[Federal Register Volume 85, Number 207 (Monday, October 26, 2020)]
[Rules and Regulations]
[Pages 67671-67681]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-23003]



[[Page 67671]]

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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

43 CFR Part 3500

[LLW0320000 L13300000 PP0000 20X]
RIN 1004-AE58


Non-Energy Solid Leasable Minerals Royalty Rate Reduction Process

AGENCY: Bureau of Land Management, Interior.

ACTION: Final rule.

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SUMMARY: The Bureau of Land Management (BLM) is amending its 
regulations to revise the process for lessees to seek and for the BLM 
to grant reductions of rental fees, royalty rates, and/or minimum 
production requirements associated with all non-energy solid leasable 
minerals. This final rule streamlines the process for such reductions 
for non-energy solid minerals leased by the Federal Government and 
codifies the BLM's authority to issue an area- or industry-wide 
reduction on its own initiative. Existing regulatory requirements are 
overly restrictive, inflexible, and burdensome. A report from the 
Senate Committee on Appropriations on the 2019 Department of the 
Interior, Environment, and Related Agencies Appropriations Bill 
encouraged the BLM to work with soda ash producers to reduce the 
Federal royalty rate, as appropriate. This final rule gives the BLM 
more flexibility to respond to changing market dynamics and to promote 
development of the Federal mineral estate when deemed necessary.

DATES: This final rule is effective on November 25, 2020.

FOR FURTHER INFORMATION CONTACT: Lindsey Curnutt, Acting Division Chief 
of Solid Minerals, WO-320; 480-708-7339. Persons who use a 
telecommunications device for the deaf (TDD) may call the Federal Relay 
Service (FRS) at 1-800-877-8339, 24 hours a day, 7 days a week, to 
leave a message or question with the above individuals. You will 
receive a reply during normal business hours.

SUPPLEMENTARY INFORMATION:

I. Background
II. Discussion of the Final Rule and Comments on the Proposed Rule
III. Procedural Matters

I. Background

    Pursuant to the Mineral Leasing Act of 1920 (MLA), 30 U.S.C. 181 et 
seq., and other legal authorities, the BLM is authorized to lease 
deposits of certain minerals on lands owned by the United States. In 
addition to commonly known energy resources, such as coal, oil, and 
gas, the MLA authorizes the BLM to lease non-energy minerals, such as 
gilsonite, phosphate, sodium, potassium, and sulfur. The BLM 
regulations implementing this authority for solid minerals (other than 
coal) are found at 43 CFR part 3500--Leasing of Solid Minerals Other 
than Coal and Oil Shale. As described in Sec.  3501.2, the subject 
minerals are those minerals other than oil, gas, coal and oil shale, 
leased under the mineral leasing acts, and those hardrock minerals 
leasable under Reorganization Plan No. 3 of 1946, on any unclaimed, 
undeveloped area of available public domain or acquired lands on which 
leasing of these specific minerals is allowed by law. Special areas 
identified in 43 CFR part 3580 and asphalt on certain lands in Oklahoma 
also are leased under this part. Leasing these minerals on Federal land 
provides valuable revenue to the states and the Federal Government.
    The United States was once the leading producer in the world of one 
such mineral, sodium carbonate (natural soda ash), before falling 
behind China in 2003.\1\ This change stimulated a move in Congress to 
provide relief to American soda ash producers. The Soda Ash Royalty 
Reduction Act of 2006 (SARRA) (Pub. L. 109-338) prescribed a reduced 2 
percent royalty rate for sodium compounds produced from Federal land in 
the 5-year period beginning on October 12, 2006.\2\ Additionally, the 
Helium Stewardship Act of 2013 (Pub. L. 113-40) included a provision 
that set a 4 percent royalty rate on soda ash for a 2-year period, 
which ended on October 1, 2015. These reductions have expired.
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    \1\ Dennis S. Kostick, U.S. Geological Survey, 2005 Minerals 
Yearbook: Soda Ash 70.1 (2006).
    \2\ The SARRA required that the Department report to Congress on 
the impacts of the 2-percent royalty rate. The report to Congress, 
completed in 2011, concluded that while total sales revenues from 
Federal Soda Ash leases increased, royalty revenues were 
significantly lower than they would have been absent the SARRA and 
that as a result of the lower 2-percent royalty rate, soda ash 
production had shifted away from state and private land leases onto 
Federal leases.
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    The minimum royalty rates for soda ash, along with other non-energy 
solid minerals on Federal lands, are set in the MLA and BLM regulations 
(see 43 CFR 3504.21). The MLA authorizes the Secretary to establish 
royalty rates higher than the minimum, along with rental fees and 
minimum production requirements through regulation. The BLM sets the 
royalty rates for each lease at or above the specified minimum royalty 
rate (see 43 CFR 3504.22) based on current market conditions at the 
time of lease issuance, but those conditions may change over the life 
of the lease and may be dynamic based upon global supply.
    Section 39 of the MLA, 30 U.S.C. 209, authorizes the Secretary to 
reduce royalty rates and rental fees on mineral leases for the purpose 
of encouraging the greatest ultimate recovery, and in the interest of 
conservation of natural resources, whenever the Secretary determines it 
is necessary to do so in order to promote development, or when the 
Secretary determines that leases cannot be successfully operated under 
the existing terms.
    The BLM regulations contain a process for reducing royalty rates, 
along with rental fees and minimum production requirements, for non-
energy solid minerals leased by the Federal Government in 43 CFR 
subpart 3513--Waiver, Suspension or Reduction of Rental and Minimum 
Royalties. The process described in this subpart of the regulations 
imposes requirements beyond what section 39 of the MLA, 30 U.S.C. 209, 
requires. The BLM has reviewed the existing regulatory requirements for 
non-energy solid minerals and has determined that the royalty reduction 
process codified in 43 CFR subpart 3513 is unnecessarily restrictive, 
inflexible, and burdensome. See Sec.  3513.15 of the section-by-section 
discussion of this preamble for a more detailed discussion of the 
overly burdensome requirements that this final rule removes.
    The BLM promulgated the current regulations during the late 1990s 
to ``streamline and rewrite necessary regulations in plain English.'' 
\3\ The effect of rewriting the language, however, introduced some 
substantive changes as compared with the previous regulations by 
requiring those who are seeking a reduction to submit specific 
information in all applications that may not always be necessary. In 
contrast, previous versions of the royalty rate reduction regulations 
from 1946, 1964, and 1983 were more closely aligned with the statutory 
language and did not list specific data requirements for an 
application.
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    \3\ ``The purpose of this rule is to comply with President 
Clinton's government-wide regulatory reform initiative to eliminate 
unnecessary regulations, and streamline and rewrite necessary 
regulations in plain English.'' 64 FR 53,512, 53,512 (Oct. 1, 1999).
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    This final rule streamlines the process to reduce rental fees, 
royalty rates, or minimum production requirements for all non-energy 
solid minerals leased by the Federal Government, without altering the 
substantive criteria that BLM will use to determine whether a

