Copyright 1999 Federal News Service, Inc.
Federal News Service
AUGUST 3, 1999, TUESDAY
SECTION: IN THE NEWS
LENGTH:
5821 words
HEADLINE: PREPARED TESTIMONY OF
STEPHEN
D'ESPOSITO
PRESIDENT
MINERAL POLICY CENTER
BEFORE THE
HOUSE COMMITTEE ON RESOURCES
SUBCOMMITTEE ON ENERGY AMD
MINERAL RESOURCES
SUBJECT - "MINING REGULATORY ISSUES
AND IMPROVING THE
GENERAL MINING LAWS"
BODY:
INTRODUCTION
Chairman Cubin, members of the Subcommittee. Good afternoon. My name is
Stephen D'Esposito--I am president of Mineral Policy Center. Thank you for
inviting Mineral Policy Center to testify before this subcommittee on the urgent
need for comprehensive environmental reform of the 1872 Mining Law.
Mineral
Policy Center (MPC) is an environmental organization dedicated to protecting the
environment and communities from the adverse impacts of mineral development, and
cleaning up pollution from past mining. Our national office, based in Washington
D.C., provides support to citizens across the country and around the world. Our
field offices in Colorado and Montana assist communities throughout the western
United States concerned about the impact of mineral development in their
backyards.
MPC has more than 3,000 members. Hundreds of community groups and
organizations support our efforts to reform the 1872 Mining Law and improve
public policy and industry practices related to mining.
MPC believes that
responsible mining can and does occur on our public lands.
Mineral Policy
Center Supports Responsible Mining Polices and Practices Mineral Policy Center
supports responsible mining policies and practices: responsible mining policies
that give taxpayers a fair return for valuable land and mineral assets, and that
eliminate government subsidies to mine on public lands; responsible mining
policies that require mining companies meet adequate environmental protection
standards; and responsible mining policies that recognize that on some public
lands there are resources, and other uses, that may be more valuable than
mining, including the protection of environmentally significant areas.
Currently, federal law does not offer adequate environmental or taxpayer
protections.
Mineral Policy Center recognizes that some mining companies
seek to operate in a manner that protects our environment. But the 1872 Mining
Law is actually a disincentive for responsible industry action. The 1872 Mining
Law sends the wrong signal to mining companies. It rewards irresponsible
behavior. Until it is reformed it will serve as a haven for bad actors and fail
to reward those who act responsibly.
Those who most vociferously oppose
environmental reform of the 1872 Mining Law, may be those companies who do not
believe they are poised to operate successfully in an environment that mandates
and rewards environmental performance.
Successful mining law reform will
balance the interest of mining companies with those of taxpayers, citizens who
seek to protect land and water resources, and future generations who will
benefit from well managed public lands.127 YEARS LATER, ITS TIME FOR MINING LAW
REFORM
One hundred and twenty-seven years is too long. It is time to reform
the 1872 Mining Law. Written to encourage the development of the mining
industry, and the settlement of the western United States, the mining law is a
relic of a bygone era - a time when mining was a pick- and-shovel affair, when
men moved on horses and in covered wagons.1 The mining law's roots may also have
a humanitarian origin, to deter violence that resulted from claim jumping.2 One
hundred and twenty- seven years after its passage, its original purposes
accomplished, it is time for reform.
Today, the prospector's pan has given
way to giant earth-moving machines that cam literally crumble mountains and dig
pits the size of small towns. Panning for gold nuggets has given way to the use
of potentially lethal chemicals such as cyanide that leach microscopic flecks of
ore from massive piles of pulverized rock. Today's prospectors are
multi-national corporations and their mine sites occupy thousands of acres of
our public land.
While there are technical and engineering solutions to many
of the environmental problems that mining can cause, technical solutions are
only part of the answer. They will not be enough to fully address the broader
environmental, economic, social, and cultural issues that this subcommittee, and
all members of Congress, must grapple with. Reforming the mining law is not,
after all, just a matter of a technical fix. It is one thing to design a safe
and efficient mine, it is quite another to design public policy that results in
good decisions about the use of public land and resources. Good public policy
must provide a basis for weighing environmental, social, economic, and cultural
issues, as well as technical issues.
MILLSITE CLAIMS AND THE 1872 MINING LAW
With the enforcement of the millsite limit of the 1872 Mining Law, it
appears that we may have a new ally in the fight for mining law reform, the
mining industry.
