H. R. 1975
One Hundred Fourth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Wednesday,
the third day of January, one thousand nine hundred and ninety-six
An Act
To improve the management of royalties from Federal and Outer Continental Shelf
oil and gas leases, and for other purposes.
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Federal Oil and Gas Royalty
Simplification and Fairness Act of 1996’’.
SEC. 2. DEFINITIONS.
Section 3 of the Federal Oil and Gas Royalty Management
Act of 1982 (30 U.S.C. 1701 et seq.) is amended—
(1) by amending paragraph (7) to read as follows:
‘‘(7) ‘lessee’ means any person to whom the United States
issues an oil and gas lease or any person to whom operating
rights in a lease have been assigned;’’; and
(2) by striking ‘‘and’’ at the end of paragraph (15), by
striking the period at the end of paragraph (16) and inserting
a semicolon, and by adding at the end the following:
‘‘(17) ‘adjustment’ means an amendment to a previously
filed report on an obligation, and any additional payment or
credit, if any, applicable thereto, to rectify an underpayment
or overpayment on an obligation;
‘‘(18) ‘administrative proceeding’ means any Department
of the Interior agency process in which a demand, decision
or order issued by the Secretary or a delegated State is subject
to appeal or has been appealed;
‘‘(19) ‘assessment’ means any fee or charge levied or
imposed by the Secretary or a delegated State other than—
‘‘(A) the principal amount of any royalty, minimum
royalty, rental bonus, net profit share or proceed of sale;
‘‘(B) any interest; or
‘‘(C) any civil or criminal penalty;
‘‘(20) ‘commence’ means—
‘‘(A) with respect to a judicial proceeding, the service
of a complaint, petition, counterclaim, cross claim, or other
pleading seeking affirmative relief or seeking credit or
recoupment: Provided, That if the Secretary commences
a judicial proceeding against a designee, the Secretary
shall give notice of that commencement to the lessee who
designated the designee, but the Secretary is not required
to give notice to other lessees who may be liable pursuant
to section 102(a) of this Act, for the obligation that is
the subject of the judicial proceeding; or
H. R. 1975—2
‘‘(B) with respect to a demand, the receipt by the
Secretary or a delegated State or a lessee or its designee
(with written notice to the lessee who designated the des-
ignee) of the demand;
‘‘(21) ‘credit’ means the application of an overpayment (in
whole or in part) against an obligation which has become due
to discharge, cancel or reduce the obligation;
‘‘(22) ‘delegated State’ means a State which, pursuant to
an agreement or agreements under section 205 of this Act,
performs authorities, duties, responsibilities, or activities of
the Secretary;
‘‘(23) ‘demand’ means—
‘‘(A) an order to pay issued by the Secretary or the
applicable delegated State to a lessee or its designee (with
written notice to the lessee who designated the designee)
that has a reasonable basis to conclude that the obligation
in the amount of the demand is due and owing; or
‘‘(B) a separate written request by a lessee or its des-
ignee which asserts an obligation due the lessee or its
designee that provides a reasonable basis to conclude that
the obligation in the amount of the demand is due and
owing, but does not mean any royalty or production report,
or any information contained therein, required by the Sec-
retary or a delegated State;
‘‘(24) ‘designee’ means the person designated by a lessee
pursuant to section 102(a) of this Act, with such written des-
ignation effective on the date such designation is received by
the Secretary and remaining in effect until the Secretary
receives notice in writing that the designation is modified or
terminated;
‘‘(25) ‘obligation’ means—
‘‘(A) any duty of the Secretary or, if applicable, a dele-
gated State—
‘‘(i) to take oil or gas royalty in kind; or
‘‘(ii) to pay, refund, offset, or credit monies includ-
ing (but not limited to)—
‘‘(I) the principal amount of any royalty, mini-
mum royalty, rental, bonus, net profit share or
proceed of sale; or
‘‘(II) any interest; and
‘‘(B) any duty of a lessee or its designee (subject to
the provision of section 102(a) of this Act)—
‘‘(i) to deliver oil or gas royalty in kind; or
‘‘(ii) to pay, offset or credit monies including (but
not limited to)—
