[Congressional Record Volume 148, Number 34 (Thursday, March 21, 2002)]
[Extensions of Remarks]
[Pages E422-E424]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              THE ABANDONED HARDROCK MINES RECLAMATION ACT

                                 ______
                                 

                            HON. MARK UDALL

                              of colorado

                    in the house of representatives

                       Wednesday, March 20, 2002

  Mr. UDALL of Colorado. Mr. Speaker, today I am introducing the 
Abandoned Hardrock Mines Reclamation Act. This bill is designed to help 
promote the cleanup of abandoned and inactive hardrock mines that are a 
menace to the environment and public health throughout the country, but 
especially in the west.


                             The Background

  For over one hundred years, miners and prospectors have searched for 
and developed valuable ``hardrock'' minerals--gold, silver, copper, 
molybdenum, and others. Hardrock mining has played a key role in the 
history of Colorado and other states, and the resulting mineral wealth 
has been an important aspect of our economy and the development of 
essential products.
  However, as all westerners know, this history has too often been 
marked by a series of ``boom'' times followed by a ``bust'' when mines 
were no longer profitable--because ore bodies were exhausted or not 
economically recoverable with contemporary technology, or because of 
depressed mineral prices. When these busts came, too often the miners 
would abandon their workings and move on, seeking riches over the next 
mountain. The resulting legacy of unsafe open mine shafts and acid mine 
drainages can be seen throughout the country and especially on the 
western public lands where mineral development was encouraged to help 
settle our region.


                              The Problems

  The problems caused by abandoned and inactive mines are very real and 
very large--including acidic water draining from old tunnels, heavy 
metals leaching into streams killing fish and tainting water supplies, 
open vertical mine shafts, dangerous highwalls, large open pits, waste 
rock piles that are unsightly and dangerous, and hazardous dilapidated 
structures.
  And, unfortunately, many of our current environmental laws, designed 
to mitigate the impact from operating hardrock mines, are of limited 
effectiveness when applied to abandoned and inactive mines. As a 
result, many of these old mines go on polluting streams and rivers and 
potentially risking the health of people who live nearby or downstream.
  The full scope of these problems is hard to estimate because many of 
these old mines are in remote regions and because a complete inventory 
does not exist. Some states and federal agencies have done some 
inventory work, but in 1996 the General Accounting Office, after 
reviewing available data, found that many

[[Page E423]]

agencies had not done thorough surveys and those that did showed a 
range of results. For example, GAO's report showed that the U.S. Forest 
Service listed about 25,000 abandoned mine sites within its boundaries, 
while the U.S. Bureau of Mines reported 12,500 sites on Forest Service 
lands. On the other hand, the Mineral Policy Center, a private non-
profit group, has estimated that over 560,000 sites exist on public and 
private land. As a first step, my bill would provide a source of funds 
to assist states to complete inventories.
  But if we do not know exactly how big the problem is, we already know 
enough to recognize more than inventories will be needed to fully 
address it. In particular, we know that timely solutions will require 
efforts by more entities than just the federal government. We need to 
assist and encourage the states, local governments, and Indian Tribes--
as well as private groups--to join in the work of cleaning up these 
sites.