Organizations Representing Millions of Members Support the
Millsite Decision MPC believes the millsite opinion, effectively enforcing
limits on mine waste dumping on public land, is based upon an
accurate reading of the 1872 Mining Law. While it is widely accepted that the
Mining Law's millsite restriction does not meet the needs of some of today's
mining operations, neither does this antiquated law meet the needs of taxpayers,
communities near many of today's mines, or the environmental health of our
public lands. The massive waste piles produced at many of today's mines have
outgrown the mining law.
However, the solution to this problem is not to
create a special exemption from the part of the mining law that some in the
industry find troublesome. The solution is comprehensive reform that will
balance the needs of the industry, taxpayers and the environment. We should
engage in a public debate about reforming all of the mining law, not just the
part that the mining industry does not like.
In a March 23, 1999, letter to
Secretary of the Interior Bruce Babbitt and Forest Service Chief Michael
Dombeck, Mineral Policy Center, Friends of the Earth, Natural Resources Defense
Council, Sierra Club, The Wilderness Society, U.S. Public Interest Research
Group, Okanogan Highlands Alliance, Western Organization of Resource Councils,
and Grassroots Environmental Effectiveness Network (GREEN) petitioned the
government to reject the Plan of Operations for the Crown Jewel Mine because it
was over the millsite claims limit. To quote from the letter: hi this case, the
federal land agencies must determine whether to approve a mining plan that is
proposed on public lands that do not contain valid mining and millsite claims
under the 1872 Mining Law. A number of other proposed open pit gold mines on
federal land face similar issues. The most pressing examples include the
Imperial Project m southern California and the Yarnell Mine adjacent to the town
of Yarnell, Arizona.
Thus, your decisions at Crown Jewel will have
ramifications across the West.
On March 25, 1999, the U.S. Departments of
the Interior (DOI) and Agriculture (DOA) released a joint decision stating that
they were "unable to approve the proposed Plan of Operations" for the Crown
Jewel Mine in the State of Washington.3 The plan for this large open- pit,
cyanide-leach gold mine was rejected because it did not comply with the
requirement of the 1872 Mining Law that limits claimants to one 5-acre millsite
claim for each mining claim.
The March 25, 1999 decision references the
November 7, 1997, Solicitor's Opinion entitled "Limitations on Patenting
Millsites Under the Mining Law of 1872." This 1997 opinion reviews the millsite
limit in detail. The conclusion is unequivocal: "the plain language of the
mining law indicates that only one 5-acre millsite claim per mining claim may be
patented."4
Before the March 25th decision, mining companies were sometimes
permitted, albeit illegally, more than one 5-acre millsite claim per mining
claim. Although the Bureau of Land Management (BLM) and U.S. Forest Service
(USFS) have permitted multiple millsite claims in some instances, they had no
legal basis under the mining law, or under regulations, for such approvals.
The Solicitor's Opinion notes that the current BLM's Handbook for Mineral
Examiners may be the source of the problem. It provides for the granting of
multiple millsite claims per mining claim. However, as the Solicitor makes
clear, "no authority is cited for these statements." While this explains why
some BLM field staff may have approved plans of operations that were over the
millsite limit, it does not change the fact that the limit exists in the Mining
Law.This is Not Just About Land Use The recent millsite ruling addresses a
fundamental environmental problem--today's mines are dramatically larger and
produce more waste than the pick-and-shovel operations that the mining law was
written to govern. Management of this waste presents a significant public policy
challenge since waste from mines often pollutes surface and groundwater
resources with acid mine drainage and heavy metals such as arsenic. The Mining
Law does not address these environmental concerns directly. To the extent that
it deals with them at all, it addresses them through the millsite limit. This de
facto environmental safeguard should not simply be jettisoned, it should remain
in place until the Mining Law is reformed to include such protections by design.