‘‘(I) the principal amount of any royalty, mini-
mum royalty, rental, bonus, net profit share or
proceed of sale;
‘‘(II) any interest;
‘‘(III) any penalty; or
‘‘(IV) any assessment,
which arises from or relates to any lease administered
by the Secretary for, or any mineral leasing law related
to, the exploration, production and development of oil
or gas on Federal lands or the Outer Continental Shelf;
‘‘(26) ‘order to pay’ means a written order issued by the
Secretary or the applicable delegated State to a lessee or its
H. R. 1975—3
designee (with notice to the lessee who designated the designee)
which—
‘‘(A) asserts a specific, definite, and quantified obliga-
tion claimed to be due, and
‘‘(B) specifically identifies the obligation by lease,
production month and monetary amount of such obligation
claimed to be due and ordered to be paid, as well as
the reason or reasons such obligation is claimed to be
due, but such term does not include any other communica-
tion or action by or on behalf of the Secretary or a delegated
State;
‘‘(27) ‘overpayment’ means any payment by a lessee or
its designee in excess of an amount legally required to be
paid on an obligation and includes the portion of any estimated
payment for a production month that is in excess of the royalties
due for that month;
‘‘(28) ‘payment’ means satisfaction, in whole or in part,
of an obligation;
‘‘(29) ‘penalty’ means a statutorily authorized civil fine
levied or imposed for a violation of this Act, any mineral leasing
law, or a term or provision of a lease administered by the
Secretary;
‘‘(30) ‘refund’ means the return of an overpayment;
‘‘(31) ‘State concerned’ means, with respect to a lease, a
State which receives a portion of royalties or other payments
under the mineral leasing laws from such lease;
‘‘(32) ‘underpayment’ means any payment or nonpayment
by a lessee or its designee that is less than the amount legally
required to be paid on an obligation; and
‘‘(33) ‘United States’ means the United States Government
and any department, agency, or instrumentality thereof, the
several States, the District of Columbia, and the territories
of the United States.’’.
SEC. 3. DELEGATION OF ROYALTY COLLECTIONS AND RELATED
ACTIVITIES.
(a) GENERAL AUTHORITY.—Section 205 of the Federal Oil and
Gas Royalty Management Act of 1982 (30 U.S.C. 1735) is amended
to read as follows:
‘‘SEC. 205. DELEGATION OF ROYALTY COLLECTIONS AND RELATED
ACTIVITIES.
‘‘(a) Upon written request of any State, the Secretary is
authorized to delegate, in accordance with the provisions of
this section, all or part of the authorities and responsibilities
of the Secretary under this Act to:
‘‘(1) conduct inspections, audits, and investigations;
‘‘(2) receive and process production and financial reports;
‘‘(3) correct erroneous report data;
‘‘(4) perform automated verification; and
‘‘(5) issue demands, subpoenas, and orders to perform
restructured accounting, for royalty management enforcement
purposes,
to any State with respect to all Federal land within the State.
‘‘(b) After notice and opportunity for a hearing, the Secretary
is authorized to delegate such authorities and responsibilities
granted under this section as the State has requested, if the Sec-
retary finds that—
H. R. 1975—4
‘‘(1) it is likely that the State will provide adequate
resources to achieve the purposes of this Act;
‘‘(2) the State has demonstrated that it will effectively
and faithfully administer the rules and regulations of the Sec-
retary under this Act in accordance with the requirements
of subsections (c) and (d) of this section;
‘‘(3) such delegation will not create an unreasonable burden
on any lessee;
‘‘(4) the State agrees to adopt standardized reporting proce-
dures prescribed by the Secretary for royalty and production
accounting purposes, unless the State and all affected parties
(including the Secretary) otherwise agree;
‘‘(5) the State agrees to follow and adhere to regulations
and guidelines issued by the Secretary pursuant to the mineral
leasing laws regarding valuation of production; and
‘‘(6) where necessary for a State to have authority to carry
out and enforce a delegated activity, the State agrees to enact
such laws and promulgate such regulations as are consistent
with relevant Federal laws and regulations
with respect to the Federal lands within the State.
