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Issues >
Public
Lands > Choice Cut
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Under the 1872 Mining Law, mining companies extract minerals from publicly owned lands without paying royalties to the federal government. This policy differs from federal policy toward the coal, oil and gas industries, all of which must pay royalties for extracting minerals from public lands. In 2000, mining corporations extracted almost $1 billion worth of minerals from public lands without any royalty payment to taxpayers. Adding insult to injury, the 130-year-old law also allows a mining company to patent, or buy, mineral-rich public land for $5 an acre or less, paying 1872 prices for land worth billions of dollars. The archaic 1872 Mining Law not only distorts the minerals market, it promotes environmental destruction of public lands because it includes no provisions for environmental protection and elevates mining as the best use of the land, regardless of other potential uses. Green
Scissors Proposal 2) Make permanent, and also double, the fee mining companies pay to maintain their unpatented claims on public lands, from $100 per claim annually to $200 annually, to better reflect the value of these claims. Moreover, the fee should be doubled again to $400 if no mining occurs within five years of filing a mining claim. Without adjustment for any decline in claims associated with an increased fee, a doubled fee would return approximately $50 million per year to taxpayers. 3) Eliminate mineral patenting, which amounts to the giveaway of public lands for $5 per acre. Current Status In 2001, Congress renewed a moratorium on patenting, originally passed in 1994, blocking billions of dollars worth of public lands giveaways. But patent applications filed before 1994 may still proceed. More recent efforts to enact a mineral royalty and create an abandoned mine reclamation program have been blocked in Congress. H.R. 410, a legitimate mining reform bill introduced by Representative Nick Rahall (D-W. VA.), remained bottled up in the House Resources Committee in 2000. In
October 2001, Interior Secretary Gale Norton, through the Bureau
of Land Management, published revised regulations that govern
mining operations on public lands managed by the Department of
the Interior. The new 3809 mining rule (found in part 43, subpart
3809 of the Code of Federal Regulations), which went into effect
on December 31, 2001, contains a bonding provision requiring
mining companies to post bonds to pay for the full cleanup cost
for new mine proposals. However, because the rule eliminates
cleanup standards, it is uncertain what paying for cleanup will
mean. Consequently, taxpayers may still be liable for the cost
of mine cleanups in the future. Since the mining law was enacted, the U.S. government has given away more than $245 billion of mineral reserves through patenting or royalty-free mining, according to the Mineral Policy Center. The
subsidies embedded in public lands mining, along with the percentage
depletion tax allowance, create false incentives for miners and
distort the mineral market. Mining
can severely and permanently damage public lands. Mines
have polluted more than 40 percent of the headwaters of Western
watersheds, according to the Environmental Protection Agency,
and more than 550,000 abandoned hardrock mines scar the American
landscape. The Mineral Policy Center estimates the cost of cleaning
up such sites at $32 billion to $72 billion. Contacts
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