[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1830 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 1830

To provide for claim maintenance fees and royalties on hardrock mining 
                    claims, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              June 6, 1997

  Ms. Furse introduced the following bill; which was referred to the 
                         Committee on Resources

_______________________________________________________________________

                                 A BILL


 
To provide for claim maintenance fees and royalties on hardrock mining 
                    claims, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. DEFINITIONS.

    (a) Definitions.--As used in this Act:
            (1) The term ``locatable mineral'' means any mineral not 
        subject to disposition under any of the following:
                    (A) the Mineral Leasing Act (30 U.S.C. 181 and 
                following);
                    (B) the Geothermal Steam Act of 1970 (30 U.S.C. 100 
                and following);
                    (C) the Act of July 31, 1947, commonly known as the 
                Materials Act of 1947 (30 U.S.C. 601 and following); or
                    (D) the Mineral Leasing for Acquired Lands Act (30 
                U.S.C. 351 and following).
            (2) The term ``mineral activities'' means any activity for, 
        related to or incidental to mineral exploration, mining, 
        beneficiation and processing activities for any locatable 
        mineral, including access. When used with respect to this 
        term--
                    (A) The term ``exploration'' means those techniques 
                employed to locate the presence of a locatable mineral 
                deposit and to establish its nature, position, size, 
                shape, grade and value.
                    (B) The term ``mining'' means the processes 
                employed for the extraction of a locatable mineral from 
                the earth.
                    (C) The term ``beneficiation'' means the crushing 
                and grinding of locatable mineral ore and such 
                processes as are employed to free the mineral from 
                other constituents, including but not necessarily 
                limited to, physical and chemical separation 
                techniques.
                    (D) The term ``processing'' means processes 
                downstream of beneficiation employed to prepare 
                locatable mineral ore into the final marketable 
                product, including but not limited to, smelting and 
                electrolytic refining.
            (3) The term ``mining claim'' means a claim for the 
        purposes of mineral activities.
            (4) The term ``Secretary'' means, unless otherwise provided 
        in this Act, the Secretary of the Interior acting through the 
        Director of the Minerals Management Service.

SEC. 2. MINING CLAIM MAINTENANCE REQUIREMENTS.

    (a) In General.--The holder of each mining claim located on lands 
open to location shall pay to the Secretary an annual claim maintenance 
fee of $100 per claim per calendar year.
    (b) Time of Payment.--The claim maintenance fee payable pursuant to 
subsection (a) for any year shall be paid on or before August 31 of 
each year, except that for the initial calendar year in which the 
location is made, the locator shall pay the initial claim maintenance 
fee at the time the location notice is recorded with the Bureau of Land 
Management.
    (c) Oil Shale Claims Subject to Claim Maintenance Fees Under Energy 
Policy Act of 1992.--This section shall not apply to any oil shale 
claims for which a fee is required to be paid under section 2511(e)(2) 
of the Energy Policy Act of 1992 (106 Stat. 3111; 30 U.S.C. 242).
    (d) Claim Maintenance Fees Payable Under 1993 Act.--The claim 
maintenance fees payable under this section for any period with respect 
to any claim shall be reduced by the amount of the claim maintenance 
fees paid under section 10101 of the Omnibus Budget Reconciliation Act 
of 1993 with respect to that claim and with respect to the same period.
    (e) Waiver.--(1) The claim maintenance fee required under this 
section may be waived for a claim holder who certifies in writing to 
the Secretary that on the date the payment was due, the claim holder 
and all related parties held not more than 10 mining claims on lands 
open to location. Such certification shall be made on or before the 
date on which payment is due.
    (2) For purposes of paragraph (1), with respect to any claim 
holder, the term ``related party'' means each of the following:
            (A) The spouse and dependent children (as defined in 
        section 152 of the Internal Revenue Code of 1986), of the claim 
        holder.
            (B) Any affiliate of the claim holder.
    (f) Co-ownership.--Upon the failure of any one or more of several 
co-owners to contribute such co-owner or owners' portion of the fee 
under this section, any co-owner who has paid such fee may, after the 
payment due date, give the delinquent co-owner or owners notice of such 
failure in writing (or by publication in the newspaper nearest the 
claim for at least once a week for at least 90 days). If at the 
expiration of 90 days after such notice in writing or by publication, 
any delinquent co-owner fails or refuses to contribute his portion, his 
interest in the claim shall become the property of the co-owners who 
have paid the required fee.

SEC. 3. ROYALTY.

