Newspaper article The Christian Science Monitor

Hard to Crystalize Support to Amend US Mining Law

Newspaper article The Christian Science Monitor

Hard to Crystalize Support to Amend US Mining Law

Article excerpt

WHEN a Canadian mining company last year paid the United States government less than $10,000 for title to a chunk of Nevada estimated to be worth as much as $10 billion, Interior Secretary Bruce Babbitt called it "the biggest gold heist since the days of Butch Cassidy."

Changing laws bound up in tradition - even ones that give foreigners a huge price break - has never been easy. This is proving especially true for mining laws in the West.

Both industry supporters and critics agree that the 123-year-old statue governing hardrock mining ought to be revamped. But the two sides remain so far apart on the key economic and environmental issues that it is doubtful reform will occur this year.

At stake are millions of acres of federal land and billions of dollars in potential revenue from gold, silver, copper, and other valuable minerals. Also at stake are such environmental treasures as Yellowstone National Park, which is less than three miles from a proposed mine site.

The key issues are ownership of the land and Uncle Sam's fair share of mineral revenues. Under the 1872 General Mining Law, those who stake a claim may obtain title to the land (called a "patent") for no more than $5 an acre, then pay no royalties to the federal government for extracted resources.

Royalty revisions

Western Republicans (and some Democrats) favor proposals that would charge a royalty of 3 percent on net income from mine operations. These bills retain the patenting system, charging miners "fair market value" for the federal land. But this covers only the surface value - which is not much in some desert areas - not the minerals below.

Critics call this "sham reform" and "the accountants full-employment act." They favor a bill put forth by Sen. Dale Bumpers (D) of Arkansas, a long-time critic of the 1872 law.

The Bumpers bill would end the patenting system and impose an 8 percent royalty on gross revenues. Supporters say this is closer to the 12.5 percent now paid for coal, oil, and gas leases on federal land. Mine operators say that kind of royalty would put many of the estimated 120,000 hardrock miners out of work. …

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