House Bill 1273

AN ACT TO AMEND SECTION 29-7-3, MISSISSIPPI CODE OF 1972, TO PROHIBIT ANY SEISMOGRAPHIC TESTING OR EXPLORATION OR OTHER MINERAL EXPLORATION OR TESTING ACTIVITIES OR DRILLING OR EXTRACTING OF OIL, GAS OR OTHER MINERALS ON, IN OR UNDER STATE MARINE WATERS AND TIDELANDS AND ALL WATERS AND SUBMERGED LANDS TWELVE NAUTICAL MILES SOUTH OF A LINE DRAWN FROM THE SOUTHERNMOST LAND OF CAT ISLAND TO THE SOUTHERNMOST LAND OF SHIP ISLAND, TO THE SOUTHERNMOST LAND OF HORN ISLAND, TO THE SOUTHERNMOST LAND OF PETIT BOIS ISLAND AND EXTENDING EAST AND WEST TO THE STATE BORDERS WITH ALABAMA AND LOUISIANA AND TO PROHIBIT ANY LEASES FOR EXTRACTION OF OIL, GAS OR OTHER MINERALS ON, IN OR UNDER THE STATE MARINE WATERS AND TIDELANDS AND ALL WATERS AND SUBMERGED LANDS TWELVE NAUTICAL MILES SOUTH OF A LINE DRAWN FROM THE SOUTHERNMOST LAND OF CAT ISLAND TO THE SOUTHERNMOST LAND OF SHIP ISLAND, TO THE SOUTHERNMOST LAND OF HORN ISLAND, TO THE SOUTHERNMOST LAND OF PETIT BOIS ISLAND AND EXTENDING EAST AND WEST TO THE STATE BORDERS WITH ALABAMA AND LOUISIANA; TO AMEND SECTIONS 29-7-1 AND 29-7-17, MISSISSIPPI CODE OF 1972, TO CONFORM TO THE PRECEDING SECTION; TO REPEAL SECTIONS 29-7-19 AND 29-7-21, MISSISSIPPI CODE OF 1972, WHICH PROVIDE FOR HEARINGS TO BE HEARD BY THE COMMISSION ON ENVIRONMENTAL QUALITY AS A RESULT OF EXTRACTING MINERALS AND FOR AN APPEALS PROCESS FOR DECISIONS MADE BY THE COMMISSION; TO REPEAL SECTIONS 27-25-505 AND 27-25-705, MISSISSIPPI CODE OF 1972, WHICH PROVIDE THAT THE BOARD OF SUPERVISORS OF A COUNTY SHALL REDUCE THE AD VALOREM TAXES LEVIED BY THE COUNTY IN AN AMOUNT EQUAL TO ONE-HALF OF THE COUNTY'S SHARE OF THE REVENUE DERIVED FROM THE OIL AND GAS SEVERANCE TAX UNDER SUCH SECTIONS, AS A RESULT OF OFFSHORE DRILLING ON THE MISSISSIPPI GULF COAST, AND THE GOVERNING AUTHORITIES OF A MUNICIPALITY SHALL REDUCE THE AD VALOREM TAXES LEVIED BY THE MUNICIPALITY IN AN AMOUNT EQUAL TO ONE-HALF OF THE MUNICIPALITY'S SHARE OF THE REVENUE DERIVED FROM THE OIL AND GAS SEVERANCE TAX UNDER SUCH SECTIONS, AS A RESULT OF OFFSHORE DRILLING ON THE MISSISSIPPI GULF COAST; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 29-7-3, Mississippi Code of 1972, is amended as follows:

29-7-3. There shall be no development or extraction of oil, gas, or other minerals from state-owned lands by any private party without first obtaining a mineral lease therefor from the commission. The commission is hereby authorized and empowered, for and on behalf of the state, to lease any and all of the state land now owned (including that submerged or whereover the tide may ebb and flow) or hereafter acquired, to some reputable person, association, or company for oil and/or gas and/or other minerals in and under and which may be produced therefrom, excepting, however, sixteenth section school land, lieu lands, and such forfeited tax land and property the title to which is subject to any lawful redemption, for such consideration and upon such terms and conditions as the commission deems just and proper. * * *

* * * The commission may promulgate rules and regulations * * * governing all aspects of the process of leasing state lands within its jurisdiction for mineral development, including the setting of * * * any necessary fees, public bidding process, delay rental payments, shut-in royalty payments, and such other provisions as may be required. * * *

There shall not be conducted any seismographic or other mineral exploration or testing activities on any state-owned lands within the mineral leasing jurisdiction of the commission without first obtaining a permit therefor from the commission. * * * The commission shall promulgate rules and regulations governing all aspects of seismographic or other mineral exploration activity on state lands within its jurisdiction, including the establishing of fees and issuance of permits for the conduct of such mineral exploration activities. * * * Provided, however, that persons obtaining permits from the commission for seismographic or other mineral exploration or testing activities on state-owned wildlife management areas, lakes and fish hatcheries, shall be subject to rules and regulations promulgated therefor by the Mississippi Commission on Wildlife, Fisheries and Parks which shall also receive all permit fees for such testing on said lands. * * *