                         Obstacles To Cleanups

  However, right now there are two serious obstacles to their 
involvement.
  One obstacle is a serious lack of funds for cleaning up sites for 
which no private person or entity can be held liable. For example, the 
1996 GAO report found that the U.S. Forest Service estimated it would 
cost $4.7 billion to clean up abandoned mine sites on its lands alone--
and many other sites are on lands managed by other federal agencies.
  Another obstacle is legal. While the Clean Water Act is one of the 
most effective and important of our environmental laws, as applied it 
can mean that someone undertaking to clean up an abandoned or inactive 
mine will be exposed to the same liability that would apply to a party 
responsible for creating the site's problems in the first place. As a 
result, would-be ``good Samaritans'' understandably have been unwilling 
to volunteer their services to clean up abandoned and inactive mines. 
They have not wanted to be required to secure long-term pollution 
discharge permits and thus face long-term costs and potentially stiff 
fines and penalties.
  For example, near the Keystone ski resort in Colorado is an abandoned 
mine, named the ``Pennsylvania Mine.'' Each minute, the tunnel of this 
mine releases between 30 and 200 gallons of orange-tinted, highly 
acidic water into Peru Creek. That mountain stream flows into the Snake 
River, which in turn feeds into Dillon Reservoir in Summit County--a 
major source of drinking water for many people in our state. To reduce 
this health risk, the state, with some private and federal partners, 
began working to have the contaminants from this mine filtered out by a 
wetland and other methods. However, this effort has come to a halt--
partly because of technical problems with the cleanup method, but more 
importantly because of a recent judicial decision regarding a similar 
situation in California. In that case, the court ruled that ``good 
Samaritans''--like the parties working on the Pennsylvania Mine 
cleanup--could be held liable under the Clean Water Act for creating a 
``point-source'' discharge from a wetland and other techniques and thus 
be liable for permits, costs and penalties. Faced with that prospect, 
the Colorado volunteers abandoned the effort.
  In short, in this case the valiant and laudable efforts of volunteers 
were frustrated by the very laws that are designed to stem this type of 
pollution.
  Unless these fiscal and legal obstacles are overcome, often the only 
route to clean up abandoned mines will be to place them on the nation's 
Superfund list. Colorado has experience with that approach, so 
Coloradans know that while it can be effective it also has 
shortcomings. For one thing, just being placed on the Superfund list 
does not guarantee prompt cleanup. The site will have to get in line 
behind other listed sites and await the availability of financial 
resources.
  In addition, as many communities within or near Superfund sites know, 
listing an area on the Superfund list can create concerns about 
stigmatizing an area and potentially harming nearby property values. 
For example, that is just what is happening in the case of some 
abandoned mines above the communities of Jamestown and Ward in Boulder 
County. These sites are creating water quality concerns for these 
communities and others downstream, and the Environmental Protection 
Agency has been considering placing this old mining region on the 
Superfund list. That would mean that eventually the sites could receive 
attention and cleanup. In the meantime, however, these communities have 
to live with a potential Superfund designation and all the issues and 
concerns associated with that designation.
  We need to develop an alternative approach that will mean we are not 
left only with the options of doing nothing or creating additional 
Superfund sites--because while in some cases the Superfund approach may 
make the most sense, in many others there could be a more direct and 
effective way to remedy the problem.


                     Western Governors Want Action

  For years, the Governors of our western States have recognized the 
need for action to address this serious problem. The Western Governors' 
Association has several times adopted resolutions on the subject. The 
most recent, adopted in August of last year, was entitled ``Cleaning Up 
Abandoned Mines'' and was proposed by Governor Bill Owens of Colorado 
along with Governors Guinn of Nevada, Janklow of South Dakota, and 
Johnson of New Mexico.
  That resolution begins by pointing out that these sites are 
``responsible for threats and impairments to water quality'' throughout 
the west and also often are safety hazards. It notes that their cleanup 
is ``hampered by two issues--lack of funding and concerns about 
liability.'' And it says that Congress should ``protect a remediating 
agency from becoming legally responsible [unless they would be 
otherwise] . . . for any continuing discharges . . . after completion 
of a cleanup project'' and that ``reliable sources of funds that do not 
divert from other important Clean Water programs should be identified 
and made available for the cleanup of hardrock abandoned mines in the 
West.''
  The bill I am introducing today is based directly on those 
recommendations by the Western Governors. It addresses both the lack of 
resources and the liability risks to those doing cleanups.