History Supports the Millsite Decision There is ample evidence that
Congress, DOI, and many in the mining industry understood the strict millsite
limit contained in the Mining Law. Prior to 1960, the Mining Law allowed
millsite claims only in connection with vein or lode claims, not with placer
claims. In 1960, Congress explicitly amended the mining law to permit the
location of millsites in connection with placer claims.5 The legislative history
of the amendment makes it clear that Congress and DOI understood both the
millsite limits in the existing statute and the amendment, which permitted only
one five-acre millsite claim in connection with a placer claim. The amendment
was passed and signed only after input from the DOI caused Congress to remove
language that would have permitted millsites "for each individual claimant" and
allowed for a larger millsite claim of "10 acres for each individual claimant."6
The amendment was changed as requested by DOI, which sought to have the millsite
limit for placer claims match that of lode claims. The report language was
explicit:
(T)he word "ten" was stricken and the word "five" inserted in lieu
thereof The purpose of this amendment is to restrict the area of a millsite in
conjunction with a placer claim to 5 acres of land to make it conform with the
allowable millsite acreage for lode claims which has been the statutory
requirement since 1872... IT)he words 'for each individual claimant" were
stricken so as to impose a limit of one 5-acre millsite limit in any individual
case preventing the location of a series of 5-acre millsites in cases where a
single claim is jointly owned by several persons ....
In essence, S.2033
merely grants to holders of placer claims the same rights to locate a 5 acre
millsite as has been the case since 1872 in respect to holders of lode claims,
and the committee unanimously urges enactment.7
In 1968, the leading mining
industry trade association (the American Mining Congress, the predecessor of
today's National Mining Association), in a statement submitted to the Public
Land Law Review Commission, acknowledged that the law permits only one millsite
claim per mining claim. "When the mining law was enacted in 1872, provision was
made for the acquisition of five-acre millsites to be used for plant facilities
on mining claims. The typical mine then was a high- grade lode or vein deposit
from which ores were removed by underground mining. The surface plant was
usually relatively small, and acquisition of five-acre millsites in addition to
the surface mining claims ... adequately served the needs of mines ... Today,
the situation is frequently different ... A mine having 500 acres of mining
claims may, for example, require 5,000 acres for surface plant facilities and
waste disposal areas. It is obvious that such activities may not be acquired
through five-acre millsites." 8 (emphasis added) In 1974 in United States v.
Swanson, 14 IBLA 158 the Interior Board of Land Appeals stated that: (,4)
claimant is entitled to receive only that amount of land needed for his mining
and milling operations, and this amount can embrace a tract of less than five
acres. The statute states that the location shall not "exceed five acres. "...
The reference to five acres in the statute is clearly a ceiling measure, not an
absolute, automatic grant.
In 1979, the Congressional Office of Technology
Assessment confirmed this interpretation of the mining law's millsite provision.
There could be as many millsites as there are mining claims, and each millsite
would be at most one-fourth the size of the typical 20 acre claim, so that
millsites, in the aggregate, would be one-fourth the size of the ore body
encompassed by the claims.
The Impacts of Enforcing the Millsite Opinion
Will this be the end of mining on public lands.'? No, there are mining methods,
such as underground mining, that do not necessarily require such vast amounts of
space for processing and waste dumping. It is also important to remember that
open-pit mining takes place on non- federal lands. In those instances, mining
companies successfully assemble the necessary lands through acquisition, leases,
or by purchasing mineral rights. As the Solicitor's Opinion made clear, mining
companies can seek to acquire necessary millsite acreage through land exchanges
and special use permits. Both methods do require the company to meet additional
hurdles and land managers could exercise discretion to prevent "unnecessary" or
"undue" degradation of public lands. But these are not unreasonable conditions.
The decision may have an impact on marginal, low-grade deposits. But there
is no reason why federal policy should be used to subsidize the mining of such
deposits on public lands. In fact, it should be the government's policy to
create a level playing field for all mining companies--whether the land is owned
by the federal government, the state, or private citizens.
We do not expect
open-pit mining to end on public lands as a result of this opinion, nor would we
expect, does DOI or the Forest Service.
The Millsite Liould be Enforced
Until the Mining Law is Reformed We do not think that the law should be
effectively amended, and weakened, to suit the needs of a number of mining
companies or even an entire industry. We should not look at this problem from
the wrong side. The underlying problem is not the millsite limit. The millsite
limit is a symptom. The problem is the outdated 1872 Mining Law. It does not fit
today's mining industry, it does not protect taxpayers, and it does not protect
the environment. Let's fix the underlying problem, not just treat the symptom.
