HF 2560

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 11:32pm

A bill for an act
relating to natural resources; providing for financial assurance for nonferrous
metallic mineral mining; amending Minnesota Statutes 2008, sections 93.481,
by adding a subdivision; 93.49; Minnesota Statutes 2009 Supplement, section
93.481, subdivision 1; proposing coding for new law in Minnesota Statutes,
chapter 93.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2009 Supplement, section 93.481, subdivision 1, is
amended to read:

Subdivision 1.

Prohibition against mining without permit; application for
permit.

Except as provided in this subdivision, after June 30, 1975, no person shall
engage in or carry out a mining operation for metallic minerals within the state unless the
person has first obtained a permit to mine from the commissioner. Any person engaging
in or carrying out a mining operation as of the effective date of the rules adopted under
section 93.47 shall apply for a permit to mine within 180 days after the effective date of
such rules. Any such existing mining operation may continue during the pendency of the
application for the permit to mine. The person applying for a permit shall apply on forms
prescribed by the commissioner and shall submit such information as the commissioner
may require, including but not limited to the following:

(1) a proposed plan for the reclamation or restoration, or both, of any mining area
affected by mining operations to be conducted on and after the date on which permits
are required for mining under this section;

(2) a certificate issued by an insurance company authorized to do business in the
United States that the applicant has a public liability insurance policy in force for the
mining operation for which the permit is sought, or evidence that the applicant has
satisfied other state or federal self-insurance requirements, to provide personal injury
and property damage protection in an amount adequate to compensate any persons who
might be damaged as a result of the mining operation or any reclamation or restoration
operations connected with the mining operation;

(3) an application fee of:

(i) $25,000 for a permit to mine for a taconite mining operation;

(ii) $50,000 for a permit to mine for a nonferrous metallic minerals operation;

(iii) $10,000 for a permit to mine for a scram mining operation; or

(iv) $5,000 for a permit to mine for a peat operation;

(4) deleted text begin a bond which may be deleted text end new text begin financial assurance as new text end required deleted text begin pursuant to deleted text end new text begin under new text end section
93.49 new text begin or 93.491 new text end ; and

(5) a copy of the applicant's advertisement of the ownership, location, and
boundaries of the proposed mining area and reclamation or restoration operations, which
advertisement shall be published in a legal newspaper in the locality of the proposed site
at least once a week for four successive weeks before the application is filed, except that if
the application is for a permit to conduct lean ore stockpile removal the advertisement
need be published only once.

Sec. 2.

Minnesota Statutes 2008, section 93.481, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Responsible persons. new text end

new text begin For purposes of nonferrous mining operations, the
permittee and any person who manages, directs, or conducts operations under this section,
including a parent entity or affiliate who materially participates in that management,
direction, or conduct of operations, is responsible for complying with sections 93.44 to
93.51, rules adopted under those sections, and any permit conditions required by those
sections or rules.
new text end

Sec. 3.

Minnesota Statutes 2008, section 93.49, is amended to read:

93.49 FINANCIAL ASSURANCE OF OPERATOR new text begin ; FERROUS MINING new text end .

The commissioner shall require deleted text begin a bond or other security or other deleted text end financial assurance
satisfactory to the commissioner from an operator new text begin of a ferrous mine new text end . The commissioner
shall review annually the extent of each new text begin ferrous mine new text end operator's financial assurance
under this section. new text begin Financial assurance for nonferrous mining operations is governed
by section 93.491.
new text end

Sec. 4.

new text begin [93.491] FINANCIAL ASSURANCE OF OPERATOR; NONFERROUS
MINING.
new text end

new text begin Subdivision 1. new text end

new text begin Financial assurance required. new text end

new text begin As a condition for issuing a permit
to mine, the commissioner of natural resources shall require financial assurance from a
nonferrous mine operator sufficient to cover the reasonably estimated costs of contracting
with a third party for closure, corrective action, reclamation, and postclosure maintenance.
When determining the amount of financial assurance, the commissioner shall consult with
the commissioner of the Pollution Control Agency and with individuals with documented
experience and expertise in nonferrous mining reclamation and water treatment.
new text end

new text begin Subd. 2. new text end

new text begin Long-term water treatment costs. new text end

new text begin The financial assurance shall include
the reasonably estimated costs of constructing, operating, and maintaining any water
treatment facilities that may be needed as a result of the mining activity to ensure
compliance with federal and state environmental requirements after mining ceases.
new text end

