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OVERSIGHT HEARING TITLED ‘‘AMERICA’S 

MINERAL RESOURCES: CREATING MINING AND MANUFACTURING JOBS AND 

SECURING AMERICA’’; AND LEGISLATIVE 

HEARING ON H.R. 1063, H.R. 687, H.R. 697, 

H.R. 761, H.R. 767, H.R. 957, AND H.R. 981

OVERSIGHT AND 

LEGISLATIVE HEARING

BEFORE THE

SUBCOMMITTEE ON ENERGY AND 

MINERAL RESOURCES

OF THE

COMMITTEE ON NATURAL RESOURCES 

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED THIRTEENTH CONGRESS

FIRST SESSION

Thursday, March 21, 2013

Serial No. 113–7

Printed for the use of the Committee on Natural Resources

(

Available via the World Wide Web: http://www.fdsys.gov 

or 

Committee address: http://naturalresources.house.gov 

(II)

COMMITTEE ON NATURAL RESOURCES

DOC HASTINGS, WA, Chairman 

EDWARD J. MARKEY, MA, Ranking Democratic Member

Don Young, AK 

Louie Gohmert, TX 

Rob Bishop, UT 

Doug Lamborn, CO 

Robert J. Wittman, VA 

Paul C. Broun, GA 

John Fleming, LA 

Tom McClintock, CA 

Glenn Thompson, PA 

Cynthia M. Lummis, WY 

Dan Benishek, MI 

Jeff Duncan, SC 

Scott R. Tipton, CO 

Paul A. Gosar, AZ 

Rau ́l R. Labrador, ID 

Steve Southerland, II, FL 

Bill Flores, TX 

Jon Runyan, NJ 

Mark E. Amodei, NV 

Markwayne Mullin, OK 

Chris Stewart, UT 

Steve Daines, MT 

Kevin Cramer, ND 

Doug LaMalfa, CA 

Vacancy 

Peter A. DeFazio, OR 

Eni F. H. Faleomavaega, AS 

Frank Pallone, Jr., NJ 

Grace F. Napolitano, CA 

Rush Holt, NJ 

Rau ́l M. Grijalva, AZ 

Madeleine Z. Bordallo, GU 

Jim Costa, CA 

Gregorio Kilili Camacho Sablan, CNMI 

Niki Tsongas, MA 

Pedro R. Pierluisi, PR 

Colleen W. Hanabusa, HI 

Tony Ca ́ rdenas, CA 

Steven A. Horsford, NV 

Jared Huffman, CA 

Raul Ruiz, CA 

Carol Shea-Porter, NH 

Alan S. Lowenthal, CA 

Joe Garcia, FL 

Matt Cartwright, PA

Todd Young, Chief of Staff 

Lisa Pittman, Chief Legislative Counsel 

Jeffrey Duncan, Democratic Staff Director 

David Watkins, Democratic Chief Counsel 

SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES 

DOUG LAMBORN, CO, Chairman 

RUSH HOLT, NJ, Ranking Democratic Member

Louie Gohmert, TX 

Rob Bishop, UT 

Robert J. Wittman, VA 

Paul C. Broun, GA 

John Fleming, LA 

Glenn Thompson, PA 

Cynthia M. Lummis, WY 

Dan Benishek, MI 

Jeff Duncan, SC 

Paul A. Gosar, AZ 

Bill Flores, TX 

Mark E. Amodei, NV 

Steve Daines, MT 

Kevin Cramer, ND 

Doc Hastings, WA, ex officio 

Steven A. Horsford, NV 

Matt Cartwright, PA 

Jim Costa, CA 

Niki Tsongas, MA 

Jared Huffman, CA 

Alan S. Lowenthal, CA 

Peter A. DeFazio, OR 

Tony Ca ́ rdenas, CA 

Rau ́l M. Grijalva, AZ 

Colleen W. Hanabusa, HI 

Joe Garcia, FL 

Vacancy 

Vacancy 

Edward J. Markey, MA, ex officio 

(III)

CONTENTS 

Page

Hearing held on Thursday, March 21, 2013 .......................................................... 1

Statement of Members: 

Holt, Hon. Rush, a Representative in Congress from the State of New 

Jersey ............................................................................................................. 5

Prepared statement of ............................................................................... 6

Lamborn, Hon. Doug, a Representative in Congress from the State of 

Colorado ......................................................................................................... 2

Prepared statement of ............................................................................... 4

Statement of Witnesses: 

Batulis, Ruthe, President, Dakota County Regional Chamber of 

Commerce, and President, Minnesota Conference of Chamber 

Executives ...................................................................................................... 23

Prepared statement on the Oversight Hearing ....................................... 24

Connell, Jamie E., Acting Deputy Director, Bureau of Land Management, 

U.S. Department of the Interior .................................................................. 46

Prepared statement: 

on H.R. 687 ......................................................................................... 49

on H.R. 697 ......................................................................................... 51

on H.R. 761 and H.R. 1063 ................................................................ 48

on H.R. 767 ......................................................................................... 52

on H.R. 957 ......................................................................................... 54

on H.R. 981 ......................................................................................... 55

Questions submitted for the record ......................................................... 56

Gosar, Hon. Paul A., a Representative in Congress from the State of 

Arizona ........................................................................................................... 7

Prepared statement on H.R. 687 .............................................................. 9

Grijalva, Hon. Rau ́l M., a Representative in Congress from the State 

of Arizona, Oral statement on H.R. 687 ...................................................... 10

Heck, Hon. Joseph J., a Representative in Congress from the State of 

Nevada ........................................................................................................... 14

Prepared statement on H.R. 697 .............................................................. 15

Hohn, Mike, General Manager, Soda Ash Business OCI Chemical 

Corporation .................................................................................................... 83

Prepared statement on H.R. 957 .............................................................. 85

Iwanicki, James M., P.E., Engineer Manager, Marquette County Road 

Commission ................................................................................................... 18

Prepared statement on the Oversight Hearing ....................................... 20

Johnson, Hon. Henry C. ‘‘Hank,’’ Jr., a Representative in Congress from 

the State of Georgia, Oral statement on H.R. 981 ..................................... 17

Kirkpatrick, Hon. Ann, a Representative in Congress from the State 

of Arizona ...................................................................................................... 12

Prepared statement on H.R. 687 .............................................................. 13

Krill, Jennifer, Executive Director, Earthworks ............................................ 28

Prepared statement on the Oversight Hearing, H.R. 687, H.R. 697, 

H.R. 761, and H.R. 957 ......................................................................... 29

McGroarty, Daniel, President, American Resources Policy Network ........... 80

Prepared statement on H.R. 1063 ............................................................ 81

Melander, Harry, President, Minnesota Building and Construction Trades 

Council ........................................................................................................... 25

Prepared statement on the Oversight Hearing ....................................... 26

Miller, Stephen Q., Chairman, Board of Supervisors, Pinal County 

District 3, Casa Grande, Arizona ................................................................ 72

Prepared statement on H.R. 687 .............................................................. 74

Page

IV

Statement of Witnesses—Continued

Miller, Stephen Q., Chairman, Board of Supervisors, Pinal County 

District 3, Casa Grande, Arizona—Continued

Question submitted for the record ........................................................... 75

Neatby, Pierre, Vice President, Sales & Marketing, Avalon Rare Metals ... 87

Prepared statement on H.R. 1063, H.R. 761, and H.R. 981 .................. 88

Peralta, Soyla ‘‘Kiki,’’ Council Member, Superior Town Council, Superior, 

Arizona ........................................................................................................... 102

Prepared statement on H.R. 687 .............................................................. 103

Quinn, Hal, President and CEO, National Mining Association ................... 76

Prepared statement on H.R. 761 .............................................................. 77

Rambler, Terry, Chairman, San Carlos Apache Tribe .................................. 91

Prepared statement on H.R. 687 .............................................................. 92

Questions submitted for the record ......................................................... 101

Wagner, Mary, Associate Chief, U.S. Forest Service, U.S. Department 

of Agriculture ................................................................................................ 57

Prepared statement on H.R. 687 .............................................................. 58

Additional materials submitted for the record: 

List of documents retained in the Committee’s official files ......................... 112

(1)

OVERSIGHT HEARING ON ‘‘AMERICA’S 

MINERAL RESOURCES: CREATING MINING 

AND MANUFACTURING JOBS AND 

SECURING AMERICA’’; AND A LEGISLATIVE 

HEARING ON H.R. 1063, ‘‘NATIONAL 

STRATEGIC AND CRITICAL MINERALS 

POLICY ACT OF 2013’’; H.R. 687, ‘‘SOUTHEAST 

ARIZONA LAND EXCHANGE AND CONSERVATION ACT OF 2013’’; H.R. 697, ‘‘THREE KIDS 

MINE REMEDIATION AND RECLAMATION 

ACT’’; H.R. 761, ‘‘NATIONAL STRATEGIC AND 

CRITICAL MINERALS PRODUCTION ACT OF 

2013’’; H.R. 767, TO AMEND THE ENERGY 

POLICY ACT OF 2005 TO MODIFY THE PILOT 

PROJECT OFFICES OF THE FEDERAL 

PERMIT STREAMLINING PILOT PROJECT; 

H.R. 957, ‘‘AMERICAN SODA ASH COMPETITIVENESS ACT’’; AND H.R. 981, ‘‘RESOURCE 

ASSESSMENT OF RARE EARTHS ACT OF 

2013.’’

Thursday, March 21, 2013

U.S. House of Representatives 

Subcommittee on Energy and Mineral Resources 

Committee on Natural Resources 

Washington, D.C. 

The Subcommittee met, pursuant to notice, at 10:07 a.m., in 

room 1334, Longworth House Office Building, Hon. Doug Lamborn 

[Chairman of the Subcommittee] presiding. 

Present: Representatives Lamborn, Broun, Lummis, Benishek, 

Duncan, Gosar, Daines, Cramer, Holt, Horsford, Huffman, 

Lowenthal, DeFazio, Grijalva, Hanabusa, and Garcia. 

Also Present: Representatives Heck, Napolitano, Johnson of 

Georgia, and Kirkpatrick. 

Mr. LAMBORN. The Committee will come to order. We are going 

to go ahead and get an expedited start here. As the Ranking Member comes in he will make his opening statement at an opportune 

time. But with votes pending, and then with people wanting to 

catch planes later in the day, we thought we should go ahead and 

get started. 

The Chairman notes the presence of a quorum, which, under 

Committee Rule 3(e), is 2 Members. The Subcommittee on Energy 

2

and Mineral Resources hearing today is to hear testimony on an 

oversight hearing on, America’s Mineral Resources: Creating Mining and Manufacturing Jobs and Securing America, and we are 

going to have a legislative hearing on H.R. 1063, I introduced it, 

it is National, Strategic, and Critical Minerals Policy Act of 2013; 

H.R. 687 by Representatives Gosar and Kirkpatrick on Southeast 

Arizona Land Exchange and Conservation Act of 2013; H.R. 697 by 

Representative Heck, Three Kids Mine Remediation and Reclamation Act; H.R. 761, by Representative Amodei, National Strategic 

and Critical Minerals Production Act of 2013; H.R. 767 by Representative Cramer to amend the Energy Policy Act of 2005 to 

modify the Pilot Project offices of the Federal Permit Streamlining 

Pilot Project; H.R. 957 by Representative Lummis, America Soda 

Ash Competitiveness Act; and H.R. 981 by Representative Johnson 

of Georgia and Markey, Resource Assessment of Rare Earths Act 

of 2013. 