‘‘(c) After notice and opportunity for hearing, the Secretary
shall issue a ruling as to the consistency of a State’s proposal
with the provisions of this section and regulations under subsection
(d) within 90 days after submission of such proposal. In any unfavor-
able ruling, the Secretary shall set forth the reasons therefor and
state whether the Secretary will agree to delegate to the State
if the State meets the conditions set forth in such ruling.
‘‘(d) After consultation with State authorities, the Secretary
shall by rule promulgate, within 12 months after the date of enact-
ment of this section, standards and regulations pertaining to the
authorities and responsibilities to be delegated under subsection
(a), including standards and regulations pertaining to—
‘‘(1) audits to be performed;
‘‘(2) records and accounts to be maintained;
‘‘(3) reporting procedures to be required by States under
this section;
‘‘(4) receipt and processing of production and financial
reports;
‘‘(5) correction of erroneous report data;
‘‘(6) performance of automated verification;
‘‘(7) issuance of standards and guidelines in order to avoid
duplication of effort;
‘‘(8) transmission of report data to the Secretary; and
‘‘(9) issuance of demands, subpoenas, and orders to perform
restructured accounting, for royalty management enforcement
purposes.
Such standards and regulations shall be designed to provide reason-
able assurance that a uniform and effective royalty management
system will prevail among the States. The records and accounts
under paragraph (2) shall be sufficient to allow the Secretary to
monitor the performance of any State under this section.
‘‘(e) If, after notice and opportunity for a hearing, the Secretary
finds that any State to which any authority or responsibility of
the Secretary has been delegated under this section is in violation
of any requirement of this section or any rule thereunder, or that
an affirmative finding by the Secretary under subsection (b) can
no longer be made, the Secretary may revoke such delegation.
H. R. 1975—5
If, after providing written notice to a delegated State and a reason-
able opportunity to take corrective action requested by the Sec-
retary, the Secretary determines that the State has failed to issue
a demand or order to a Federal lessee within the State, that
such failure may result in an underpayment of an obligation due
the United States by such lessee, and that such underpayment
may be uncollected without Secretarial intervention, the Secretary
may issue such demand or order in accordance with the provisions
of this Act prior to or absent the withdrawal of delegated authority.
‘‘(f) Subject to appropriations, the Secretary shall compensate
any State for those costs which may be necessary to carry out
the delegated activities under this Section. Payment shall be made
no less than every quarter during the fiscal year. Compensation
to a State may not exceed the Secretary’s reasonably anticipated
expenditure for performance of such delegated activities by the
Secretary. Such costs shall be allocable for the purposes of section
35(b) of the Act entitled ‘An act to promote the mining of coal,
phosphate, oil, oil shale, gas and sodium on the public domain’,
approved February 25, 1920 (commonly known as the Mineral Leas-
ing Act) (30 U.S.C. 191 (b)) to the administration and enforcement
of laws providing for the leasing of any onshore lands or interests
in land owned by the United States. Any further allocation of
costs under section 35(b) made by the Secretary for oil and gas
activities, other than those costs to compensate States for delegated
activities under this Act, shall be only those costs associated with
onshore oil and gas activities and may not include any duplication
of costs allocated pursuant to the previous sentence. Nothing in
this section affects the Secretary’s authority to make allocations
under section 35(b) for non-oil and gas mineral activities. All moneys
received from sales, bonuses, rentals, royalties, assessments and
interest, including money claimed to be due and owing pursuant
to a delegation under this section, shall be payable and paid to
the Treasury of the United States.
‘‘(g) Any action of the Secretary to approve or disapprove a
proposal submitted by a State under this section shall be subject
to judicial review in the United States district court which includes
the capital of the State submitting the proposal.
‘‘(h) Any State operating pursuant to a delegation existing
on the date of enactment of this Act may continue to operate
under the terms and conditions of the delegation, except to the
extent that a revision of the existing agreement is adopted pursuant
to this section.’’.
(b) CLERICAL AMENDMENT.—The item relating to section 205
in the table of contents in section 1 of the Federal Oil and Gas
Royalty Management Act of 1982 (30 U.S.C. 1701) is amended
to read as follows:
‘‘Sec. 205. Delegation of royalty collections and related activities.’’.
SEC. 4. SECRETARIAL AND DELEGATED STATES’ ACTIONS AND LIMITA-
TION PERIODS.