    (a) Reservation of Royalty.--Production of all locatable minerals 
from any mining claim located under the general mining laws, or mineral 
concentrates or products derived from locatable minerals from any 
mining claim located under the general mining laws, as the case may be, 
shall be subject to a royalty of 8 percent of the gross income from 
such production. The claimholder and any operator to whom the 
claimholder has assigned the obligation to make royalty payments under 
the claim and any person who controls such claimholder or operator 
shall be jointly and severally liable for payment of such royalties.
    (b) Duties of Claim Holders, Operators, and Transporters.--(1) A 
person--
            (A) who is required to make any royalty payment under this 
        section shall make such payments to the United States at such 
        times and in such manner as the Secretary may by rule 
        prescribe; and
            (B) shall notify the Secretary, in the time and manner as 
        may be specified by the Secretary, of any assignment that such 
        person may have made of the obligation to make any royalty or 
        other payment under a mining claim.
    (2) Any person paying royalties under this section shall file a 
written instrument, together with the first royalty payment, affirming 
that such person is liable to the Secretary for making proper payments 
for all amounts due for all time periods for which such person has a 
payment responsibility. Such liability for the period referred to in 
the preceding sentence shall include any and all additional amounts 
billed by the Secretary and determined to be due by final agency or 
judicial action. Any person liable for royalty payments under this 
section who assigns any payment obligation shall remain jointly and 
severally liable for all royalty payments due for the claim for the 
period.
    (3) A person conducting mineral activities shall--
            (A) develop and comply with the site security provisions in 
        operations permit designed to protect from theft the locatable 
        minerals, concentrates or products derived therefrom which are 
        produced or stored on a mining claim, and such provisions shall 
        conform with such minimum standards as the Secretary may 
        prescribe by rule, taking into account the variety of 
        circumstances on mining claims; and
            (B) not later than the 5th business day after production 
        begins anywhere on a mining claim, or production resumes after 
        more than 90 days after production was suspended, notify the 
        Secretary, in the manner prescribed by the Secretary, of the 
        date on which such production has begun or resumed.
    (4) The Secretary may by rule require any person engaged in 
transporting a locatable mineral, concentrate, or product derived 
therefrom to carry on his or her person, in his or her vehicle, or in 
his or her immediate control, documentation showing, at a minimum, the 
amount, origin, and intended destination of the locatable mineral, 
concentrate, or product derived therefrom in such circumstances as the 
Secretary determines is appropriate.
    (c) Recordkeeping and Reporting Requirements.--(1) A claim holder, 
operator, or other person directly involved in developing, producing, 
processing, transporting, purchasing, or selling locatable minerals, 
concentrates, or products derived therefrom, subject to this Act, 
through the point of royalty computation shall establish and maintain 
any records, make any reports, and provide any information that the 
Secretary may reasonably require for the purposes of implementing this 
section or determining compliance with rules or orders under this 
section. Such records shall include, but not be limited to, periodic 
reports, records, documents, and other data. Such reports may also 
include, but not be limited to, pertinent technical and financial data 
relating to the quantity, quality, composition volume, weight, and 
assay of all minerals extracted from the mining claim. Upon the request 
of any officer or employee duly designated by the Secretary or any 
State conducting an audit or investigation pursuant to this section, 
the appropriate records, reports, or information which may be required 
by this section shall be made available for inspection and duplication 
by such officer or employee or State.
    (2) Records required by the Secretary under this section shall be 
maintained for 6 years after cessation of all mining activity at the 
claim concerned unless the Secretary notifies the operator that he or 
she has initiated an audit or investigation involving such records and 
that such records must be maintained for a longer period. In any case 
when an audit or investigation is underway, records shall be maintained 
until the Secretary releases the operator of the obligation to maintain 
such records.
    (d) Audits.--The Secretary is authorized to conduct such audits of 
all claim holders, operators, transporters, purchasers, processors, or 
other persons directly or indirectly involved in the production or 
sales of minerals covered by this Act, as the Secretary deems necessary 
for the purposes of ensuring compliance with the requirements of this 
section. For purposes of performing such audits, the Secretary shall, 
at reasonable times and upon request, have access to, and may copy, all 
books, papers and other documents that relate to compliance with any 
provision of this section by any person.
    (e) Cooperative Agreements.--(1) The Secretary is authorized to 
enter into cooperative agreements with the Secretary of Agriculture to 
share information concerning the royalty management of locatable 
minerals, concentrates, or products derived therefrom, to carry out 
inspection, auditing, investigation, or enforcement (not including the 
collection of royalties, civil or criminal penalties, or other 
payments) activities under this section in cooperation with the 
Secretary, and to carry out any other activity described in this 
section.
    (2) Except as provided in paragraph (4)(A) of this subsection 
(relating to trade secrets), and pursuant to a cooperative agreement, 
the Secretary of Agriculture shall, upon request, have access to all 
royalty accounting information in the possession of the Secretary 
respecting the production, removal, or sale of locatable minerals, 
