Sunday, April 5, 2009

1872 Mining Law to Get with the Times

Measure would revamp 1872 mining law

By SUE MAJOR HOLMES Associated Press Writer

U.S. Sen. Jeff Bingaman says there's no justification for continuing hard-rock mining on public land under a law passed well over a century ago.

Bingaman, D-N.M., has introduced a measure that would set royalties on hard-rock mining on federal lands for the first time, establish a fund to reclaim abandoned hard-rock mines and eliminate patenting — which has conveyed title to mining companies to develop mines on public land for as little as $2.50 an acre. Congress has passed annual moratoriums on further mineral patent applications since October 1994.

Mining for metals such as gold, silver and copper currently is governed by a law passed in 1872 after the California gold rush, when Congress was trying to encourage settlement by offering free minerals and land to those willing to go West and mine.

"We don't have that for coal, we don't have that for oil and gas," said Bingaman, chairman of the Senate Energy and Natural Resources Committee.

The 137-year-old law needs reform, particularly in light of today's economy and the health, safety and environmental issues raised by mining and abandoned mines, he said Friday.

"We need to keep a healthy mining industry, but there's no way to justify continuing to operate under this law. ... There's some general agreement about that. The question is can we get agreement on the right set of changes," he said.

For decades, both Republicans and Democrats have introduced bills to change the mining law, but Bingaman said none has passed the Senate in the 27 years he's been in Washington.

In 1995, then-Interior Secretary Bruce Babbitt highlighted the law by rolling out a large Christmas-wrapped box with "$2.9 billion" stamped on the side when mining rights estimated to be worth that much were turned over to a private company for $1,745.

Bingaman's proposal calls for royalties, to be determined by the interior secretary, of between 2 percent and 5 percent of the value of the mine's production. The amount is comparable to what Canada, several Canadian provinces and several states, including New Mexico, charge in royalties, he said.

Royalties could be reduced for all or part of a mining operation if the mining company shows clear and convincing evidence that production would not occur without a reduction. Royalties would not be collected on land producing in commercial quantities at the time the law is enacted.

The revenue would go into a reclamation fund.

Mineral activities on federal land also would require a permit and financial assurance for reclamation.

The National Mining Association said it supports an update of the mining law.

"We believe that would help provide some greater level of predictability on where federal mining legislation is going to be," said Carol Raulston, spokeswoman for the agency.

She said the association will look at the proposed royalties "in light of the new economic environment."

Past efforts to reform the law have run into problems because of the gap between House and Senate proposals, particularly in the area of royalties, Raulston said.

In recent sessions, the House has proposed 8 percent royalties, which Raulston said would be the highest government royalties in the world. She said that would harm the competitiveness of the American industry, "since all these commodities are sold on the world market and the price is set on the world market."

Jeremy Vesbach, executive director of the New Mexico Wildlife Federation, said Bingaman's measure is a big step forward.

"This will bring us more into the modern age of mining, similar to oil and gas, where they lease the land but not own it," he said.

Royalties would mean some money to restore land and water as well, Vesbach said.

The proposal also addresses reclamation, establishing a program to reclaim abandoned hard-rock mines in 14 western states, partly funded by a fee based on the value of production.

Raulston said the Washington, D.C.-based mining association was pleased by the cleanup provisions.

The measure would set up a grant program for states for reclamation projects and for public entities and nonprofit organizations for collaborative restoration projects to improve fish and wildlife habitat affected by past hard-rock mining.

State Mining and Minerals Director Bill Brancard said his agency appreciates the effort to fund cleanup.

"New Mexico's long history of mining has left a legacy of thousands of abandoned mine features that pose a threat to public health and safety," Brancard said in a statement.

The bill also directs the secretaries of interior and agriculture to work together to prevent "undue degradation" in administering mining activities on national forests.


How about a royalty tax on the breeding of domestic equines?

The equine industry in the USA has a long history of over-production resulting in so many "unwanted" horses they pose a threat to public health and safety, cause an undue burden on equine rescues and devalues the worth of the American horse in general. Therefore, the breeding of equines should be subject to a tax of some kind, in hopes to compel less, but better, breeding.


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