Under Committee Rule 4(f), opening statements are limited to 

the Chairman and Ranking Member. However, I ask unanimous 

consent to include any other Members’ opening statements in the 

hearing record if submitted to the clerk by close of business today. 

[No response.] 

Mr. LAMBORN. Hearing no objection, so ordered. 

I also ask unanimous consent that the following Members be allowed to participate in today’s hearing: the gentlelady from California, Mrs. Napolitano; the gentlelady from Arizona, Mrs. Kirkpatrick, the gentleman from Nevada, Mr. Heck, and the gentleman 

from Georgia, Mr. Johnson. 

[No response.] 

Mr. LAMBORN. Hearing no objection, so ordered. 

STATEMENT OF THE HON. DOUG LAMBORN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF COLORADO 

Mr. LAMBORN. I would like to welcome everybody to the hearing 

today, and who are listening via our webcast, to the Subcommittee 

on Energy and Mineral Resources oversight, and the legislative 

hearing focusing on assessing the Nation’s solid mineral resources, 

and examining our national strategic and critical minerals policy. 

As I have stated before, our national minerals policy has been 

neglected for far too long. And as evidenced by the bipartisan nature of the legislation we will be considering today, there is a clear 

recognition that, as a Nation, we can no longer afford to have our 

domestic mineral needs or policy put on the back burner. 

Strategic and critical minerals are essential to our economy, livelihoods and national security, as well. Renewable energy, national 

defense equipment, agriculture, health care, and everyday items 

such as televisions, telephones, computers, light bulbs, and so on, 

are all dependent on minerals. Currently, the United States relies 

on foreign sources for a majority of our non-fuel mineral materials. 

And, according to the USGS, we are 100 percent dependent on foreign sources for rare earth minerals. 

Mining creates tangible value, introducing new money into the 

Nation’s economic system. Additional tangible value is added to the 

raw mined production through manufacturing, construction, and 

other uses. Harvesting domestic mineral resources contributes to 

3

local economies, and it also contributes to the Nation’s overall economic security from the most basic level up. 

Mining and the associated businesses and industry have been 

one of the few growth areas during our country’s prolonged recession, and has provided employment opportunities for skilled labor, 

scientists, engineers, and others. These are not your everyday, runof-the-mill jobs, but high-paying, family wage jobs with generous 

benefits. A recent CRS analysis shows the non-supervisory positions in the energy and mineral sectors pays $1,200 to $1,500 per 

week, respectively. 

I would like to point out that domestic mining isn’t just about 

jobs in the mines. It is thousands of geologists, biologists, and environmental engineers. It is about the tens of thousands of jobs in 

the industries that support our miners, from the Caterpillar factories in Illinois to Redwing Boots in Minnesota, from St. Pierre 

chains in Worcester, Massachusetts to AirFlow Catalyst Systems in 

Rochester, New York. 

As an added benefit, the Nation will become more self-reliant on 

the raw, mined materials our society depends on, as well as increasing opportunities for growth in our domestic manufacturing 

sector. We will also have improved economic and national security. 

The end result is Americans everywhere benefit from more domestic mining. 

Now, we have an interesting and exciting hearing before us 

today. We will start with a bipartisan panel of our colleagues on 

both sides of the legislation before us. We will have an oversight 

panel following that will provide testimony on America’s mineral 

resources creating mining and manufacturing jobs and securing 

America. 

Domestic mining faces many challenges in the U.S., permitting 

and access being only a sliver of the numerous challenges facing 

mine development. However, it holds great promise. So we will 

hear from folks who see a bright future and opportunity. Just as 

the United States has experienced significant growth in oil and 

natural gas reserves and resources, mainly from private and State 

mineral-rich lands, there is an opportunity for significant growth in 

domestic, non-fuel, strategic, and critical minerals production, as 

well. 

Now, this oversight hearing will be followed by an administration 

panel that will provide testimony on the legislation under consideration today. 

And finally, we will hear from our legislative panel. We are getting a lot of things done today. With the exception of my colleague 

Kevin Cramer’s bill to amend the Energy Policy Act of 2005 to 

modify the Pilot Project offices that were referred to earlier, the 

other pieces of legislation have passed out of the House Committee 

on Natural Resources and, in some cases, the Floor of the House 

during the last Congress, unfortunately only to languish in the 

Senate. 

Here I would like to make a pitch for my legislation, H.R. 1063, 

the National Strategic and Critical Minerals Policy Act of 2013, 

which I strongly believe will provide the agencies with the information they need to make better decisions for the country when it 

comes to the development of our non-fuel solid mineral resources. 

4

Other important bipartisan pieces of legislation under consideration today that will not be considered by the Members panel, so 

I should give them a little emphasis right here, H.R. 761, the National Strategic and Critical Minerals Production Act of 2013, 

which uses the President’s Executive order requiring coordination 

between agencies when permitting infrastructure projects in order 

to expedite construction and job creation; and H.R. 957, the American Soda Ash Competitiveness Act, which sets the Federal royalty 

rate for soda ash at 2 percent, allowing the domestic soda ash industry to remain competitive with international producers. 

I look forward to hearing from our witnesses today, and I would 

like to recognize the Ranking Member, from New Jersey, Representative Holt. 

[The prepared statement of Mr. Lamborn follows:]

PREPARED STATEMENT OF THE HONORABLE DOUG LAMBORN, CHAIRMAN, 

SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES

I would like to welcome everyone in the room here today and listening via our 

webcast to the Subcommittee on Energy and Mineral Resources oversight and legislative hearing focusing on accessing the Nation’s solid mineral resources and examining our national Strategic and Critical Minerals Policy. As I’ve stated before—our 

national minerals policy has been neglected for far too long. And as evidenced by 

the bipartisan nature of the legislation we will be considering today there is a clear 

recognition that as a Nation we can no longer afford to leave our domestic mineral 

needs or policy on the back burner. 

Strategic and critical minerals are essential to our economy, livelihood and national security. Renewable energy, national defense equipment, agriculture, 

healthcare and everyday items such as televisions, telephones, computers and light 

bulbs are all dependent on minerals. Currently the United States relies on foreign 

sources for a majority of our non-fuel mineral materials and, according to the USGS, 

is 100 percent dependent on foreign sources for rare earth minerals. 

Mining creates tangible value, introducing new money into the Nation’s economic 

system. Additional tangible value is added to the raw mined product through manufacturing, construction, and other uses. Harvesting domestic mineral resources contributes to local economies, and to the nation’s overall economic security from the 

most basic level up. 

Mining and the associated businesses and industry have been one of the few 

growth areas during the country’s prolonged recession providing employment opportunities for skilled labor, scientist, engineers and others. 

These are not your everyday run of the mill jobs but high-paying-family wage jobs 

with generous benefits. A recent CRS analysis shows the non- supervisory positions 

in the energy and minerals sector pay $1,535 and $1,220 per week respectively. 

I’d like to point out that domestic mining isn’t just about jobs in the mines, its 

thousands of geologists, biologists, and environmental engineers, it is about the tens 

of thousands of jobs in the industries that support our miners. From the Caterpillar 

factories in Illinois to Red Wing Boots in Minnesota, from St. Pierre Chains in 

Wooster, MA to Airflow Catalyst Systems in Rochester, NY. 

As an added benefit—the Nation will become more self-reliant on the raw mined 

materials our society depends on as well as increasing opportunities for growth in 

our domestic manufacturing sector, and improving the Nation’s economic and national security. The end result is Americans everywhere benefit from more domestic 

mining. 

Members Panel

We have an exciting hearing before us today; we will start with a bipartisan panel 

of our colleagues, on both sides of the legislation before us. 

Oversight Panel

The Members panel will be followed by our oversight panel that will provide testimony on ‘‘America’s Mineral Resources: Creating Mining and Manufacturing Jobs 

and Securing America.’’ Domestic mining faces many challenges in the U.S., permitting and access being only a sliver of the numerous challenges facing mine development. However, it also holds great promise as we will hear from folks who see a 

bright future and opportunity. 

5

Just as the U.S. has experienced significant growth in Oil and Natural Gas reserves and resources—mainly from private and state mineral rich lands—there is 

an opportunity for significant growth in domestic non-fuel strategic and critical minerals production as well. 

ADMINISTRTION PANEL

The Oversight panel will be followed by the Administration Panel that will provide testimony on the Legislation under consideration today. 

Legislative Panel

Finally, we will hear from our legislative panel. With the Exception of my colleague Kevin Cramer’s bill to amend the Energy Policy Act of 2005 to modify the 

Pilot Project offices of the Federal Permit Streamlining Pilot Project to include Montana and South Dakota, the other pieces of legislation have passed out of the House 

Committee on Natural Resources and in some cases the floor of the House during 

the last Congress only to languish in the Senate. 

Here I’d like to make a pitch for my legislation H.R. 1063 the ‘‘National Strategic 

and Critical Minerals Policy Act of 2013,’’ which I strongly believe will provide the 

agencies with the information they need to make better decisions for the country 

when it comes to the development of our non-fuel solid mineral resources. 

Other important bipartisan pieces of legislation under consideration today that 

will not be discussed by the Members panel are:

• H.R. 761 the ‘‘National Strategic and Critical Minerals Production Act of 2013’’

which uses the President’s Executive Order requiring coordination between 

agencies when permitting infrastructure projects in order to expedite construction and JOB creation as a template for permitting reform for advanced mineral 

exploration and mine development projects—the foundation of other more familiar Infrastructure projects such as roads and bridges—leading to JOB creation 

and economic and national security; and • H.R. 957 the ‘‘American Soda Ash Competitiveness Act’’ sets the Federal royalty 

rate for soda ash at 2 percent allowing the domestic soda ash industry to remain competitive with international producers—namely China—and protects 

domestic JOBS in the mining, transportation and shipping sectors.

I look forward to hearing from our witnesses today. 

STATEMENT OF THE HON. RUSH HOLT, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF NEW JERSEY 

Dr. HOLT. Thank you, Mr. Chairman. Let me see if I can keep 

my remarks to a minute or two. The bells have sounded. We have 

Members waiting, and we clearly won’t be able to get through everything. 

But I am pleased we are examining rare earth and critical minerals. I am pleased that H.R. 1063, introduced by Chairman 

Lamborn, includes compromised language agreed to in the last 

Congress. 

I would point out that, despite being entitled, ‘‘National Strategic 

and Critical Minerals Production Act of 2013,’’ H.R. 761 has nothing to do with developing these minerals. In fact, it is about gutting 

environmental safeguards and proper review of large mining 

projects. 

Another bill today, H.R. 687 that looks at exchanging land at the 

Tonto National Forest with regard to copper mining, raises numerous concerns about the impacts on the environment. And I will be 

interested to hear more about that. 

H.R. 957 would impose reduced royalty rate for soda ash produced on Federal lands. We can and should debate the impact of 

such a reduction. But the ability of the soda ash industry to increase production should be part of that conversation. 

And, overall, we have to understand that all of this debate is 

done in the context of the archaic Mining Law of 1872. Ranking 

6

Member Markey and Representative Grijalva and I will be introducing legislation that would ensure that large companies extracting minerals belonging to the taxpayer from public lands pay for 

the privilege of doing so, as they do for oil and gas. More about 

that later. 

But to save time, let me end my remarks and come back to them 

in the course of the questioning. Thank you. 

[The prepared statement of Dr. Holt follows:]

PREPARED STATEMENT OF THE HONORABLE RUSH HOLT, RANKING MEMBER, 

SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES

Thank you. 

I am pleased that we are examining rare earth and other critical and strategic 

minerals that are indispensable in the manufacture of high-tech goods. Everything 

from solar panels and iPhones, to missile guidance systems and MRI machines requires one or several of the world’s 17 minerals collectively known as rare earths. 

