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State Land Office projects record non‑royalty revenue and seeks staff to manage growth

Legislative Finance Committee (subcommittee A) · October 14, 2025

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Summary

Deputy commissioner told the committee the Land Office expects about $559 million in non-royalty earnings this year from lease sales and asked for a 6% operating increase (~$1.8M) including three FTE to expand forestry, economic development and petroleum engineering capacity to manage projects and revenue streams.

Deputy Commissioner Sunilay Stewart told the subcommittee that the State Land Office has experienced record revenue from lease activity and projects non-royalty earnings of roughly $559 million for the fiscal year. The office is funded from those earnings rather than the general fund and requested a ~6% increase in its operating budget (about $1.8M) to add three positions: a forester to manage 9 million acres and prescribed-burn/thinning work, a manager for economic development to support housing and other projects, and a petroleum engineer to manage commingling and technical oil-and-gas issues.

Stewart said the Land Office has a low vacancy rate (~6%) and is emphasizing implementing Deloitte/SPO pay parity adjustments; about $1.5M of the requested increase is targeted at salaries and benefits to retain staff and fund parity adjustments. Committee members — led by Vice Chair Munoz and Rep. Dixon — urged the office to present a clearer analysis tying additional FTE to additional revenue generation and suggested a return visit with a requested FTE-by-revenue assessment.

Oil-and-gas division director Allison Marks told members the oil-and-gas team is busy and probably could double staffing to match current workload; members directed LFC and the Land Office to assess how additional engineering and permitting capacity could increase revenue capture.

The committee did not vote; members asked for a follow-up analysis that links staffing additions to potential revenue returns and more detailed justification for the comp-and-benefit elements baked into the FY27 ask.