(a) IN GENERAL.—The Federal Oil and Gas Royalty Manage-
ment Act of 1982 (30 U.S.C. 1701 et seq.) is amended by adding
after section 114 the following new section:
H. R. 1975—6
‘‘SEC. 115. SECRETARIAL AND DELEGATED STATES’ ACTIONS AND
LIMITATION PERIODS.
‘‘(a) IN GENERAL.—The respective duties, responsibilities, and
activities with respect to a lease shall be performed by the Sec-
retary, delegated States, and lessees or their designees in a timely
manner.
‘‘(b) LIMITATION PERIOD.—
‘‘(1) IN GENERAL.—A judicial proceeding or demand which
arises from, or relates to an obligation, shall be commenced
within seven years from the date on which the obligation
becomes due and if not so commenced shall be barred. If
commencement of a judicial proceeding or demand for an obliga-
tion is barred by this section, the Secretary, a delegated State,
or a lessee or its designee (A) shall not take any other or
further action regarding that obligation, including (but not
limited to) the issuance of any order, request, demand or other
communication seeking any document, accounting, determina-
tion, calculation, recalculation, payment, principal, interest,
assessment, or penalty or the initiation, pursuit or completion
of an audit with respect to that obligation; and (B) shall not
pursue any other equitable or legal remedy, whether under
statute or common law, with respect to an action on or an
enforcement of said obligation.
‘‘(2) RULE
OF
CONSTRUCTION.—A judicial proceeding or
demand that is timely commenced under paragraph (1) against
a designee shall be considered timely commenced as to any
lessee who is liable pursuant to section 102(a) of this Act
for the obligation that is the subject of the judicial proceeding
or demand.
‘‘(3) APPLICATION OF CERTAIN LIMITATIONS.—The limitations
set forth in sections 2401, 2415, 2416, and 2462 of title 28,
United States Code, and section 42 of the Mineral Leasing
Act (30 U.S.C. 226–2) shall not apply to any obligation to
which this Act applies. Section 3716 of title 31, United States
Code, may be applied to an obligation the enforcement of which
is not barred by this Act, but may not be applied to any
obligation the enforcement of which is barred by this Act.
‘‘(c) OBLIGATION BECOMES DUE.—
‘‘(1) IN GENERAL.—For purposes of this Act, an obligation
becomes due when the right to enforce the obligation is fixed.
‘‘(2) ROYALTY OBLIGATIONS.—The right to enforce any roy-
alty obligation for any given production month for a lease
is fixed for purposes of this Act on the last day of the calendar
month following the month in which oil or gas is produced.
‘‘(d) TOLLING
OF LIMITATION PERIOD.—The running of the
limitation period under subsection (b) shall not be suspended, tolled,
extended, or enlarged for any obligation for any reason by any
action, including an action by the Secretary or a delegated State,
other than the following:
‘‘(1) TOLLING AGREEMENT.—A written agreement executed
during the limitation period between the Secretary or a dele-
gated State and a lessee or its designee (with notice to the
lessee who designated the designee) shall toll the limitation
period for the amount of time during which the agreement
is in effect.
‘‘(2) SUBPOENA.—
H. R. 1975—7
‘‘(A) The issuance of a subpoena to a lessee or its
designee (with notice to the lessee who designated the
designee, which notice shall not constitute a subpoena to
the lessee) in accordance with the provisions of subpara-
graph (B)(i) shall toll the limitation period with respect
to the obligation which is the subject of a subpoena only
for the period beginning on the date the lessee or its
designee receives the subpoena and ending on the date
on which (i) the lessee or its designee has produced such
subpoenaed records for the subject obligation, (ii) the Sec-
retary or a delegated State receives written notice that
the subpoenaed records for the subject obligation are not
in existence or are not in the lessee’s or its designee’s
possession or control, or (iii) a court has determined in
a final decision that such records are not required to be
produced, whichever occurs first.
