MontanaSB 33969th Legislature, Regular Session (2025)SenateWALLET

Revise oil and gas production damage mitigation account

Sponsored By: Daniel Zolnikov (Republican)

Became Law

Mining and MineralsOil and GasState Finance

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 3 benefits, 0 costs, 1 mixed.

Dedicated fund to clean up orphaned wells

Beginning July 1, 2025, Montana creates an oil and gas cleanup fund in the state special revenue fund. After the board and the small resource deposit are taken out, the remaining oil and gas tax money goes into this fund unless the fund’s unobligated balance is $10 million or more. At the start of each two-year period, up to $650,000 of trust interest tops the fund up to $1,000,000; any unused amount goes to natural resources projects. The fund also receives certain board receipts and keeps all interest it earns. Money in the fund is statutorily appropriated, with board approval, to plug abandoned wells and restore damaged sites when the responsible party cannot be found or refuses to act. The responsible party still owes the costs and must repay the fund, and the fund can place a lien.

State share of oil taxes divided

Beginning July 1, 2025, the state share left after county and prior deductions is split by set percentages. 2.16% goes to natural resources projects, 2.02% to natural resources operations, 2.95% to the orphan share account, 2.65% to the Montana University System for the state tax levy, and the rest goes to the general fund.

County oil tax shares and penalties

Beginning July 1, 2025, each county gets a fixed percentage of oil and gas production taxes for local services and schools. The state deposits these amounts and then transfers them to each county for distribution. The state may withhold payments if a local government is more than 90 days late in filing required reports or remitting money owed to the state or another taxing unit.

Board expenses funded, small resource deposit

Beginning July 1, 2025, the board’s share of oil and gas production taxes tied to its privilege-and-license percentage is deposited in the board’s expense account to pay its costs. After that, up to 0.08% of certain production tax collections goes to the oil and gas natural resource distribution account.

Sponsors & Cosponsors

Sponsor

Daniel Zolnikov
Republican • Senate

Cosponsors

Valerie Moore
Republican • House

Roll Call Votes

All Roll Calls

Yes: 293 • No: 0

Senate vote • 4/15/2025

Do Concur

Yes: 97 • No: 0

Senate vote • 4/14/2025

Do Concur

Yes: 96 • No: 0

Senate vote • 4/2/2025

Do Pass

Yes: 50 • No: 0

Senate vote • 4/1/2025