H.R. 981, the RARE Act, tasks the U.S. Geological Society with conducting a global 

assessment of rare earth mineral resources and potential supply sources. And I am 

pleased that H.R. 1063, introduced by Chairman Lamborn, also includes compromise language agreed to in the last Congress that would accomplish the same 

goals of improving our understanding of these important rare earth minerals. 

Unfortunately, while these two bills will improve our understanding of critical and 

strategic minerals, other pieces of legislation that we are considering today represent nothing more than huge giveaways to the mining industry and rollbacks of 

environmental protections for our public lands. Many of these measures passed the 

House in the last Congress but were too extreme to pass the Senate. Yet, today we 

are considering these same extreme bills with few or no changes. 

For instance, despite being entitled the ‘‘National Strategic and Critical Minerals 

Production Act of 2013,’’ H.R. 761 has absolutely NOTHING to do with developing 

these minerals. In fact, this bill is all about gutting the environmental safeguards 

and the proper review of large mining projects on public lands for virtually all minerals. The bill would really waive proper environmental review and public input for 

large mining operations on public lands for abundant minerals like gold, silver or 

copper. 

Another bill we are considering today, H.R. 687, would transfer approximately 

2,400 acres of land in the Tonto National Forest, including 760 acres that were 

withdrawn from mining operations by President Eisenhower in 1955, to a subsidiary 

of two foreign mining companies—Rio Tinto and BHP Billiton. This bill raises numerous concerns about the impacts on the environment, surrounding communities 

and Native American sacred sites. 

Allowing copper mining in this area could have significant impacts on the quality 

and quantity of drinking water for thousands of people in this already drought 

prone area. This proposal could decimate the economic benefits of recreation. It 

could devastate an area sacred to Native People. And this legislation would hand 

over billions of dollars worth of mineral resources to foreign mining companies without receiving a fair return. All while waiving proper review under the National Environmental Policy Act. In addition, support for this mining proposal has been eroding. The town of Superior, Arizona—the town that would be most directly impacted—recently adopted a resolution opposing the deal. 

H.R. 957 would re-impose a reduced royalty rate for soda ash produced from Federal lands. We can and should debate the impact of such a reduction but the ability 

of the soda ash industry to increase production, exports, and employment last year 

following the expiration of the reduced royalty rate should be part of that conversation. 

And while many of the bills we are considering today provide new giveaways to 

large, multinational mining companies, they do nothing to update the Mining Law 

of 1872, which allows mining companies to pull taxpayer-owned hardrock minerals 

out of our public lands virtually for free. In fact, under this 140-year old law, mining 

companies can extract gold, silver, uranium, copper and other hardrock minerals 

without paying taxpayers a dime in royalties for those minerals. This law isn’t just 

outdated, it’s outrageous. That is why I will be introducing legislation with Ranking 

Member Markey, and Representative Grijalva that would ensure that large companies extracting these minerals on public lands pay taxpayers for the privilege of 

doing so, just as oil, gas and coal companies do now. As we are looking at ways to 

7

reduce our deficit, updating this law should be a common sense reform. But instead, 

the Majority continues to focus on heaping new giveaways on this industry. 

Mr. LAMBORN. OK, certainly. And thank you, Representative 

Holt. We now have five Members who have come forward for our 

first panel. We have about 8 minutes or so before we have to scurry 

over there to catch the first vote, because the 15-minute period is 

running. Hopefully we can get through the testimony. If not, we 

will just reconvene after votes. But we will be in recess in about 

8 minutes or so. 

Let’s start now with Representative Paul Gosar of Arizona. 

STATEMENT OF THE HON. PAUL A. GOSAR, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ARIZONA 

Dr. GOSAR. Thank you, Chairman Lamborn, and thanks for 

scheduling today’s legislative hearing on the Southeast Arizona 

Land Exchange and Conservation Act. When I was first elected to 

Congress a little over 2 years ago, one of the first initiatives the 

people of Arizona brought to my attention was this land exchange. 

H.R. 687 facilitates a land exchange that will bring into Federal 

stewardship 5,500 acres of high-priority conservation lands that 

contain endangered species, sensitive ecosystems, recreational 

sites, and historical landmarks, in exchange for 2,600 acres of Federal land in Pinal County, Arizona, containing one of the largest 

undeveloped copper resources in the world. It is a critical first step 

in the development of the largest producing mine in North America. 

The potential economic benefits of this legislation are staggering. 

Upon passage of the bill, Resolution Copper estimates that it will 

be able to employ nearly 3,000 workers during a 6-year construction period, and that is just the start. The mine, assuming the company’s mine plan of operation, complies with all environmental 

laws. Let me repeat. It is a requirement explicitly by my bill that 

they comply with all environmental bills. 

When they go into full production, they will directly employ another 1,400 people. These are high-paying jobs, ranging from 

$40,000 to $120,000 salaries per year in a region that is struggling, 

economically. As many people familiar with mining communities 

know, an influx of over 1,000 mining jobs will spur economic development growth in the community. These mine workers need restaurants to eat at, convenience stores to shop at, and homes to live 

in. A recent economic study estimates an additional 2,300 jobs 

could be created due to these demands. That brings the estimated 

total number of jobs resulting from this legislation to 3,700. 

Overall, independent analysis estimates the total economic impact of the project will be over $61 billion. That is over $1 billion 

per year over the life of the mine, which equates to over $19 billion 

to Federal, State, county, and local tax revenues—$19 billion in tax 

revenues. In these tough fiscal times, I think we could all agree our 

local governments, and certainly the U.S. Treasury, could use those 

funds. 

This legislation has national security implications. The U.S. currently imports 30 percent of our copper demands, and the demand 

is skyrocketing. This critical mineral is used in virtually all modVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00011 Fmt 6633 Sfmt 6602 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
8

ern-day technology, ranging from renewable energy and hybrid cars 

to everyday electronics like cell phones and iPads. Our country 

must use domestic resources to meet this growing demand, and 

this project could yield enough copper to meet 25 percent of our 

current needs. 

This legislation is not only a jobs bill, it is a conservation bill. 

The lands that the Federal Government acquires in the exchange 

are highly coveted recreational and conservation areas. It protects 

one of the few remaining undammed rivers in Arizona, the San 

Pedro River. The Dripping Springs property is a superb hiking and 

climbing location. The Cave Creek property will protect a riparian 

corridor, as well as numerous archeological sites, and nearly 100 

acres of private land adjacent to culturally important Apache Leap 

is placed into the Federal stewardship. 

A few of the witnesses today are going to testify that Congress 

is rushing consideration of the land project exchange, and that 

there are many unanswered questions surrounding the project. 

That could not be further from the truth. Over the past 8 years, 

this exchange and the potential mine have been subject to intensive review, public consideration, and modification. Today will be 

the fifth legislative hearing in either the House or the Senate held 

to examine the specifics of this legislation. This exact language 

passed the U.S. House with bipartisan support, and was almost 

signed into law last year. 

Many of the issues that the detractors of this project will bring 

up in today’s hearing have been addressed in the Congressional 

Record at some point. Congresswoman Kirkpatrick and I are committed to addressing the few concerns that have not as we move 

forward in this legislative process, in particular the concerns about 

the land that will be conveyed to the Town of Superior. 

But don’t be fooled. This land exchange has strong bipartisan 

support across the State of Arizona. I would like to submit letters 

of support from the State Government delegation of the affected region: Governor Jan Brewer, Democrat State Senator Barb McGuire, 

Republican State Representatives Frank Pratt and T.J. Shope, and 

Brenda Barton. I would like to submit these for the record. 

Mr. LAMBORN. With no objection, so ordered. 

Dr. GOSAR. Also for the record, a resolution unanimously passed 

by the bipartisan Pinal County Board of Supervisors and letters of 

support from the entire bipartisan Gila County Board of Supervisors. 

Mr. LAMBORN. With no objection, so ordered. 

Dr. GOSAR. These two counties encompass the area’s most affected by the exchange. 

And finally, I have letters from the Town of Payson; the Mayor 

of Globe, Terry Wheeler; a Superior Councilman, John Tameron; 

and a resolution of support from the Town of Kearny. 

Mr. LAMBORN. Seeing no objection, so ordered. 

[The information submitted for the record by Dr. Gosar has been 

retained in the Committee’s official files:] 

Dr. GOSAR. Each of these officials was elected to their position 

in some part because of their support for this land exchange. Their 

constituents—our constituents—want Congress to approve this 

land exchange. 

9

Thank you for the opportunity to testify. I urge my colleagues to 

support the legislation because I know it will lead to a better future for my constituents and this country. Thank you, sir. 

[The prepared statement of Dr. Gosar follows:]

PREPARED STATEMENT OF PAUL A. GOSAR, A REPRESENTATIVE IN CONGRESS FROM

THE STATE OF ARIZONA, ON H.R. 687

First, I would like to thank Chairman Lamborn for scheduling today’s legislative 

hearing on the Southeast Arizona Land Exchange and Conservation Act. When I 

was first elected to Congress a little over 2 years ago, one of the first initiatives 

the people of Arizona brought to my attention was this land exchange. 

H.R. 687 facilitates a land exchange that will bring into Federal stewardship 

5,500 acres of high-priority conservation lands that contain endangered species, sensitive ecosystems, recreational sites, and historic landmarks, in exchange for 2,600 

acres of Federal land in Pinal County, Arizona containing one of the largest undeveloped copper resources in the world. It is the critical first step to the development 

of the largest producing mine in North America. 

The potential economic benefits of this legislation are staggering. Upon passage 

of the bill, Resolution Copper estimates it will be able to employ nearly 3,000 workers during a 6-year construction period—and that is just the start. The mine, assuming the company’s mine plan of operation complies with all environmental laws, 

which let me repeat—is required explicitly by my bill before the company can begin 

production, will directly employ around 1,400 people. These are high-paying jobs, 

ranging from $40,000 to $120,000 salaries per year, in a region that is struggling 

economically. 

As many people familiar with mining communities know, an influx of over 1,000 

mining jobs will spur additional economic growth in a community. Those mine workers need restaurants to eat at, convenience stores to shop at, and homes to live. A 

recent economic study estimates an additional 2,300 jobs could be created due to 

these demands. That brings the estimated total number of jobs resulting from this 

legislation to 3,700. 

Overall, independent analysis estimates the total economic impact of the project 

will be over $61 billion. That is over $1 billion per year over the life of the mine, 

which equates to over $19 billion in Federal, State, county, and local tax revenue. 

Nineteen billion dollars in tax revenue—in these tough fiscal times I think we can 

all agree our local governments and certainly the U.S. Treasury could use those 

funds. 

This legislation also has national security implications. The United States currently imports 30 percent of our copper and demand is skyrocketing. This critical 

mineral is used in virtually all modern day technology ranging from renewable energy and hybrid cars, to your everyday electronics like cell phones and iPods. Our 

country must use domestic resources to meet this growing demand; this project 

could yield enough copper to meet 25 percent of our current needs. 

This legislation is not only a jobs bill, it’s a conservation bill. The lands the Federal Government acquires in the exchange are highly-coveted recreational and conservation areas. It protects one of the few remaining undammed rivers in Arizona, 

the San Pedro River. The Dripping Springs property is a superb hiking and climbing 

location. The Cave Creek property will protect a riparian corridor as well as numerous archaeological sites. And nearly 100 acres of private land adjacent to the culturally important Apache Leap is being placed into Federal stewardship. 

