Casper Star-Tribune from Casper, Wyoming • 17

star Wyoming Bl Sunday, September 1 8, 1 988 Star-Tribune, Casper, Wyo. Governor frustrated in efforts to protect Wyo's royalty income J- -4 I- 4 V'" A If i r. Patchwork Mms. By ANNE MacKINNON Star- Tribune staff writer CHEYENNE Gov. Mike Sullivan's office says it has been frustrated in its efforts to protect Wyoming's royalty income now threatened by a federal draft decision involving Exxon USA's LaBarge Project.

Nancy Freudenthal, the governor's lawyer for intergovernmental affairs, outlined Friday the state's efforts to protect its Exxon royalty income. The state has attempted to influence the Interior Department's decision on how many deduction to allow Exxon to take on its LaBarge production. The larger the deductions permitted, the less value remains for royalty purposes. (See main story, page A 1.) Freudenthal has said that top Interior officials from Washington late last spring soon after Exxon had filed its application for deductions assured the governor's office Wyoming would receive basic data with which to evaluate Exxon's request. By August, more state requests had been made and no data received and there were rumors of a draft decision pending.

The Denver office in charge of the decision "is extremely difficult to get information from without going over their heads to Washington," Freudenthal told Ed Boland, vice president of the Wyoming Natural Gas Pipeline Authority. When she did talk to Washington, she was again assured that the state would get data and be involved as earlier promised. Sullivan's office received the Interior Department's draft proposal on the issue just before the governor left for Yellowstone National Park to meet Interior Secretary Don Hodel and other Cabinet officials on tour there last weekend, Freudenthal said. The governor gave Hodel a memo on the results the state had expected, contrasted with the problems posed by the proposed ruling, and objecting to Interior's failure to involve the state, she said. He made the same objection in a letter to the assistant secretary in charge just before the draft decision came out.

The state's basic concerns with the ruling involve the policy the federal government has adopted, of allowing processing cost deductions to be taken against methane or natural gas, Freudenthal said. Traditionally, deductions have been allowed against by-products of processing but not against methane, the primary and usually most valuable product. The state questioned the new policy when first proposed before this year, and called for state involvement case-by-case if such deductions ever were to be granted, she said. An example of how far a precedent in this area might stretch, Freudenthal said, is another application she understands is before interior. In that case, the company involved is claiming "extraordinary costs" that should be deducted against methane for royalty purposes because it runs an ordinary gas plant in California but California required the company to install a fire station, she said.

The "extraordinary cost" a company is claiming to lower its royalties in that case is essentially "the fact of doing business in California," she commented. Many calculations, and many market and production "scenarios" have to be analyzed to estimate the policy impact of a royalty ruling made today on a project like Exxon's expected to operate for at least 50 years, Freudenthal noted. She cited an example of a hypothetical in which Exxon can sell large volumes of carbon dioxide from LaBarge that it is now venting unsold for lack of a market. Under the valuation approach proposed by Interior, in that situation Wyoming might see Exxon paying no increase in royalties even though more LaBarge production was being sold, she said. It is the basic computer runs on a variety of such scenarios that the state wants to see and has not yet seen, Freudenthal said.

She also noted that the federal calculations are based entirely on production and cost data supplied by Exxon. State auditors hope to get a look at that data to judge of its value at the meeting next week, she said. Katharine CollinsSlar-Tribune The Clover-Mist fire in Yellowstone National Park's Lamar Valley left a mosiac pattern burning some areas and missing others. Only one tree in stand of aspens was charred by the blaze. Firefighters in Yellowstone park look forward to favorable weather Prospect of losing interest funds upsets state officials ,4 mNt.

constructed, a distance firefighters could be reasonably sure the fire could not breach, he said. In addition, control implies that every hot spot inside the fire's perimeters is cold to the touch, according to Rothschadl. Crews, aided by helicopters, at the Crandall front were working on hots spots on that flared up Friday when winds picked up. Yellowstone National Park officials were "monitoring" the western front portion of Clover-Mist burning in the park from the Montana state line to Pelican Creek, he said. Since June, about $15.8 million has been spent fighting the Clover-Mist fire, according to Rathschadl.

