the action on the Director of the Department of Geology of the Department of Environmental Quality of natural resources in the same manner as is provided for service of notice of the action on a defendant. The Director of the Department of Geology of the Department of Environmental Quality may appear and contest the allegations of ownership and value in the same manner as a defendant in such actions. A copy of the court's decree shall be attached to the claim.
(5) The forfeiture provisions of this section do not apply to mineral interests valued and taxed under other laws relating to the taxation of minerals, gas, coal, oil, or other similar interests, so long as a tax is imposed and no forfeiture under the tax laws is complete. However, if the mineral interest is valued under other tax laws, but no tax is imposed, the mineral
interest forfeits under this section if not recorded as required by this section.
SECTION 2. This act shall take effect and be in force from and after January 1, 2015.