Further, provided that each permit within the Mississippi Sound or tidelands shall be reviewed by the Mississippi Commission on Marine Resources and such special conditions as it may specify will be included in the permit. Information or data obtained in any mineral exploration activity on any and all state lands shall be disclosed to the state through the Department of Environmental Quality, upon demand. Such information or data shall be treated as confidential for a period of ten (10) years from the date of receipt thereof and shall not be disclosed to the public or to any firm, individual or agency other than officials or authorized employees of this state. Any person who makes unauthorized disclosure of such confidential information or data shall be guilty of a misdemeanor, and upon conviction thereof, be fined not more than Five Thousand Dollars ($5,000.00) or imprisoned in the county jail not more than one (1) year, or both.

Whenever any such land or property is leased for oil and gas and/or other minerals, such lease contract shall provide for a lease royalty to the state of at least three-sixteenths (3/16) of such oil and gas or other minerals, same to be paid in the manner prescribed by the commission. Of the monies received in connection with the execution of such leases, five-tenths of one percent (5/10 of 1%) shall be retained in a special fund to be appropriated by the Legislature, One Hundred Thousand Dollars ($100,000.00) of which amount to be used by the department for the administration of the Mineral Lease Division, and the remainder of such amount shall be deposited into the Education Trust Fund, created in Section 206A, Mississippi Constitution of 1890; and two percent (2%) shall be paid into a special fund to be designated as the "Gulf and Wildlife Protection Fund," to be appropriated by the Legislature, one-half (1/2) thereof to be apportioned as follows: an amount which shall not exceed One Million Dollars ($1,000,000.00) shall be used by the Mississippi Department of Wildlife, Fisheries and Parks * * * solely for the purpose of cleanup, remedial or abatement actions involving pollution as a result of the exploration or production of oil or gas, and any amount in excess of such One Million Dollars ($1,000,000.00) shall be deposited into the Education Trust Fund, created in Section 206A, Mississippi Constitution of 1890. The remaining one-half (1/2) of such Gulf and Wildlife Protection Fund to be apportioned as follows: an amount which shall not exceed One Million Dollars ($1,000,000.00) shall be used by the Mississippi Commission on Wildlife, Fisheries and Parks * * * for use first in the prudent management, preservation, protection and conservation of existing waters, lands and wildlife of this state and then, provided such purposes are accomplished, for the acquisition of additional waters and lands and any amount in excess of such One Million Dollars ($1,000,000.00) shall be deposited into the Education Trust Fund, created in Section 206A, Mississippi Constitution of 1890. However, in the event that the Legislature is not in session to appropriate funds from the Gulf and Wildlife Protection Fund for the purpose of cleanup, remedial or abatement actions involving pollution as a result of the exploration or production of oil or gas, then the Mississippi Department of Wildlife, Fisheries and Parks * * * may make expenditures from this special fund account solely for said purpose. The commission may lease the submerged beds for sand and gravel on such a basis as it may deem proper, but where the waters lie between this state and an adjoining state, there must be a cash realization to this state, including taxes paid for such sand and gravel, equal to that being had by such adjoining state, in all cases the requisite consents therefor being lawfully obtained from the United States.

Notwithstanding anything in this section to the contrary and not withstanding any other provisions of law to the contrary, the State of Mississippi, acting through the Mississippi Major Economic Impact Authority or any other agency, shall not permit any seismographic testing or exploration or other mineral exploration or testing activities or drilling or extracting of oil, gas or other minerals on, in or under state marine waters and tidelands and all waters and submerged lands twelve (12) nautical miles south of a line drawn from the southernmost land of Cat Island to the southernmost land of Ship Island, to the southernmost land of Horn Island, to the southernmost land of Petit Bois Island and extending east and west to the state borders with Alabama and Louisiana; furthermore, notwithstanding anything in this section to the contrary and notwithstanding any other provisions of law to the contrary, the State of Mississippi, acting through the Mississippi Major Economic Impact Authority or any other agency, shall not grant any leases for extraction of oil, gas or other minerals on, in or under state marine waters and tidelands nor any waters and submerged lands twelve nautical miles south of a line drawn from the southernmost land of Cat Island to the southernmost land of Ship Island, to the southernmost land of Horn Island, to the southernmost land of Petit Bois Island and extending east and west to the state borders with Alabama and Louisiana.

It is the policy of the State of Mississippi within state waters and tidelands, and to the extent under federal law, treaties, or local, state or federal agreements that the state may do so in the area of economic interest beyond the territorial waters of the State of Mississippi, to prohibit all seismographic testing, exploration, other mineral exploration or testing activities, or drilling, extracting or leasing of oil, gas or other minerals on, in or under all waters and submerged lands twelve (12) nautical miles south of a line drawn from the southernmost land of Cat Island to the southernmost land of Ship Island, to the southernmost land of Horn Island, to the southernmost land of Petit Bois Island and extending east and west to the state borders with Alabama and Louisiana.