                          Outline of the Bill

                      Title 1. Funds for Cleanups

  First, the lack of resources. To help fund cleanup projects, the bill 
would create a reclamation fund paid for by a modest fee applied to 
existing hardrock mining operations. The fund would be used by the 
Secretary of the Interior to assist projects to reclaim and restore 
lands and waters adversely affected by abandoned or inactive hardrock 
mines.
  A similar method already exists to fund clean up of abandoned coal 
mines. The Surface Mining Control and Reclamation Act of 1977 (SMCRA) 
provides for fees on coal production. Those fees are deposited into the 
Abandoned Mine Reclamation Fund and used to fund reclamation of sites 
that had been mined for coal and then abandoned before enactment of 
SMCRA. Similarly, my bill provides for fees on mineral production from 
producing hardrock mines.
  In developing this part of the bill, I have followed the lead of a 
1999 resolution of the Western Governors Association. That resolution 
(proposed by Governors Guinn of Nevada and Leavitt of Utah), notes that 
``While society has benefited broadly from the metal mining industry, 
problems created by some abandoned mine lands [are] a significant 
national concern . . . [and] industry can play an important role in the 
resolution of these problems through funding mechanisms'' as well as in 
other ways.
  In accord with that suggestion, the bill provides for fees that would 
apply to hardrock mines on federal lands or lands that were federal 
before issuance of a mining-law patent. The fees would be paid to the 
Secretary of the Interior and would be deposited in a new Abandoned 
Minerals Mine Reclamation Fund in the U.S. Treasury. Money in that fund 
would earn interest and would be available for reclamation of abandoned 
hardrock mines and associated sites.
  In developing the bill, I decided that a one-fee-fits-all approach 
would not be fair. Instead, the bill provides for only modest fees and 
a sliding scale based on the ability of mines to pay.

                         Mines Exempt from Fees

  To begin with, the bill would entirely exempt mines with gross 
proceeds of less than $500,000 per year. That means many--probably 
most--small operations, such as Alaskan prospectors working individual 
placer claims, will not be liable for any fees under the bill.

                          Calculation of Fees

  For more lucrative mines, fees would be based on the ratio of net 
proceeds to gross proceeds. If a mine's net proceeds were under 10% of 
gross proceeds, the fee would be 2% of the net proceeds. For mines with 
net proceeds of at least 10% but less than 18% of gross proceeds, the 
fee would be 2.5% of net proceeds. Mines where the net proceeds were at 
least 18% but less than 26% of gross proceeds would pay a fee of 3% of 
net proceeds. If the net proceeds were at least 26% but less than 34% 
of gross proceeds, the fee would be 3.5% of net proceeds. Where the net 
proceeds were at least 34% but less than 42% of gross proceeds the fee 
would be 4% of net proceeds. Mines with net proceeds equal to at least 
42% but less than 50% of gross proceeds would pay a fee of 4.5% of net 
proceeds. And mines whose net proceeds were 50% or more of the gross 
proceeds would pay a fee of 5% of the net proceeds.
  For the purpose of calculating these fees, the bill defines gross 
proceeds as the value of any extracted hardrock minerals that are sold, 
exchanged for good or services, exported

[[Page E424]]

ready for use or sale, or initially used in manufacture or service. Net 
proceeds are defined as how much of the gross proceeds remain after 
deducting the costs of mine development; mineral extraction; 
transporting minerals for smelting or similar processing; mineral 
processing; marketing and delivery to customers; maintenance and 
repairs of machinery and facilities; depreciation; insurance on mine 
facilities and equipment; insurance for employees; and royalties and 
taxes.

                         Based on Nevada Model

  This method of calculating fees is similar to that used by the State 
of Nevada, which collects similar production-based fees from mines in 
that state. However, the fees in my bill are more moderate than those 
set by the Nevada law in one important respect--Nevada imposes its 
maximum fee rate on all mines with net proceeds of $5 million or more, 
regardless of the ratio between those net proceeds and the gross 
proceeds. My bill does not do that--instead, all of its fees are based 
on the ratio. In other words, under my bill a mine with earnings (i.e., 
net proceeds) of more than $5 million per year still might pay the 
minimum fee if those earnings were less than 10% of the gross proceeds.