Some believe that our reading of the millsite limit under the 1872 Mining
Law is legally flawed. We disagree. But for those who hold this view there is an
obvious remedy and it is not this subcommittee or the Congress. It is the
courts. Some believe there is an urgent need to address this issue because of
concerns about retroactivity. We do not think a rush to judgement on these
important issues should be driven by such concerns, and we do not believe this
issue should be applied retroactively. If necessary, we would support a
resolution or amendment specifying that there would be no retroactive
application of this issue to currently operating mines. Our objective is not to
penalize mining companies that may have benefited from the incorrect application
of the Mining Law by either DOI or the Forest Service. Our objective is that
this provision now be applied.
WHAT'S WRONG WITH THE 1872 MINING LAW
The 1872 Mining Law allows for public land giveaways and taxpayer subsidies
to the mining industry. And it fails to protect our environment and our public
lands. Of course, those who crafted the mining law in 1872 could not envision
the potential environmental impacts of modern mining. The environmental legacy
of this outdated law is all too clear. A 1989 report from the U.S. General
Accounting Office found that the Mining Law "runs counter to other national
natural resource policies and legislation."9 The GAO found that the mining law
"no longer promotes mineral development" and can result in "needless damage" to
public lands. 10
Let's Cleanup Our Nation's Abandoned Mines Estimates of
abandoned mines, range from at least 200,000 to over 500,000, scattered across
the country. The abandoned mine problem should serve as a wake-up call. Cleanup
costs could be as high as $72 billion.11
We should immediately implement a
national program to clean up the hundreds of thousands of unreclaimed and
abandoned mine sites. MPC estimates that there are 557,000 abandoned mine sites
nationwide, with an estimated cleanup cost of $32 to $72 billion. The Western
Governors Association has identified abandoned mine sites in 10 states in need
of priority cleanup. In Alaska, the abandoned Treadwall Mine is pockmarked with
vertical shafts, open portals and pits, and a dangerous highwall 500 feet tall.
Because the site is adjacent to the cities of Juneau and Douglas it receives
extensive use by the public. Washington state residents are struggling with a
toxic legacy at the Holden Mine where acid mine drainage from waste rock and 18
million tons of tailings have rendered 12 miles of nearby river biologically
dead. In Utah, the abandoned Temple Mountain site is home to 300 open uranium
mines with moderate to high radionuclides. 12 Californians are still living with
the festering Iron Mountain Mine, which is predicted to continue leaching acid
for at least 3,000 years. And that is just to name a few.
Reclamation of
sites like these would restore valuable lands, eliminate public safety and
health threats, and create up to 10,000 jobs.13 The question is not whether it
should be done, but how it should be funded. Potential sources of funding
include a mineral royalty, rental fees, and through other sources such as a
reclamation fee. Establishment of this fund should not be delayed.
We Should
Permanently End $2.50 An-Acre Public Lands Giveaways Although an annual
moratorium is in place, the 1872 Mining Law allows public land giveaways at the
bargain-basement rate of $2.50 or $5.00. This was a bargain in 1872, today it's
a steal. Patenting is not necessary to mine on public lands.
According to
the Department of Interior, during the Mining Law's first 120 years, 315 million
ounces of gold, 5.5 billion ounces of silver, 79.5 million tons of copper, 19.2
million tons of lead, and 13.9 million tons of zinc were mined in 13 western
states. In 1994 we estimated the value of these minerals at more than $231
billion. That's just the minerals under the land, it doesn't take into account
the value of the land.
Taxpayers Deserve a Fair Royalty When a mining
company mines on public land, they do not pay a royalty. When they mine on
private or state land, mining companies pay a royalty that can range from 5% to
18%. What is the justification for not requiring a royalty for mining on public
lands? There is none. The coal, oil and gas industries pay a fee when they mine
on federal lands. Why not the hardrock mining industry?
Consider these
excerpts from the testimony of Dr. W. Thomas Goerold, a noted minerals economist
to the Senate Energy and Natural Resources Committee, Subcommittee on Mineral
Resource Development and Production, on September 13, 1990:
"Current
domestic hardrock mineral producers sometimes claim that paying for federal
minerals would be so burdensome that it would force a significant portion of
them out of business. A cursory examination of the evidence does not support
these claims. Producers of leasable minerals found on federal lands have paid
royalties and land rentals since 1920 and no one questions the health of these
industries. Moreover, miners of hardrock minerals have a long history of
routinely paying royalties and rental payments when these same minerals are
found on state or private lands."