SECTION 2. Section 29-7-1, Mississippi Code of 1972, is amended as follows:

29-7-1. (1) The Mississippi Commission on Environmental Quality shall be the mineral lease commission, and shall exercise the duties and responsibilities of the mineral lease commission under the provisions of Chapter 2 of Title 49, Mississippi Code of 1972.

(2) The words "mineral lease commission," whenever they may appear in the laws of the State of Mississippi, shall be construed to mean the Mississippi Commission on Environmental Quality.

(3) The term "commission" means the Mississippi Commission on Environmental Quality.

SECTION 3. Section 29-7-17, Mississippi Code of 1972, is amended as follows:

29-7-17. (1) Any person found by the commission to be violating any of the provisions of Section 29-7-3, or any rule or regulation or written order of the commission in pursuance thereof, or any condition or limitation of a permit shall be subject to a civil penalty of not more than Ten Thousand Dollars ($10,000.00) for each violation, such penalty to be assessed and levied by the commission after a hearing as hereinafter provided. Each day upon which a violation occurs shall be deemed a separate and additional violation. Appeals from the imposition of a civil penalty may be taken to the appropriate chancery court in the same manner as appeals from the orders of the commission. If the appellant desires to stay the execution of a civil penalty assessed by the commission, he shall give bond with sufficient resident sureties of one or more guaranty or surety companies authorized to do business in this state, payable to the State of Mississippi, in an amount equal to double the amount of any civil penalty assessed by the commission, as to which the stay of execution is desired, on the condition that if the judgment shall be affirmed the appellant shall pay all costs of the assessment entered against him.

(2) In lieu of, or in addition to, the penalty provided in subsection (1) of this section, the commission shall have power to institute and maintain in the name of the state any and all proceedings necessary or appropriate to enforce the provisions of Section 29-7-3, rules and regulations promulgated, and orders and permits made and issued thereunder, in the appropriate circuit, chancery, county or justice court of the county in which venue may lie. The commission may obtain mandatory or prohibitory injunctive relief, either temporary or permanent, and it shall not be necessary in such cases that the state plead or prove: (i) that irreparable damage would result if the injunction did not issue; (ii) that there is no adequate remedy at law; or (iii) that a written complaint or commission order has first been issued for the alleged violation.

(3) Any person who violates any of the provisions of, or fails to perform any duty imposed by, Section 29-7-3 or any rule or regulation issued hereunder, or who violates any order or determination of the commission promulgated pursuant to such section, and causes the death of fish, shellfish, or other wildlife shall be liable, in addition to the penalties provided in subsections (1), (2), (4) and (5) of this section, to pay to the state an additional amount equal to the sum of money reasonably necessary to restock such waters or replenish such wildlife as determined by the commission after consultation with the Mississippi Commission on Wildlife, Fisheries and Parks * * *. Such amount may be recovered by the commission on behalf of the state in a civil action brought in the appropriate county or circuit court of the county in which venue may lie.

(4) Any person who, through misadventure, happenstance or otherwise causes damage to or destruction of state-owned lands or structures or other property thereon necessitating remedial or cleanup action shall be liable for the cost of such remedial or cleanup action and the commission may recover the cost of same by a civil action brought in the circuit court of the county in which venue may lie. This penalty may be recovered in lieu of or in addition to the penalties provided in subsections (1), (2), (3) and (5) of this section.

(5) It shall be unlawful for any person to conduct unauthorized mineral exploration, development, or extraction activity or to violate the provisions of Section 29-7-3 or the rules and regulations of the commission which relate to mineral exploration, development, or extraction activity and, upon conviction thereof, such person shall be guilty of a misdemeanor, and fined not less than Five Hundred Dollars ($500.00) nor more than Five Thousand Dollars ($5,000.00) for each offense. Each day on which such violation occurs or continues shall constitute a separate offense.

(6) In lieu of or in addition to the penalties prescribed hereinabove, any person convicted by a court of law or found guilty by the commission of unlawful mineral extraction activity on state-owned lands shall repay to the state the fair market value of the minerals unlawfully extracted.

(7) Proceedings before the commission on civil violations prescribed hereinabove shall be conducted in the manner set forth in Sections 49-17-31, 49-17-33 and 49-17-35, with appeals therefrom to be perfected in the manner set forth in Section 49-17-41.

SECTION 4. Sections 29-7-19 and 27-7-21, Mississippi Code of 1972, which provide for the hearing process concerning the extraction of minerals before the Commission on Environmental Quality and the appeals process for decisions made by the commission, are repealed.

SECTION 5. Sections 27-25-505 and 27-25-705, Mississippi Code of 1972, which require the board of supervisors of a county to reduce the ad valorem taxes levied by the county in an amount equal to one-half (1/2) of the county's share of the revenue derived from the oil and gas severance tax under Sections 27-25-505 and 27-25-705, as a result of offshore drilling on the Mississippi Gulf Coast and the governing authorities of a municipality shall reduce the ad valorem taxes levied by the municipality in an amount equal to one-half (1/2) of the municipality's share of the revenue derived from the oil and gas severance tax under such sections, are repealed.

SECTION 6. This act shall take effect and be in force from and after its passage.