[[Page 67672]]

reduction is appropriate, removing unnecessary and overly burdensome 
requirements. Additionally, this final rule codifies in regulation the 
BLM's authority to implement area- or industry-wide reductions on the 
BLM's own initiative, thus giving greater effect in 43 CFR part 3500 to 
the broad authority that the MLA grants to the Secretary of the 
Interior to reduce rental fees, royalty rates, and/or minimum 
production requirements to promote development. This improves the BLM's 
ability to provide relief to producers of non-energy solid leasable 
minerals from burdens such as geological hardships \4\ and market 
transformations.
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    \4\ Geological hardships are circumstances that may slow or stop 
mining in a given area. These hardships may include such things as a 
thinning deposit, becoming exhausted, changing in composition, or 
running into an underground barrier, such as a structure that 
compromises the integrity and or grade of the deposit. Such 
circumstances often cannot be foreseen at the time of leasing.
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    This final rule also aligns with the recommendations of 
congressional committees. The American Soda Ash Competitiveness Act was 
introduced in Congress in 2017 and recommended setting the Federal 
royalty rate for soda ash at the minimum of 2 percent for a 5-year 
period. Although this proposed legislation was not enacted, the Senate 
Committee on Appropriations expressed concern about keeping the United 
States competitive in the global soda ash market, and encouraged ``the 
Bureau to work with soda ash producers to assist them in reducing 
royalty rates and [directing] the Bureau to take the necessary steps to 
reduce the Federal royalty rate for soda ash as appropriate.'' S. Rep. 
No. 115-276, at 14 (2018). The House Appropriations Committee also 
noted in an explanatory statement for the 2018 Interior, Environment, 
and Related Agencies Appropriations bill that the Committees are 
concerned about maintaining the United States' global competitiveness 
in the production of natural soda ash. The United States contains 
approximately 90 percent of the world's natural soda ash deposits, 
while many international competitors are producing synthetic soda ash 
using more energy and generating higher emissions than natural soda ash 
production. Therefore, the Committees expect the Bureau to consider 
using its authority to reduce the Federal royalty rate for soda ash to 
2 percent.\5\
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    \5\ An Explanatory Statement for the Department of the Interior, 
Environment, and Related Agencies Appropriations Bill, 2018.
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    By clarifying the BLM's authority to reduce the royalty rate for 
soda ash and other non-energy solid leasable minerals in general (i.e., 
for the industry as a whole or for a particular area) in the absence of 
an individual lease-by-lease application submitted by a leaseholder 
seeking a reduction for specific leases in an operation, this final 
rule simplifies the process the BLM would need to go through if it were 
to determine certain area- or industry-wide royalty rate reductions 
were appropriate to promote development. In such a scenario, if a 
leaseholder is operating under a pre-existing reduction at the time of 
an area wide reduction, the lease will operate at the pre-existing 
reduction unless the area wide reduction is at a lesser rate.
    The BLM has a history of receiving applications requesting royalty 
rate reductions for commodities such as lead-zinc, gilsonite, and 
potash. Since the early 1990s the BLM has received between ten and 
fifteen applications seeking a reduction, and approximately half of 
those were considered complete applications. The BLM has approved about 
five applications for reduction since 1993. Although the BLM has no 
history of implementing area- or industry-wide royalty rate reductions 
in the context of non-energy solid leasable minerals under 43 CFR part 
3500, the BLM has reduced royalty rates on an area-wide basis for coal 
leases under section 39 of the MLA, 30 U.S.C. 209. As an example, the 
BLM reduced the royalty rate for coal leases in a specific area of 
North Dakota in the spring of 2019 to 2.2 percent as a ``category 5'' 
reduction due to market conditions.
    Executive Order 13817, ``A Federal Strategy to Ensure Secure and 
Reliable Supplies of Critical Minerals,'' emphasizes the need for the 
United States to domestically source critical minerals. The Secretary 
of the Interior published a ``Final List of Critical Minerals'' on May 
18, 2018. This list includes commodities that can be leased as non-
energy minerals, such as potash and metals like lithium or rare earth 
on any unclaimed, undeveloped area of public domain and on acquired 
lands. This final rule would further the goals of E.O. 13817 by 
improving the BLM's ability to react to unforeseen market forces and 
ensure continued production of critical minerals on Federal lands.
    Over the past two decades, U.S. natural soda ash production has 
grown at an average annual rate of 0.9 percent, from 11.1 million short 
tons (MMst) in 1998 to 13.2 MMst in 2018, which comprised 22 percent of 
world soda ash production in 2018.\6\ During this period, however, 
Chinese synthetic soda ash production grew at a 6.4 percent annual 
rate, rising from less than one-quarter of world total soda ash 
production to nearly half.\7\ China has used the Hue and Solvay 
synthetic processes to ramp up its soda ash production, surpassing U.S. 
total production in 2003,\8\ and producing double the U.S. volume in 
2011.\9\
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    \6\ U.S. Geological Survey (USGS) Minerals Yearbook data, 
editions from 2002 through 2018.
    \7\ USGS Minerals Yearbook data through 2017, with National 
Bureau of Statistics of China monthly data from January through 
October 2018 used to project the 2018 total.
    \8\ Dennis S. Kostick, U.S. Geological Survey, 2005 Minerals 
Yearbook: Soda Ash 70.1 (2006).
    \9\ Wallace P. Bolen, U.S. Geological Survey, 2014 Minerals 
Yearbook: Soda Ash 70.1 (2015).
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    Although China's soda ash production has largely focused on 
producing glass for its automotive and construction industries (among 
others), its rise has reduced the ability of U.S. producers to satisfy 
the burgeoning demand for the mineral. It has also caused the U.S. 
share of world soda ash production to decline from 31 percent of the 
world total in 1998 to 22 percent in 2018. Moreover, while China's more 
expensive synthetic soda ash production has largely gone to its 
domestic manufacturing industry, relatively low-cost natural soda ash 
produced from Turkey's significant trona ore deposits compete directly 
with U.S. exports to countries in the European Union and elsewhere. 
Recent announcements point to soda ash production expansions in Turkey, 
as well as in Belarus, Kazakhstan, Uzbekistan, India, Thailand, and 
Pakistan.\10\
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    \10\ Wallace P. Bolen, U.S. Geological Survey, 2016 Minerals 
Yearbook: Soda Ash 70.1 (2016).
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    It is the BLM's view that in light of world market developments, 
including those described above, this final rule is necessary to keep 
the United States competitive in the world markets of non-energy solid 
leasable commodities. The BLM also views the rule as necessary to 
promote development of non-energy solid leasable mineral resources in 
accordance with the MLA, particularly during periods of market 
fluctuation. For example, from 2008 to 2010, the price of soda ash, as 
with many other commodities, spiked and then dropped precipitously, 
threatening industry proponents' ability to operate successfully while 
paying all related royalties and taxes.
    The changes in this final rule will not adversely affect the 
processing time for royalty rate reduction applications. On the 
contrary, the changes will reduce the time required for a lessee to 
compile and complete applications. Moreover, the rule will allow the 
BLM to implement industry- or area-wide reductions on its own 
initiative in

[[Page 67673]]

accordance with section 39 of the MLA, 30 U.S.C. 209.