A few of the witnesses today are going to testify that Congress is rushing consideration of the land exchange and that there are many unanswered questions surrounding the project. That could not be further from the truth. Over the past 8 

years, this exchange and the potential mine has been subject to intensive review, 

public consideration, and modification. Today will be the sixth legislative hearing, 

in either the House or the Senate, held to examine the specifics of this legislation. 

This exact language passed the U.S. House with bipartisan support and was almost 

signed into law last year. 

Many of the issues that the detractors of this project will bring up in today’s hearing have been addressed in the Congressional record at some point. Congresswoman 

Kirkpatrick and I are committed to addressing the few concerns that have not as 

we move forward in the legislative process, in particular concerns about the land 

that will be conveyed to the Town of Superior. 

But don’t be fooled—this land exchange has strong bipartisan support across the 

State of Arizona. 

10

I would like to submit letters of support from the State government delegation 

of the affected region—Democrat State Senator Barb McGuire, and Republican 

State Representatives Frank Pratt, T.J. Shope, and Brenda Barton. 

Also for the record—a resolution unanimously passed by the bipartisan Pinal 

County Board of Supervisors and letters of support from the entire bipartisan Gila 

County Board of Supervisors. These two counties encompass the areas most affected 

by the exchange. 

Finally, I have letters from the Town of Payson, the Mayor of Globe Terry Wheeler, Superior Councilman John Tameron, and a resolution of support from the Town 

of Kearney. 

Each of these officials was elected to their positions in some part because of their 

support for this land exchange. Their constituents . . . OUR constituents, want 

Congress to approve this land exchange. 

Thank you for the opportunity to testify. I urge my colleagues to support the legislation because I know it will lead to a better future for my constituents and this 

country. 

Mr. LAMBORN. OK, thank you. 

We will now hear from Representative Grijalva. 

STATEMENT OF THE HON. RAU ́ L M. GRIJALVA, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ARIZONA 

Mr. GRIJALVA. Thank you, Mr. Chairman. I appreciate the time. 

And I think, as President Reagan said famously in a debate once, 

‘‘Here we go again.’’ And as my friend, Mr. Gosar, said, this is 

about the fifth, sixth version of this piece of legislation. 

And before I make any comments on this legislation, I want to 

advise the Chairman and the Ranking Member that I made a request to Chairman Hastings and Ranking Member Markey to delay 

this hearing until there is meaningful government-to-government 

consultation between the Federal Government and tribal Nations 

affected by this legislation. And that is consistent with the Federal 

agency and tribal memorandum of understanding that is in place 

right now. And I would again urge that consideration. 

I am also asking that we ask the State Department to verify that 

this particular decision on H.R. 687 does not violate any resolution 

that this Congress has passed with regards to sanctions, economic 

sanctions in Iran, or any company or entity that does business with 

them. It is our understanding that Rio Tinto, the parent company 

of subsidiary Resolution Copper, jointly operates a uranium mine, 

of all things, in Namibia. 

And I would suggest that before you take my word for it or take 

the denials as truth, that a formal request from the Chair and the 

Ranking Member to the State Department to validate and verify 

that. We have all passed resolutions and the urgency of those resolutions has come for the protection of Israel. I would suggest that 

that is one. The last time we had a motion to recommit on the 

same subject, we split entirely along party lines. Democrats supported the motion to recommit, and every Republican opposed to it. 

Before we cross that bridge again I would suggest we get information. 

This legislation, quite frankly, Mr. Chairman, is a deception. 

Even today we have no one from Rio Tinto or its subsidiary, Resolution, as a witness available to answer questions, questions dealing with transparency, the due diligence, and what is the return 

for the taxpayer. There is a tattered history to this legislation and 

11

this deal. But the fundamental and consistent reasons for opposition remain the same. 

Pre or post-NEPA, the company says, ‘‘We are going to obey everything,’’ but once it is in their hands and it is privatized, the Federal land, no matter what is found in NEPA, no matter what is 

found in the environmental impact statement, there is nothing the 

Government can do to assure compliance. So when we say we are 

OK with NEPA, after the fact, the law is moot after the fact. 

Native Americans, and you are going to hear from them today, 

we have the Chairman and the President of the Hopi and Navajo 

Nation, as well as the Chairman of the All-Indian Pueblo Council, 

representing 20 pueblos in New Mexico and Texas that are here, 

not only in support of their colleagues, San Carlos Apaches, but 

also in opposition to this bill. 

And the opposition continues the same. What is the value of the 

resource? $60 billion? $100 billion? What is under that land? And 

is the trade that we are talking about, is that a fair return for the 

taxpayer? I understand the value is proprietary to the company, 

but I think some due diligence on the part of this Committee to understand value and what we are giving back to the taxpayer is an 

important issue. 

I mentioned the issue of sanctions. I think all the legitimate opposition and concerns that we have are always met with, ‘‘You are 

anti-jobs, you are anti-mining.’’ Well, I think there is a rush for 

this legislation because there is an erosion of local support. There 

is unanimous opposition among Native Americans, not only in Arizona but across the country. And there is a track record for Rio 

Tinto with regards to labor violations, environmental violations, 

and failure to do reclamation. 

So, why the rush? Perhaps there is a feeling there is a much 

more accommodating presence at the Senate that would allow this 

bill to go as is. Perhaps it is that there is hemorrhaging local support in the region for the mine, and let’s do it now before that support eradicates entirely. 

Mr. Chairman, I hope that we do our due diligence and be true 

stewards of our public lands and the responsibility we own. We are 

not Wal-Mart greeters for Rio Tinto or its subsidiary. We are not 

facilitators or brokers. This cozy deal before us today in the form 

of H.R. 687 is the same deal we saw before, and before, and before. 

We are doing it again, and the opposition to the points remain the 

same. Thank you, Mr. Chairman. 

Mr. LAMBORN. OK, thank you for your testimony. I apologize that 

we couldn’t finish the remainder of the panel. We will go into recess now to vote. I am going to let the audience know I am estimating about 45 minutes or so before we come back. But at that 

point we will reconvene, hear from the rest of the panel, and then 

go into our other panels. 

We will be in recess. 

[Recess.] 

Mr. LAMBORN. The Subcommittee will come back to order. We 

have a couple Members who are on their way from the voting that 

just concluded, but one Member is here and I see another Member 

coming in. Excellent. So we will go ahead and, since Mrs. KirkVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6602 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
12

patrick is here and we are still on the subject of H.R. 687, we will 

hear her testimony and then go to Mr. Heck of Nevada. 

Mrs. Kirkpatrick, the floor is yours. 

STATEMENT OF THE HON. ANN KIRKPATRICK, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ARIZONA 

Mrs. KIRKPATRICK. Thank you, Mr. Chairman and Ranking Member Holt. I am proud to represent Arizona’s first district. It covers 

60,000 square miles, 80 rural communities, including the Town of 

Superior, whose leaders are here today. And it has 12 Native 

American Tribes, including the San Carlos Apache Tribe, whose 

leaders are here today. 

I am here today testifying in support of H.R. 687, the Southeastern Arizona Land Exchange, of which I am an original cosponsor. I would like to start by first recognizing there are pros and 

cons to this legislation and to the land exchange. My testimony will 

touch on both aspects of this project. However, it is my belief that 

there is a way to work together and use the legislative process to 

develop a piece of legislation that brings a diversified and stable 

economy to this region. But not without first addressing the 

project’s impact on our environment, water, and lands. 

My district includes Arizona’s Copper Corridor, which has more 

than a century’s legacy of copper mining. It includes communities 

like Superior, Globe, Miami, Hayden, Winkelman, and Kearny. 

Copper is part of Arizona’s heritage. It is one of the four C’s represented in our State Seal. 

The Copper Corridor has played a major role in our State’s early 

growth and economic development. Folks here have remained in 

these towns for generations, and have expressed strong support 

over the years for the Superior mine. They have raised their families here, worked the mines, run their own businesses. But small 

towns in Arizona have been hit hard by the Great Recession. They 

have been set back by changing economic realities. The median 

household income in my district is just over $30,000. These are 

working families; they struggle. But they love their communities 

and they want to stay if there is a way. 

Across the globe there is a great need, an economic demand for 

the high-grade copper these communities can produce. I know this, 

and so does my colleague, Congressman Gosar. That is why each 

of us tried in previous Congresses to make this project a reality. 

And that is why, in this Congress, we have joined together to try 

again in hopes that a bipartisan approach could make the difference. 

My district is also home to the San Carlos Apache Tribe. The testimony of Chairman Rambler must also be taken into account as 

we move through the legislative process. The Tribe’s concerns 

about the impact this project will have on sacred sites and land are 

valid concerns. The Tribe’s concerns about the impact of the project 

on our environment, water, and public health are also valid concerns. I am committed to using the legislative process to represent 

their concerns. This process must be transparent. It must reflect 

our shared interest in the public good. And that means recognizing 

that these communities cannot have long-term economic stability 

without clean water, air, and land. 

13

The voices of tribal and environmental groups should be heard 

and respected, and that is where the legislative process comes in. 

I support requiring government-to-government tribal consultations 

prior to the land exchange. We also need to include environmental 

protections for the water and land in and around the Copper Corridor very likely prior to the land exchange. 

If people are going to live, work, and raise their families in these 

areas, these factors must be addressed. I will be working toward 

including responsible provisions like these in a final version of this 

legislation. I believe that if these provisions are included, it will 

help ensure that Superior Mine can finally move forward. 

I offer my sincere thanks to all of those who came here today to 

testify about this legislation and make your voices heard. 

And I want to especially thank Congressman Gosar and his staff 

for working together with us on this important effort. Thank you 

very much. 

[The prepared statement of Mrs. Kirkpatrick follows:]

PREPARED STATEMENT OF THE HONORABLE ANN KIRKPATRICK, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF ARIZONA, ON H.R. 687

I am proud to represent Arizona’s first district, which covers 60,000 square miles, 

80 rural communities, including the town of Superior whose leaders are here today, 

and 12 Native American tribes—including the San Carlos Apache Tribe, whose leaders are here today. 

I stand here today testifying in support of H.R. 687—the Southeastern Arizona 

Land Exchange, of which I am an original co-sponsor. 

I would like to start by recognizing there are pros and cons to this legislation and 

to the land exchange. My testimony will touch on both aspects of this project. 

However, it is my belief that there is a way to work together, and use the legislative process to develop a piece of legislation that brings a diversified and stable 

economy to the region—but not without first addressing the project’s impact on our 

environment, water and lands. 

My district includes Arizona’s Copper Corridor, which has more than a century’s 

legacy of copper mining. 

It includes communities like Superior. Globe. Miami. Hayden. Winkelman and 

Kearny. 

Copper is part of Arizona’s heritage—it’s one of the five C’s represented in our 

State seal. 

The Copper Corridor has played a major role in our State’s early growth and economic development. 

Folks here have remained in these towns for generations and have expressed 

strong support over the years for the Superior mine. 

They’ve raised their families here. Worked the mines. Run their own businesses. 

But small towns in Arizona have been hit hard by the great recession. 

They’ve been set back by changing economic realities. 

The median income in my district is just over $30,000 a year. 

These are working families. They struggle. 

But they love their communities and they want to stay—if there’s a way. 

Across the globe, there is a great need—an economic demand—for the high-grade 

copper these communities can produce. 

I know this, and so does my colleague, Congressman Gosar. 

That’s why each of us tried in previous Congresses to make this project a reality. 

And that’s why in this Congress, we have joined together to try again, in hopes 

that a bipartisan approach could make the difference. 

Now, my district is also home to the San Carlos Apache Tribe. The testimony of 

Chairman Rambler must also be taken into account as we move through the legislative process. 