Full containment of the Storm Creek fire was also anticipated Saturday, according to fire information officer Ron Sanow of the Area Command in West Yellowstone, Mont. Mop-up activities continued Saturday, with an unusually wide attack line stretching about 1,500 feet into the burned perimeter from Cooke City, east to Kersey Lake, Sanow said. Storm Creek fire officials Saturday also prepared to bring in a Class II fire management team. The fire, which once threatened Cooke City and Silver Gate, has burned 107,347 acres, Sanow said. About $6.5 million has been spent on fighting the blaze, he said.

Rehabilitation of fire lines in the Pebble Creek area is under way, and the Cooke City Fire Information Center closed two days ago, Sanow said. comprehensive solid waste management bill providing bonding and permitting requirements; a bill to make the current solid waste management program in the Department of Environmental Quality into 'a division, with more administrative autonomy; and a bill making Wyoming a party to an interstate agreement on transportation of radioactive materials. Low-level radioactive waste is expected to be shipped from federal defense installations to a disposal site in New Mexico across Interstate 80 in southern Wyoming. day, adding that M-K Ferguson plans to install monitoring equipment of its own to protect workers from further injuries. Collins said the emissions problem apparently stems from a malfunction of equipment inside the plant that monitors the strength of the acid being produced.

"It's kind of gone haywire," said Collins. "If the acid gets too strong, the emissions from the stack are higher." On Aug. 9, Chemical Marketing Services reported to the DEQ that a plume of sulfuric acid mist had escaped through its smokestack. Saturday night and continuing into Sunday with accumulations of 4 to 6 inches by Sunday morning. Daytime temperatures were expected to remain cool in the 40s and 50s through next Wednesday, falling below freezing at night.

"It's time to break out the sweaters," commented park spokeswoman Judy Jennings. She added that the fires, which have charred nearly 1.2 million acres of Yellowstone and the surrounding forests, did not grow Friday despite gusty winds that whipped up flames after several days of calm. Crews on Saturday planned to strengthen containment lines forged around half the North Fork fire, she said, but they also would waste no time in jumping on hot spots as they appeared. Fire managers northeastern Yellowstone, meanwhile, had a similar strategy in mind for the 4 1 1 Clover-Mist blaze, where a top level "Class fire supervision team was released Saturday morning. The team, which is trained in handling especially unruly blazes, was replaced by a Class II team.

The Clover-Mist fire has been divided into two fronts, Crandall and the North Fork of the Shoshone River, according to fire information officer Ron Rothschadl in Cody. The North Fork portion of the Clover-Mist fire is 100 percent contained as of Saturday. The Crandall portion is still considered to be 70 percent contained, Rothschadl said. Containment means that the fire is totally surrounded by fire lines, he said. When a fire is considered controlled, 1,000 feet of fire line into the burned perimeter has been Retirement board backs investment bill CHEYENNE The Wyoming Retirement System Board last week endorsed a bill to go to the 1989 Legislature that would allow the state more diversity to invest state employee pension funds, according to State Treasurer Stan Smith, a board member.

Smith said the bill would authorize retirement funds to be invested in a number of kinds of investments, including: commercial paper, bankers' acceptances and certificates of deposit; privately placed debt securities; and equity or debt interests in real estate. The bill would also increase from 35 to 40 percent the share of the total pension fund portfolio that could be held in equity investments, Smith said. It would eliminate the previous requirement that securities bought by the pension fund be rated "or better, he said. In addition the bill would authorize the retirement system to retain the services of a custodial bank for a program of securities lending which could earn the system additional income. Smith said.

UW enrollment hits all-time high LARAMIE (AP) University of Wyoming enrollment is at an all-time high, with 10,560 students attending classes. That's a 2.8 percent increase from the previous record of 10,359, set during fall 1987. This year's figures do not include 115 Casper College students taking UW-Casper courses. A major increase was seen in the non-resident new and transfer freshmen category, which rose from 346 to 492. Total non-resident new student enrollment is up 23.7 percent.