"Hardrock mineral miners maintain that
there is still a fundamental difference between hardrock minerals production and
other businesses, as well as between hardrock minerals firms and other mineral
producers that pay land rental and royalty fees to the Federal Government for
use of publicly owned resources. Contrary to industry claims, these purported
distinctions do not justify the privileged treatment accorded producers of
hardrock minerals. The Office of Technology Assessment supports this view. The
OTA believes that the distinctions between leasable (generally energy and
chemical minerals requiring government permission and payment of lease and
royalty fees) and locatable minerals are more artificial than real."
Do
hardrock miners on federal lands have more importance than automobile
manufacturers, retail store owners, or any other business not eligible for
similar government subsidies? Are hardrock miller producing minerals from
federal lands more important than these same producers mining state or private
lands?
One argument advanced by mining interests against the imposition of
royalties for federal hardrock minerals is that the Federal Government already
taxes the profits of these companies. This is a misleading argument--most
non-mineral businesses do not obtain the inputs to their firms from the federal
government at no cost, yet virtually all pay a federal income tax. Royalty and
rental free mineral operations are analogous to a gift of steel and rubber to
automobile manufacturers, or free office rental to an accounting firm, courtesy
of the U.S. Government.14
There are also federal land parcels in Minnesota,
Missouri and Illinois where miners pay royalties for extraction of hardrock
minerals. And even on federal lands, mining companies are willing to pay
royalties, to other mining companies but not to the taxpayer. 15 In October
1993, Newmont Mining Corporation leased 1872 Mining Law claims on BLM Land at
Grassy Mountain in Oregon from the Atlas Corporation. Newmont paid a $22.5
million cash bonus and a $5 net smelter royalty production.
A net smelter
royalty of between 8% and 12.5% should be enacted. The proceeds from this
royalty should be used to fund abandoned mine cleanup.
We Should Let Mining
Compete With Other Land Uses 127 years ago it may have been possible to make a
case that mining deserved preferential treatment on public land, over all other
uses. Today there is no social or economic good that justifies this preferential
treatment. There are public lands that deserve protection, and there are public
lands that are more suitable for other economic or recreational purposes.
Land managers should have the authority and discretion to protect
environmentally significant public lands, weigh other land uses, and deny
permits for poorly planned mines. A mining permit application must clearly
demonstrate, before mining begins, how the mining and reclamation project will
occur so as to minimize environmental impacts. Land managers must have the
authority to deny mining permits in environmentally fragile areas, or critical
wildlife habitats and areas otherwise found to be unsuitable for mining.
We
Should Protect Our Pub Lands and Environment Environmental safeguards must
protect water resources and prevent significant long-term environmental damage.
It is worth noting that a 1987 study by the EPA rated problems related to mining
waste as second only to global warming and stratospheric ozone depletion in
terms of ecological risk. The report concludes "with high certainty" that the
release to the environment of mining waste "can result in profound, generally
irreversible destruction of ecosystems." In a 1985 report the EPA stated that
mining for hardrock minerals, asbestos, and phosphate alone generates 1 to 2
billion metric tons of waste each year, and that "perhaps 56% of the waste
generated could be considered potentially hazardous to human health or the
environment." Mining has polluted 12,000 miles of rivers and streams and 180,000
acres of lakes. 16
Environmental safeguards should include provisions for
water protection, full cleanup and reclamation, environmental operating
standards, enforcement requirements, and guarantees that the mining company will
pay for full closure and cleanup. We are all familiar with the Summitville
nightmare.
In 1992, the Summitville Consolidated Mining Company declared
bankruptcy and walked away from its environmentally disastrous cyanide,
heap-leach gold mine in the San Juan Mountains of southern Colorado. Taxpayers,
meanwhile, have been left with a devastated landscape and an enormous cleanup
bill. So far the State and EPA have spent $130 million dollars to reclaim and
restore the site, and expect to spend another $45 million dollars before the job
is done.17 With a reclamation bond of $4.7 million/18, taxpayer liability
equates to approximately $170.3 million. This is today's problem because the
taxpayer bill is still mounting.
The Public Should Participate in Mining
Decision on Public Lands The public must have the right to fully participate in
mine decisions on public lands. This includes access to information, the right
to comment on permit and regulatory actions, the right to petition the
government to designate an area unsuitable for mining, the right to file citizen
complaints, the right to accompany an inspector to a site, and citizen suit
provisions to compel enforcement. The public must have the right to fully
participate in mine decisions on public lands.
