Changing mining laws, gold price among enviro, industry concerns
From our weekly issue dated July 01, 2009
Waldo Mining District President Tom Kitchar, who’s combed Illinois Valley for gold since 1980, has relied during all that time on the provisions of mining laws established in 1872.
While those laws may have served Kitchar well through the years, efforts are being made continually at the federal level to update them. So far, the original mining laws have largely remained intact and survived legislative challenges. But a number of contributing factors may cause that to change.
Historical Perspective
Along with logging, mining was one of the original industries in Josephine County. In fact, Kitchar said that prior to World War II, mining was the county’s largest employer. The industry had declined considerably by the time Kitchar made his way to the area, and had peaked to around $700 per ounce in 1979 before dropping again.
Since then, the price of gold has risen considerably. As of Sunday, June 21, the price was listed at approximately $934 per ounce, as prevailing fears regarding the strength of the U.S. dollar has prompted investment in gold.
Shane Jimmerfeld, executive director of Illinois Valley-based Siskiyou Project, said that the rising cost of gold has prompted thegroup to examine patterns of mining activity in Southwestern Oregon.
He said that a study was conducted during 2001 on mining claims in the Siskiyou National Forest, the Illinois Valley and area land managed by the U.S. Forest Service and Bureau of Land Management. That study, which Jimmerfeld said showed approximately 1,200 claims then, was compared to more recent activities.
“It does look like there was an increase within the boundary of the Siskiyou National Forest,” he said. “A lot of it has to do with the fact that gold is going up.”
No Longer Alone
Kitchar also has noticed an uptick in mining-related activities in Illinois Valley. He is afraid that the people trying their hand at it for the first time may be causing problems for established miners like himself.
“There are lots of new people out there that don’t really totally understand what they’re doing,” Kitchar said. “People are filing claims on top of other people’s claims. I’ve personally had two different groups of people try to file on top of me this spring and winter based on faulty information from the Bureau of Land Management.”
Kitchar said that scenario almost reminds him of how things were in 1979, when a “huge amount of mining claims” were filed, and many people were living in tents on those claims. The difference now, according to Kitchar, is there’s much less gold than there was then.
“Unfortunately, the creeks are so small and were once worked so hard with a modern suction dredge that they don’t replenish themselves,” Kitchar said. “It’s a diminishing industry. Here, it’s nothing like it was in 1980.”
Jimmerfeld agrees that the overall supply of gold in the area has diminished throughout the years.
“To a large degree, most of those gold veins have been discovered and exploited,” he said. “They’re done.”
Kitchar and Jimmerfeld acknowledge that traces of the precious substance still are to be found, especially in Illinois Valley. What concerns Jimmerfeld is the fact that the declining value of the dollar “makes those trace bits out there more valuable.”
Although Jimmerfeld predicts that the price of gold “should be pretty close to its peak,” the environmental ramifications of increased mining are enough to keep him paying close attention to the issue.
“Mostly, what you find are pretty small claims where people were doing suction dredging, panning and that type of thing,” Jimmerfeld said. “But if gold goes up, that could change. It would be devastating to this area. Most of those types of things are contained to two places here: in streams, where they would have a major impact on salmon, and serpentine soils, where rare endemic plants are contained.”
The Frontier Days
Jimmerfeld points out that the situation was considerably different in the United States when the existing mining laws were codified.
“At the time that the bill came into play in 1872, it was a fairly reasonable idea because what it was designed to do was help settle the West,” he said. “The West has been well settled.”
Under the 1872 laws, Jimmerfeld said, a mining operation can patent the land surrounding a claim. He said that the cost of doing so has remained unchanged since.
“Through the process, they can take ownership of the land, at a return to the people of $2.50 per acre,” Jimmerfeld said. “It’s essentially free.” Foreign companies also can lay claim to those mining permits, he said.
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Kitchar’s defense of current mining law is a simple one.
“Basically, Congress granted all the valuable minerals on public lands to the public,” he said. “When you grant something, you can’t take it back. Otherwise, it wouldn’t be a grant,” he said. “Once they codified it in the 1872 law, they used such words as ‘exclusive possession.’
“That’s an exclusive right to enjoy a claim and an exclusive right to work a claim. Those minerals are private property.”
Attempted Remedies
Reforms to the mining laws have been attempted since passage of the original legislation, Kitchar said. Early legislation called for establishing a royalty on minerals, he added, but the government ended up spending more money trying to collect them than it was bringing in.
Jimmerfeld said that new laws to clear up outdated provisions of previous mining legislation are “definitely something we’re looking at.”
More recently, House Resolution 322 was introduced in Congress in 1993. It was co-sponsored by Rep. Peter DeFazio (D-Springfield), who represents much of Josephine County, including Illinois Valley.
Amendments to HR 322 established an 8 percent royalty value for minerals extracted from public land. But that bill stalled in the U.S. Senate.
Jimmerfeld said that a likely reason for the bills stalling in the Senate is the large amount of support that the mining industry has given to Majority Leader Harry Reid (D-Nev).
Introduced in 2007, the Hardrock Mining & Reclamation Act contained many of the same provisions as the 1993 proposal. That bill also stalled in the Senate, prompting introduction of the Hardrock Act of 2009.
Among other aspects, the current proposal would permanently end the sale of public land to developers at 1872 prices. It would establish a permitting process and strong environmental standard for mining; and use royalties to help fund $30 to $70 billion in cleanup for abandoned mine sites.
Jimmerfeld said that the establishment of the royalties would give the public a benefit for the use of its land.
“When a timber sale happens, the timber company pays for the trees,” he said. “If a filmmaker wants to shoot a film on public land, they have to pay permit fees. There’s all of this stuff where if people use natural resources, they pay for them because they belong to the American people, mining being the exception.”
Solution in Search of a Problem?
Kitchar said that collecting royalties from mining is akin to a “taking,” and is contrary to the spirit of the original mining legislation.
He stated, “That would be like if I came over to your house and said I want to take one wall of your garage or half of your tools. It’s the same thing. People don’t see if that way, they see the public land as everybody’s.
“What they don’t understand is if you read the law very carefully, as soon as you’ve filed a mining claim on a piece of public land, it’s no longer public land. It’s part of a mineral estate.”
Also, Kitchar said, various kinds of mining activities already are regulated by the government. Those include leaseable or sellable mining, under which USFS can lease or sell land to miners.
“Under those kinds of mining, they have the authority to totally regulate every step you take when you’re mining that,” Kitchar said. “About the only thing you can do around here that does not require prior permission or a permit from the federal or state agencies is pan up to 1 yard in any one given location per year.”
The Immediate Future
In a June 9 e-mail, DeFazio spokesman Molly Simmons wrote that the House Natural Resource Committee held hearings on mining reform in February.
“However, the committee is currently focused on climate change legislation which is a priority for the Obama administration,” Simmons said. “The Senate is expected to hold a hearing and possibly mark-up mining reform legislation this summer. The House will likely let the Senate go first this year.”
Jimmerfeld said that the new proposal is “not radical.” Passing the plan would ultimately serve the public interest, he feels.
“If we can get that done, it will be a major step towards balancing resource management in the West,” he said.
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