Boone Crockett win one-shot contest LANDER The 1987 One Shot Antelope championship Wyoming team was unceremoniously dumped in Saturday's 45th annual hunt as the Boone Crockett team, riding on the strength of two bagged antelopes, captured the title. The winning team edged out the Celebrity Past Shooters, the only other" three-man team, to come away from the field with two bagged antelope. The Wyoming team, led by Gov. Mike Sullivan, missed all their shots, the only team to draw a total blank. The Boone Crockett team, composed of William Spencer, William Searle, and John Poston, had an elapsed hunting time of 84 minutes, with successful shots from Spencer and Poston.

The runnerup celebrity team, composed of Dusty Rogers, son of Roy Rogers; Wilford Brimley, and Laramie's Larry Wilcox of "C.H.I.P.s" fame, had an elapsed hunting time of five hours, with Rogers and Brimley scoring. Along with Sullivan, both Doug Dowes of Casper and longtime popular One Shot guide Dick Dolenc failed in their bid to retain the title won a year ago. "I took an early shot and missed. I told them that a year ago I had been a perfect host by setting up my guest hunter and although I said I didn't want to do that again this year, I did," Sullivan said. Killsontop brothers denied new trials MILES CITY, Mont.

(AP) Judges have denied separate motions for new trials for brothers Lester and Vern Killsontop, both facing the death penalty in the kidnapping and killing of a Miles City man, the Custer County attorney said Friday. Retired Judge C.B. Sande of Billings on Friday rejected a defense motion for a new trial for Vern Killsontop; earlier in the week Judge H.R. Obert of Terry denied a similar motion entered on behalf of Lester Killsontop, according to Countv Attornev Keith Maker. Lester Killsontop, 26, was convicted on charges of deliberate homicide, aggravated kidnapping and robbery in the death of Martin Etchemendy.

In a separate trial, Vern Killsontop, 30, was convicted on the same charges. Each defendant received the death sentence. Etchemendy's badly beaten body was found in an abandoned building outside Gillette. From staff and wire reports YELLOWSTONE NATIONAL PARK A forecast for up to a half-foot of snow in Yellowstone National Park brought firefighters prospects Saturday for several days of favorable weather in which to reinforce battle lines against fires burning there for nearly three months. "This forecast is music to our ears," said Ken Dittmer, one of Yellowstone's area commanders.

But in advance of the storm came high winds, with more than 40 mph gusts in some areas. Firefighters took special measures to stop a spot fire threatening Roosevelt Lodge because of the winds. "I hope this thing decides to take a nap soon," said Capt. Ron Goet-zinger, who heads a fire engine strike team from Brainerd, Minn. "The snow should take care of it.

We sure hope so." The spot fire was fought with both water and retardant drops Saturday afternoon, as hand crews worked on fire lines. Dittmer said the storm, forecast to swing into Yellowstone sometime Saturday night, was expected to leave much of its moisture on the northern portions of the country's first national park. Fires burning in northern Yellowstone, including the troublesome North Fork blaze, have been the most active in recent days and got the least moisture of a front that passed through the park a week ago, according to the commander. "It couldn't come to a better place," he said. The forecast for Saturday and Sunday called for snow beginning Garbage bill CHEYENNE A bill setting in motion a prohibition against disposal of solid waste in Wyoming mines will come before a legislative subcommittee next week.

The bill would prohibit anyone from disposing of solid waste in an open pit mine without a solid waste disposal permit dated before June 8, 1989, according to Rep. Dennis Tippets, R-Fremont, chairman of a subcommittee on solid waste issues. Rep. Sam Blackwell, D-Sweet-water, has proposed the bill. Tippets said.