ZORTMAN-LANDUSKY, A REFORM
CASE STUDY
The Zortman-Landusky Mine (ZL) is a prime example of why the 1872
Mining Law needs urgent reform The Zortman-Landusky mines is located on BLM
managed lands in the Little Rocky Mountains of Montana. It is the home of the
Assiniboine and Gros Ventre Tribes of Fort Bellalap who have a strong cultural
and spiritual connection with the Little Rockies. In fact, Spirit Mountain,
where the mine site is located was considered a sacred site.
This was a
large-scale open-pit cyanide heap leach gold mine. It was the largest gold mine
in Montana and it mined the lowest grade ore in the United States. It caused
more land disturbance per amount of gold extracted than any other gold mine in
the U.S. During typical operations, more than 55 tons of ore are processed to
yield a single ounce of gold.
During its operation, Zortman-Landusky
experienced a litany of cyanide solution leaks and spills, stability failures,
surface and groundwater contamination, bird and wildlife fatalities, and other
problems. Streams emanating from the mine area, including water flowing onto the
reservation, were seriously polluted with acid and heavy metals. The mine
experienced numerous cyanide spills. There have been severe problems with acid
streams and fish kills. Following a major spill, cyanide appeared in domestic
drinking water in a mine worker's housing unit south of the mine.
The mine
was operated by Pegasus Gold Incorporated. Responsibility for the mine's
troubled track record rests not only with Pegasus Gold, but the 1872 Mining Law
and weak environmental safeguards.
Things got worse when the stock of
Pegasus plunged in late 1997 due to the falling price of gold and legal
troubles. Pegasus declared chapter 11 bankruptcy on January 16, 1998.
Today
in the state of Montana, government officials estimate that this recently
abandoned open-pit cyanide heap-leach gold mine could cost state taxpayers $8
million in cleanup costs. )9 An independent mining engineer has estimated that
the cleanup bill to taxpayers could be an additional $90 million. It is
estimated that Pegasus produced $360 million worth of gold at the mine and
returned $0 to the taxpayer. And it is likely that the taxpayer will get stuck
with a substantial cleanup bill.
During the bankruptcy proceedings, the
company outraged both state officials and the public when it sought to pay
executives a bonus of $5 million, just as state officials revealed that
taxpayers could get hit with a cleanup bill of $8 million. And in June the
company appointed by the state to handle reclamation, was fired because it had
already spent its entire annual budget in just six months.
There has been a
history of problems like this with cyanide process gold mines in Montana. As a
result, in 1998, Montana voters passed a ban on all new cyanide process mines.
NOW IS THE TIME FOR COMPREHENSIVE MINING LAW REFORM
It has been six
years since the last significant attempt was made to reform the mining law.
There is too much at stake on our public lands, in our Western communities, for
American taxpayers, and for the mining industry, to delay further.
Over the
years, a number of bills have been introduced under the reform label that are
actually not true reform bills because they fail to adequately address the
fundamental environmental and fiscal shortcomings of the mining law. These bills
typically contain miniscule royalties and wide loopholes for escaping royalty
payment, fail to address important environmental protection issues, and do not
allow land managers to weigh other uses of public lands. One telltale sign of a
sham reform bill is the use of a "net proceeds"royalty. The "net proceeds"
royalty allows companies to deduct so many costs before paying a royalty that
the taxpayer ends up with almost nothing.
Some will argue that now is not
the time to reform the mining law because mining companies are already suffering
as a result of today's low mineral prices. But mineral prices have, and always
will, fluctuate. It is in the public's interest to take action that will
stimulate other commercial and non-commercial uses of our public lands,
including preservation. And it is in our best interest to pursue environmental
objectives that will lead to job creation in mining communities or former mining
communities, such as abandoned mine cleanup. Taxpayers deserve a fair royalty
and our public lands deserve environmental safeguards, whatever the price of
metals happens to be.
Policies that provide public subsidies to mining
companies create an incentive for inefficient mine operations on public lands,
perhaps in places that are best used for other purposes. These subsidies lead to
an unfair economic advantage for some companies and may result in inefficiencies
and over-supply. The net impact of such policies is to make mining more
attractive on federal lands than on other lands. "The Federal government, by
forgiving this normal mineral business cost, has distorted the distribution of
economic activity, discouraging mining on private, state, and tribal land and
encouraging it on Federal land."20 Continuation of this policy is not in the
country's economic interest.
