Federal Leasing Policy

The initial coordination efforts between the Departments of the Interior and Energy in leasing Federal lands were discussed. GAO addressed the following areas of coordination: (1) Energy's development of production goals for energy resources and Interior's use of these goals in the development of lease schedules; (2) Energy's attempts to issue regulations in the areas of production rates, competition, alternative bidding systems, diligence, and in-kind royalty; and (3) the effectiveness of the Leasing Liaison Committee in identifying and resolving interdepartmental problems. The analysis indicated that the initial coordination efforts between the Departments are not working smoothly. The Departments differ on the use of production goals, the framework and context of regulations, and the general responsibilities of each Department on leasing matters. GAO recommended that by January 1, 1980, the Secretaries of Energy and the Interior issue compatible regulations on production goals that clearly define the goals as a primary component of Federal leasing schedules. The goals should be the starting point for leasing energy resources and should include a sequential procedure for review and resolution of problems with the goals. The steps of review should include the Leasing Liaison Committee, the Secretaries, and the President. Also recommended was that Energy publish an analysis of each lease schedule announced by Interior identifying the schedule's potential impact on domestic energy needs; and the alternative energy resources needed if Energy's production goals could not be met by the schedule. Finally, it was recommended that the Department of Energy take positive steps to begin issuing regulations mandated by the Department of Energy Organization Act which transferred certain responsibilities for Federal lands from the Department of the Interior to the Department of Energy.