Conscious Choice: Stripping Our Public Lands for a Song

May 2000 | News of the Earth

Stripping Our Public Lands for a Song

by Dave Aftandilian

When President Ulysses S. Grant signed it, the 1872 Mining Law was intended to encourage mineral exploration and settlement in the West. The law "allows any person to stake a claim on [Western] lands and thereby to obtain the exclusive right to extract the minerals thereon without payment of royalty to the U.S. and without acquiring title to the land itself," writes the National Research Council. Originally the law applied to all minerals except coal, but it has since been restricted to so-called hardrock minerals such as gold, silver, platinum, copper, lead, zinc, magnesium, nickel, tungsten, and uranium.

All someone has to do to earn the right to mine on federal lands (excluding most land in the National Parks and other designated wilderness areas) is prove there are valuable minerals under the land being claimed, pay $100 a year in administrative fees, and spend $500 developing the claim. Until 1994, claimants were allowed to purchase — or "patent" — the land for no more than $5 an acre; Congress has placed an annual moratorium on patents every year since 1994, but it is still legal for claimants to mine the land without a patent. The law includes no environmental protections, nor does it make any provision for reclaiming the land after mining (since 1981, the Bureau of Land Management has required mining companies operating on BLM lands to purchase bonds for reclamation, but these rarely cover the full costs of restoring the land and water to its premining condition).

Because it allows extraction of valuable minerals from public lands without payment of any royalties or leasing fees, and entitles companies to purchase federal land at 1872 prices, Senator Dale Bumpers of Arkansas calls the 1872 Mining Law "a license to steal and the biggest scam in America." Critics such as Bumpers and all the major environmental groups say the law is obsolete and should be completely revised. Predictably, the mining companies and their allies among conservative Western senators think the 1872 Mining Law works just fine. The National Mining Association, for instance, states that "existing law more than adequately meets the four criteria essential to any mineral tenure law": it grants free and open access to land, exclusive exploration rights, rights to develop minerals discovered, and security of tenure. And it lets mining companies make a killing — environmental and economic — at the public’s expense.

Hardrock Mining and the Environment

Did you know that you have to tear out 2.8 tons of earth to make enough gold for one wedding ring? Put another way, "an average pair of gold wedding bands could make a six-foot-wide, six-foot-deep, ten-foot-long pile of tailings [mine waste] in the happy couple’s backyard," says Project Underground. Marry the excavations for all those rings and you get quite a lot of solid waste — 620 million tons a year, according to the Worldwatch Institute.

And that’s not the worst of gold mining’s impacts on the environment. Gold typically occurs in minute quantities in sulfide-bearing rock. Once this sulfide is exposed to air and water by mining, it reacts to form sulfuric acid. Acid mine drainage from the huge piles of waste tailings left behind by a gold mine can pollute hundreds of acres of land and miles of surface and ground water not just with the acid itself, but also with the heavy metals the acid dissolves out of the soil and carries with it. The Summitville gold mine in Colorado, for instance, poisoned a seventeen-mile stretch of the Alamosa River — the main source of irrigation water for farms and ranches in the San Luis Valley — with acids and toxic metals. Abandoned in December 1993, the mine is now a Superfund hazardous waste site.

Cyanide used to filter gold from the surrounding ore (a process called heap-leaching) is deadly to fish, wildlife, and people in very small quantities, and cyanide spills due to shoddy storage methods or overflow during heavy rains have caused massive environmental disasters. After heavy rains at the Brewer gold mine in South Carolina in 1990, the retaining wall of a cyanide containment pond broke, causing ten million gallons of cyanide solution to flood a tributary of the Lynches River, killing at least 10,000 fish. Thirsty birds are also frequent victims of cyanide containment ponds; between 1980 and 1990, nearly 7,000 birds were found dead near cyanide leach ponds in Arizona, California, and Nevada. (All figures in this paragraph are from the Mineral Policy Center.) Small wonder that the citizens of Montana voted in November 1998 to ban from their state all new mines using cyanide heap-leach.