The tribe’s concerns about the impact this project will have on sacred sites and 

land are valid concerns. 

The tribe’s concerns about the impact of the project on our environment, water 

and public health are also valid concerns. 

I am committed to using the legislative process to represent their concerns. 

14

This process must be transparent. It must reflect our shared interest in the public 

good. 

And that means recognizing that these communities cannot have long-term economic stability without clean water, air and land. 

The voices of tribal and environmental groups should be heard and respected. 

And that’s where the legislative process comes in: 

I support requiring government-to-government tribal consultations prior to the 

land exchange. 

We also need to include environmental protections for the water and land in and 

around the Copper Corridor—very likely, prior to the land exchange. 

If people are going to live, work and raise their families in these areas, these factors must be addressed. 

I will be working toward including responsible provisions like these in a final 

version of this legislation. 

I believe that if these provisions are included, it will help ensure the Superior 

mine can finally move forward. 

I offer my sincere thanks to all those who came here today to testify about this 

legislation and make your voices heard. 

And I want to thank Congressman Gosar and his staff for working together with 

us on this important effort. 

Thank you. 

Mr. LAMBORN. Thank you, Representative. And as each Member 

provides their testimony, feel free to be excused. I know there are 

other Committees going on and other pressing matters. Thank you. 

Mrs. KIRKPATRICK. Mr. Chairman, may I be excused? 

Mr. LAMBORN. Please, yes. 

Mrs. KIRKPATRICK. Thank you. 

Mr. LAMBORN. Thank you for being here. And now we will hear 

from Representative Heck of Nevada on his bill. 

STATEMENT OF THE HON. JOSEPH J. HECK, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEVADA 

Mr. HECK. Chairman Lamborn, thank you for inviting me back 

to testify before the Subcommittee on an innovative solution for restoring the environment, improving safety, and creating jobs in my 

district in Southern Nevada. 

As you know, I originally introduced the Three Kids Mine Remediation and Reclamation Act in the previous Congress. This legislation was passed successfully through the Natural Resources Committee and passed the House by a voice vote, but unfortunately, did 

not receive consideration in the Senate before the 112th Congress 

adjourned. I have since re-introduced the legislation as H.R. 697. 

Mr. LAMBORN. Representative, is your microphone on? 

Mr. HECK. Yes, it is. 

Mr. LAMBORN. OK, excellent. Maybe pull it a little closer. 

Mr. HECK. And I appreciate the opportunity to come back and 

testify before the Subcommittee to talk about a serious environmental public safety and abandoned mine reclamation issue in the 

city of Henderson, Nevada. In the interest of time, I am going to 

abbreviate my remarks, but request that my full statement be entered into the record. 

Mr. LAMBORN. No objection, so ordered. 

Mr. HECK. And I also request that a written statement of The 

Honorable Andy Hafen, Mayor, City of Henderson, Nevada, be entered into the record. 

Mr. LAMBORN. Without objection, so ordered. 

15

[The information submitted for the record by Mr. Heck has been 

retained in the Committee’s official files:] 

Mr. HECK. The Three Kids Mine is an abandoned manganese 

mine and mill site consisting of approximately 1,262 acres of Federal and private lands which lies within the Henderson City limits, 

and is literally across from Lake Mead Parkway, from an increasing number of homes and businesses. The Three Kids Mine was 

owned and operated by various parties, including the United 

States, from approximately 1917 through 1961, and used as a storage area for Federal manganese ore reserves from the late 1950s 

through 2003. 

The project site contains numerous large, unstable, sheer cliff 

open pits as deep as 400 feet, and huge volumes of mine overburden and tailings, mill facility remnants, and waste disposal areas. 

To give a sense of scale, the mine overburden is 10 stories high 

in some areas. Abandoned waste ponds are up to 60 feet deep and 

filled with over 1 million cubic yards of gelatinous tailings containing high concentrations of arsenic, lead, and petroleum compounds. Reclaiming the project site will require the excavation and 

management of at least 12 million cubic yards of material, enough 

to fill a modern sports stadium 6 times. The presumptive remedy 

for the project site is to use the existing mine pits as permanent 

repositories for the mine residue in an appropriately engineered 

manner. 

The legislation I have introduced with the support of the entire 

Nevada Delegation is the result of over 5 years of work among the 

City of Henderson Redevelopment Agency, the Department of the 

Interior, the State of Nevada, and private entities to develop a program to finally clean up the Three Kids Mine site. 

Boiled down to its simplest form, the Secretary of the Interior 

will convey the Federal lands at the project site, approximately 948 

acres, at fair market value, taking into account the cost of investigating and remediating the entire site, which includes an additional 314 acres of now private lands that were used historically in 

mine operations. The Federal Government will receive a release of 

liability for clean-up of both the Federal lands and the private 

lands. 

This is a unique and complex public-private partnership proposal. It will finally lead to the clean-up of the Three Kids Mine 

site at no cost to the Federal Government. 

In closing, I want to once again thank Chairman Lamborn and 

Ranking Member Holt, as well as the other members of the Subcommittee for holding a hearing on this serious problem of abandoned mine lands and innovative solutions for addressing the problem. And I would be happy to answer any questions the Subcommittee might have. 

[The prepared statement of Mr. Heck follows:]

PREPARED STATEMENT OF THE HONORABLE JOSEPH J. HECK, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF NEVADA, ON H.R. 697

Chairman Lamborn and Ranking Member Holt, thank you for inviting me back 

testify before the Subcommittee on an innovative solution for restoring the environment, improving safety, and creating jobs in my District in southern Nevada. As you 

know, l originally introduced the Three Kids Mine Remediation and Reclamation 

Act in the previous Congress. This legislation was passed successfully through the 

16

Natural Resources Committee and the House, but unfortunately, did not receive 

consideration in the Senate before the 112th Congress adjourned. I have since reintroduced this legislation as H.R. 697, and I appreciate the opportunity to come 

back and testify before the Subcommittee to talk about a serious environmental, 

public safety, and abandoned mine reclamation issue in the City of Henderson, Nevada. 

***

The Three Kids Mine is an abandoned manganese mine and mill site consisting 

of approximately 1,262 acres of Federal and private lands which lies within the 

Henderson City limits and is literally across Lake Mead Parkway from an increasing number of homes and businesses. The Three Kids Mine was owned and operated 

by various parties, including the United States, from approximately 1917 through 

1961, and used as a storage area for Federal manganese ore reserves from the late 

1950s through 2003. The project site contains numerous large unstable sheer-cliff 

open pits as deep as 400 feet, huge volumes of mine overburden/tailings, mill facility 

remnants and waste disposal areas. To give a sense of scale, mine overburden is 

ten stories high in some areas; abandoned waste ‘‘ponds’’ are up to 60 feet deep and 

filled with over 1 million cubic yards of gelatinous tailings containing high concentrations of arsenic, lead and petroleum compounds. Reclaiming the Project Site 

will require the excavation and management of at least 12 million cubic yards of 

material (enough to fill a modern sports stadium six times). The ‘‘Presumptive Remedy’’ for the Project Site is to use the existing mine pits as permanent repositories 

for the mine residue, in an appropriately engineered manner. 

***

The Nevada Division of Environmental Protection has identified the Three Kids 

Mine as a high priority for the implementation of a comprehensive environmental 

investigation, remediation, and reclamation program. Numerous unsuccessful proposals to clean up and redevelop the Project Site have been advanced over the years. 

All were ultimately abandoned due to unrealistic estimates of the scale of required 

remediation, as well as the complexities posed by the mix of private and Federal 

ownership at the Project Site. Something must be done to address this serious blight 

on the Henderson community. 

***

The legislation I have introduced, with the support of the entire Nevada Delegation, is the result of over 5 years of work among the City of Henderson Redevelopment Agency, the Department of the Interior, the State of Nevada, and private entities to develop a program to finally clean up the Three Kids Mine site. Boiled down 

to its simplest form, the Secretary of the Interior will convey the Federal lands at 

the project site—approximately 948 acres—at fair market value taking into account 

the costs of investigating and remediating the entire site, which includes an additional 314 acres of now-private lands that were used historically in mine operations. 

The Federal Government will receive a release of liability for cleanup of both the 

Federal lands and the private lands. Under the legislation, before the Federal lands 

are conveyed, the State must enter into a binding consent agreement under which 

the cleanup of the entire Project Site will occur. The consent agreement must include financial assurances to ensure the completion of the remediation and reclamation of the Site. The cleanup will be financed with private capital and Nevada tax 

increment financing at no cost to the Federal Government. 

In more detail, the legislation would direct the Secretary to convey the 948 Federal acres of the Three Kids Mine project site to the Henderson Redevelopment 

Agency for fair market value, discounted to reflect the costs of cleanup of the entire 

Project Site. According to preliminary estimates, the cleanup costs for the Project 

Site range from a low of $300 million to a high of nearly $1 billion. The BLM’s preliminary estimate of the value of the lands to be conveyed as if they were ‘‘clean’’ 

ranges from $95 million to $190 million. The value and costs will be determined by 

the Secretary under the legislation using established national appraisal methods, 

environmental assessment standards, and cost estimating procedures. We fully expect the cleanup costs to substantially exceed the value of the lands to be conveyed. 

Moreover, given the mix of private and Federal lands at the project site and the 

substantial cleanup costs involved, there is no viable solution to remediate and reclaim the Federal lands without the private lands. 

Before any conveyance of Federal land, the legislation requires an executed Mine 

Remediation and Reclamation Agreement between a responsible party and the State 

of Nevada that would govern the ‘‘CERCLA-protective’’ cleanup program for the entire Project Site (Federal and private lands) and ensure that the program is fully 

funded. Finally, in exchange for the conveyance, the Federal Government’s responsiVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6621 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
17

bility for the cleanup of this site will be assumed and paid for by a responsible third 

party and the Secretary’s land will also be cleaned up at no cost to the Federal Government. 

***

Fundamental to the economic viability of the entire project is the availability of 

‘‘tax increment financing’’ under the Nevada Community Redevelopment Law. The 

Nevada Redevelopment Law allows the Redevelopment Agency to fund the cleanup 

of blighted conditions such as an abandoned mine and environmental contamination 

through use of an ‘‘increment’’ of property taxes collected within a designated redevelopment area over a 30-year ‘‘capture period.’’ The ‘‘increment’’ is a portion of the 

assessed value of the property which predictably increases in value following cleanup and as the subsequent commercial and residential redevelopment build-out occurs. To advance this important project, the City of Henderson completed annexation of the Three Kids site in January 2009, and the Lakemoor Canyon Redevelopment Area was established in February 2009. 

***

This is a unique and complex ‘‘public/private partnership’’ proposal. It will finally 

lead to the cleanup of the Three Kids Mine site at no cost to the Federal Government. Millions of dollars have been spent on this effort to date on environmental 

assessment work at the Project Site and to advance discussions and negotiations 

among project stakeholders. I believe that this initiative offers a viable solution for 

the cleanup and reclamation of the Three Kids Mine and could serve as a model 

for other similar sites across the country. I would respectfully request that the Subcommittee grant expeditious consideration of the Three Kids Mine Remediation and 

Reclamation Act. 

In closing, I want to once again thank Chairman Lamborn and Ranking Member 

Holt, as well as the other members of the Subcommittee, for holding a hearing on 

the serious problem of abandoned mined lands, and innovative solutions for addressing the problem. I would be happy to answer any questions the Subcommittee might 

have. 

Mr. LAMBORN. OK, thank you for your testimony. Feel free to be 

excused. I know there are other pressing issues and Committee 

hearings. Thank you for being here. 