new text begin Subd. 3. new text end

new text begin Form of financial assurance. new text end

new text begin (a) The financial assurance shall be
deposited into a trust fund at a bank or trust company approved by the commissioner of
management and budget, with the funds available only upon the written request of the
commissioner of natural resources. Interest and investment returns from the trust fund
shall be retained by the trust fund.
new text end

new text begin (b) The financial assurance shall be in a form the commissioner of management
and budget determines will adequately protect the state's taxpayers if a nonferrous mine
operator or other responsible person defaults on the permit obligations. The commissioner
of management and budget may accept financial assurance only in the following forms:
new text end

new text begin (1) cash or cash equivalents;
new text end

new text begin (2) bills, certificates, notes, or bonds of the United States;
new text end

new text begin (3) other obligations of the United States or its agencies;
new text end

new text begin (4) obligations of any corporation wholly owned by the federal government; and
new text end

new text begin (5) indebtedness of the federal National Mortgage Association.
new text end

new text begin Subd. 4. new text end

new text begin Prohibited forms of financial assurance. new text end

new text begin The commissioner of
management and budget may not accept the following as financial assurance under
this section: corporate guarantees, self-insurance, financial tests, captive insurance, or
any other form the commissioner of management and budget determines may become
unavailable to the state if the nonferrous mining operator or other responsible person
defaults on the permit obligations.
new text end

new text begin Subd. 5. new text end

new text begin Annual review of financial assurance. new text end

new text begin (a) The commissioner of natural
resources, in consultation with the commissioner of management and budget, shall review
at least annually the adequacy of each nonferrous mine operator's financial assurance
under this section. The commissioner of natural resources shall require additional financial
assurance if the commissioner determines during the annual review or at any other time
that the operator's financial assurance is inadequate.
new text end

new text begin (b) After completion of the review under paragraph (a), the commissioner of natural
resources shall publish a notice in the State Register and the Environmental Quality Board
Monitor stating that the commissioner has completed review of the financial assurance in
place, stating whether the amount and type of financial assurance in place is adequate, and
providing a detailed analysis of the rationale for the commissioner's decision.
new text end

new text begin (c) Written objections to the commissioner's financial assurance review may be
filed with the commissioner no later than 30 days following the publication required
under paragraph (b). Within ten days after the final day for filing written objections, the
commissioner shall determine whether any of the objections raise a material issue of fact
and whether there is a reasonable basis underlying the issue of fact such that holding a
hearing would allow the presentation or introduction of relevant information that would
aid the commissioner in making a final determination on the adequacy of the operator's
existing financial assurance or the type and level of financial assurance to be required.
If the commissioner concludes that any of the objections meet those requirements, the
commissioner shall commence a contested case under the contested case procedures
adopted by the Office of Administrative Hearings.
new text end

new text begin Subd. 6. new text end

new text begin Release of financial assurance. new text end

new text begin (a) Before the release of any amount of the
financial assurance to the permittee of a nonferrous mining operation, the commissioner
of natural resources shall publish a notice of the action in the State Register and the
Environmental Quality Board Monitor.
new text end

new text begin (b) Written objections to the commissioner's financial assurance release decision may
be filed with the commissioner no later than 30 days following the publication required
under paragraph (a). Within ten days after the final day for filing written objections, the
commissioner shall determine whether any of the objections raise a material issue of fact
and whether there is a reasonable basis underlying the issue of fact such that holding a
hearing would allow the presentation or introduction of relevant information that would
aid the commissioner in making a final determination on whether to release all or part
of the financial assurance. If the commissioner concludes that any of the objections
meet those requirements, the commissioner shall commence a contested case under the
contested case procedures adopted by the Office of Administrative Hearings.
new text end

new text begin (c) The portion of the financial assurance attributable to the estimated cost of water
treatment shall not be released until the discharge has ceased for a period of five years, as
determined by ongoing monitoring and testing, or, if the discharge is continuous, until the
operator has met all applicable effluent limitations and water quality standards without
treatment for five consecutive years following closure of the mine.
new text end

new text begin Subd. 7. new text end

new text begin Treatment of financial assurance in environmental review process. new text end

new text begin The
commissioner of natural resources or other responsible government unit shall include an
analysis and estimate of the financial assurance that would be required for each alternative
in any draft or final environmental impact statement for a nonferrous mining operation.
The analysis shall include an adequate discussion of reasonably foreseeable best-case,
worst-case, and most likely scenarios from an environmental perspective.
new text end