Gold mines are bad, but they’re far from being the only hardrock mining villains. The Bunker Hill silver mine and smelting operation in Idaho, for instance, discharged 72 million tons of toxic metals into the Coeur d’Alene River, poisoning an estimated 150 square miles and causing an estimated $1 billion in environmental damage, according to the Natural Resources Defense Council. The Mineral Policy Center estimates that the hardrock mining industry as a whole has polluted 12,000 miles of American rivers and streams and 180,000 acres of lakes and reservoirs, and that it produces 2 billion tons of mining waste each year — that’s more than nine times the amount produced by all municipal solid-waste collection programs combined. Just how much and what kinds of hazardous waste are produced by hardrock mines in the United States each year used to be a closely guarded secret, but thanks to the Clinton Administration and a number of dedicated environmentalists, the EPA’s Toxics Release Inventory for 1999 (which should be available on the web soon at www.epa.gov/tri) will contain this information.

The Economics of Hardrock Mining

From start to finish, the 1872 Mining Law is nothing but corporate welfare, pure and simple. It allows companies to remove valuable minerals from public lands without paying any royalties or lease fees to the federal government that owns the land. We’re not talking chump change here; the Natural Resources Defense Council estimates that companies remove $2 to $3 billion worth of minerals from public lands every year for free. Compare that with the 12.5 percent royalties the government charges for offshore oil drilling, and you’ll see that hardrock miners are getting a sweetheart deal.

Until Congress began placing an annual moratorium on patenting of land under the 1872 Mining Act in 1994, companies were making a killing at public expense there too. Buying land for $5 an acre was a good deal in 1872, but it’s a bargain beyond compare today. For twenty patents the U.S. General Accounting Office reviewed in 1989, the federal government had received less than $4,500 for lands valued between $13.8 and $47.9 million. Small wonder that a lot of the patents claimed were never used for mining at all (also perfectly legal under the 1872 law), when the land itself was so valuable and could be obtained so cheaply. Another General Accounting Office study found that of ninety-three randomly selected patents, sixty-six had not been used at all, and twenty had been used for nonmineral purposes. Only seven were actually mined. According to a report from the National Wildlife Federation, patent holders in Denali National Park in Alaska plan to construct extensive resort facilities on their "mine land," and the owner of a 160-acre patent in a national forest near a popular resort in Colorado put it to good use as the site for his new luxury vacation home.

As if all that weren’t enough, generous tax incentives are also available for hardrock miners. Companies can expense (i.e., write off) the costs of exploration and development in the year that they’re spent. And an amazingly nonsensical provision called the percentage depletion allowance lets mining companies reduce their taxable gross profits by a fixed percentage each year. The rationale for this is that allowing corporations to deduct the cost of capital investments as those investments diminish in value will encourage new capital investment. But as the Mineral Policy Center points out, this deduction "makes sense only so long as the deducting company actually pays for the investment for which it claims a deduction" — which hardrock miners don’t do, since they mine public lands for a fee so low it might as well be free.

The giveaways don’t stop when the mines have run dry. While it’s true that many mining companies are required by the Bureau of Land Management (but not by the 1872 Mining Law) to post bonds to help pay for land- and water-reclamation efforts after their mines are closed, these bonds usually don’t even come close to providing enough money for cleanup. For instance, Galactic Resources Ltd. of Canada, which owned the Summitville mine mentioned above, posted $7.5 million in reclamation bonds. After declaring bankruptcy in 1993, the company was allowed to keep $2.5 million worth of the bonds, even though the EPA estimates cleanup costs will total at least $100 million. Who gets to pay the $95 million shortfall? Federal taxpayers.