We will now hear from Senator—excuse me, Representative 

Johnson—there is an interesting Senate race going on in Georgia, 

but I should say Representative Johnson of Georgia. 

STATEMENT OF THE HON. HENRY C. ‘‘HANK,’’ JOHNSON, JR., A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF 

GEORGIA 

Mr. JOHNSON OF GEORGIA. Well, I tell you, I am going to stay 

right where I am and stay out of that big fight. 

[Laughter.] 

Mr. JOHNSON OF GEORGIA. But thanks for the elevation, anyway. 

Mr. LAMBORN. We just made some news today here. 

Mr. JOHNSON OF GEORGIA. Thanks, Mr. Chairman. I want to 

thank you, Chairman Lamborn. Also, Ranking Member Horsford, 

for allowing me to join you today. 

Mr. Chairman, it is a testament to the statesmanship of the 

Chairman and Ranking Members that you have placed a bill offered by a Democrat on the table for discussion today. That bipartisan approach will be necessary if we are going to rise to the challenges of our time. 

I also must thank Ranking Member Markey for his and his 

staff’s hard work in developing H.R. 981, the Resource Assessment 

of Rare Earths Act of 2013, or the RARE Act, which we jointly introduced this year. 

18

Ranking Member Holt I also want to thank for his support for 

this legislation. 

This hearing on creating mining and manufacturing jobs here in 

America, and the securing of our access to necessary minerals is 

critically important. The RARE Act will help ensure that our Nation is able to assess rare earth elements, which are necessary components of numerous products, from wind turbines to solar panels 

to energy-efficient light bulbs and a number of Department of Defense applications, as well. 

The bill is simple and I would also argue that it is also non-partisan. It directs the U.S. Geological Survey to lead a global, multilateral assessment of rare earth element deposits to develop a comprehensive understanding of their distribution around the world. 

We need this bill because China now accounts for upwards of 90 

percent of U.S. rare earth element supply. This Chinese monopoly 

is a potentially ruinous economic and geopolitical vulnerability for 

the United States. In recent years, China has shown a willingness 

to exploit its monopoly by restricting rare earth elements exports, 

undermining U.S. national security and competitiveness in defense 

and clean energy. A better understanding of where these critical 

elements are will enable us to adjust to supply disruptions from 

any particular region. 

As I said, this is a non-partisan issue, and that is why I am 

happy to see Chairman Lamborn’s bill, H.R. 1063, which is under 

consideration today, and which includes language that mirrors the 

rare earth assessments called for in my bill. 

Thank you, Mr. Chairman, for holding this hearing today. I look 

forward to the comments from the witnesses which I will take in 

via webcast. And thank you, members of the Committee. 

Mr. LAMBORN. OK, thank you, Representative Johnson, for being 

here today and providing your testimony. 

That concludes our first panel. We will now move to the second 

panel of witnesses for oversight. And I invite forward Mr. James 

Iwanicki, Engineer Manager for the Marquette County Road Commission; Ms. Ruthe Batulis, President of the Dakota County Regional Chamber of Commerce, and President of the Minnesota Conference of Chamber Executives; Mr. Harry Melander, President of 

the Minnesota Building and Construction Trades Council; and Ms. 

Jennifer Krill, Executive Director of Earthworks. 

Like all our witnesses, your written testimony will appear in full 

in the record. So I ask that you keep your oral statements to 5 minutes, as outlined in our invitation letter and our Committee rules. 

Our microphones are not automatic, so you have to push a button to be heard. And the way the timing works is that when you 

press the button a green light comes on, and the 5-minute timer 

starts counting down. After 4 minutes, the yellow light comes on, 

and then the red light at 5 minutes. 

So, we will start in with our testimony. Mr. Iwanicki, you may 

begin. 

STATEMENT OF JAMES M. IWANICKI, P.E., ENGINEER 

MANAGER, MARQUETTE COUNTY ROAD COMMISSION 

Mr. IWANICKI. Hi. I am James M. Iwanicki, Engineer and Manager of the Marquette County Road Commission. Thank you, Mr. 

19

Chairman and members of the Committee. Thank you for asking 

me here to testify about our experiences with trying to create a 

new county road, County Road 595, to improve the quality of life, 

the health, safety, and welfare of our citizens. County Road 595 

would have had a positive impact on the mining, logging, recreation, and tourist industries. 

Rio Tinto was willing to fund an $83 million, 21-mile public road 

project to access a remote but key area of the county. The road 

would have had a major positive economic and public safety impact 

for the area and region. The road is located in a working woods. 

It would have replaced a system of two track roads that are currently used to access the area. 

As a local government official, it was very frustrating in dealing 

with the EPA throughout this project. If I operated the Marquette 

County Road Commission the way the EPA handled this permit, I 

would not be sitting here today. It is even more surprising, when 

you consider the list of support that we had. County Road 595 was 

supported by all local units of government in Marquette County 

and where County Road 595 would either go, or where the existing 

road to the mine goes through. This includes three cities, Marquette, Ishpeming, and Negaunee; eight townships; the Marquette 

County Board; two Michigan State House of Representative Members, one Democrat, one Republican; the Michigan State Senator of 

the area, a Republican; 63 of the 110 Members of the 96th Michigan State House; 28 of the 38 Senators from the 96th Michigan 

State Senate; the Governor of the State of Michigan; the Michigan 

Department of Transportation; the Michigan Department of Environmental Quality; the Michigan Department of Natural Resources; the Michigan State Police; Republican Dan Benishek of the 

U.S. House; and both Democratic U.S. Senators, Carl Levin and 

Debbie Stabenow. 

EPA over-reached their authority on this project in at least five 

different ways to kill County Road 595. EPA did not allow Marquette County Road Commission to use any creation of wetlands 

for mitigation, forested wetlands in particular, as allowed by 40 

CFR Part 230.92 and 230.92a2. The preservation ratios EPA required were beyond that which were reasonable, and not compliant 

with 40 CFR Part 230. Michigan Department of Environmental 

Quality rules allowed a maximum ratio of 12-to-1 for wetland preservation. 

EPA imposed requirements that required mineral rights to be obtained for wetland preservation areas. Federal rules only required 

that site protection should include measures to protect sites to the 

extent appropriate and practical in regard to mineral extraction 

and other threats. 

EPA continually changed the rules in regards to what was required for mitigation on the project. EPA suggested that wetland 

preservation be at 20-to-1 replacement ratio in June 2012 to cover 

indirect and secondary impacts. But in December 2012 it required 

additional mitigation to address secondary impacts and gave Marquette County Road Commission less than 30 days, including 

Christmas and New Year’s holidays, to come up with such measures. The EPA public hearing in this process was held over 3 

months prior to the December 4, 2012 EPA letter, and the timing 

20

of the letter did not allow sufficient time for the Marquette County 

Road Commission and MDEQ to respond to the requirements of 

EPA’s letter, due to the holidays. 

EPA would not allow the Marquette County Road Commission, 

Marquette County, or Michigamme Township, all legal governmental entities in the State of Michigan, to be the land stewards 

for the proposed wetland mitigation area, as allowed in 230.97(a). 

Because of the EPA decision, we have gone from having a common-sense practical solution to solve public safety issues and improve the economics of the region to the use of the existing road 

system which will not be as safe as the proposed solution, cause 

more air pollution, and stagnate the economic development of the 

area. 

In conclusion, it is hard for the people in the area to understand 

how a Federal agency that does not live and work in our community can make such an important decision for us, 350 miles away 

in Chicago. 

Thank you for your time. I would be happy to answer any questions the Committee may have. 

[The prepared statement of Mr. Iwanicki follows:]

PREPARED STATEMENT OF JAMES M. IWANICKI, P.E., ENGINEER MANAGER, MARQUETTE COUNTY ROAD COMMISSION

Mr. Chairperson and Members of the Committee: 

Thank you for asking me here today to testify about our experiences with trying 

to create a new county road, CR 595, to improve the quality of life, the health, the 

safety, and the welfare of our citizens. CR 595 would have had a positive economic 

impact on the Mining, Logging, Recreation, and Tourism Industries. 

Background Information 

In January of 2012 Marquette County Road Commission (MCRC) submitted a 

Section 404 permit application to fill approximately 26 acres of wetland to construct 

21 miles of road at a cost of $83 million. CR 595 was going to be funded by Rio 

Tinto through a public-private partnership. In addition Rio Tinto spent over $20 

million to permit CR 595. 

Rio Tinto was interested in funding the project because they were constructing a 

new nickel and copper underground mine called the Eagle Mine. The company is 

also refurbishing the old Humboldt Mill to process the ore. The mine and the mill 

will create about 300 direct new jobs. (See Figure 2) The distance between the mine 

and the mill as the crow flies is about 19 miles. Using the existing road system to 

go from the mine to the mill would be approximately 60 miles one way. CR 595 

would reduce travel time by an hour. The construction of CR 595 would have lasted 

2 years and employed over 100 people during that timeframe. 

CR 595 would have been built in a working woods not in pristine wilderness. The 

road alignment is based on existing public and private roads. (See Figures 4 and 

6–9.), 

CR 595 was the common sense solution to Marquette County’s transportation 

needs. 

If you cannot build CR 595 then you can never build any new road in Marquette 

County or the Upper Peninsula of Michigan. 

EPA 

• In April of 2012 EPA objected to MCRC’s project purpose. • EPA held a public hearing on CR 595 in August of 2012. 

• EPA lifted their objection to the project purpose on December 4, 2012 but had 

other objections which needed to be satisfied by January 3, 2013 (within 30 

days) or jurisdiction would revert to the Army Corps of Engineers. 

• Rio Tinto needed certainty in their transportation route by January of 2013. 

Failure to have a permit for CR 595 in January 2013 would cause Rio Tinto 

to pull their $83 million funding commitment for CR 595 and they would use 

the existing road system to truck the ore. 

• EPA did not like how we proposed to mitigate the impacts of CR 595. Our proposed mitigation plan involved preserving over 1,576 Acres of land (2.5 square 

21

miles) adjacent to McCormick Tract in the Ottawa National Forrest. The area 

included approximately 647 acres of high quality wetland (25 to 1 ratio) including an additional 929 acres of uplands (60 to 1, total acreage). (See Figure 5) 

• EPA was very aloof doing the whole permit process. They would not tell us 

what would be acceptable. In fact during the last month of the project they 

would not even tell us who the decision maker was going to be. They were unwilling to negotiate resolutions openly by telling us directly what would satisfy 

their issues. 

• EPA wanted additional wildlife protection and they proposed creating wildlife 

crossings (tunnels or bridges) large enough to accommodate moose, bear, and 

cougar and to place fencing to guide wildlife to the crossing. But they would not 

tell us where these crossings needed to go. 

• EPA wanted to limit secondary road connections to CR 595 by placing deed restrictions on CR 595 so adjacent land owners could not connect to the road. 

EPA’s Overreach of Their Authority 

The Marquette County Road Commission (MCRC) believes the EPA overstepped 

its authority in the following areas:

1. EPA would not allow MCRC to use any creation (‘‘establishment’’) of wetlands 

for mitigation, forested wetlands in particular, as allowed by 40 CFR part 230.92 

and 230.93(a)(2). 

2. The preservation ratios EPA required (i.e. 20:1) were beyond what was reasonable and not compliant with 40 CFR part 230. Michigan Department of Environmental Quality (MDEQ) rules allow a maximum replacement ratio of 12:1 for wetland preservation. 

3. EPA imposed requirements that required mineral rights to be obtained for the 

wetland preservation areas. Federal rules only require that site protection should 

include measures to protect sites ‘‘to the extent appropriate and practicable’’

(230.97(a)(2)) in regard to mineral extraction and other threats. 