It is time to put an end to the subsidies and
favors that mining companies receive on public lands. The net results of 1872
Mining Law reform will be healthier communities and healthier ecosystems, jobs
creation, and, we believe, a healthier mining industry.21
A mining industry
that is rewarded for its environmental performance, and penalized for its
environmental mistakes, will be a healthier industry, both in the United States
and around the world. It is in the interest of this subcommittee to create
incentives for better environmental performance on our public lands. Improved
environmental performance will increase the competitiveness, marketability, and
performance of U.S. mining companies.
The United States economy has
developed to the point that mineral development no longer needs preferential
treatment on our public lands. The way we manage and use our public lands today
will have an impact on the landscape and opportunities we pass on to future
generations. The federal government has a duty to manage those lands in a manner
that is in the public interest, not in the short-term interest of a particular
industry. Is it wise to allow management of our public lands to be governed by a
19th century law that no longer reflects, and in fact, runs contrary to popular
opinion? Sixty-seven percent of all Americans say no.22
To summarize, we
recommend that Congress permanently end public lands giveaways to mining
companies, impose a fair royalty for mining on public lands, create an abandoned
mine cleanup program, and end the policy of giving mining companies first-use of
our public lands. Thank you."...
After eight years in this office, I have
come to the conclusion that the most important piece of unfinished business on
the nation's resource agenda is the complete replacement of the Mining Law of
1872."
Stewart L. Udall, Secretary of the Interior, 15 January 1969
FOOTNOTES:
1 Federal Land Management: The Mining Law of 1872 Needs
Revision, GAO Report/RCED-89-72, March 1989, 2.
2 Multiple Conflicts Over
Multiple Uses, Reform of the 1872 Mining Law: A Primer, John L. Dobra, ed. Terry
L. Anderson, Political Economy Research Center, 1994, 39.
3 The "Crown Jewel
Aline Decision, "U.S. Department of the Interior, Solicitor John Leshy, Mar. 25,
1999.
4 Limitations on Patenting Millsites Under the Mining Law of 1872,
U.S. Department of the Interior, Solicitor John Leshy, Nov. 7, 1997.
5 Pub.
L. No. 86-390, 74 Stat. 7 (1960), codified at 30 U.S.C. sec. 42 (b) (1994).
6 The original bill was introduced in 1959 as S.2033. 105 Cong. Rec. 8734
(1959).
7 S Rep. No. 904, 86* Cong., 1st Sess., at 2.
8 American Mining
Congress, The Mining Law and Public Lands, at 29, Jan. 11, 1968.
9 Federal
Land Management: The Mining Law of 1872 Needs Revision, GAO Report/RCED-89-72,
Mar. 1989, 3.
10 Ibid
11 Mineral Policy Center estimates. See MPC
methodology in Mineral Policy Center, Burden of Gilt, June 1993, 28-31.
12
Abandoned Hardrock and Noncoal Mines in the West, Draft, Western Governor's
Association, March 24, 1998. 13 Burden of Gilt, Mineral Policy Center, June
1993, 3.
14 Dr. W. Thomas Goerold, Testimony before the Senate Subcommittee
on Mineral Development and Production, Sept. 13, 1990.
15 Ibid
16 U.S.
Environmental Protection Agency, Fish Kills Caused by Pollution, Fifteen Year
Summary 1961-1975, Apr. 1978, 8.
17 Gold mine cleanup progresses, The Denver
Post, June 16, 1999.
18 Summitville Consolidated Mining Company
Inc./Galactic Resources Inc./Galactic Resources Ltd., Summitville Mine Site,
State of Colorado, Division of Minerals and Geology, Feb. 1, 1993.
19 Mining
company sues state over cleanup plans, Great Falls Tribune, Sept. 3, 1998.
20 American Mining Congress, The Mining Law and Public Lands, at 29, Jan.
11, 1968
21 Mineral Policy Center, Thomas Michael Power, Not All That
Glitters, 1993.
22 Findings from a National Bipartisan Survey of Voter
Attitudes Toward Mining Law Reform, Prepared for MPC et al by
Frederic,/Schneiders Inc., September 1994.
END
LOAD-DATE: August 5, 1999
