LegiStorm

Summary:

Mining of hardrock minerals on federal lands is governed primarily by the General Mining Law of 1872. The law grants free access to individuals and corporations to prospect for minerals in public domain lands, and allows them, upon making a discovery, to stake (or "locate") a claim on that deposit. A claim gives the holder the right to develop the minerals and may be "patented" to convey full title to the claimant. A continuing issue is whether this law should be reformed, and if so, how to balance mineral development with competing land uses. The right to enter the public domain and freely prospect for and develop minerals is the feature of the claim-patent system that draws the most vigorous support from the mining industry. Critics consider the claim-patent system a giveaway of publicly owned resources because of the small amounts paid to maintain a claim and to obtain a patent. Congress, however, has imposed a moratorium on mining claim patents through the annual Interior spending bill since FY1995. The lack of direct statutory authority for environmental protection under the Mining Law of 1872 is another major issue that has spurred reform proposals. Many Mining Law supporters contend that other current laws provide adequate environmental protection. Critics, however, argue that these general environmental requirements are not adequate to assure reclamation of mined areas. Broad-based legislation to reform the General Mining Law of 1872, the Hardrock Mining and Reclamation Act of 2009 (H.R. 699), was introduced on January 21, 2009. The bill would establish an Abandoned Locatable Minerals Mine Reclamation Fund, a Locatable Minerals Community Impact Assistance Fund, and an 8% royalty on "net smelter returns" from new mines or mine expansions and a 4% "net smelter return" royalty on existing mines. New reclamation standards would be established, and a reclamation bond or other financial guarantee would be required before operation permits are approved. A hearing was held on H.R. 699 by the Committee on Natural Resources' Subcommittee on Energy and Minerals on February 26, 2009. A broad-based Senate bill (S. 796) similar to House bill, H.R. 699, was introduced on April 2, 2009. A royalty rate (on the value of production) of not less than 2% or more than 5% would apply to mining claims that are not yet in commercial production or those with an approved operations plan. Royalty revenues would be deposited into a newly established Hardrock Minerals Reclamation Fund. An abandoned mine land reclamation fee would also be assessed on each mine operator and deposited into the Reclamation Fund. The Federal Land Policy and Management Act would be amended to include a complete "review of land" not later than three years after enactment of this legislation and the National Academy of Sciences would conduct a study of uranium development on federal land and would issue its findings and recommendations to the Secretary of the Interior and Secretary of Agriculture within 18 months after enactment of the legislation. A Senate bill, S. 140, was introduced January 6, 2009 (Abandoned Mine Reclamation Act of 2008) that would address cleaning up abandoned hardrock mines throughout the United States by establishing an Abandoned Mine Cleanup Fund and imposing various fees on hardrock mining operations on federal land. The Senate Committee on Energy and Natural Resources held a hearing on July 14, 2009, on S. 796 and S. 140. Witnesses presented testimony on royalty regimes for hardrock minerals on public lands, environmental permitting, and public land withdrawals, among other issues.