[Senate Report 113-147]
[From the U.S. Government Publishing Office]
Calendar No. 353
113th Congress Report
SENATE
2d Session 113-147
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THREE KIDS MINE REMEDIATION
AND RECLAMATION ACT
_______
April 8, 2014.--Ordered to be printed
_______
Ms. Landrieu, from the Committee on Energy and Natural
Resources, submitted the following
R E P O R T
[To accompany H.R. 697]
The Committee on Energy and Natural Resources, to which was
referred the Act (H.R. 697) to provide for the conveyance of
certain Federal land in Clark County, Nevada, for the
environmental remediation and reclamation of the Three Kids
Mine Project Site, and for other purposes, having considered
the same, reports favorably thereon without amendment and
recommends that the Act do pass.
PURPOSE
The purpose of H.R. 697 is to provide for the conveyance of
certain Federal land in Clark County, Nevada, for the
environmental remediation and reclamation of the Three Kids
Mine Project Site.
BACKGROUND AND NEED
The Three Kids Mine site is a 1,262-acre abandoned
manganese mine and mill site located in Henderson, Nevada. The
mine operated from 1917 until 1961, and was originally
developed during World War I for steel production for U.S.
military use. At one time the Three Kids Mine was the largest
manganese mine in Nevada. It was effectively abandoned in 1961,
but did continue to serve as a storage site for U.S. manganese
reserves until 2003. Approximately 314 acres of private land
and 948 acres of land managed by the Bureau of Land Management
(BLM) and the Bureau of Reclamation (BOR) comprise the site.
The site is a public health and safety hazard, with three
massive open mine pits, ruins from the milling facility, and
toxic manganese tailings containing arsenic, lead, and diesel
fuel. Because of the complicated pattern of land ownership and
the large cost of cleaning up the site, the Federal government
has been unable to initiate remediation and reclamation of the
Three Kids Mine site.
H.R. 697 would address this situation by requiring the
Federal government to convey its portions of the site to the
Henderson Redevelopment Agency for fair market value, after
taking into consideration the costs of clean-up for the entire
site. Upon conveyance, the United States would be released from
liability for the contamination at the site. Conveyance of the
land is contingent on the Secretary of the Interior receiving
notification from the State of Nevada that a mine remediation
and reclamation agreement has been executed by the State and
the party to undertake the remediation and reclamation,
including financial assurances to ensure completion of the
remediation and reclamation. The legislation anticipates that a
private developer will finance and complete the remediation of
the site, subject to an agreement administered by the State of
Nevada.
LEGISLATIVE HISTORY
H.R. 697, sponsored by Representative Heck, passed the
House of Representatives by voice vote on July 22, 2013.
Senators Reid and Heller introduced similar legislation, S.
343, on February 14, 2013. The Subcommittee on Public Lands,
Forests, and Mining held a hearing on S. 343 on July 30, 2013
(S. Hrg. 113-85). The Committee on Energy and Natural Resources
ordered H.R. 697 favorably reported at its business meeting on
November 21, 2013.
In the 112th Congress, Senators Reid and Heller introduced
similar legislation, S. 1492, on August 2, 2011. The
Subcommittee on Public Lands and Forests held a hearing on S.
1492 on March 22, 2012 (S. Hrg. 112-642).
COMMITTEE RECOMMENDATION
The Senate Committee on Energy and Natural Resources, in
open business session on November 21, 2013, by a voice vote of
a quorum present, recommended that the Senate pass H.R. 697.
SECTION-BY-SECTION ANALYSIS
Section 1 provides the short title, ``Three Kids Mine
Remediation and Reclamation Act.''
Section 2 provides key terms used in the bill and provides
the location and scope of the Three Kids Mine Project Site.
Section 3 (a) authorizes the Secretary of the Interior to
convey all right, title, and interest of the approximately 948
acres at the Three Kids Mine Project Site that are held by the
United States government to the Henderson Redevelopment Agency.
Subsection (b) sets the conditions of the conveyance
between the U.S. government and the Henderson Redevelopment
Agency.