To add insult to injury, many of the mining companies getting rich off our public lands are huge multinational corporations, many not even headquartered in the United States. And the lands they’re claiming for mining are often located on the traditional lands of Native Americans. The now-defunct Zortman-Landusky mine in north-central Montana, for instance, destroyed lands sacred to the Assiniboine and Gros Ventre tribes of the Fort Belknap reservation — including Spirit Mountain, which mining reduced to nothing more than a huge hole in the ground.

This exploitation of Native Americans by miners is part of a long and sad tradition in the U.S. history, starting with the first gold rush in central North Carolina, which by 1830 had drawn an estimated 10,000 miners who illegally worked lands granted by treaty to the Cherokee (who were forced to give up their lands to the prospectors and embark on the Trail of Tears to Oklahoma; see William C. Patric’s article "The Cost of Gold" in the Winter 1999 MPC News). And then there’s the more famous California Gold Rush that began in 1849, which according to Project Underground’s "Gold, Greed, and Genocide" report resulted in the displacement or murder of more than 100,000 Native Americans.

Upcoming Reform Legislation

If you think it’s about time we reformed the 1872 Mining Law, one of the most environmentally destructive and economically wasteful laws on the books, you’re not alone. Representative Nick Rahall of West Virginia introduced a comprehensive reform bill in January of last year — H.R. 410, the Mineral Exploration and Development Act of 1999. The bill would increase the annual fee to hold claims to $200 (though this fee would be waived for those who hold fewer than ten claims), stop all new land patents, require a reclamation plan and bond before exploration or mining permits are issued, establish a mine reclamation fund, charge an 8 percent royalty on minerals removed from federal lands, and require an "unsuitability review" by the Departments of the Interior (for BLM lands) or the Department of Agriculture (for Forest Service lands) to determine whether lands are unsuitable or conditionally suitable for mining. Most major environmental groups support this bill.

Representative George Miller of California has also come up with some decent hardrock mining law reform bills, though in general they don’t go as far as Rahall’s bill does — H.R. 394, the Hardrock Mining Royalty Act of 1999; H.R. 395, the Hardrock Reclamation Act of 1999; and H.R. 397, the Elimination of Double Subsidies for the Hardrock Mining Industry Act of 1999. Representative Rahall has cosponsored the last two bills.

There’s a good chance that some sort of hardrock mining reform bill will pass in the House; a similar reform bill (H.R. 322) sponsored by Representative Rahall in the 103rd Congress passed by a vote of 316 to 108 in November 1993. The real problem is the Senate, which is proportionately dominated by conservative Western senators. In the last session of Congress, Senator Larry Craig of Idaho introduced S. 1102, a sham reform bill favored by the mining industry; he is expected to reintroduce this bill soon.

Closer to home, the U.S. Forest Service is working on a new management plan for the Shawnee National Forest in southern Illinois. Currently the forest is mined for fluorspar (used in toothpaste and fire extinguishers) and tripoli (paints and abrasives), among other resources. The Illinois Sierra Club is making a big push to persuade the Forest Service to ban mining — as well as logging and oil and gas drilling — in the Shawnee. (You can send your comments to Shawnee Forest Supervisor, 50 Highway 145 South, Harrisburg, IL 62946, or e-mail r9_shawnee@fs.fed.us.)

You can help by writing your state representatives and senators and asking them to support H.R. 410. Tell them it’s time we stop giving corporate welfare benefits to one of the most polluting industries in America.

As Representative Rahall wrote when he introduced H.R. 410, "The issue of insuring a fair return to the public in exchange for the disposition of public resources, and the issue of properly managing our public domain lands, is neither Republican nor Democrat. It is simply one that makes sense if we are to be good stewards of the public domain and meet our responsibilities to the American people."

Resources

Mineral Policy Center (MPC), 202-887-1872, e-mail: mpc@mineralpolicy.org

Project Underground, 510-705-8981, e-mail: project_underground@moles.org

U.S. Congress, 202-224-3121, House of Representatives, Senate

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