§1721a Adjustments and Refunds

Summary

Leaseholders or their representatives must fix or ask for refunds when they find they paid too little or too much. They must do this within a reasonable time and only during the adjustment period. Sending a royalty report that shows the mistake counts as telling the Secretary or the State. When fixing amounts, the leaseholder must also calculate and report the interest at the same time unless doing so would be a hardship. If it is a hardship, the Secretary or delegated State will figure the interest and tell the leaseholder, unless the leaseholder chooses to calculate it themselves. Changes or refund requests after the adjustment period need written notice and approval during an audit that covers the production month involved. The adjustment period is six years after the payment became due and can be paused or extended the same way the limitation period in section 1724 can be. To get a refund, a written request must say it is a demand under section 1724, name who should get the money, give enough details to find the overpayment, and explain why it was an overpayment. The Secretary certifies approved refunds to the Treasury, which pays from current receipts from sales, bonuses, royalties (including collected interest), and rentals of public lands and the Outer Continental Shelf under the Mineral Leasing Act and the Outer Continental Shelf Lands Act, when those amounts are not payable to a State or the Reclamation Fund. If some of the refund money was already paid out to a State, the Reclamation Fund, or another lawful recipient, that part will be taken from the next payments to them and credited to miscellaneous receipts. Refunds must be paid or denied with reasons within 120 days of the Secretary getting the request. All refunds can be audited later and cannot be reduced by amounts whose enforcement is barred by section 1724.