Paragraph (1) requires the Henderson Redevelopment Agency
to pay fair market value for the Federal land and requires the
BLM to determine this value by appraising the land and then
reducing the appraised value by a reasonable estimate of
remediation costs. Remediation costs are expected to exceed the
appraised fair market value.
Paragraph (2) requires the Secretary to receive
notification that the State of Nevada has entered into an
agreement with a private entity, and that agreement obligates
the entity to complete the remediation and reclamation work
necessary at the Three Kids Mine Project Site.
Paragraph (3) establishes a 90-day window, after the State
of Nevada enters into its remediation agreement, for the
Henderson Redevelopment Agency to notify the Secretary of the
Interior that it is prepared to accept the conveyance of the
Federal land.
Section 4 withdraws the Federal land from mining, leasing,
and disposal upon the date of enactment of the Act.
Section 5 adjusts the boundary of the River Mountains Area
of Critical Environmental Concern to exclude the Three Kids
Mine Project Site.
Section 6 preserves the responsibilities for the
remediation of the Three Kids Mine Project Site with the
Secretary of the Interior--upon conveyance, and authorizes the
Secretary of the Interior to enforce the remediation agreement
between the State of Nevada and its contractor.
Section 7 excludes the conveyance of the Federal land at
the Three Kids Mine Project Site from the revenue distribution
and sale procedures required under the Southern Nevada Public
Land Management Act.
COST AND BUDGETARY CONSIDERATIONS
The following estimate of costs of this measure has been
provided by the Congressional Budget Office:
H.R. 697--Three Kids Mine Remediation and Reclamation Act
H.R. 697 would require the Bureau of Land Management (BLM)
to sell 950 acres of federal land, some of which are
contaminated by hazardous waste, to the city of Henderson,
Nevada. Under the act, the agency would determine the sale
price by estimating the fair market value of the land and
reducing that amount by the estimated cost of any necessary
environmental remediation and mining reclamation activities at
the site. The city of Henderson would be responsible for those
costs following the sale. Based on information from BLM, CBO
estimates that implementing the legislation would have no
significant impact on the federal budget. Enacting H.R. 697
would not affect direct spending or revenues; therefore, pay-
as-you-go procedures do not apply.
Roughly 15 percent of the lands that would be sold under
the act are contaminated and will require mine reclamation and
environmental remediation. Based on information provided by BLM
and the city of Henderson, CBO estimates that the agency is
unlikely to receive any financial compensation for any of the
land because remediation and reclamation costs would exceed the
land's fair market value. Because CBO expects that the affected
lands would not generate any receipts under current law over
the next 10 years, we estimate that conveying the lands under
the act would have no significant impact on the federal budget.
H.R. 697 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would not affect the budgets of state, local, or tribal
governments.
On June 20, 2013, CBO transmitted a cost estimate for H.R.
697 as ordered reported by the House Committee on Natural
Resources on June 12, 2013. The two versions of the legislation
are similar, and the CBO cost estimates are the same.
The CBO staff contact for this estimate is Jeff LaFave. The
estimate was approved by Theresa Gullo, Deputy Assistant
Director for Budget Analysis.
REGULATORY IMPACT EVALUATION
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee makes the following
evaluation of the regulatory impact which would be incurred in
carrying out H.R. 697.
The bill is not a regulatory measure in the sense of
imposing Government-established standards or significant
economic responsibilities on private individuals and
businesses.
No personal information would be collected in administering
the program. Therefore, there would be no impact on personal
privacy.
Little, if any, additional paperwork would result from the
enactment of H.R. 697, as ordered reported.
CONGRESSIONALLY DIRECTED SPENDING
H.R. 697, as reported, does not contain any congressionally
directed spending items, limited tax benefits, or limited
tariff benefits as defined in rule XLIV of the Standing Rules
of the Senate.