‘‘(B)(i) A subpoena for the purposes of this section
which requires a lessee or its designee to produce records
necessary to determine the proper reporting and payment
of an obligation due the Secretary may be issued only
by an Assistant Secretary of the Interior or an Acting
Assistant Secretary of the Interior who is a schedule C
employee (as defined by section 213.3301 of title 5, Code
of Federal Regulations), or the Director or Acting Director
of the respective bureau or agency, and may not be dele-
gated to any other person. If a State has been delegated
authority pursuant to section 205, the State, acting through
the highest State official having ultimate authority over
the collection of royalties from leases on Federal lands
within the State, may issue such subpoena, but may not
delegate such authority to any other person.
‘‘(ii) A subpoena described in clause (i) may only be
issued against a lessee or its designee during the limitation
period provided in this section and only after the Secretary
or a delegated State has in writing requested the records
from the lessee or its designee related to the obligation
which is the subject of the subpoena and has determined
that—
‘‘(I) the lessee or its designee has failed to respond
within a reasonable period of time to the Secretary’s
or the applicable delegated State’s written request for
such records necessary for an audit, investigation or
other inquiry made in accordance with the Secretary’s
or such delegated State’s responsibilities under this
Act; or
‘‘(II) the lessee or its designee has in writing denied
the Secretary’s or the applicable delegated State’s writ-
ten request to produce such records in the lessee’s
or its designee’s possession or control necessary for
an audit, investigation or other inquiry made in accord-
ance with the Secretary’s or such delegated State’s
responsibilities under this Act; or
‘‘(III) the lessee or its designee has unreasonably
delayed in producing records necessary for an audit,
investigation or other inquiry made in accordance with
the Secretary’s or the applicable delegated State’s
H. R. 1975—8
responsibilities under this Act after the Secretary’s
or delegated State’s written request.
‘‘(C) In seeking records, the Secretary or the applicable
delegated State shall afford the lessee or its designee a
reasonable period of time after a written request by the
Secretary or such delegated State in which to provide such
records prior to the issuance of any subpoena.
‘‘(3) MISREPRESENTATION
OR
CONCEALMENT.—The inten-
tional misrepresentation or concealment of a material fact for
the purpose of evading the payment of an obligation in which
case the limitation period shall be tolled for the period of
such misrepresentation or such concealment.
‘‘(4) ORDER TO PERFORM RESTRUCTURED ACCOUNTING.—A)(i)
The issuance of a notice under subparagraph (D) that the
lessee or its designee has not substantially complied with the
requirement to perform a restructured accounting shall toll
the limitation period with respect to the obligation which is
the subject of the notice only for the period beginning on the
date the lessee or its designee receives the notice and ending
120 days after the date on which (I) the Secretary or the
applicable delegated State receives written notice that the
accounting or other requirement has been performed, or (II)
a court has determined in a final decision that the lessee
is not required to perform the accounting, whichever occurs
first.
‘‘(ii) If the lessee or its designee initiates an administrative
appeal or judicial proceeding to contest an order to perform
a restructured accounting issued under subparagraph (B)(i),
the limitation period in subsection (b) shall be tolled from
the date the lessee or its designee received the order until
a final, nonappealable decision is issued in any such proceeding.
‘‘(B)(i) The Secretary or the applicable delegated State may
issue an order to perform a restructured accounting to a lessee
or its designee when the Secretary or such delegated State
determines during an audit of a lessee or its designee that
the lessee or its designee should recalculate royalty due on
an obligation based upon the Secretary’s or the delegated State’s
finding that the lessee or its designee has made identified
underpayments or overpayments which are demonstrated by
the Secretary or the delegated State to be based upon repeated,
systemic reporting errors for a significant number of leases
or a single lease for a significant number of reporting months
with the same type of error which constitutes a pattern of
violations and which are likely to result in either significant
underpayments or overpayments.
‘‘(ii) The power of the Secretary to issue an order to perform
a restructured accounting may not be delegated below the most
senior career professional position having responsibility for the
royalty management program, which position is currently des-
ignated as the ‘Associate Director for Royalty Management’,
and may not be delegated to any other person. If a State
has been delegated authority pursuant to section 205 of this
Act, the State, acting through the highest ranking State official
having ultimate authority over the collection of royalties from
leases on Federal lands within the State, may issue such order
to perform, which may not be delegated to any other person.
