HR-398-119
Placed on the Union Calendar, Calendar No. 569.
Sponsored by Alexandria Ocasio-Cortez (D-NY)
What it does
This bill would amend the Geothermal Steam Act of 1970 to allow the Department of the Interior to require geothermal lease applicants and holders to reimburse the federal government for the reasonable administrative costs of processing applications, issuing permits, and conducting inspections and monitoring. The cost-recovery authority would run through September 30, 2032, and reimbursed funds would be credited back to Interior as discretionary offsetting collections, available only through future appropriations acts. The Secretary of the Interior would have discretion to reduce or waive reimbursement in cases of economic hardship or to promote greater use of geothermal resources, and must submit a report to Congress within five years assessing the program's effects.
Who benefits
U.S. taxpayers broadly, who would no longer fully subsidize the administrative costs of processing private geothermal leases. The Bureau of Land Management (BLM), which would gain a funding stream to support its geothermal permitting and inspection workload. Geothermal developers who may benefit from faster processing if BLM has more resources to handle applications. Small or financially constrained applicants who could qualify for hardship waivers. Competing energy sectors (e.g., solar, wind) whose federal permitting costs are already subject to cost-recovery mechanisms, leveling the playing field.
Who is hurt
Geothermal lease applicants and current leaseholders who would face new fees on top of existing costs, potentially increasing the upfront financial burden of geothermal development. Smaller or startup geothermal companies with limited capital, for whom even reduced fees could be a barrier to entry. Geothermal energy development broadly, if higher costs slow project timelines or deter investment in a sector that currently has a relatively small market footprint. Rural communities and states with significant geothermal potential (e.g., Nevada, California, Idaho) where reduced development activity could affect local tax revenues and jobs.
Supporters argue
Supporters argue that requiring private companies to reimburse the government for the direct costs of processing their lease applications is a straightforward user-fee principle — the same model already applied to oil, gas, and hardrock mining permits — and that it is inequitable for taxpayers to subsidize the administrative overhead of for-profit energy development. They contend that crediting recovered funds back to BLM's geothermal program would directly improve the agency's capacity to process permits more efficiently, potentially accelerating project timelines and benefiting the industry itself. The bill's hardship waiver and sunset provisions further demonstrate a measured, targeted approach rather than a blanket fee mandate.
Opponents argue
Opponents argue that geothermal energy is an emerging sector that already faces high upfront exploration and drilling costs, and that adding federal cost-recovery fees could make marginal projects economically unviable at a critical stage of industry growth. They contend that the bill's discretionary structure — leaving fee amounts entirely to the Secretary's determination — provides insufficient certainty for developers trying to model project costs, and that the lack of a fee cap or schedule could expose applicants to unpredictable charges. Critics may also note that the bill's sunset in 2032 creates regulatory uncertainty that could discourage long-term capital commitments in a sector where project development cycles often exceed seven years.
Constitutional context
This bill amends an existing statute (the Geothermal Steam Act of 1970) and delegates fee-setting discretion to the Secretary of the Interior. Under Loper Bright v. Raimondo (2024), courts will independently review whether the statutory language clearly authorizes the specific fee structures Interior implements, rather than deferring to the agency's interpretation. No significant Commerce Clause, Takings, or major questions doctrine issues are apparent given the narrow, administrative scope of the bill.
Checks and balances
The Executive Branch (Department of the Interior) gains new discretionary authority to set and collect cost-recovery fees; Congress retains a check through the appropriations process, as recovered funds are available only to the extent provided in advance in appropriations acts, and through the mandatory five-year report requirement.
Historical precedent
The Federal Oil and Gas Royalty Management Act and subsequent BLM regulations have long applied cost-recovery fee structures to oil, gas, and coal leasing on federal lands, providing a direct administrative analogue for this approach in the geothermal context.