EXECUTIVE COMMUNICATIONS
The testimony provided by the Department of the Interior,
on behalf of the Bureau of Land Management, on S. 343, the
Senate companion measure to H.R. 697, at the July 30, 2013,
Subcommittee on Public Lands, Forests, and Mining hearing
follows:
Statement of Ned Farquhar, Deputy Assistant Secretary, Land and
Minerals Management, Department of the Interior
Thank you for the opportunity to testify on S. 343, the
Three Kids Mine Remediation and Reclamation Act. Over the past
several years, the Bureau of Land Management (BLM) has worked
with the City of Henderson, Nevada, and other Nevada
governmental entities in search of administrative remedies to
redevelopment challenges at the abandoned Three Kids Mine. The
Department of the Interior (Department) supports the goals of
S. 343, which aims to provide legislated solutions to the
issues surrounding the Three Kids Mine area and clears the way
for its eventual redevelopment. However, the BLM would prefer
that the Committee consider H.R. 697 as introduced, which the
Department supported in testimony on March 21, 2013.
background
The Three Kids Mine is an abandoned manganese mine and mill
site on 314 acres of private land located along the south side
of Lake Mead Drive, across the highway from Lake Las Vegas, in
Henderson, Nevada. The mine and mill operated from 1917 through
1961, in part providing steel-strengthening manganese to the
defense industry and contributing to the United States' efforts
in World War I and II. Federal manganese reserves were stored
in the area from the late 1950s through 2003. Approximately
five years ago, the City of Henderson and Lakemoor Canyon, LLC,
approached the BLM with a plan for redevelopment of the area if
the site could be remediated.
S. 343 directs that 948 acres of public lands adjacent to
the private site be conveyed to the Henderson Redevelopment
Agency, bringing the total size of the redevelopment project
area to 1,262 acres. Of the 948 acres of public lands, 146
acres are contaminated and will require mine reclamation and
environmental remediation. The most severe contamination
appears to be on the 314 private acres where the mine and mill
were located. No viable former operator or responsible party
has been identified to remediate and reclaim the abandoned mine
and mill site. Today, the site's deep open pits, large volumes
of mine overburden and tailings, mill facility ruins, and solid
waste disposal areas pose risks to public safety and to human
health and the environment. The Nevada Division of
Environmental Protection (NDEP) identified the Three Kids Mine
site as a high priority for the implementation of a
comprehensive environmental investigation, remediation, and
reclamation program. Representatives of the BLM, the Bureau of
Reclamation, and the Department of the Interior Solicitor's
Office have worked with the City of Henderson and
representatives of developer Lakemoor Canyon to find solutions
to the complex challenges of remediating this site.
s. 343
S. 343 designates the combined 314 acres of private land
and 948 acres of public land as the 1,262-acre ``Three Kids
Mine Project Site'' and provides for the conveyance of the
public lands to the Henderson Redevelopment Agency. The
legislation provides that fair market value for the Federal
lands to be conveyed should be determined through standard
appraisal practices, and that, subsequent to the determination,
the Secretary of the Interior (Secretary) should determine the
``reasonable approximate estimation of the costs to assess,
remediate, and reclaim the Three Kids Mine Project Site.'' The
fair market value would be adjusted by deducting the cost
estimate prepared by the Secretary. The Henderson Redevelopment
Agency would pay the adjusted fair market value of the conveyed
land to the United States, if any.
The bill makes the conveyance of the land conditional upon
the State of Nevada executing a mine remediation and
reclamation agreement that obligates a party to perform the
cleanup and which must be backed up by financial assurances.
While the BLM has not established a range for the cost of
cleanup, a proponent of the transaction estimated the cost of
remediating the public and private lands at between $300
million and $1.3 billion. While it is possible that the cost of
remediating and reclaiming the entire project area might exceed
the fair market value of the Federal land to be conveyed, the
cost of the transaction will be known only after the Secretary
completes the appraisal and remediation cost estimate process
as outlined in the legislation.
The Department supports innovative proposals to address the
cleanup of the Three Kids Mine. We support the goals of S. 343,
and prefer that the Committee consider H.R. 697 as introduced,
which the Department supported in testimony on March 21, 2013.
conclusion
Thank you for the opportunity to present testimony on S.
343.
CHANGES IN EXISTING LAW
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee notes that no
changes in existing law are made by H.R. 697, as ordered
reported.