II. Discussion of the Final Rule and Comments on the Proposed Rule

Discussion of Comments by Topic

General Comments
    Comment: Some commenters opposed the rulemaking and asserted that 
environmental impacts will increase due to increased access to leasing 
and ramping up of production. A commenter suggested that ``regulations 
should not be streamlined for economic reasons'' and that 
``environmental fortitude should be valued above international trade 
and local mining operations''.
    Response: This rule does not reduce any royalties, but merely 
changes the process by which certain royalty reductions may be 
considered and made. No royalties will be reduced unless and until a 
subsequent decision or decisions are made pursuant to this rule. 
Therefore, this rule will not result in any environmental impacts. 
Moreover, a reduced royalty does not change the amount of acreage that 
has been leased or the amount of minerals in the leased lands. Instead, 
such a royalty allows an operator to continue mining the same volumes 
that were available to develop under an approved mining plan, but with 
a lower royalty payment. BLM does not anticipate that reduced royalties 
will increase the footprint on Federal leases or result in increased 
environmental impacts on public lands.
    Moreover, reduced royalties only apply to existing leases with 
approved mine plans, which have already undergone environmental 
analysis in compliance with NEPA regulations, not to new development, 
therefore there is no increased footprint from a royalty reduction. 
Before BLM can approve a mine plan of operations, a NEPA analysis is 
conducted. Heretofore, a CX has been completed for reductions on leases 
that have already undergone an environmental analysis for their 
associated mine plan of operations. The CX for a royalty rate reduction 
has been done in accordance with our NEPA handbook H-1790-1 Appendix 4, 
F4 on page Appendix 4-152.
    Comment: Some commenters expressed concern that lowered royalty 
rates will reduce revenue to states, including funds for local school 
districts. The commenters stated that recent earthquakes caused damage 
to local infrastructure and that earthquake recovery efforts would cost 
the school district in the vicinity of the earthquake several millions 
of dollars.
    Response: In 2019, the federal government collected $57.1 million 
in Royalties from non-energy solid leasable minerals, 49% of which was 
transferred back to the states, totaling $28 million. By comparison, 
$3.2 billion dollars was collected from oil, gas, and coal in 2019, of 
which the states also received 49%, totaling $1.6 billion. This means 
that royalties from non-energy solid leasable operations on federal 
lands only make up 1.7% of total royalties paid to the states, so 
temporary reductions for which a lessee might qualify would not 
substantially affect total royalties received by the states. Moreover, 
it should be noted that such temporary reductions may increase 
aggregate state revenues by allowing certain operations to continue 
(rather than decrease production or shut down entirely), thereby 
assuring that payments to the State would continue over a longer 
period. The statute provides authority to reduce royalty rates in order 
to ensure the ``greatest ultimate recovery'' of the mineral. 30 U.S.C. 
209. If an operator is forced to close due to a shift in economic 
conditions or hardships, it could lead to job losses and minerals left 
undeveloped over the long term. The ability to provide flexibility to 
royalty rates may allow for production to remain economic and keep 
operations going, leading to the greater ultimate recovery of the 
resource and continued royalty payments to the states. The BLM does not 
have control over the way in which states allocate funds after 
royalties are paid. The BLM does not expect a change of revenues from 
promulgation of this rule, as it does not directly affect royalty 
rates. If the BLM were to reduce royalty rates subsequent to this 
rulemaking, there may be a decrease in revenues collected in order to 
ensure the greatest ultimate recovery. Because this rule does not 
directly affect royalty rates, the BLM cannot at this time assess the 
impact of specific royalty rate adjustments that may be implemented at 
a future date. For instance, in some cases, a royalty rate reduction 
may allow operations and royalty revenue to continue that may otherwise 
have ceased.
    Comment: Many commenters supported the rule change, specifically 
pertaining to soda ash, potash, and gilsonite. However, some commenters 
appeared to mistakenly assume that the final rule would implement an 
automatic royalty rate reduction for certain industries.
    Response: The final rule does not reduce the royalty rates for any 
mineral. Instead, it will streamline the application process and will 
allow the BLM to consider whether it will issue an area- or industry-
wide reduction on its own initiative for non-energy solid minerals 
leased by the Federal Government, if the BLM determines that such a 
reduction is necessary in order to promote development. This will 
improve the BLM's ability to provide relief to producers of non-energy 
solid leasable minerals, including soda ash, potash, and gilsonite, 
from burdens, such as geological hardships and market fluctuations, 
when necessary. The final rule is intended to promote development of 
the mineral resources in accordance with section 39 of the MLA (30 
U.S.C. 209).
    Comment: Some commenters suggested that the BLM should consider 
updating and publishing its guidance documents, including the Non-
Energy Solid Leasable Handbook H-3500-01, to be consistent with any 
rule amendments or additions.
    Response: The BLM will update its guidance documents following this 
rulemaking, including the Non-Energy Solid Leasable Handbook H-3500-01, 
to further clarify the parameters of reductions. Updates to the rule's 
implementing guidance will be coordinated with OMB. The updated 
handbook will be posted online and available to the public via the 
guidance document section of the Department of the Interior's 
Electronic Library of the Interior Policies (ELIPS) website (https://www.doi.gov/elips/browse). Current guidance can be found in BLM Manual 
Section 3485--Reports, Royalties, and Records, December 17, 1990 
(https://www.blm.gov/sites/blm.gov/files/uploads/mediacenter_blmpolicymanual3485.pdf).
    Comment: One commenter suggested that the BLM should decline 
receiving any royalties from potash, leaving the balance to be 
deposited to the states from which potash is mined. That would decrease 
the amount of royalties paid by the respective industries while not 
hurting the entities benefiting from the royalties in those states.
    Response: The BLM is required to collect royalties on federally 
owned minerals as described in the Mineral Leasing Act at 30 U.S.C. 181 
and 43 CFR 3504.20, which states: ``you must pay royalties on any 
production from your lease in accordance with the terms specified in 
the lease.'' Any potential revisions to 43 CFR 3504.20 would be outside 
the scope of this rulemaking.
Market Conditions
    Comment: Many commenters expressed support for the final rule, 
including the new provision that codifies the BLM's authority to issue 
an area- or industry-wide reduction on its

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own initiative. These commenters expressed support for the BLM's use of 
an industry-wide reduction or reductions to support producers on public 
lands in the domestic and global markets.
    Response: In accordance with section 39 of the MLA (30 U.S.C. 209) 
and with this final rule, the BLM may issue a reduction on its own 
initiative when it determines ``it is necessary to do so in order to 
promote development.'' Following publication of this final rule, the 
BLM will consider all available and applicable information when 
determining whether such a reduction is necessary.
    Comment: Some commenters provided detailed information about the 
historical trends and projected future of the soda ash market, which 
included an expectation for domestic demand to remain flat for the 
foreseeable future. Some commenters also provided information about 
market conditions for other commodities, as well as information about 
international production.
    Response: While the BLM did not make any changes to the final rule 
as a result of these comments, this is the kind of data that the BLM 
would find useful in the future when determining whether it is 
necessary to issue an industry-wide or area-wide reduction to promote 
development. Lessees are welcome to present helpful data at any time. 
This rule does not implement a royalty rate reduction but merely 
clarifies the procedures for doing so.
Application Process
    Comment: Many commenters supported the BLM's revisions to 
streamline the application process. These commenters agreed that it is 
unnecessary for applicants to submit some of the information required 
in the current regulation and that the changes do not alter the 
substantive criteria.
    Response: The BLM appreciates the support for this rule.
    Comment: Some commenters noted that in some cases, royalty rates 
are lower on State leases than on Federal leases. They also noted that 
it is often less expensive for a company to mine a commodity on 
privately held lands than on public lands.
    Response: Although the BLM did not make any changes to the final 
rule in response to this comment, this is the sort of information that 
should be included in applications for reductions that are submitted by 
operators under Sec.  3513.15 of this rule.
    Comment: A commenter asserted that every effort should be made to 
facilitate domestic critical mineral production. The commenter not only 
supported the changes in the proposed rule concerning rent and royalty 
reduction requests, but also argued that the Federal processes for 
obtaining mine permits should be streamlined more generally.
    Response: The additional changes supported by the commenter are 
beyond the scope of this rulemaking. We note that the BLM may take 
additional actions in the future to facilitate the production of 
critical minerals on public lands.
    Comment: Some commenters provided a suggested revision to proposed 
Sec.  3513.15(f), which proposed to describe the information necessary 
to support a reduction request for a minimum mineral production 
requirement. The proposed rule would have required that the applicant 
submit ``complete information'' with a reduction request. The 
commenters believe that such a requirement is unnecessarily broad and 
recommend that the rule require only ``the information sufficient to 
demonstrate'' the need for the reduction.
    Response: The BLM agrees with this comment and has revised Sec.  
3513.15(f) in the final rule. See the discussion of Sec.  3513.15 for 
more information about this change.
    Comment: Some commenters believe that an additional paragraph 
should be added under Sec.  3513.17(c), authorizing the BLM to grant an 
extension to an existing rate reduction if the economic conditions 
continue to warrant such reduction. The commenters suggest that this 
would obviate the need for the creation and filing of a completely new 
reduction request.
    Response: The royalty rate at which a commodity is set is analyzed 
by the same criteria regardless of the type of request. Therefore, a 
regulatory mechanism for an extension would be redundant. An operator 
that was granted a reduction under Sec.  3513.15 could apply for 
another reduction after the initial reduction ends and could reuse any 
information in a new application that has not changed since the initial 
application was submitted.