concentrates, or products derived therefrom from claims on lands open 
to location under the general mining laws.
    (3) Trade secrets, proprietary, and other confidential information 
shall be made available by the Secretary pursuant to a cooperative 
agreement under this subsection to the Secretary of Agriculture upon 
request only if--
            (A) the Secretary of Agriculture consents in writing to 
        restrict the dissemination of the information to those who are 
        directly involved in an audit or investigation under this 
        section and who have a need to know;
            (B) the Secretary of Agriculture accepts liability for 
        wrongful disclosure; and
            (C) the Secretary of Agriculture demonstrates that such 
        information is essential to the conduct of an audit or 
        investigation under this subsection.
    (f) Interest and Substantial Underreporting Assessments.--(1) In 
the case of mining claims where royalty payments are not received by 
the Secretary on the date that such payments are due, the Secretary 
shall charge interest on such under payments at the same interest rate 
as is applicable under section 6621(a)(2) of the Internal Revenue Code 
of 1986. In the case of an underpayment, interest shall be computed and 
charged only on the amount of the deficiency and not on the total 
amount.
    (2) If there is any underreporting of royalty owed on production 
from a claim for any production month by any person liable for royalty 
payments under this section, the Secretary may assess a penalty of 10 
percent of the amount of that underreporting.
    (3) If there is a substantial underreporting of royalty owed on 
production from a claim for any production month by any person 
responsible for paying the royalty, the Secretary may assess an 
additional penalty of 10 percent of the amount of that underreporting.
    (4) For the purposes of this subsection, the term 
``underreporting'' means the difference between the royalty on the 
value of the production which should have been reported and the royalty 
on the value of the production which was reported, if the value which 
should have been reported is greater than the value which was reported. 
An underreporting constitutes a ``substantial underreporting'' if such 
difference exceeds 10 percent of the royalty on the value of production 
which should have been reported.
    (5) The Secretary shall not impose the assessment provided in 
paragraphs (2) or (3) of this subsection if the person liable for 
royalty payments under this section corrects the underreporting before 
the date such person receives notice from the Secretary that an 
underreporting may have occurred, or before 90 days after the date of 
the enactment of this section, whichever is later.
    (6) The Secretary shall waive any portion of an assessment under 
paragraph (2) or (3) of this subsection attributable to that portion of 
the underreporting for which the person responsible for paying the 
royalty demonstrates that--
            (A) such person had written authorization from the 
        Secretary to report royalty on the value of the production on 
        basis on which it was reported, or
            (B) such person had substantial authority for reporting 
        royalty on the value of the production on the basis on which it 
        was reported, or
            (C) such person previously had notified the Secretary, in 
        such manner as the Secretary may by rule prescribe, of relevant 
        reasons or facts affecting the royalty treatment of specific 
        production which led to the underreporting, or
            (D) such person meets any other exception which the 
        Secretary may, by rule, establish.
    (7) All penalties collected under this subsection shall be 
deposited in the Treasury.
    (g) Expanded Royalty Obligations.--Each person liable for royalty 
payments under this section shall be jointly and severally liable for 
royalty on all locatable minerals, concentrates, or products derived 
therefrom lost or wasted from a mining claim located or converted under 
this section when such loss or waste is due to negligence on the part 
of any person or due to the failure to comply with any rule, 
regulation, or order issued under this section.
    (h) Exception.--No royalty shall be payable under subsection (a) 
with respect to minerals processed at a facility by the same person or 
entity which extracted the minerals if an urban development action 
grant has been made under section 119 of the Housing and Community 
Development Act of 1974 with respect to any portion of such facility.
    (i) Disbursement of Revenues.--The receipts from royalties 
collected under this section with respect to any mining claim shall be 
disbursed in the same manner as provided in section 35 of the Mineral 
Leasing Act (30 U.S.C. 181 and following).
    (j) Effective Date.--The royalty under this section shall take 
effect with respect to the production of locatable minerals after the 
enactment of this Act, but any royalty payments attributable to 
production during the first 12 calendar months after the enactment of 
this Act shall be payable at the expiration of such 12-month period.

SEC. 4. PURCHASING POWER ADJUSTMENT.

    The Secretary shall adjust all dollar amounts established in this 
Act for changes in the purchasing power of the dollar every 10 years 
following the date of enactment of this Act, employing the Consumer 
Price Index for all-urban consumers published by the Department of 
Labor as the basis for adjustment, and rounding according to the 
adjustment process of conditions of the Federal Civil Penalties 
Inflation Adjustment Act of 1990 (104 Stat. 890).

SEC. 5. SAVINGS CLAUSE.

    Nothing in this Act shall be construed as repealing or modifying 
any Federal law, regulation, order or land use plan, in effect prior to 
the effective date of this Act, that prohibits or restricts the 
application of the general mining laws, including such laws that 
provide for special management criteria for operations under the 
general mining laws as in effect prior to the effective date of this 
Act, to the extent such laws provide environmental protection greater 
than required under this Act.

SEC. 6. EFFECTIVE DATE.

    This Act shall take effect on the date 1 year after the date of 
enactment of this Act.
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