An order to perform a restructured accounting shall—
H. R. 1975—9
‘‘(I) be issued within a reasonable period of time from
when the audit identifies the systemic, reporting errors;
‘‘(II) specify the reasons and factual bases for such
order;
‘‘(III) be specifically identified as an ‘order to perform
a restructured accounting’;
‘‘(IV) provide the lessee or its designee a reasonable
period of time (but not less than 60 days) within which
to perform the restructured accounting; and
‘‘(V) provide the lessee or its designee 60 days within
which to file an administrative appeal of the order to
perform a restructured accounting.
‘‘(C) An order to perform a restructured accounting shall
not mean or be construed to include any other action by or
on behalf of the Secretary or a delegated State.
‘‘(D) If a lessee or its designee fails to substantially comply
with the requirement to perform a restructured accounting
pursuant to this subsection, a notice shall be issued to the
lessee or its designee that the lessee or its designee has not
substantially complied with the requirements to perform a
restructured accounting. A lessee or its designee shall be given
a reasonable time within which to perform the restructured
accounting. Such notice may be issued under this section only
by an Assistant Secretary of the Interior or an acting Assistant
Secretary of the Interior who is a schedule C employee (as
defined by section 213.3301 of title 5, Code of Federal Regula-
tions) and may not be delegated to any other person. If a
State has been delegated authority pursuant to section 205,
the State, acting through the highest State official having ulti-
mate authority over the collection of royalties from leases on
Federal lands within the State, may issue such notice, which
may not be delegated to any other person.
‘‘(e) TERMINATION OF LIMITATIONS PERIOD.—An action or an
enforcement of an obligation by the Secretary or delegated State
or a lessee or its designee shall be barred under this section prior
to the running of the seven-year period provided in subsection
(b) in the event—
‘‘(1) the Secretary or a delegated State has notified the
lessee or its designee in writing that a time period is closed
to further audit; or
‘‘(2) the Secretary or a delegated State and a lessee or
its designee have so agreed in writing.
For purposes of this subsection, notice to, or an agreement by,
the designee shall be binding on any lessee who is liable pursuant
to section 102(a) for obligations that are the subject of the notice
or agreement.
‘‘(f) RECORDS REQUIRED
FOR DETERMINING COLLECTIONS.—
Records required pursuant to section 103 of this Act by the Sec-
retary or any delegated State for the purpose of determining obliga-
tions due and compliance with any applicable mineral leasing law,
lease provision, regulation or order with respect to oil and gas
leases from Federal lands or the Outer Continental Shelf shall
be maintained for the same period of time during which a judicial
proceeding or demand may be commenced under subsection (b).
If a judicial proceeding or demand is timely commenced, the record
holder shall maintain such records until the final nonappealable
decision in such judicial proceeding is made, or with respect to
H. R. 1975—10
that demand is rendered, unless the Secretary or the applicable
delegated State authorizes in writing an earlier release of the
requirement to maintain such records. Notwithstanding anything
herein to the contrary, under no circumstance shall a record holder
be required to maintain or produce any record relating to an obliga-
tion for any time period which is barred by the applicable limitation
in this section. In connection with any hearing, administrative
proceeding, inquiry, investigation, or audit by the Secretary or
a delegated State under this Act, the Secretary or the delegated
State shall minimize the submission of multiple or redundant
information and make a good faith effort to locate records previously
submitted by a lessee or a designee to the Secretary or the delegated
State, prior to requiring the lessee or the designee to provide
such records.
‘‘(g) TIMELY COLLECTIONS.—In order to most effectively utilize
resources available to the Secretary to maximize the collection
of oil and gas receipts from lease obligations to the Treasury within
the seven-year period of limitations, and consequently to maximize
the State share of such receipts, the Secretary should not perform
or require accounting, reporting, or audit activities if the Secretary
and the State concerned determine that the cost of conducting
or requiring the activity exceeds the expected amount to be collected
by the activity, based on the most current 12 months of activity.
This subsection shall not provide a defense to a demand or an
order to perform a restructured accounting. To the maximum extent
possible, the Secretary and delegated States shall reduce costs
to the United States Treasury and the States by discontinuing
requirements for unnecessary or duplicative data and other informa-
tion, such as separate allowances and payor information, relating
to obligations due. If the Secretary and the State concerned deter-
mine that collection will result sooner, the Secretary or the
applicable delegated State may waive or forego interest in whole
or in part.
