CHEYENNE - Gov. Dave Freudenthal recommends that Wyoming spend the first round of money it stands to receive from the federal Abandoned Mine Lands program on research into clean coal technology and to build a road to a planned coal plant in Carbon County.

Freudenthal presented his recommendations Monday to the Joint Appropriations Committee. Some legislators said they want to consider other possible ways to spend the money than those the governor proposed.

Freudenthal emphasized that he wants the Legislature to guard against using the $580 million that Wyoming stands to receive in federal cleanup funds over the next seven years as just another pot of money to support general government operations.

"If we initially say we're going to use this for a lot of non-energy related funding, the truth is, it will be gone," Freudenthal said.

Wyoming will get the first $82.7 million payment from the federal AML program this year. The program uses taxes on coal production to clean up abandoned mine sites and related pollution.

Freudenthal said Wyoming will need just over $30 million in the fiscal year that starts in July for coal reclamation projects in the state.

Of the remaining $52.5 million, Freudenthal recommended that the state set aside $20 million for a joint research project into coal gasification. The project would be conducted at the School of Energy Resources at the University of Wyoming with General Electric Co.

Freudenthal said he doesn't expect details of the project to be worked out by the end of the legislative budget session that begins next month.

Freudenthal recommended spending $17.4 million to fund the School of Energy Resources. He said that would cover the school's entire operating budget.

Another $10 million should go to build a road to a planned $2 billion coal-to-liquids plant that DKRW Advanced Fuels plans to build in Carbon County, Freudenthal said.

The Wyoming Industrial Siting Council recently approved a permit to construct the plant. Freudenthal said company officials say they are still working on plant financing, but intend to proceed with construction.

Officials with DKRW Advanced Fuels have said they will hire up to 2,300 workers during the peak period of construction from 2011-2012.

Freudenthal said building the road to the plant is a good investment for the state. "This isn't your basic dirt-track county road," he said. "There's going to be a huge amount of heavy equipment going in and out."

Some legislators questioned whether the AML money should be used for other projects.

Rep. Frank Philp, R-Shoshoni, is co-chairman of the Joint Appropriations Committee. He questioned whether Freudenthal considered recommending that AML money be used to fund pending water projects in Gillette, a city which has experienced fast growth in the energy boom.

Freudenthal responded that he believes construction of a large water project in the Gillette area won't occur for a few years.

Committee Chairman Sen. Phil Nicholas, R-Laramie, said he believes the Legislature should fund projects that are certain to proceed in the coming year.

If the DKRW project isn't built on schedule, Nicholas said, the federal government will wind up sitting on the money and pocketing the interest. He said the state needs to set up a funding formula so the state can get the federal money right away and then receive the interest payments itself.

As the federal law stands now, Wyoming and other states must apply for the federal dollars from the AML program, which will be distributed through a line of credit.

Members of Congress from Wyoming and elsewhere are pushing legislation to allow the money to be transferred directly to the states, instead of parceled out in grants that require the states to submit applications.

While Nicholas said Freudenthal did a good job of coming up with a list of projects that could be funded with the AML money, he said, "I do think we ought to give some consideration of whether there are some other projects that we could be equally proud of."