[Congressional Record (Bound Edition), Volume 146 (2000), Part 8]
[Extensions of Remarks]
[Page 10617]
[From the U.S. Government Publishing Office, www.gpo.gov]



                     REFORM OF THE 1872 MINING LAW

                                 ______
                                 

                         HON. JOSEPH M. HOEFFEL

                            of pennsylvania

                    in the house of representatives

                         Tuesday, June 13, 2000

  Mr. HOEFFEL. Mr. Speaker, last week the Budget Committee held a 
hearing on my legislation H.R. 3221, the Corporate Welfare Commission 
Act. The Committee heard testimony from several witnesses including 
members of Congress about the most egregious examples of unnecessary 
and wasteful subsidies to industry. While members of Congress have 
mixed feelings about many of the items other members consider corporate 
welfare, there is virtual unanimity in the belief that the 1872 Mining 
Law needs reform.
  The 1872 Mining Law was enacted to promote mineral exploration and 
development on federal lands in the western United States and to 
encourage settlers to move west. This law granted free access to 
individuals and corporations to prospect for minerals on public lands. 
Once a discovery was made, they were allowed to stake a claim on the 
deposit.
  The law works this way:
  Once the prospector does some exploration work on public land, he may 
stake a claim on an area that he believes to contain a valuable 
mineral. The price of holding such a claim is $100 per claim per year.
  If the prospector spends at least $500 on development work on the 
parcel and the claimed mineral deposit is determined to be economically 
recoverable, the claim holder may file a patent application for the 
title to surface and mineral rights.
  If the application is approved, the claimant may purchase surface and 
mineral rights for between $2.50 and $5.00 an acre. These amounts have 
not been adjusted since 1872.
  There is no limit on the number of claims a person can locate, nor is 
there a requirement that mineral production ever commence.
  And as if this policy were not bad enough, the 1872 Mining Law lets 
mining companies extract the minerals without paying a royalty. This is 
unlike all other resources taken from public lands. For example, oil, 
gas and coal industries operating on the public lands pay a 12.5 
percent royalty on gross income of the operation. On tribal lands, the 
average royalty paid for copper was 13 percent. In the private sector, 
gold royalties range from 5 to 18 percent.
  As an unnecessary subsidy, this policy should have been reformed long 
ago. But the harm of this policy does not end with wasteful government 
support for the mining industry. Once the land has been exploited, the 
environmental damage is the additional price that taxpayers are forced 
to pay. Over the past century, irresponsible mining operators have 
devastated over half a million acres of land through carelessness and 
abandoned mines. According to the EPA, waste from mining operations has 
polluted more than 12,000 miles of our nations waterways and 180,000 
acres of lakes and reservoirs.
  My amendment to the FY 2001 Interior Appropriations Bill, which was 
rejected by the Rules Committee, would impose a 5 percent royalty on 
all hard rock minerals mined from public lands. The funds generated 
from the royalty would be devoted entirely to environmental cleanup of 
these mining sites. The amendment would also make the current one year 
moratorium on the issuance of mining patents permanent (the current 
moratorium has been extended each year over the past five years).
  Mr. Speaker, this policy is in need of repair and reform. I am 
disappointed that the Rules Committee did not allow for House 
consideration of my amendment. I will continue to work with my 
colleagues to reform this outdated and wasteful policy.

                          ____________________