On November 1, 2007, the House passed H.R. 2662, the Hardrock Mining and Reclamation Act.  This bill is a long-overdue reform bill that updates the Mining Law of 1872 for the 21st century.  For example, it requires hardrock mining companies (which mine for such valuable minerals as gold, silver and copper), for the first time, to pay royalties for their operations on federal lands. 

Following are highlights of the bill’s provisions.   

Benefits to U.S. Taxpayers

Imposes, for the first time, royalty payments for hardrock mining on federal lands.  Under the Mining Law of 1872, industry does not pay any royalties for  the publicly-owned minerals mined on federal lands.  It is estimated that since the Mining Law of 1872 was enacted, the U.S. government has given away more than $245 million of minerals through royalty-free mining and “patenting,” the forced sale of federal lands.  This bill, for the first time, requires hardrock mining operations to pay the government royalties for their operations on federal lands -- just as coal, oil and gas companies do now.  It would impose an 8 percent royalty on new hardrock mines, based on gross proceeds, while imposing a 4 percent royalty on existing hardrock mines.   The royalties, in turn, would help fund the estimated $30-$70 billion in abandoned mine reclamation costs – a cost U.S. taxpayers now foot.
 
Ends “patenting,” which amounts to practically giving away federal lands to mining companies.    The bill puts an end to the giveaway of public lands to mining companies – by repealing provisions in current law that allow companies to “patent” the land they have claimed; i.e., buy it for a fraction of the market price.  The practice of “patenting” has resulted in more than 3 million acres of our federal lands being practically given away to mining companies for as little as $2.50 to $5.00 an acre – ripping off U.S. taxpayers.   

Benefits to the Environment

Provides for practical and enforceable environmental standards.  The bill gives the Interior Department the right to say “no” to a proposed mine that would have severe, irreparable impacts on public resources.  It establishes a simple but effective standard for mining on federal lands; a proposed mine that cannot be carefully controlled to prevent undue degradation of lands and resources would not be permitted.  The bill also requires regulations to address a comprehensive list of environmental objectives and emphasizes transparency and public participation as critical elements of the mine permitting process.

By ending the giveaway of federal lands to mining companies, better preserves our wildlife habitat and prime hunting and fishing areas.  Federal lands harbor some of the most important fish and wildlife habitat and provide some of the finest hunting and fishing opportunities in the country.  For example, federal lands contain more than 50 percent of the nation’s blue-ribbon trout streams.  More than 80 percent of the most critical habitat for elk is found on lands managed by the Forest Service and the Bureau of Land Management alone.  Pronghorn antelope, sage grouse, mule deer, salmon and steelhead, and countless other fish and wildlife species are similarly dependent on federal lands.  By ending “patenting,” or the giveaway of federal lands, this bill protects critical wildlife habitat, as well as prime hunting and fishing areas.

Expands the federal lands where mining is prohibited.  The bill expands the federal lands where mining is prohibited to include such areas as wilderness study areas, areas of critical environmental concern, and  Wild and Scenic Rivers program areas.

Includes provisions helping local governments balance competing uses and values of federal lands.  The bill gives state and local governments the ability to petition the Interior Department to withdraw federal lands from mining to proactively protect drinking water, wildlife habitat, and other resources they determine are critical to their communities or local economies. 

Benefits to the Mining Industry

Provides numerous provisions to sustain a robust mining industry in the United States.  For example, the bill requires fully operational mines to pay only a 4 percent gross income royalty, recognizing that many companies have already made substantial investments in properties based on economic calculations without a royalty and should not, therefore, be subject to the full 8 percent royalty new mines will pay under the bill.  Another provision in the bill ensures that mining companies can continue to occupy lands once they have staked a claim to them.  

Simplifies the application process for exploration permits and extends the term of mine permits to 20 years.  The bill proposes a straightforward application process for exploration permits, in light of the shortcomings of applying a “one-size-fits-all” process to both exploration and operations.  In addition, in light of the complexities of the permitting process, the bill also extends the term of mine permits to 20 years, with an automatic renewal of 20 additional years.