Congress sees lode of flaws in mining law

Way back when Ulysses S. Grant was president and George Armstrong Custer thought he knew how to fight Indians, Congress passed a law governing the mining of gold, silver, and other hardrock minerals on federal land.

At a time when westward expansion was an important national goal, a miner – typically a Gabby Hayes figure who had his closest personal relationship with a mule – could file a claim, take virtual title to the land for as little as $2.50 an acre, and make millions (or go bust) with Uncle Sam's blessing.

The General Mining Law of 1872 still governs most aspects of hardrock mining across the West, even though miners these days are more likely to be multi-billion-dollar corporations – many of them under foreign ownership.

For many observers, the law is flawed and outdated. They say that its loose construct has been responsible for unchecked environmental damage. And, because miners don't have to pay for the valuable minerals they extract from public lands, taxpayers not only lose revenues but often have to foot the bill for environmental cleanup. Now lawmakers on Capitol Hill are touting a new bipartisan proposal, that, if adopted, promises to reform the mining law to accord with modern economic and environmental sensibilities.

The problems with the 130-year-old law are many, according to critics.

Unlike those who drill or dig for coal, oil, and gas on public land, hardrock mining companies pay no royalties to the federal government. With hardrock minerals estimated to be worth about $1.8 billion a year, even a modest royalty (coal miners pay 8 percent) would send a considerable sum to the US treasury.

And with miners now wielding giant earth-moving machines instead of pick axes – in addition to using a cyanide solution to tease out microscopic bits of gold from tons of ore – the environmental impact is considerable.

Mine waste is the largest source of toxic pollution in the country, the Environmental Protection Agency has reported, and about 40 percent of the watersheds in the US are tainted by mine waste. There are more than 500,000 abandoned mines around the country, and the cost of cleanup could total $32 billion or more, according to the Mineral Policy Center, a research and advocacy group in Washington. The largest Superfund sites in the country are former mines – many of them owned by companies that went bankrupt and left American taxpayers with the tab for cleanup.

"The mining industry has the biggest sweetheart deal in the country," says Rep. Christopher Shays (R) of Connecticut. "Mining companies are not paying royalties for minerals taken from public lands.... and they haven't had to pay the full price for environmental cleanups."

Another problem is that federal land covered by mining claims can be "patented," allowing their holders to seek other forms of lucrative development.

"Once the mining claim is patented, nothing ... says that it has to be actually mined," complains Rep. Nick Rahall (D) of West Virginia. "The land is now in private ownership. People are free to build condos or ski slopes on the land."

Reps. Rahall and Shays are cosponsors of legislation that would impose an 8 percent royalty on hardrock mining, set up a fund using royalty revenues to reclaim abandoned mines, end patenting, and require mine operators to restore disturbed areas to premining vegetation and wildlife habitat conditions.

For years, environmental groups have battled the mining industry over reclaiming public lands torn up and polluted by mining. So, too, have budget watchdogs critical of the lack of royalties.

"Mining on US public lands represents one of the greatest taxpayer heists in history," says Jill Lancelot, legislative director of Taxpayers for Common Sense, a private government spending watchdog group in Washington.

Mine law reformers were not cheered by the 2000 presidential elections. President Bush received more industry contributions than any other campaigner, and his administration includes former mining-industry lobbyist J. Steven Griles as deputy secretary of the interior. But Mr. Griles has told miners he's "wearing a new hat" now and that he must "look at [their] problems from a number of different perspectives." His boss, Interior Secretary Norton, hints that the Bush administration is open to changing the law.

"It is my belief that it is time for the mining law to be reformed and reauthorized," Ms. Norton wrote to Rep. Rahall, the senior Democrat on the House Committee on Resources. "We have an historic opportunity to resolve longstanding and contentious issues in a way that provides stability to the industry and improves our environment."

There are also indications that the mining industry – a powerful economic force across the West – could be ready for changes in the law as well.

"The mining industry supports amendments to the General Mining Law that will provide a fair return to the government on the use of federally owned lands and creation of an abandoned mine land program funded by industry dollars, among other provisions," says Jack Gerard, president of the National Mining Association, an industry trade group headquartered in Washington.

Mr. Gerard adds that this includes "compliance with the full range of federal and state environmental laws that strictly regulate mining activities – including reclamation of mining sites."

The devil will be in the details, of course. And this isn't the first attempt to change the law. But, 130 years after former president Grant signed it, the General Mining Law could well make the leap from the 19th to the 21st century.