California is a land ripe with many natural resources which result in some of its land being leased out for the sole purpose of harvesting these resources. Some land may be leased from private individuals or corporations while other land may involve leases with the federal government. When the federal government is involved, it may end up paying the state of California royalties.
The amount of money paid by the federal government to the state for leases involving the extraction of natural gas and oil has been the subject of legal action and political policy over the past couple of years. As reported by Courthouse News Service, effective January 2017, the federal government was supposed to increase the amount of money it paid to states for these royalties per an order dated July 2016.