It would in effect prohibit garbage disposal in mines as soon as it is possible for laws passed in the topic of meeting in Gillette By JOAN BARRON Star-Tribune capital bureau CHEYENNE State agency and board officials are dismayed over the prospect of giving up their interest income as recommended by a government efficiency committee staff study group. State officials say they need the interest income for their operations and point out the loss would have to be made up through general fund appropriations anyway. The committee staff, headed by former Deputy State Auditor Dave Ferrari, is recommending that the Legislature divert pooled interest from 59 state agency accounts and from 28 professional licensing boards and put it into the state's general fund to make it available for general government spending. A staff report said the diversion would total $33 million for one year and $56 million over the two-year biennium. A total of $72.5 million in pooled interest is annually credited to funds outside of the general fund, the report said.

About half the interest income would be diverted from two water development accounts. Mike Purcell, director of the Wyoming Water Development Commission, pointed out the interest income of $16 million a year comprises 30 to 40 percent of the agency's total income. The agency started with a $114.6 million general fund appropriation in 1982 and receives revenue from a percentage of the severance taxes on coal, oil and gas. "To me the long term commitment to water development comes from the dedication from taxes and interest," Purcell said. "That's where the program gets credibility.

That's what allows us to plan for the future." If a diversion must be made, Purcell said he would rather see it come from the original $114.6 million appropriation than from the interest income. The committee staff is recommending diverting $2,500 in interest that now goes to various Wyoming Game and Fish Department accounts. Larry Gabriele, manager of the department's accounting section, said the interest represents 10 percent of the agency's annual operating expenses. "If it would be removed it would have a drastic effect," Gabriele said. "It goes into our total revenue picture." He pointed out the agency receives no state general fund money.

Keith Rounds, public information officer for the Wyoming Highway said the proposal to take $3.2 million of the department's interest income would further "erode badly needed highway funds." "There are more needs than we have funds to satisfy at the present time," Rounds said. The highway department is funded 68.5 percent by the state and 31.5 percent by the federal government, the committee report said. The committee staff is recommending the Legislature divert interest from the 28 professional licensing boards and also consolidate their funds into the general fund. Thomas Toft of the Board of Medical Examiners said his group needs to have money set aside to pay for costly administrative hearings on complaints against physicians. "We are expected to be tougher on physicians," Toft said.

"We've been accused of not keeping our house in order the way we should. The Board of Medical Examiners in recent years has really been making an effort t6 police themselves better than probably in the past 10 or 20 years." Toft said if a compromise is necessary, the board would rather keep control of all of the principal in the fund and give up part or all of the interest income. State Veterinarian N. R. Swan-son questioned what can be gained by diverting livestock inspection and Board of Veterinary Medicine funds.

He said the $140,000 per year interest to the livestock inspection fund is used to operate the state's brand inspection program and would have to be replaced along with the fund principal. "People wrongfully think the interest is off in a big sack," Swanson said. He pointed out Board of Veterinary Medicine funds aren't taxpayers' money but are from license renewal fees and are used to police the profession. 1989 Legislature to take effect, Tippets explained. A proposal by a Denver firm to dispose of out-of-state garbage in Hanna mines has caused considerable controversy and comment in Wyoming.

The Solid, Hazardous and Radioactive Waste Subcommittee of the Joint Mines, Business and Economic Development Committee will consider the bill in its meeting Tuesday in Gillette, Tippets said. The subcommittee will meet at 1 p.m. at the Holiday Inn in Gillette. Tippets said other issues before the subcommittee will include: a ions from their smokestack," said Collins. John E.

Jones, site manager for M-K Ferguson, the contractor on the mill tailings removal project, said two workers complaining of sore throats later were diagnosed as suffering from acid mist exposure. In addition, Jones said his company had blocked off a section of land around the Chemical Marketing Services plant "for any persons associated with this project until the problem is solved." The plant is part of the mill tailings project area, Jones said Thurs Riverton sulfuric acid emission probed RIVERTON (AP) State environmental officials are investigating sulfuric acid mist emissions that may be causing health problems for some people working on the Susquehanna uranium mill tailings removal project. Chuck Collins of the Department of Environmental Quality's Air Quality Division said the emissions apparently are coming from Chemical Marketing Services' sulfuric acid production plant south of Riverton. "The DEQ has required CMS to install ambient monitoring equipment at the site to check the emiss.