4. EPA continually changed the ‘‘rules’’ in regards to what was required for mitigation on the project. EPA suggested that wetland preservation be at a 20:1 replacement ratio in June 2012 to cover indirect and secondary impacts but in December 

2012 it required additional mitigation measures to address secondary impacts and 

gave MCRC less than 30 days (including Christmas and New Year holidays) to come 

up with such measures. The EPA public hearing in this process was held over three 

months prior to the December 4, 2012 EPA letter and the timing of the letter did 

not allow sufficient time for MDEQ or MCRC to respond to the requirements of 

EPA’s letter due in substantial part to the holidays. 

5. EPA would not allow the Marquette County Road Commission, Marquette 

County, or Michigamme Township (all legal governmental entities in the State of 

Michigan) to be the land steward of the proposed wetland preservation area, as allowed in 230.97(a). 

Political Support for CR595

CR 595 is supported by all local units of government in Marquette County where 

CR 595 would either go through or where the existing road to the mine goes 

through. This includes 3 cities, (Marquette, Ishpeming, Negaunee) 8 townships, the 

Marquette County Board, the two Michigan State House of Representatives members that represent Marquette County, the Michigan State Senate senator who represents Marquette County, 63 of the 110 members of the 96th Michigan State 

House, and 28 of 38 senators from the 96th Michigan State Senate, the Governor 

of the State of Michigan, Michigan Department of Transportation, Michigan Department of Environmental Quality, Michigan Department of Natural Resources, the 

Michigan State Police, Dan Benishek (R) U.S. House of Representative, and both 

U.S. Senators Carl Levin (D), and Debbie Stabenow (D). 

Result of EPA’s Overreach 

• Heavy truck traffic will now be routed through the populated areas of Marquette County. 

• Local Units of government are trying to address the safety issues created by 

EPA’s lack of regards for people and local units of government. 

• The following are excerpts from The Mining Journal, the local newspaper:

Headline: CR 595 project killed 

Date: January 4, 2013

Online location: http://www.miningjournal.net/page/content.detail/id/583130/CR-595-

project-killed.html 

Author: John Pepin, Staff Writer

22

Quotes:

• Road Commission Engineer-Manager Jim Iwanicki said the U.S. Environmental 

Protection Agency’s refusal to remove objections to the project prevented the 

DEQ from issuing a permit that had the required Federal backing.

‘‘It’s a shame that the EPA has killed a good project,’’ Iwanicki said. ‘‘The 

EPA’s action is going to affect a lot of lives in Marquette County and the 

road commission believes it will affect them negatively.’’

• Iwanicki said the EPA ‘‘stonewalled’’ road commission efforts to comply with the 

agency’s request in several phone conversations held with the road commission, 

EPA and DEQ in December.

‘‘The EPA moved the bar every time we got close,’’ Iwanicki said. ‘‘Throughout the whole process, it’s been an ever-changing target.’’

The road commission responded on Dec. 27 to the EPA’s requirements for 

removing its remaining objections, but Iwanicki said it became clear before 

Christmas; the Federal agency would not be satisfied.

• Iwanicki said the agency never liked the project from the start and for months 

worked to change expectations and requirements. He said Thursday’s official finality to the project was expected and was ‘‘just the bow on the package.’’

‘‘They played a good game of bureaucratic nonsense,’’ Iwanicki said of the 

EPA.

Headline: City wants joint meeting on truck traffic 

Date: March 12, 2013

Online location: http://www.miningjournal.net/page/content.detail/id/585271/Citywants-joint-meeting-on-truck-traffic.html 

Author: Kyle Whiney—Journal Staff Writer

Quotes:

• In the wake of the Michigan Department of Environmental Quality’s decision 

to not permit the proposed Marquette County Road 595, local groups have been 

working to determine the route mining company Rio Tinto will use to transport 

ore from its Eagle Mine to the Humboldt Mill.

• The city commission also charged its special legal counsel with determining how 

best to communicate with the U.S. Environmental Protection Agency concerning 

Rio Tinto traffic on city streets.

In an August letter to the EPA, the city voiced concerns related to the prospect of mine trucks traveling through Marquette.

At that time, according to the letter, the city had no plans ‘‘for expanding local 

infrastructure to support increased heavy truck traffic.’’ The alternate route 

would ‘‘create substantial negative social impacts, as well as drastically undermine decades of transitional economic development and tens of millions of dollars of investment supporting Marquette’s current economy.’’

Editorial: Finding new truck route worth the effort

Date: March 14, 2013

Online location: http://www.miningjournal.net/page/content.detail/id/585322/Findingnew-truck-route-worth-the-effort.html 

Author: Mining Journal Editorial

Quotes: 

• Concerns over the increase in truck traffic from the mine, which is expected to 

begin production in 2014, became more significant when a plan to construct a 

new north-south haul road—Marquette County Road 595—through the woods 

from the mine to the mill was scrapped.

Rio Tinto now plans to use its originally intended route, which involves trucking 

the ore from Eagle Mine on County Road AAA to CR 510, then on CR 510 to 

CR 550, south on CR 550 to the City of Marquette, then on Wright Street to 

U.S. 41 and finally west on U.S. 41 to the mill. While we maintain our stance 

that the CR 595 option was by far the best route, particularly for public safety 

reasons, it’s a good idea to have the county, city and township seriously explore 

an alternative to driving the trucks through residential areas and on busy 

roads. 

23

Mr. LAMBORN. Mr. Iwanicki, thank you for your testimony. 

We will now hear from Ms. Batulis. 

STATEMENT OF RUTHE BATULIS, PRESIDENT, DAKOTA 

COUNTY REGIONAL CHAMBER OF COMMERCE, PRESIDENT, 

MINNESOTA CONFERENCE OF CHAMBER EXECUTIVES 

Ms. BATULIS. Mr. Chair and Members, thank you for having us 

here today. I want to bring greetings from Minnesota, where yesterday it was minus 7 degrees. So we are glad to be here. My name 

is Ruthe Batulis. I represent a statewide association of chamber of 

commerce executives, and I am President of Dakota County Regional Chamber of Commerce. 

As you know, business and labor do not always agree. But when 

it comes to job creation, and specifically the jobs that come from 

the mining of strategic metals, we could not agree more. You will 

hear from my friend, Harry Melander next to me, from the Building and Trades Association in a minute. We are tremendously excited about the Jobs for Minnesotans Coalition, and what strategic 

metal mining can do for the entire State of Minnesota and our 

country. 

You have heard previous testimony about the jobs that are created, ancillary jobs that are created from the strategic metal mining and the production of materials and entrepreneurs that can 

really drive creation of jobs throughout the State. These strategic 

metals such as nickel and copper are used in the green economy 

in electric cars, wind turbines, and, of course smart phones and 

other high-tech equipment. 

Imagine Minnesota’s high-tech manufacturing industry, where 

contractors and suppliers have the opportunity to creatively utilize 

those strategic metals mined right in Minnesota. That is on the horizon. 

In Minnesota, we have some of the best schools in the country. 

We know that providing for a good education and a good investment isn’t cheap. Resources for our schools are constantly an issue 

of public debate and discussion. Our schools will gain tremendously 

from an emerging strategic metals industry in Minnesota because 

royalties generated from the projects directly benefit our schools. In 

Minnesota, these royalties from mining go directly into what our 

lawmakers call the School Trust Fund. At this time about $5 million a year goes into the Trust Fund. That is $26 for every student. 

Imagine the impact of $2.5 billion going into the school district. 

The addition of strategic metal mining in Minnesota will add to 

this existing fund. Businesses and construction unions alike need 

skilled workers. And, as such, the education and workforce development issues are paramount. The prospect of this kind of investment is thrilling. 

Our members are always seeking ways to make their processes 

more efficient and effective to serve their customers. In fact, you 

are all working together to make the permitting process more efficient and effective, and it is a great sign for all of us, this renewed 

commitment and job creation. 

We are blessed in Minnesota that any large-scale projects and 

the jobs that follow come with the equivalent of the Good Housekeeping Seal of Approval. Our environmental laws are among the 

24

most stringent in the world, ensuring that our precious waters are 

protected from the outset through our permitting processes. Our 

citizens can always rest assured that permitting projects have undergone responsible and extensive scrutiny by the Department of 

Natural Resources, the Minnesota Pollution Control Agency and 

other State agencies. 

Minnesotans have just recently worked across party lines to ensure responsible scrutiny is done in an effective manner that allows 

permit seekers to have certainty and investors to continue to seek 

opportunities in Minnesota and the United States. 

I applaud you for all that you do here in Washington, and appreciate what you are about to accomplish to foster job creation in 

Minnesota and the United States. 

Thank you for hearing us here today, and I can answer any questions that you might have. 

[The prepared statement of Ms. Batulis follows:]

PREPARED STATEMENT OF RUTHE BATULIS, PRESIDENT OF THE MINNESOTA

CONFERENCE OF CHAMBER EXECUTIVES

Mr. Chairman, Members of the Committee, good morning, my name is Ruthe 

Batulis and I am the President of the Dakota County Regional Chamber of Commerce, also in Minnesota. We are a regional chamber of commerce in the southeast 

suburbs of the Twin Cities. We proudly serve the cities of Eagan, Farmington, 

Lilydale, Mendota Heights, Mendota, Rosemount, Sunfish Lake, and West St. Paul. 

And we’re proud to contribute to the outstanding quality of life our businesses enjoy 

every day. I also currently serve as President of the Minnesota Conference of Chamber Executives—the professional association for chamber leaders across our State. 

We are also tremendously excited about the Jobs for Minnesotans Coalition, and 

what strategic metals mining means for the entire State of Minnesota and the country. 

As you know—business and labor don’t always agree, but when it comes to job 

creation, and specifically the jobs that will come with the mining of strategic metals 

in Northern Minnesota, we couldn’t agree more. 

Minnesota is fortunate to have an abundance of natural resources. We are literally ‘‘by nature’’ an agricultural state, a timber State and a mining State. 

What people don’t necessarily think of when it comes to our natural resources—

and for us what is very exciting—is that thousands of associated and spinoff jobs 

are created as a result of our natural resources industry. When the strategic metals 

mines start producing materials, entrepreneurs and workers across Minnesota and 

throughout the Twin Cities will have new opportunities in all kinds of industries. 

These strategic metals are used in electric car batteries, smart phones, wind turbines and other high tech equipment. The sky is the limit. 

Imagine Minnesota’s medical device manufacturing industry, or Minnesota’s many 

national defense contractors and suppliers with the opportunity to creatively utilize 

strategic metals mined right here in Minnesota. That is on the horizon. 

Furthermore, Minnesota (especially Dakota County) has some of the best schools 

in the country. Providing for schools is a good investment, but it isn’t cheap! Resources for our schools are constantly an issue of public discussion and debate. Our 

schools will gain tremendously from an emerging strategic metals industry in Minnesota, because of the royalties generated from the projects that directly benefit our 

schools. In Minnesota, royalties from mining go directly into what our law makers 

call our ‘‘school trust fund.’’ The addition of Strategic Metals Mining in Minnesota 

will add to this existing fund. Businesses and construction unions alike need skilled 

workers for the future, and as such, education and workforce development issues 

are paramount. The prospect of this kind of new investment is thrilling. 

My members are always seeking ways to make their processes more efficient and 

effective to serve their customers. The fact that you are all working together to 

make the permitting process more efficient and effective is a wonderful sign to us 

of a renewed commitment to my members and businesses in general. 