              Estimated Proceeds from Fees and Use of Fund

  There are not sufficient data available to say exactly how much money 
would go into the new reclamation fund each year under my bill. 
However, the United States Geological Survey does have information 
about the number of operating copper and gold mines and the State of 
Nevada has data about the money raised by their similar fee system. By 
extrapolating from those data, it is possible to estimate that the fees 
provided for in my bill would generate about $40 million annually for 
the Abandoned Minerals Mine Reclamation Fund.
  Funds in the new reclamation fund would be available for 
appropriation for grants to States to complete inventories of abandoned 
hardrock mine sites, as mentioned above. A state with sites covered by 
the bill could receive a grant of up to $2 million annually for this 
purpose. In addition, and again subject to appropriation, money from 
the new reclamation fund would be available for cleanup work at 
eligible sites.
  To be eligible, a site would have to be within a state subject to 
operation of the general mining laws that has completed its statewide 
inventory. Within those states, eligible sites would be those--(1) 
where former hardrock-mining activities had permanently ceased as of 
the date of the bill's enactment; (2) that are not on the National 
Priorities List under the Superfund law; (3) for which there are no 
identifiable owners or operators; and (4) that lack sufficient minerals 
to make further mining, remining, or reprocessing of minerals 
economically feasible. Sites designated for remedial action under the 
Uranium Mill Tailings Radiation Control Act of 1978 or subject to 
planned or ongoing response or natural resource damage action under the 
Superfund law would not be eligible for cleanup funding from the new 
reclamation fund.
  The Interior Department could use money appropriated from the fund to 
do cleanup work itself or could authorize use of the money for cleanup 
work by a holder of one of the new ``good Samaritan'' permits provided 
for in Title II of the bill.
  Among eligible sites, priorities for funding would be based on the 
presence and severity of threats to public health, safety, general 
welfare, or property from the effects of past mining and the 
improvement that cleanup work could make in restoration of degraded 
water and other resources. The first priority would be for sites where 
effects of past mining pose an extreme danger. After that, priorities 
would be sites where past mining has resulted in adverse effects (but 
not extreme danger) and then those where past mining has not led to 
equally serious consequences but where cleanup work would have a 
beneficial effect.
  Further, the bill recognizes that in Colorado and other states there 
are often concentrations of abandoned mining sites that vary in the 
severity of their threat to the public health and the environment but 
that can and should be dealt with in a comprehensive manner. Therefore, 
it provides that sites of varying priority should be dealt with at the 
same time when that is feasible and appropriate.

              Title II. Protection for ``Good Samaritans''

  Second, the threat of long-term liability. To help encourage the 
efforts of ``good Samaritans,'' the bill would create a new program 
under the Clean Water Act under which qualifying individuals and 
entities could obtain permits to conduct cleanups of abandoned or 
inactive hardrock mines. These permits would give some liability 
protection to those volunteering to clean up these sites, while also 
requiring the permit holders to meet certain standards and 
requirements.
  The bill specifies who can secure these permits, what would be 
required by way of a cleanup plan, and the extent of liability 
exposure. Notably, unlike regular Clean Water Act point-source 
(``NPDES'') permits, these new permits would not require meeting 
specific standards for specific pollutants and would not impose 
liabilities for monitoring or long-term maintenance and operations. 
These permits would terminate upon completion of cleanup, if a regular 
Clean Water Act permit is issued for the same site, or if a permit 
holder encounters unforeseen conditions beyond the holder's control.
  I think such protection would encourage more efforts to resolve 
problems like those at the Pennsylvania Mine.
  Together, these two programs could help us begin to address a problem 
that has frustrated federal and state agencies throughout the country 
and make progress in cleaning up from an unwelcome legacy of our mining 
history. The Pennsylvania Mine and the Jamestown area are but two 
examples--others can be found throughout the west. And as population 
growth continues near these old mines, more and more risks to public 
health and safety are likely to occur. We simply must begin to address 
this issue--not only to improve the environment, but also to ensure 
that our water supplies are safe and usable.

                          ____________________