Area and Industry Wide Reductions

    Comment: Some commenters agreed with the BLM that the MLA 
explicitly grants the BLM the authority to lower royalty rates to 
promote development, based on any information available to it, 
including information submitted in lease-specific applications. The 
commenters noted that the MLA does not limit the information that the 
BLM may consider in exercising its judgment. Some commenters support 
the addition of Sec.  3513.17, but encourage the BLM to broaden the 
language of the rule to clarify that lessees or industry 
representatives may request the BLM to reduce royalties or the minimum 
production amount under 3513.17(a), instead of allowing the BLM to do 
so on its own initiative only.
    Response: The BLM may use information received through the 
application process under Sec.  3513.15 when determining whether an 
area- or industry-wide reduction is necessary to promote development. 
This rule does not disallow lessees or industry representatives from 
submitting to the BLM any communications about whether an area- or 
industry-wide reduction is warranted. The BLM may consider any 
applicable data submitted by the public when evaluating an industry 
wide or area wide reduction.
    This final rule also does not limit how many operators could 
jointly file an application, so long as information is included ``for 
all leases involved.'' If several interested parties jointly submit an 
application for a royalty rate reduction, the BLM could approve that 
application for the leases identified in the application or could 
initiate an industry-wide reduction under Sec.  3513.17(a).
    Comment: Some commenters asserted that the BLM should prepare a 
competitive analysis before granting an area-wide rate reduction. These 
commenters expressed concern that issuing a reduction in one area could 
cause direct and indirect competitive impacts on the affected industry 
at large, as well as individual members of that industry. In addition, 
these commenters stated that there is potential for BLM rate reductions 
in one region of the country to have unintended and anti-competitive 
impacts to market participants in other regions.
    Response: As described in the section-by-section analysis, an area-
wide reduction would generally be issued to overcome a geological 
hardship in a specific area. Such a reduction would be limited to a 
specific period of time. If the BLM determines that a condition impacts 
more than one specific area, it could initiate an industry-wide 
reduction under Sec.  3513.17(a). The BLM will determine what analysis 
is necessary on a case-by-case basis, but no change to the rule is 
necessary. The level and type of analyses appropriate to a particular 
case may differ from case to case, and it would be inefficient for the 
regulations to impose unnecessary or overly burdensome requirements on 
the process.

[[Page 67675]]

Timing and Fixed Tonnage
    Comment: The BLM received comments both in favor of, and opposed 
to, timing restrictions for a reduction. Some commenters believed that 
the BLM should not issue a reduction for less than 10 years, because 
anything less than 10 years would not provide sufficient stability for 
the affected industry.
    Response: The BLM will determine the appropriate length of time for 
each reduction based on the best available information. For more 
information about the 10-year limit on reductions, see the section-by-
section discussion of Sec.  3513.17(c). The final rule will retain the 
flexibility to issue a reduction for less than 10 years. The BLM 
recognizes that some business decisions will be made based on this 
timeframe, and will designate appropriate timeframes based on the best 
data available to provide more certainty to affected parties and 
communities, facilitating longer-term planning, investment, and hiring 
decisions.
    Comment: Some commenters suggested that the timeframe of a 
reduction should take into account the time it can take a company to 
launch a plant or mine expansion. The commenters encouraged the BLM to 
look for constructive ways to ensure that the full extent of royalty 
relief is made available by allowing for the tolling of the royalty 
reduction for projects that are under construction, until they are 
completed.
    Response: The BLM will take into account all available information 
when determining the appropriate length of time for a reduction. If a 
project takes longer to complete than the length of the reduction, the 
lessee could apply for an additional reduction under Sec.  3513.15 if 
the lessee would be unable to meet the terms and conditions of the 
lease. Lessees should recognize that these reductions are temporary in 
nature, and business decisions should not be made that assume that a 
reduction will be in place for longer than the period of time for which 
the reduction is issued. This rule does not implement a royalty rate 
reduction but merely clarifies the procedures for doing so.
    Comment: Some commenters disagreed with the BLM's being able to 
apply a fixed tonnage rather than applying a time limit. These 
commenters expressed frustration and confusion with BLM's explanation 
in the preamble of its proposal as to how this fixed tonnage amount 
would be determined.
    Response: The BLM revised the preamble in the final rule to more 
clearly explain how a fixed tonnage is determined. A tonnage constraint 
allows for a royalty rate reduction to be applied without a time limit 
for a designated ore block and gives BLM the flexibility to apply the 
best reduction strategy for a given application or area. The use of a 
fixed tonnage could prevent a lessee from exploiting a reduction issued 
by the BLM to produce excessive quantities of a commodity at a reduced 
rate. Some geologic hazards may present a challenge where it would be 
difficult to estimate how long it would take for a lessee to overcome 
the problem presented by a particular hazard, and a fixed tonnage could 
provide the BLM flexibility to provide relief without a time constraint 
on the lessee.
    Comment: A commenter expressed concern that the proposed rule would 
not require the BLM to notify lessees when a reduction ends.
    Response: The BLM will issue a reduction with a specific end date 
or a maximum fixed tonnage. The lessee is responsible for adhering to 
the agreed terms of the reduction. The BLM case file will include the 
terms of this agreement, and a lessee may consult with the BLM if the 
lessee needs this information. It will also be BLM policy to notify 
lessees before and when reductions end. This information is included in 
the initial notification letter describing the royalty rate reduction, 
its start and end date, and the reduced rate.
    Comment: A commenter suggested that the BLM should clarify in the 
final rule that it will not adjust the time period for a rate reduction 
after that reduction has already been issued, unless the BLM 
determines, after providing the applicant with notice and an 
opportunity to be heard, that the criteria for the rate reduction are 
no longer present.
    Response: The BLM recognizes that lessees may make planning, 
investment, and hiring decisions as a result of the BLM's issuing a 
reduction. The BLM makes these determinations on a case-by-case basis 
with the best available information, but recognizes that some estimates 
may not align exactly with the time needed to overcome a hardship. The 
final rule includes a 10-year limit to prevent unnecessary loss of 
revenue. Under new paragraph 3513.17(d), the BLM will not end a 
reduction before the end of the term or fixed tonnage originally 
identified.

Section-by-Section Discussion of the Final Rule

    The regulations in 43 CFR part 3500 are authorized by the Mineral 
Leasing Act of 1920 (30 U.S.C. 181 et seq.) and other statutory 
authorities as listed in 43 CFR 3501.1. This final rule revises the 
authority citation for part 3500 by adding section 39 of the MLA (30 
U.S.C. 209), which authorizes the Secretary to reduce royalty rates and 
rental fees. This is consistent with other provisions in this final 
rule and is not a substantive change.
    The final rule streamlines the process to apply for rental fee, 
royalty rate, and minimum production requirement reductions for non-
energy solid mineral leases. This final rule also reduces the burden on 
lease holders by simplifying the regulatory requirements to better 
align the regulations with the statute.
    You may find the BLM regulations that implement this authority for 
solid minerals (other than coal) in 43 CFR subpart 3513--Waiver, 
Suspension or Reduction of Rental and Minimum Royalties.
Section 3513.11 May BLM relieve me of the lease requirements of rental, 
minimum royalty, or production royalty while continuing to hold the 
lease?
    Section 3513.11 states that the BLM has a process that allows for 
temporary relief from the rental, minimum royalty, or production 
royalty provisions in a lease. The BLM considers applications submitted 
under Sec.  3513.15 on a case-by-case basis based on the data in the 
application for relief from lease requirements. This existing section 
is the introductory provision in subpart 3513, which explains that 
process in greater detail. The BLM Manual Section 3485-Reports, 
Royalties, and Records, December 17, 1990 (https://www.blm.gov/sites/blm.gov/files/uploads/mediacenter_blmpolicymanual3485.pdf), includes 
guidance for processing applications for temporary relief from the 
rental, minimum royalty, or production royalty provisions and will be 
updated following this rulemaking.
    This final rule adds to Sec.  3513.11 a citation to the relevant 
section of the Mineral Leasing Act (30 U.S.C. 209). This is not a 
substantive change.
Section 3513.15 How do I apply for reduction of rental, royalties, or 
minimum production?
    Section 3513.15 sets out the information that a lessee must include 
in an application to BLM. The BLM needs the information provided in an 
application to determine whether the request satisfies the reduction 
criteria described in 43 CFR 3513.12.
    This final rule removes the requirement to submit two copies of an 
application, because two copies are no longer necessary. When the BLM 
promulgated these regulations, lessees

[[Page 67676]]

submitted applications to the BLM via hard copy mail and the BLM used 
both paper copies during its processing. The BLM is able to receive and 
process these applications electronically, or the BLM is able to make 
physical or electronic copies of the paper submissions.
    Section 3513.15(d) in the current regulations requires an 
application to include a description of the lands for which the 
reduction would apply. This final rule revises this requirement to be 
applicable only when the application is for a portion of the lease or 
leases. If the application is for the lease in its entirety, the BLM 
already has that information on hand, and a land description would not 
be necessary for that application. This revision makes the application 
easier to complete and improves processing timeliness.
    This final rule removes paragraphs (f) and (h) of the previous 
regulations, which required a tabulated statement of the leasable 
minerals mined for each month, covering at least the last twelve months 
before a lessee files an application; the average production mined per 
day for each month; a detailed statement of the expenses and costs of 
operating the entire lease; and the income from the sale of any leased 
products. This information is not required under the final rule, 
because the BLM already knows the quantity of leasable minerals that 
the lessees are mining on each lease. The BLM can extrapolate the 
average production mined per day from production records and mine plan 
reports that the lessee already submits to the BLM and Office of 
Natural Resources Revenue (formerly Mineral Management Service) for 
royalty payment purposes and to prove that the lessee is meeting 
minimum production requirements as indicated on its lease form in 
accordance with 43 CFR 3504.20. Similarly, the Office of Natural 
Resources Revenue also gathers information pertaining to income from 
the sale of minerals. The detailed statement of expenses and costs is 
not necessary for the application because the reduction is based on 
market conditions and geologic interferences that are not tied to past 
costs and expenses. BLM may request information under the new 43 CFR 
3513.15(h) (formerly (l)) if it finds that such information would be 
necessary to assess a specific application. For example, the 
applicant's fixed utility costs will generally not change with the 
commodity's market fluctuations, so we know that the applicant's costs 
to run the operation will not decrease at the same rate as its income 
from the commodity price decreases. Removing this unnecessary 
requirement also makes the application easier to complete, further 
improving the timeliness of the reduction process.
    In the proposed rule, paragraph (g) in the previous rule became new 
paragraph (f). New Sec.  3513.15(f) is revised in this final rule from 
the language initially proposed in response to comments received. The 
language in proposed Sec.  3513.15(f) was not changed from language in 
previous paragraph (g), which required applicants to provide ``complete 
information'' about why they were unable to meet the terms and 
conditions of their leases. The commenters believe that this 
requirement is unnecessarily broad and recommended that the BLM require 
only ``the information sufficient to demonstrate'' the need for the 
reduction. The BLM agrees that the initially proposed text was unclear, 
and the final rule incorporates the suggested revisions. The language 
in the final rule more accurately describes how much information an 
applicant must include in its application. Similar to paragraph (g) of 
this section, this clarification will not result in any substantive 
impacts.
    Section 3513.15(g) of the final rule contains the requirement found 
in Sec.  3513.15(i) of the previous regulations. However, instead of 
requiring ``all facts'' showing why the lessee cannot successfully 
operate a mine, the final rule requires the application to provide 
``justification'' showing why the lessee cannot successfully operate a 
mine under the existing royalty or rental. The final rule provides a 
more measured requirement for the applicant to demonstrate why it is 
unable to meet the terms of the lease. It is still imperative for the 
application to provide sufficient justification for the BLM to make its 
determination in each applicant's case. While this is a change to the 
wording of the regulation, the BLM does not expect any substantive 
impact from this revision because the applicant will still need to 
demonstrate why it cannot operate the lease under current conditions. 
Data that may be seen in these types of applications include: Geologic 
maps and reports about hazards being encountered, cost per ton of 
product, revenue per ton of product, or reports discussing any 
financial hardship that an individual mine is facing.
    This final rule also removes paragraphs (j) and (k) of Sec.  
3513.15, which required full information as to whether the lessee pays 
royalties or payments out of production to anyone other than the United 
States, the amounts paid and efforts the lessee has made to reduce 
them, and documents demonstrating that the total amount of overriding 
royalties paid for the lease, discussed in 43 CFR 3504.26, will not 
exceed one-half the proposed reduced royalties due the United States. 
The BLM expects that the application would disclose any relevant 
information regarding overriding royalties under the informational 
requirements of Sec.  3513.15(g) and (h) of the final rule because the 
BLM has authority to order the operator to suspend or reduce an 
overriding royalty as stated in 43 CFR 3504.26. The removal of 
paragraphs (j) and (k) makes the application easier to complete, 
improving the timeliness of the process.
    Section 3513.15(h) of the final rule contains the requirement, set 
forth in Sec.  3513.15(l) of the previous regulations, that the 
applicant include any additional information that the BLM requires to 
determine whether the applicant meets the standards of Sec.  3513.12. 
Section 3513.12, which this rule does not amend, explains the criteria 
that the BLM considers when approving a waiver, suspension, or 
reduction in rental or minimum royalty, or a reduction in the royalty 
rate.
Section 3513.17 How will the BLM implement a reduction of rental, 
royalties, or minimum production?
    This final rule adds a new Sec.  3513.17, which explains how the 
BLM implements royalty rate reductions
    Section 39 of the MLA, 30 U.S.C. 209, authorizes the Secretary to 
reduce royalty rates and rental fees when in his judgment it is 
necessary to do so to promote development, or when in his judgment the 
leases cannot be successfully operated under the terms provided 
therein. This provision of the MLA authorizes the Secretary to provide 
across-the-board royalty rate relief for all lessees who are developing 
non-energy minerals leased by the Federal Government, as long as the 
Secretary finds that it is necessary to do so in order to promote 
development. Promoting development will help ensure operations can 
continue, preserve jobs, and help ensure that domestic commodities from 
those operations remain available.
    Section 3513.17 is outlined as follows:
    Paragraph (a) of Sec.  3513.17 implements section 39 of the MLA in 
the regulations, enabling the BLM to reduce rental fees, royalty rates, 
or minimum production requirements on its own initiative, whereas 
previously, the BLM could provide rate relief only upon application on 
a case-by-case basis. This new section allows the BLM, on behalf of the 
Secretary of the Interior, to provide such relief in order to promote

[[Page 67677]]

the overall development of a mineral resource for all leases in a 
geographic area or across an industry. This section more fully 
implements in 43 CFR part 3500 the broad authority that the MLA grants 
to the Secretary of the Interior for implementing these reductions in 
order to promote development, in addition to the reductions based on 
individual lease-by-lease applications.
    Paragraph (b) of Sec.  3513.17 explains that the BLM may implement 
a reduction in response to an application submitted under Sec.  
3513.15. This is not a change from existing practice, but it is 
included to demonstrate the difference between the application process 
of Sec.  3513.15 and a BLM-initiated reduction under Sec.  3513.17(a).
    Paragraph (c) of Sec.  3513.17 describes how the BLM will limit 
reductions implemented under Sec.  3513.17. Section 3513.17(c) applies 
both to reductions that the BLM implements on its own initiative under 
Sec.  3513.17(a) and to reductions that the BLM implements in response 
to an application under Sec.  3513.17(b). Under paragraph (c) of this 
section, reductions are limited either by duration or by tonnage. That 
is, reductions either are limited in duration to not more than 10 years 
from the date on which BLM implements a reduction under either 
paragraph (a) or (b), or are limited to not more than a specific 
tonnage that the lessee produces, as determined by the BLM, under 
paragraph (b). The BLM determines the specific time or tonnage limit 
appropriate for each reduction on a case-by-case basis. The BLM will 
determine the duration of a reduction or a tonnage limit based on 
projected market conditions or geologic hazard attributes for each 
application, or for the subject area or industry. If a reduction is in 
response to an application under Sec.  3513.17(b), the reason or 
reasons set forth in the application will help determine the 
appropriate term or tonnage limit of the reduction.
    Prior to 1999, there was no requirement in the BLM's regulations 
that a reduction would be temporary, though in practice reductions 
generally have been temporary.\11\ Placing timing or tonnage 
constraints on reductions in this final rule will ensure that any 
reductions that the BLM grants or initiates would be applied when 
necessary to promote development, but not longer than necessary. At the 
end of the reduction period, the royalty, rental, or minimum production 
requirements will increase to their original rates. At that time, the 
lessee would operate under the original lease terms.
---------------------------------------------------------------------------

    \11\ See 43 CFR 3503.2-4 (1998).
---------------------------------------------------------------------------

    The BLM anticipates setting a time limit (rather than a maximum 
production volume) when issuing an area- or industry-wide reduction to 
promote development. The final rule limits the reduction to not more 
than 10 years, but the BLM may determine that a shorter period is 
appropriate. Market conditions can fluctuate over a 10-year period, and 
a longer period in a single grant may not be appropriate. Past 
legislation for reductions expired after 5 years, so a 10-year term was 
chosen as a maximum, with the option to make the term shorter, if 
appropriate.
    When a lessee submits an application under Sec.  3513.15, in 
certain circumstances, such as areas with geologic hazards, it might be 
more appropriate to apply a fixed tonnage limit rather than applying a 
time limit. Qualified BLM personnel would then calculate a fixed 
tonnage using known, estimated, or historic production determined by 
current mining style, rock type, and operator production capabilities 
or volume required to overcome a geologic hazard.
    Under the existing regulations, the BLM has often used a fixed 
tonnage when applying a constraint to the royalty rate reduction for a 
lease. The tonnage constraint ensures that the lessee produces the 
amount of a mineral projected over a particular period, but prevents 
the lessee from refocusing production exclusively to an area with a 
reduced royalty rate and producing a greater amount of the mineral at 
the reduced royalty rate.
    While there is no specific process in the regulations for an 
extension of these constraints, the final rule does not limit the 
number of times that lessees may apply for a reduction under Sec.  
3513.15.

III. Procedural Matters

Regulatory Planning and Review (Executive Orders 12866 and 13563)

    Executive Order (E.O.) 12866 provides that the Office of 
Information and Regulatory Affairs in the Office of Management and 
Budget will review all significant rules. The Office of Information and 
Regulatory Affairs has determined that this rule is significant because 
it may raise novel legal or policy issues.
    E.O. 13563 reaffirms the principles of E.O. 12866 while calling for 
improvements in the nation's regulatory system to promote 
predictability, reduce uncertainty, and use the best, most innovative, 
and least burdensome tools for achieving regulatory ends. The E.O. 
directs agencies to consider regulatory approaches that reduce burdens 
and maintain flexibility and freedom of choice for the public where 
these approaches are relevant, feasible, and consistent with regulatory 
objectives. E.O. 13563 emphasizes further that regulations must be 
based on the best available science and that the rulemaking process 
must allow for public participation and an open exchange of ideas. We 
have developed this rule in a manner consistent with these 
requirements.
    The final rule will reduce duplicative information requirements for 
non-energy solid leasable minerals operators who apply for a reduction 
of rental, royalties or minimum production. The final rule will also 
more fully implement the Secretary's authority under section 39 of the 
MLA, 30 U.S.C. 209, to provide these reductions to promote development.
    The BLM reviewed the requirements of the final rule and determined 
that it would not adversely affect in a material way the economy, a 
sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities. For more detailed information, see the 
Regulatory Impact Analysis (RIA) prepared for this rule. The RIA has 
been posted in the docket for the rule on the Federal eRulemaking 
Portal: https://www.regulations.gov. In the Searchbox, enter ``RIN 
1004-AE58'', click the ``Search'' button, open the Docket Folder, and 
look under Supporting Documents.

Reducing Regulation and Controlling Regulatory Costs (E.O. 13771)

    This final rule is an E.O. 13771 deregulatory action. As discussed 
in section 1 and detailed in section 3 of the RIA, the estimated cost 
of the final rule is negative (a net benefit) in that it could produce 
a benefit to society from greater overall non-energy solid leasable 
(NESL) minerals economic activity. This leads to the final rule having 
an annual net benefit of between $0 and $1.62 million in 2018 dollars 
($1.45 million in 2016 dollars) per affected industry depending on the 
resource that could be counted under Executive Order 13771, section 
2(c), as offsetting costs from any new regulation that the Department 
of the Interior may propose.
    The BLM does not expect a change of Federal revenues from 
promulgation of this rule, as it does not directly affect royalty 
rates. If the BLM were to reduce royalty rates subsequent to this 
rulemaking, there may be a decrease in federal revenues collected in 
order to ensure the greatest ultimate recovery.

[[Page 67678]]

This, however, would depend on the specific parameters of the royalty 
adjustments and the market environment at the time of action, as a 
royalty rate reduction may allow operations and royalty revenue to 
continue from operations that may otherwise have ceased if they did not 
receive a royalty reduction.

Administrative PAYGO (E.O. 13893)

    E.O. 13893, ``Increasing Government Accountability for 
Administrative Actions by Reinvigorating Administrative PAYGO'' (Oct. 
10, 2019), requires agencies to ``include one or more proposals for 
reducing mandatory spending whenever an agency proposes to undertake a 
discretionary administrative action that would increase mandatory 
spending. section 3 of E.O. 13893 defines ``discretionary 
administrative action'' in part as an administrative action that is not 
required by statute and would impact mandatory spending. This 
rulemaking adopts regulatory language to more closely align with the 
broad statutory authority, including at 30 U.S.C. 290.
    For the purpose of examining the rule under E.O. 12866, the BLM 
analyzed what the potential impacts would be if the royalty rates for 
these commodities were reduced, including reduced contributions to the 
U.S. Treasury. The scenarios examined are hypothetical and would not 
take effect with the issuance of this rule. Because this rule does not 
directly affect royalty rates, the BLM cannot at this time assess the 
impact of specific royalty rate adjustments that may be implemented at 
a future date. The statute allows the Secretary to make a decision in 
order to ensure the greatest ultimate recovery of the resource. While 
we estimate that the potential royalty rate reductions could reduce 
contributions to the U.S. Treasury, there may be instances where 
royalty reductions could incentivize mining to continue for a longer 
duration on public lands, versus closure of operations, and therefore 
could ensure royalty payments at a reduced rate for a longer time 
horizon. The Mineral Leasing Act envisions a fluctuating minerals 
market in which the Secretary may need to waive, suspend, or reduce 
royalty rates in order to ensure the greatest ultimate recovery of the 
resource. This rulemaking takes into account the markets for a given 
mineral at a certain snapshot in time.

Regulatory Flexibility Act

    This rule will not have a significant economic effect on a 
substantial number of small entities under the Regulatory Flexibility 
Act (5 U.S.C. 601 et seq.). The Regulatory Flexibility Act (5 U.S.C. 
601 et seq.) (RFA) generally requires that Federal agencies prepare a 
regulatory flexibility analysis for rules subject to the notice-and-
comment rulemaking requirements under the Administrative Procedure Act 
(5 U.S.C. 500 et seq.), if the rule would have a significant economic 
impact, whether detrimental or beneficial, on a substantial number of 
small entities. See 5 U.S.C. 601-612. Congress enacted the RFA to 
ensure that government regulations do not unnecessarily or 
disproportionately burden small entities. Small entities include small 
businesses, small governmental jurisdictions, and small not-for-profit 
enterprises.
    The BLM examined current BLM lessors for soda ash and potash and 
found that 0 of 5 soda ash lessors, 1 of 3 potash lessors, and 1 of 1 
gilsonite lessors are entities that constitute a small business. While 
this could be considered a substantial number of small businesses in 
the context of entities affected by this rule, the final rule does not 
directly have a significant economic impact.
    The final rule's only direct economic impact is the reduced 
information collection requirements for an application, which lessens 
the burden on the company when applying for a royalty rate reduction. 
We have calculated this to be an average saving of $680 a year. The 
rest of this rule gives the BLM tools to potentially reduce royalty 
rates in the future but does not currently affect industry. The BLM 
will consider the economic impacts on affected entities when issuing 
reductions under this final rule.
    For the purpose of carrying out its review pursuant to the RFA, the 
head of the BLM certifies that this final rule will not have a 
``significant economic impact on a substantial number of small 
entities.''. The agency certifies this on the basis that the final rule 
does not have a significant economic impact. A final regulatory 
flexibility analysis is therefore not required. For a more detailed 
discussion see the section 2.8 of the RIA.

Small Business Regulatory Enforcement Fairness Act (SBREFA)

    This rule is not a major rule under the Small Business Regulatory 
Enforcement Fairness Act, 5 U.S.C. 804(2). This rule:
    (a) Does not have an annual effect on the economy of $100 million 
or more. The BLM estimates that the rule would provide an annual 
benefit of $619,000 to the economy. Please see the RIA for this rule 
for a more detailed discussion.
    (b) Will not cause a major increase in costs or prices for 
consumers, individual industries, Federal, State, or local government 
agencies, or geographic regions. The rule is designed to lessen the 
burden on industry, when necessary, while still providing revenue to 
the government. This revenue is based on commodity price, adjusted 
royalty rate, and production amounts.
    (c) Does not have significant adverse effects on competition, 
employment, investment, productivity, innovation, or the ability of 
U.S.-based enterprises to compete with foreign-based enterprises. This 
rule may foster positive effects in each of these areas. This rule 
would improve the BLM's ability to provide relief to the affected 
industry.

Unfunded Mandates Reform Act

    This rule does not impose an unfunded mandate on State, local, 
tribal governments, or the private sector of more than $100 million per 
year. The rule does not have a significant or unique effect on State, 
local, tribal governments or the private sector. This rule would affect 
only the BLM's process for providing reductions to rental, royalties or 
minimum production requirements of Federal leases. A statement 
containing the information required by the Unfunded Mandates Reform Act 
(2 U.S.C. 1531 et seq.) is not required.

Takings (E.O. 12630)

    This rule does not affect a taking of private property or otherwise 
have taking implications under E.O. 12630. Section 2(a) of E.O. 12630 
identifies policies that do not have takings implications, such as 
those that abolish regulations, discontinue governmental programs, or 
modify regulations in a manner that lessens interference with the use 
of private property. The rule is a deregulatory action and does not 
interfere with private property. A takings implication assessment is 
not required.

Federalism (E.O. 13132)

    Under the criteria in section 1 of E.O. 13132, this rule does not 
have sufficient federalism implications to warrant the preparation of a 
federalism summary impact statement. It does not have substantial 
direct effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government. The rule would 
reduce burdens on industry and more closely align BLM regulations with 
the relevant statute. A federalism summary impact statement is not 
required.

[[Page 67679]]

Civil Justice Reform (E.O. 12988)

    This rule complies with the requirements of E.O. 12988. 
Specifically, this rule:
    (a) Meets the criteria of section 3(a) requiring that all 
regulations be reviewed to eliminate errors and ambiguity and be 
written to minimize litigation; and
    (b) Meets the criteria of section 3(b)(2) requiring that all 
regulations be written in clear language and contain clear legal 
standards.

Consultation With Indian Tribes (E.O. 13175 and Departmental Policy)

    The Department of the Interior strives to strengthen its 
government-to-government relationship with Indian tribes through a 
commitment to consultation with Indian tribes and recognition of their 
right to self-governance and tribal sovereignty. We have evaluated this 
rule under the Department's consultation policy and under the criteria 
in E.O. 13175 and have determined that it has no substantial direct 
effects on federally recognized Indian tribes and that consultation 
under the Department's tribal consultation policy is not required. The 
rule would apply to non-energy mineral leases on the Uintah and Ouray 
Indian Reservation, Hillcreek Extension, State of Utah (43 CFR 
3503.11(b)), but no active leases have been present on those lands for 
approximately 15 years. There are no plans to grant new leases to any 
entity at this time, nor is there any entity interested in pursuing 
leases on those lands. This is a procedural rule that does not change 
any royalty rates. If the BLM considers implementing an area- or 
industry-wide reduction under this rule that may have impacts on a 
tribe or tribes, the BLM would initiate tribal consultation, as 
appropriate, at that time.

Paperwork Reduction Act (44 U.S.C. 3501 et seq.)

    This final rule contains a collection of information that the BLM 
has submitted to the Office of Management and Budget (OMB) for review 
and approval under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 
et seq.). We may not conduct or sponsor and you are not required to 
respond to a collection of information unless it displays a currently 
valid OMB control number. Collections of information include requests 
and requirements that an individual, partnership, or corporation obtain 
information, and report it to a Federal agency (44 U.S.C. 3502; 5 CFR 
1320.3(c) and (k)). The OMB has reviewed and approved the information 
collection requirements in this rule and assigned OMB Control Number 
1004-0121, which expires October 31, 2022.
    The proposed rule, soliciting comments on the collections of 
information for 60 days, was published in the Federal Register on 
October 18, 2019 (84 FR 55873). No comments were received related to 
the information collection activities.
    This final rule retains most of the text of the existing 
regulations while making only a small number of changes. The BLM has 
determined that the changes in the final rule are necessary to update 
the process for lessees to seek and for the BLM to grant reductions of 
rental fees, royalty rates, and/or minimum production requirements 
associated with all non-energy solid leasable mineral under 43 CFR part 
3500.
    At present, 32 information collection activities are authorized 
under control number 1004-0121. This information collection request 
pertains to this final rule in which the BLM will revise control number 
1004-0121 by dividing one previously approved information collection 
activity, Application for Waiver, Suspension, or Reduction of Rental or 
Minimum Royalties, or for a Reduction in the Royalty Rate, into two 
activities. One activity will be limited to applications for suspension 
of operations, and the other activity will include applications for 
reductions of rental, royalties, and minimum production. The net result 
of this revision will be that control number 1004-0121 will include 33 
information collection activities.
    In addition, the BLM is reducing the hours for the application for 
reduction of rental, royalties, or minimum production (43 CFR 3513.15 
and 3513.16). The result will be a 10-hour reduction of estimated 
industry staff time, from 100 hours to 90 hours per application, of 
information that industry has to collect at present to submit an 
application.
    The net reduction of 10 burden hours per year will be a result of 
revisions of 43 CFR 3513.15 that will simplify applications for 
reduction of rental, royalties, or minimum production requirements. 
These revisions will:
     Remove current Sec.  3513.15(f), which at present requires 
a tabulated statement of the leasable minerals mined for each month 
covering at least the last twelve months before the filing of the 
application, and the average production mined per day for each month;
     Move current paragraph (g) to new paragraph (f), but make 
no other changes to that paragraph, which requires that an application 
for relief from the minimum production include complete information why 
minimum production was not attained;
     Remove paragraph (h), which currently requires a detailed 
statement of expenses and costs of operating the entire lease, and the 
income from the sale of any leased products;
     Revise current paragraph (i) by requiring 
``justification'' rather than ``all facts'' showing why the operator 
cannot successfully operate the mines under the royalty or rental fixed 
in the lease and other lease terms;
     Move current paragraph (i) to new paragraph (g);
     Remove current paragraph (j), which at present requires 
that an application for reduction of royalty must include full 
information about any royalties the lessee pays to anyone other than 
the United States and a description of the efforts the lessee has made 
to reduce the other royalties;
     Remove current paragraph (k), which requires documents 
demonstrating that the total amount of overriding royalties the lessee 
will pay will not exceed one-half the proposed reduced royalties due 
the United States;
     Revise current paragraph (l) to require ``any other 
information BLM needs to determine whether the request satisfies the 
standards in [43 CFR] 3504.25 or [43 CFR] 3513.12.'';
     Move current paragraph (l) to new paragraph (h).
    Abstract: The BLM requests OMB to approve the revision of control 
number 1004-0121 in light of a final rule, which is intended to 
streamline applications for various forms of relief, including royalty 
rate reductions. Information Collection burdens associated with 43 CFR 
3500 are approved under OMB Control Number 1004-0121 (27,306 annual 
burden hours, 507 annual responses, and $2,050,695 non-hour costs; 
expires October 31, 2022). This rule reduces annual burden hours by 10 
hours. There are no changes to number of response or non-hour cost 
burdens.
    Title of Collection: Leasing of Solid Minerals Other Than Coal and 
Oil Shale.
    OMB Control Number: 1004-0121.
    Form:
     Form 3504-1, Personal Bond and Power of Attorney under 
Mineral Lease or Prospecting Permit for Mining Deposits;
     Form 3504-3, Bond Under Lease for Mining Deposits;
     Form 3504-4, Statewide or Nationwide Personal Mineral Bond 
for Prospecting Permits and Leases--Coal, Sodium, Phosphate, Potassium, 
Sulphur, and Other Mineral Deposit;

[[Page 67680]]

     Form 3510-1, Prospecting Application and Permit;
     Form 3510-2, Phosphate or Sodium Use Permit; and
     Form 3520-7, ___Lease.
    Type of Review: Revision of a currently approved information 
collection.
    Description of Respondents: Holders of Federal leases of solid 
minerals other than coal and oil shale.
    Respondents' Obligation: Required to obtain or retain a benefit.
    Frequency of Collection: On occasion.
    Estimated Number of Annual Responses: 507.
    Estimated Total Annual Burden Hours: 27,296.
    Estimated Total Annual Non-Hour Cost: $2,050,695.
    As part of our continuing effort to reduce paperwork and respondent 
burdens, we invite the public and other Federal agencies to comment on 
any aspect of this information collection, including:
    (1) Whether or not the collection of information is necessary for 
the proper performance of the functions of the agency, including 
whether or not the information will have practical utility;
    (2) The accuracy of our estimate of the burden for this collection 
of information, including the validity of the methodology and 
assumptions used;
    (3) Ways to enhance the quality, utility, and clarity of the 
information to be collected; and
    (4) Ways to minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of response.
    If you wish to comment on the information collection activities, 
you may send your comments and suggestions on this information 
collection to the Desk Officer for the Department of the Interior at 
OMB-OIRA. To see a copy of the information collection request submitted 
to OMB, go to http://www.reginfo.gov (select Information Collection 
Review, Currently Under Review); or you may obtain a copy of the 
supporting statement for the collection of information by contacting 
the Bureau's Information Collection Clearance Officer. Send your 
comments and suggestions on this information collection to the Desk 
Officer for the Department of the Interior at OMB-OIRA at (202) 395-
5806 (fax) or [email protected] (email). Please provide a 
copy of your comments to Faith Bremner, Senior Regulatory Analyst, 
Bureau of Land Management, 20 M Street SE, Room 2134 LM, Washington, DC 
20003; or by email to [email protected]. Please reference OMB Control 
Number 1004-0121 in the subject line of your comments.''

National Environmental Policy Act

    The BLM has determined that the changes made by this final rule are 
administrative or procedural in nature in accordance with 43 CFR 
46.210(i) (``Policies, directives, regulations, and guidelines: that 
are of an administrative, financial, legal, technical, or procedural 
nature; or whose environmental effects are too broad, speculative, or 
conjectural to lend themselves to meaningful analysis and will later be 
subject to the NEPA process, either collectively or case-by-case''). 
Further, the final rule does not involve any of the extraordinary 
circumstances listed in 43 CFR 46.215 that would require further 
analysis under NEPA. Therefore, this action is categorically excluded 
from environmental review under the National Environmental Policy Act 
(NEPA).

Effects on the Energy Supply (E.O. 13211)

    This rule is not a significant energy action under the definition 
in E.O. 13211. This rule would amend only BLM regulations that could 
impact non-energy solid leasable minerals. A Statement of Energy 
Effects is not required.

Author

    The principal authors of this rule are: Lindsey Curnutt, Division 
of Solid Minerals; Charles Yudson, Division of Regulatory Affairs; 
assisted by the Office of the Solicitor.

Katharine Sinclair MacGregor,
Deputy Secretary, U.S. Department of the Interior.

List of Subjects in 43 CFR Part 3500

    Government contracts, Hydrocarbons, Mineral royalties, Mines, 
Phosphate, Potassium, Public lands-mineral resources, Reporting and 
recordkeeping requirements, Sodium, Sulphur, Surety bonds.
    For the reasons set out in the preamble, the Bureau of Land 
Management amends 43 CFR part 3500 as follows:

PART 3500--LEASING OF SOLID MINERALS OTHER THAN COAL AND OIL SHALE

0
1. Revise the authority citation for part 3500 to read as follows:

    Authority:  5 U.S.C. 552; 30 U.S.C. 189, 192c, and 209; 43 
U.S.C. 1701 et seq.; and sec. 402, Reorganization Plan No. 3 of 1946 
(5 U.S.C. appendix).


0
2. Revise Sec.  3513.11 to read as follows:


Sec.  3513.11   May BLM relieve me of the lease requirements of rental, 
minimum royalty, or production royalty while continuing to hold the 
lease?

    Yes. The BLM has a process that may allow you temporary relief from 
these lease requirements in accordance with 30 U.S.C. 209.

0
3. Revise Sec.  3513.15 to read as follows:


Sec.  3513.15   How do I apply for reduction of rental, royalties, or 
minimum production?

    You must submit your application with the following information for 
all leases involved:
    (a) The serial numbers;
    (b) The name of the record title holder(s);
    (c) The name of the operator and operating rights owners if 
different from the record title holder(s);
    (d) A description of the lands by legal subdivision, if the 
application is for a portion of the lease;
    (e) A map showing the serial number and location of each mine or 
excavation and the extent of the mining operations;
    (f) If you are applying for relief from the minimum production 
requirement, the information sufficient to demonstrate why you did not 
attain the minimum production;
    (g) Justification showing why you cannot successfully operate the 
mines under the royalty or rental fixed in the lease and other lease 
terms;
    (h) Any other information that BLM needs to determine whether the 
request satisfies the standards in Sec.  3513.12.

0
4. Add Sec.  3513.17 to read as follows:


Sec.  3513.17   How will BLM implement a reduction of rental, 
royalties, or minimum production?

    (a) The BLM may reduce rental, royalties, or minimum production on 
its own initiative if the BLM determines, based on available 
information, that it is necessary to promote development of the mineral 
resource. Such a reduction may be for a specific geographic area, or on 
an industry-wide basis.
    (b) The BLM may reduce rental, royalties, or minimum production in 
response to an application submitted under Sec.  3513.15 if the 
application meets the criteria in Sec.  3513.12.
    (c) The BLM may grant a reduction not to exceed:
    (1) 10 years from the date of implementation under paragraph (a) of 
this section, or
    (2) 10 years from the date of the decision to approve the 
application

[[Page 67681]]

submitted under paragraph (b) of this section, or for a maximum 
quantity of mineral production as determined by the BLM.

[FR Doc. 2020-23003 Filed 10-23-20; 8:45 am]
BILLING CODE 4310-84-P