‘‘(h) APPEALS AND FINAL AGENCY ACTION.—
‘‘(1) 33-MONTH PERIOD.—Demands or orders issued by the
Secretary or a delegated State are subject to administrative
appeal in accordance with the regulations of the Secretary.
No State shall impose any conditions which would hinder a
lessee’s or its designee’s immediate appeal of an order to the
Secretary or the Secretary’s designee. The Secretary shall issue
a final decision in any administrative proceeding, including
any administrative proceedings pending on the date of enact-
ment of this section, within 33 months from the date such
proceeding was commenced or 33 months from the date of
such enactment, whichever is later. The 33-month period may
be extended by any period of time agreed upon in writing
by the Secretary and the appellant.
‘‘(2) EFFECT OF FAILURE TO ISSUE DECISION.—If no such
decision has been issued by the Secretary within the 33-month
period referred to in paragraph (1)—
‘‘(A) the Secretary shall be deemed to have issued
and granted a decision in favor of the appellant as to
any nonmonetary obligation and any monetary obligation
the principal amount of which is less than $10,000; and
‘‘(B) the Secretary shall be deemed to have issued
a final decision in favor of the Secretary, which decision
shall be deemed to affirm those issues for which the agency
H. R. 1975—11
rendered a decision prior to the end of such period, as
to any monetary obligation the principal amount of which
is $10,000 or more, and the appellant shall have a right
to judicial review of such deemed final decision in accord-
ance with title 5 of the United States Code.
‘‘(i) COLLECTIONS
OF DISPUTED AMOUNTS DUE.—To expedite
collections relating to disputed obligations due within the seven-
year period beginning on the date the obligation became due, the
parties shall hold not less than one settlement consultation and
the Secretary and the State concerned may take such action as
is appropriate to compromise and settle a disputed obligation,
including waiving or reducing interest and allowing offsetting of
obligations among leases.
‘‘(j) ENFORCEMENT OF A CLAIM FOR JUDICIAL REVIEW.—In the
event a demand subject to this section is properly and timely
commenced, the obligation which is the subject of the demand
may be enforced beyond the seven-year limitations period without
being barred by this statute of limitations. In the event a demand
subject to this section is properly and timely commenced, a judicial
proceeding challenging the final agency action with respect to such
demand shall be deemed timely so long as such judicial proceeding
is commenced within 180 days from receipt of notice by the lessee
or its designee of the final agency action.
‘‘(k) IMPLEMENTATION
OF FINAL DECISION.—In the event a
judicial proceeding or demand subject to this section is timely
commenced and thereafter the limitation period in this section
lapses during the pendency of such proceeding, any party to such
proceeding shall not be barred from taking such action as is required
or necessary to implement a final unappealable judicial or adminis-
trative decision, including any action required or necessary to imple-
ment such decision by the recovery or recoupment of an underpay-
ment or overpayment by means of refund or credit.
‘‘(l) STAY OF PAYMENT OBLIGATION PENDING REVIEW.—Any per-
son ordered by the Secretary or a delegated State to pay any
obligation (other than an assessment) shall be entitled to a stay
of such payment without bond or other surety instrument pending
an administrative or judicial proceeding if the person periodically
demonstrates to the satisfaction of the Secretary that such person
is financially solvent or otherwise able to pay the obligation. In
the event the person is not able to demonstrate, the Secretary
may require a bond or other surety instrument satisfactory to
cover the obligation. Any person ordered by the Secretary or a
delegated State to pay an assessment shall be entitled to a stay
without bond or other surety instrument.’’.
(b) CLERICAL AMENDMENT.—The table of contents in section
1 of the Federal Oil and Gas Royalty Management Act of 1982
(30 U.S.C. 1701) is amended by inserting after the item relating
to section 114 the following new item:
‘‘Sec.
115.
Secretarial and delegated States’ actions and limitation periods.’’.
SEC. 5. ADJUSTMENT AND REFUNDS.
(a) IN GENERAL.—The Federal Oil and Gas Royalty Manage-
ment Act of 1982 (30 U.S.C. 1701 et seq.) is amended by inserting
after section 111 the following: