The Alaska State Senate unanimously passed Senate Joint Resolution 19 on May 5, encouraging Congress to honor what it called “Alaska’s birthright” of the 90/10 split of revenue from mineral production on federal lands. The arrangement is guaranteed by the Alaska Statehood Compact.

“With the release of President Donald J. Trump’s Executive Order, ‘Unleashing Alaska’s Extraordinary Resource Potential,’ Alaskans are optimistic that we’ll see increased production of our petroleum and mining resources,” said bill sponsor Senator Jesse Bjorkman (R-Nikiski). “However, this enthusiasm is tempered because Congress has gone back on its promise to provide Alaska with 90 percent of the royalty revenues from production on federal land.”

Language in the resolution references the Congressional deliberations over Alaska statehood that recognized that, as a large, remote state, Alaska wouldn’t have enough of a population and industrial base to be self-sufficient. In exchange for taking on the financial responsibility of providing public services, the people of Alaska were promised 90 percent of the royalties from production on federal lands in both the Alaska Statehood Act of 1958 and an amendment to the Mineral Act of 1920.

It was also acknowledged at the time the Statehood Act was under consideration that some of the most valuable land in Alaska, in particular the Naval Petroleum Reserve (now the National Petroleum Reserve Alaska or NPR-A) and the Arctic Wildlife Range (now the Arctic National Wildlife Refuge or ANWR), had been reserved by the federal government and was not available for the state to select. With roughly two-thirds or more of the North Slope under federal control, Alaska’s ability to determine its own revenue stream has been severely impacted.

“Alaska was established to rely on resource development for state revenue,” said Senator Robb Myers (R – North Pole). “If the federal government will not abide by the original agreement on mineral royalty splits, it should not be surprised at how reliant we are on federal funding.” The Resources Committee member continued, “They are cutting our legs out from underneath us.”

While past conversations regarding Alaska’s reduction in revenue share from 90 percent to 50 percent have focused on ANWR, federal revenue sharing from the NPR-A is capped at 50 percent in federal legislation, and the 50 percent share Alaska receives primarily goes to communities in the vicinity of the NPR-A and the Permanent Fund. The State’s general fund receives little to no shared federal revenue from the Area.

For the Willow Project in the NPR-A, ConocoPhillips is able to write off about 35 percent of its development costs, or about $500 million in Fiscal Year 2025, against taxes it pays to the State of Alaska. This lowers income to the general fund as a result of the project without an expectation of future royalties. In order to address the impact to State revenue that production in the NPR-A creates, the resolution asks that the federal statutes be amended to provide Alaska with 90 percent of federal revenues from this area as well.

“It is long past time the federal government honor its promise,” said Senate Minority Leader Mike Shower (R – Wasilla). “Tens of billions of dollars of potential public and private sector development, local and state revenue, jobs, and growth are at stake.”

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