Mining Reform Update: Senator Bingaman introduces Hardrock Mining and Reclamation Act of 2009
By Sally Smith, Director of Responsible Mining
For the first time in over a decade, the Senate seems to be moving forward with reform of one of the most archaic policies governing our public lands. Our own Senator Jeff Bingaman, Chairman of the Senate Energy and Natural Resources Committee (ENRC) introduced this past April S. 796, the Hardrock Mining and Reclamation Act of 2009, to regulate the mining of hardrock minerals, such as gold, copper and uranium. This bill if passed as written could create jobs and provide economic opportunities for rural communities while cleaning up a massive legacy of toxic mining pollution.
This bill has the potential to build on the money allocated by the most recent stimulus package to clean up abandoned mines by creating a dedicated fund to facilitate clean up of the estimated half a million abandoned mines littered throughout the West. This money would provide jobs in places where it is needed most, rural communities, like ours, that are victims of mining’s ‘boom-bust’ cycle. This clean up would be funded through three fees: a royalty on new hardrock mines permitted on federal lands — similar to what all other extractive industries have paid for decades, a fee for lands used in mining operations, and a reclamation fee on all hardrock mining. The reclamation fee alone could create an estimated 55,000 new jobs over the next ten years for rural western communities.
Senator Bingaman has said his goal is to reform and modernize the law, but to do so in a manner that would allow our domestic mining industry to continue to provide jobs and produce minerals important to our nation. “The mining industry plays an important role in our part of the country. It fuels local economies. And it contributes to our national security. At the same time, the industry has been criticized on both fiscal and environmental grounds. The Hardrock Mining and Reclamation Act of 2009 will make responsible changes to this outmoded law,” Bingaman said in a press release.
Currently, the Mining Law of 1872 allows billions of dollars of hardrock minerals to be mined from Federal lands without payment of a royalty. General land management and environmental laws apply, but there are no specific statutory provisions under the Mining Law setting surface management or environmental standards.
Efforts to comprehensively reform the Mining Law have been ongoing for decades, but results have been elusive. Political considerations, such as 2010 challenges to Senator Harry Reid’s seat, could affect the timing of this Bill. Hearings of the ENRC began in July of this year on two bills, S. 796 and S. 140, introduced by Senator Feinstein. Senator Bingaman said he looks forward to working with Senator Feinstein on this issue. The House passed HR2262, the Hardrock Mining and Reclamation Act of 2007, in November of 2008 (See GetAGRIP, Winter 2008). The House and Senate versions would need to go to conference committee to work out differences before final approval.
Senate Bill 796 proposes the following:
Eliminates Patenting: The bill eliminates patenting of Federal lands, but grandfathers patent applications filed and meeting all requirements by September 30, 1994.
Fees: Makes modest increases in the annual claim maintenance fee (from $125 to $150) and claim location fee (from $30 to $50). Requires a fee in exchange for the use of Federal land that is included within the mine permit area. The fees collected are to be used for the administration of hardrock mining on federal lands. Any excess funds are deposited into the Hardrock Minerals Reclamation Fund.
Royalties: Locatable minerals are subject to a royalty to be determined by the Interior Secretary by regulation of not less than 2 percent and not more than 5 percent of the value of production, not including reasonable transportation, beneficiation and processing costs. The royalty may vary based on the particular mineral concerned. No royalty will be collected from lands under permit that are producing in commercial quantities on the date of enactment. Royalty revenues will be deposited into the Hardrock Minerals Reclamation Fund. Royalty reductions may be granted for all or part of a mining operation where the person conducting the mineral activities shows by clear and convincing evidence that without the reduction, production would not occur.
Permits and Financial Assurances: Permits are required for all mineral activities on Federal land except for “casual use” that ordinarily results in no, or negligible, disturbance. Mining permits are for a term of 30 years and so long thereafter as production occurs in commercial quantities. The operator must provide evidence of approved financial assurances sufficient to ensure completion of reclamation if performed by the Secretary concerned.
Water Reclamation: Financial assurances attributable to the cost of water treatment will not be released until the discharge has ceased for at least 5 years or the operator has met all applicable water quality standards for at least 5 years. The operator may be required to establish a trust fund or other long-term funding mechanism to provide financial assurances for long-term treatment of water or other long-term post-mining maintenance or monitoring requirements.
Operation and Reclamation : The Secretary of Agriculture must take any action necessary to prevent unnecessary or undue degradation in administering mineral activities on National Forest System land. The bill directs the Secretaries of the Interior and Agriculture to jointly issue regulations. Land Open to Location: Requires within three years a review of certain lands to determine whether they will be available for future mining claim location. The governor of a state, chairman of an Indian tribe, or appropriate local official may petition the Interior Secretary to undertake a review of an area.
Hardrock Minerals Reclamation Program: Establishes a program for the reclamation of abandoned hardrock mines in 14 western states. Creates a Hardrock Minerals Reclamation Fund from hardrock royalties, fees, and donations. Each operator of a hardrock mining operation on Federal, state, tribal or private land must pay a reclamation fee established by the Secretary of not less than 0.3 percent, and not more than 1.0 percent, of the value of the production of the hardrock minerals for deposit into the Fund. The bill provides grant programs for all states for hardrock reclamation projects and for public entities and nonprofit organizations for collaborative restoration projects to improve fish and wildlife habitat affected by past hardrock mining.