Mineral Policy Center Testimony.7Jun89-11: the enforcement of environmental protection during times of laggard agency policy; given the history of mining administration, the need is clear. No Permit or Patent to Violators: A provision should be included to provide that no exploration plan or mining and reclamation plan shall be approved for, and no mineral patent shall be issued to, any person, association, corporation, or any subsidiary, affiliate, or person controlled by or under common control with such person, association, or corporation, during an period in which such entity has failed or refused to imply in any material respect with the reclamation requirements established under this Act for any prior mining operation to which such requirements applied. This provision will be a powerful incentive to force diligent cleanup. Similar provisions already exist in the Surface Mining Control and Reclamation Act and in the Federal Onshore Oil and Gas Leasing Reform Act, among others. See attached Great Falls Tribune article, "After the gold work," for an example of the need for this authority. -Additionally, we support the inclusion of a further group of enforcement provisions, including penalties, fines, and imprisonment for violation of the reformed mining law. Transition Provisions: The prohibition on any further patenting of claims under the 1872 Mining Law is crucially important. For example, 2016 unpatented claims now exist within units of the National Park System. If these are permitted to go to patent, the Park Service estimates that roughly one-fourth of them will be found to be valid. This means that 504 new twentyacre inholdings, which can be used for any purpose, could be created in the Park System through the patenting terms of the 1872 Mining Law unless prevented. This year, about $1.6 billion worth of gold will be mined from unpatented claim land in Nevada; one company, Echo Bay Mines, controls "about 125 square miles" on their "claim block" (1988 Annual Report). If a cutoff of surface patenting is not implemented immediately, these valuable public properties will Mineral Policy Center Testimony.7Jun89.12: slide into private, often foreign corporate, ownership. In 1981, the U.S. Court of Claims sustained a previous legislative ban on Mining Law patenting, in Andrew L. Freese, 2d, v. U.S., 639 F.2d 754. Since the claimant still has an opportunity to mine the claimed mineral, even under new regulations, no "taking" obligation is created by terminating the opportunity to patent lands. The bill creates a "two-tier" system of claims for the indefinite future. We see no need for this. After a reasonable period say one year from date of enactment, the final bill should provide for termination of all claims not reapplied for under the new law. With mining as with taxes, the government is under no obligation to give anything away in the future, simply because it did so in the past. Conclusion: On behalf of our own members, and of the over seventy local grassroots citizens groups we assist who are concerned with the environmental impacts of mining, we applaud the "Mining Law of 1989." We urge the Subcommittee to adopt the strengthening amendments we have suggested, to make it an even better tool. The older hands in the mining industry have grown accustomed to the 1872 Mining Law, and of course will be reluctant to see it changed. But there are new faces and more environmentally-aware folks in the industry, though they may not be in positions to testify before you today. Reform of the Mining Law will not be a detriment to the serious provision of mineral supplies for the Nation; rather, by ending the legal isolation of mining as a "special case" overriding the multiple-use consensus on our public lands, reform will do the industry, as well as the public, a great service. We thank you for the opportunity to testify before you today. We urge you to persevere. Attachments: "After the gold work," Great Falls Tribune, 20 June 1988. Photograph of acid mine drainage, Fisher Creek, Great Falls TRIBUNE, June 20, 1988 After the gold work Miner, state at odds over cleanup of old gold site B. Dale Fayram "There's tremendous remaining problem," said Kevin Keenan of the Health Department's Water Quality Bureau. "It's just a matter of time and it's all going to come down the hill. It would take tens of thousands of dollars to fix the damage." That damage will have to be paid for by taxpayers, as the Canadian-based company that mined the site, Sparrow Resources Ltd., folded in 1982. Bonds posted by the company were not adequate to cover all reclamation costs. Sparrow also left behind a quartermillion dollars' worth of unpaid fines levied for water-quality violations. But the Nellie Grant is not all that worries state and federal officials. Sparrow's founder, B. Dale Fayram, is attempting to expand another mine near Rock Creek, a prime trout stream east of Missoula. The gold and sapphire mine is located in Quartz Gulch, about 40 miles south of the stream's mouth. The mining operation already has encountered trouble. In March, the state Health Department sued Fayram and his companies, American Eagle Mining, and Questor Mining and Equipment, for violating the state's water-quality act. In February, the Department of State Lands rebuffed his request for a permit to expand the mine, calling the application "grossly deficient." And the Forest Service said Fayram could not do any more mining at the site until he Increased his bond from $3,200 to $15,200. In an interview last week, Fayram charged that government officials are trying to block his mine because of political pressure from the Rock Creek Advisory Council, a group he said wants to stop mining in the drainage. He threatened to sue the state to force it to let him proceed. State officials deny his charge, but say they are keeping a close eye on Quartz Gulch because of their bad experience with the problems at the Nellie Grant. He said he "Nellie Grant has absolutely nothing to do with Quartz Gulch," he said. "You can't run Three other former officers of Sparrow took issue with Fayram's claim that he was "He was running the goddamn thing," said Rodney Drake, another former director Fayram, who refused to say why he re- Denholme could not be contacted for comment. Meanwhile, Fayram said, he hopes to get the Quartz Gulch mine back in operation later this year. Last year, he operated under the small miner's exclusion, which exempts miners from filing plans if they work less than five acres of land and 36,000 tons of ore annually. While examining plans earlier this year, the Forest Service expressed concern about whether existing dikes and dams were adequate and whether reclamation plans were adequate. Fayram said the project would add another settling pond. He also said: "It is the company's policy to do the best job of reclamation as is reasonably possible and will cooperate fully with the Forest Service in the reclamation of Quartz Gulch." Fayram said he hopes to soon post the See MINE, 2A State officials are hoping to prevent recurrence of scen where metal-laden water sits outside the Nellie Grant Mine Great Falls TRIBUNE, June 20, 1988 Mine higher bond requested by the Forest Service in order to resume operations. Once that is done, he said, he will negotiate with the state Department of Health, which filed the lawsuit in March that charged his project was imperlling the water quality of Rock Creek The de partment requested $20,000 in fines. Fayram said he is willing to meet the department's request that he hire a Montana-registered engineer to supervise work on settling ponds. In its suit, the agency said the mine violated state law twice last fall when settling ponds leaked, caushing silt-laden water to spill through the gulch and into a nearby hayfield. The silt did not travel all the way to nearby Rock Creek. The suit names as defendants American Eagle Mining, and Questor Mining and Equipment. It also takes the unusual step of naming Fayram individually. Fayram said the incident was "blown way out of proportion" as there was just one spill, not two, and the silt did not get to Rock Creek. "We turned ourselves in," he added. "We're good corporate citizens." If he can iron out that problem, Fayram said, he hopes to persuade the State Lands Department to give him a permit allowing expansion of his operations. Expansion, he said, would increase his efficiency. But Fayram has much to do to satisfy the department. Asked whether the department would consider Fayram's ties to Nellie Grant when deciding whether to issue a permit to the Quartz Gulch Mine, state Hardrock Bureau Chief Kit Walther said that was a legal question he could not answer. He also said he could not say any thing about Fayram's operation be cause the information is confidential under the small miner's exclusion. Meanwhile, the department's chief legal counsel, Lyle Manley, indicated that Sparrow's problems probably cannot be held against American Eagle. Corporate officers generally are not liable for the acts of a corporation, he said. Fayram is listed in state records as the registered agent, a director and vice president of American Eagle and Questor. Directors of the companies are based in Texas, Alabama and California. Except for Fayram, Sparrow had none of the same officers. Most of Sparrow's directors were from Canada. Grant and Quartz Gulch mines. The Health Department notified Normax, another mining company with which Fayram was associated, that it had violated conditions of its water-discharge permit at its Gold Crown Mine exploration adit west of Helena. Officials said the violations were because of heavy rains that produced large flows of water through Fayram's run-ins with state offi- • cials are not limited to the Nellie 1 From 1A the site in the fall of 1981. The company ceased operations a short time later. To deal with problems at the Nellie Grant site, the 1987 Legisla ture appropriated $78,000 from the Resource Indemnity Trust fund to reclaim the mine site. A bid request is expected this summer on the project, which will attempt to restore the area to its natural state. |