Wyoming is set to lose about $50 million a year because of new federal breaks for the coal industry. This has state lawmakers increasingly worried.
Rep. Robert Wharff (R-Evanston) spoke with fellow lawmakers this week during the Select Federal Natural Resources Management Committee. The six committee members were trying to understand the implications of new federal law.
“If in fact this ‘Big Beautiful Bill’ is going to cost us $50 million, I know that was not the intent,” said Wharff, who’s also the committee chair. “Everybody said how this is such a great thing for our state.”
The One Big Beautiful Bill Act (BBB), signed into law by Pres. Trump on July 4, lowered coal royalty rates by nearly half through 2034. This means companies will pay less for the coal they take out of the ground on federal lands. But that hurts Wyoming’s coffers because the state, which produces the majority of the nation’s coal, gets about half of those payments. The royalties help fund schools, roads and local governments.
Wharff said he thinks Republican congressional members voted to reduce the royalty rate because they “assumed that with the lower fees that we would have more [coal] production.”
That reasoning is echoed by those who voted for the BBB, including Rep. Harriet Hageman (R-Wyoming). In an op-ed, she wrote it’ll “revitalize Wyoming’s coal sector” by “reducing the cost burden on coal producers and helping to keep our coal mines operating.”
But back in the state Legislature’s committee meeting, Wharff said, “If it's going to take us multiple years to see that – I don't know.”
He added it was the Legislature’s interim Appropriations Committee members who first flagged that the federal royalty rate reduction was “actually going to hurt us.”
According to WyoFile reporting, members sent a letter to Wyoming’s D.C. delegates asking them to amend the bill to avoid the future $50 million revenue loss. But that didn’t happen.
An alternative request state lawmakers offered the delegates was to bring future legislation to avoid the loss. Their suggestion was upping Wyoming’s split of the royalty rates from about 50-50 to 87.5% for the state and 12.5% for the feds.
Currently, most U.S. states have about a half-and-half split on fossil fuel federal royalty payments. The exception is Alaska, which state lawmakers pointed out.
“Alaska actually has a 90-10 split and they got that at statehood,” said Sen. Bob Ide (R-Casper). “They're kind of fighting right now.”
Alaskan state lawmakers contend the state’s “birthright” promises this split, but that the feds haven’t always honored it. They formally asked for the 90-10 split in a resolution to Congress last month.
That’s something Wyoming hopes to do also.
“I think we got time to put something together,” Wharff said to fellow committee members. “I want the committee to look at and see how we can come in and maybe reinforce the requests that our Appropriations Committee has had.”
Wharff’s committee feared they’re running out of interim time to draft a resolution, with only one committee meeting scheduled before the 2026 session next February. While a resolution can’t change law, as it’s essentially a formal opinion, Rep. Ide said it goes a step further than the Appropriations Committee’s letter.
But some pushed back, saying they weren’t aware of Wyoming’s stakes in the royalty rate decrease.
“I'm very reluctant in this, because this is the first news I've heard of it at all,” said Rep. Bob Davis (R-Baggs), who ultimately opposed the draft resolution. “I would like to have a lot more time to analyze what you guys are telling. I've never heard of this, never seen any of this.”
The six lawmakers voted 4 to 2 to move forward with drafting a resolution asking D.C. Delegates to consider a 87.5% split with Wyoming. It’ll be discussed further at the committee’s Oct. 10 meeting in Laramie.
Other coal news
The Select Federal Natural Resources Committee also heard updates from Wyoming’s Bureau of Land Management (BLM). The agency said the Powder River Basin will likely reopen to new coal leasing by the end of the year, but lawmakers didn’t think that’s fast enough.
The BLM is undoing the Biden administration’s moratorium on new coal mining in northeast Wyoming. The process is being expedited because of Trump’s national energy emergency order.
Rep. Wharff said the back and forth federal policies feel like ping-pong.
“And I’m not sure in this instance who’s the ball, whether it’s the state, the county commissioners or the BLM,” he said. “But it’s not a comfortable position to be in.”
Wharff said that’s because industry expansion and possible money for the state is on the line. Wharff questioned why reopening coal leasing couldn’t happen sooner.
“To me, if it's an emergency, that should be done tomorrow, not a year from now,” he said.
Kris Kirby, acting director of Wyoming BLM, said reopening the Powder River Basin for coal leasing would normally take two years. Under Trump’s orders, it’ll be closer to nine months. She said things like public comment and the governor’s review process still take time.
“That's part of what kind of drags those time frames on, because we are really prioritizing that discussion with our cooperators and our counties and the state and local agencies,” Kirby said.
However, under Trump’s orders, public comment periods are being truncated. For this project, the recently closed public comment period was 30 days, which conservation groups say is “not normal.” The National Environmental Policy Act (NEPA) required 45 days prior to Trump’s orders to dismantle it.
Similarly, the Black Butte coal mine expansion in Sweetwater County has a 10-day public comment. Previously, these types of projects had 30 days.
Shortening the public comment window is concerning Wyoming communities, even those that are backed by coal.
“We appreciate what's happening by way of executive order. But we also do have a little bit of reservation about the streamlining of the processes where NEPA are concerned,” said Jim Ford, Campbell County Commissioner. “One way that could happen is to talk less to the localities and the state.”
Ford told lawmakers he wants to make sure they still have a seat at the table in these federal land use discussions.
Rep. Wharff and Rep. Davis said a key part is counties having strong natural resource plans, as those documents are often referenced in federal resource plans.
State lawmakers asked the Legislature Service Office (LSO) to look into ways they can support counties if they need help updating those plans.