We are blessed in Minnesota that any large-scale projects and the jobs that follow 

come with the equivalent of ‘‘Good Housekeeping Seal of Approval.’’ Our environmental laws are among the most stringent in the world, ensuring that our precious 

waters are protected from the outset through our thorough permitting process. Our 

25

citizens can always rest assured that permitted projects have undergone responsible 

and extensive scrutiny by the Department of Natural Resources, the Minnesota Pollution Control Agency and other State agencies. 

As my friend Harry said during his testimony, Minnesotans just recently worked 

across party lines to ensure this responsible scrutiny is done in an efficient manner 

so that permit seekers have certainty and investors will continue to seek opportunities in Minnesota and the United States. 

I applaud you all for working to do the same here in Washington, and appreciate 

what you are about to accomplish to help foster job creation in Minnesota and 

across the country. 

I am happy to answer any questions you may have. 

Mr. LAMBORN. Thank you for your testimony and for being here. 

And we will now hear from Mr. Melander. 

STATEMENT OF HARRY MELANDER, PRESIDENT, MINNESOTA 

BUILDING AND CONSTRUCTION TRADES COUNCIL 

Mr. MELANDER. Chair, Committee members, my name is Harry 

Melander, and I work as the President of the Minnesota Building 

and Construction Trades Council, an organization that represents 

over 50,000 unionized workers throughout the State of Minnesota, 

and also the Co-Chair of Jobs for Minnesota, with David Olson, the 

President of the Minnesota Chamber of Commerce, and working 

very closely with Ruthe on this issue. 

David, Ruthe, and I, along with other business, labor, local bodies of government, professional associations, and the heart and 

backbone of our State, small businesses, and its employers, form 

this diverse group of Minnesotans to focus on jobs, jobs that will 

be created in the development of strategic metals in our State. 

Minnesota has a long history of iron ore mining for well over 100 

years, and is on the verge of its next generation of mining metals. 

These metals, copper, nickel, and others, are used in the production, as indicated earlier, in smart and green products that we all 

use today. These metals will also be used in products yet to be designed that will save lives and also create new jobs for Northeastern Minnesota that will last for generations, revitalizing an industry and its region. 

Minnesota has one of the largest untapped sources of these metals in the world. If allowed to move permitting forward, we will 

have the second-largest deposit of nickel, globally. We think that 

is important for our Nation’s independence and its security. 

Jobs for Minnesota is here today encouraging you and others to 

use what we call ‘‘The Minnesota Model.’’ As indicated in our written comments, 2 years ago, with a Republican-led House and Senate and a Democratic Governor, we were able to create a law that 

limited the time applicants have to get permits. In the report submitted to you today, that good work by different interests has benefited Minnesota, limiting the time it takes to issue permits in our 

State. 

What you are doing here today will have a positive effect on the 

permitting process on a national level. Members, we can no longer 

look to others for materials that are already limited, globally. We 

believe what Minnesota has done is only a start. The work you do 

today in efficient permitting will make our country prosperous and 

allow us to continue to grow technology with an abundant source 

of metals used in advancing technologies around the world. 

26

You have an opportunity to create and expedite always safe 

means of permitting on our limited resources. Please do not lose 

sight of this opportunity. If we can do it in Minnesota, others can 

do that. Thousands of Minnesotans and others in our country are 

waiting for jobs. 

Thank you. And if there is any questions, I would be more than 

happy to answer those. 

[The prepared statement of Mr. Melander follows:]

PREPARED STATEMENT OF HARRY MELANDER, PRESIDENT, MINNESOTA BUILDING AND

CONSTRUCTION TRADES COUNCIL

Mr. Chairman, Members of the Committee, good morning, my name is Harry 

Melander and I am the President of the Minnesota Building and Construction 

Trades Council. We are the advocate and voice for unionized construction workers 

in Minnesota. Fifty thousand members strong, we have provided leadership and advocacy for construction workers in Minnesota for 60 years. 

On behalf of my members, I have recently teamed up with David Olson, the President of the Minnesota Chamber of Commerce, to form the Jobs for Minnesotans Coalition. 

Jobs for Minnesotans is a growing coalition of labor organizations, businesses and 

business associations, middle class workers, local governments, educators and other 

supporters of job creation in the State of Minnesota. The initial focus of this diverse 

coalition is to champion the development of critical and strategic metals (copper, 

nickel, platinum, palladium and gold) mining in Minnesota and provide information 

about the direct and ancillary job creation that strategic metals mining will produce 

for the state, once permitted to begin operations. 

Why this Coalition?

Minnesota is on the verge of becoming one of the most significant producers of 

strategic metals in the world. Right now, the United States has no domestic source 

of nickel, a key element in many products used for our national security. If those 

seeking permits in Minnesota are able to proceed, Minnesota will become the 2nd 

largest producer of nickel globally. This is critically important. 

For my members, a recent University of Minnesota Duluth study shows that strategic metals projects could mean the potential for 1,300 jobs in Minnesota. A job 

surge of this magnitude in Minnesota’s Iron Range would have a significant, lasting 

impact on our State’s, and the region’s economy. By moving forward to safely extract 

these minerals from one of the world’s largest known, untapped deposits in what 

is known as Minnesota’s ‘‘Duluth Complex’’ means jobs for generations for hard 

working Minnesotans. 

The Minnesota Department of Natural Resources is charged with issuing the permits to mine. Just 2 years ago, labor and business, our Democratic governor and 

Republican legislature stood together to pass landmark permit efficiency legislation, 

much like that which you are considering here at a Federal level. There was no discussion of who was going to get a political win. It was about getting Minnesotans 

back to work; together—and doing it in an environmentally sensitive way. 

In fact, during the last Legislature, streamlining permits in Minnesota was House 

File 1. And Governor Dayton, early in that session, issued similar executive orders 

while the legislature passed this landmark legislation which the he then signed into 

law. 

Both branches of government are actively working together again this legislative 

session to shorten the permitting time. In fact it was a key policy point made by 

Governor Dayton’s Chief of Staff at the Minnesota Chamber of Commerce’s legislative banquet earlier this year. 

My point here is that an efficient permitting process can be something that policymakers of all political stripes can and should stand together to support. I am enclosing for the record the recent February 2013 report by the Minnesota Pollution Control Agency which outlines the successes of efficient environmental permitting in 

Minnesota today, due to the laws we passed. 

What you are working on here is a natural extension of what we did, working 

together in Minnesota. On behalf of the 50,000 men and women I represent through 

the Building and Construction Trades Council, and the growing coalition I am leading with my State chamber counterpart, I’d ask that you too stand together for jobs 

and pass significant permitting efficiency legislation here in Washington. 

I am happy to answer any questions you may have.

27

Note: The report entitled, ‘‘Environmental Permitting: MPCA’s Semiannual Permitting Efficiency Report’’ Minnesota Pollution Control Agency, (February 1, 2013) 

(http://www.pca.state.mn.us/index.php/view-document.html?gid=18982) has been 

retained in the Committee’s official files. Minnesota Pollution Control Agency, 520 

Lafayette Road North, Saint Paul, Minnesota 55155–4194. This report is available 

in alternative formats upon request, and online at www.pca.state.mn.us. Document 

number: Irp–gen–10sy13. 

JOBS FOR MINNESOTANS 

MINNESOTA—PERMITTING EFFICIENCY LAW

During the 2011–2012 biennium, Democratic Governor Mark Dayton and the Republican-controlled Legislature worked on a bi-partisan basis to enact the permitting efficiency law. The bills were in response to concerns expressed about the overall length and uncertainty associated with regulatory processes, including both environmental review and permitting.

Minnesota House File 1/Senate File 42 (2011) 

Minnesota House File 2095/Senate File 1567 (2012)

• Established a 150-day goal for the Minnesota Pollution Control Agency (MPCA) 

and Minnesota Department of Natural Resources (DNR) to issue permits and 

requires a report on applications not meeting that goal. 

• Allows a project proposer the option to prepare the draft Environmental Impact 

Statement (EIS), rather than a regulated government unit such as a State 

agency or local government. 

• Requires that final decisions on permits be made within 30 days—rather than 

90 days—of the final approval of an EIS. 

• Eliminated district court review of environmental review decisions and sends all 

appeals directly to the Court of Appeals. 

• Requires that when the MPCA adopts standards that exceed federal standards, 

the MPCA must document that federal standards are not protective enough. 

• Allows a permit applicant to begin new construction or an extension before a 

national pollutant discharge elimination system (NPDES) or State disposal system (SDS) permit is issued by the MPCA, unless Federal law prohibits the action. 

• Established a permits coordinator required to assist permit applicants. 

• Allowed DNR permit holders who have a permit or have applied for a permit 

to continue to operate during a suspension of government services as long as 

they abide by all rules and regulations in the permit.

On February 1, 2013 the MPCA released its semiannual report to the Legislature. 

In its findings, the MPCA acknowledged that full implementation would take additional time but that they are pleased with the overall results. Most notably the 

MPCA continues issuing more than 90 percent of priority (construction) permits 

within the 150-day goal while ensuring the protection of human health and the environment. 

Since the enactment of the Permitting Efficiency Law, the MPCA has initiated a 

number of improvement endeavors:

• Improving communication around permitting metrics through the Agency electronic dashboard. 

• Standardizing permitting processes across media and programs to minimize 

business and technology system duplication and establish a unified agency-approach, where possible, to permit delivery. 

• Developing new technology tools to improve data integration and utilization of 

data, and system efficiency.

∗The MPCA Report can be accessed here: http://www.pca.state.mn.us/index.php/

view-document.html?gid=18982.

Mr. LAMBORN. Thank you for your testimony. 

We will now hear from Ms. Krill. 

28

STATEMENT OF JENNIFER KRILL, EXECUTIVE DIRECTOR, 

EARTHWORKS 

Ms. KRILL. Thank you. Mr. Chairman, Ranking Member Holt, 

and members of the Subcommittee, for giving me the opportunity 

to testify here today. My name is Jennifer Krill, and I am the Executive Director of Earthworks. We are a nonprofit organization dedicated to protecting communities and the environment from the destructive impacts of mineral and energy development. 

Earthworks opposes H.R. 761, the National Strategic and Critical 

Minerals Production Act of 2013. The authors and advocates of this 

legislation, the mining industry lobby and its champions, would 

have you believe that mining companies in the United States are 

stifled by the current regulatory system. The truth is the mining 

lobby’s vision of a mining-hostile United States is, in our view, pure 

fantasy. Our stable democracy, our courts that enforce contracts, 

and an orderly and reliable process for public input in permitting 

decisions make this country one of the best places for mining investment. 

Hard-rock mining companies in the United States also enjoy a 

myriad of subsidies and loopholes that create an extremely friendly 

regulatory environment. 

First, they have the 1872 Mining Law, which was mentioned earlier today, a law that allows mining companies, foreign and domestic, to take gold, copper, silver, uranium, and any other mineral 

from public lands for free. The Forest Service has repeatedly said 

that because of this antiquated law, they cannot deny mine proposals on our National Forests. While operating under this 140-

year-old law, mining companies are also given free reign to pollute 

our water, thanks to two Clean Water Act loopholes that allow 

mining waste to be dumped directly into streams, rivers, lakes, and 

wetlands. The metals mining industry is the single largest source 

of toxic pollution in this country. 

An extremely favorable tax code rounds out the fantastic regulatory environment for hard-rock mining. The percentage depletion 

allowance allows a company to deduct a fixed percentage from their 

gross income, which costs taxpayers over $500 million per year. 

In the case of minerals mined on public lands, mining companies, 

because of the percentage depletion allowance, sometimes get paid 

by the government to mine minerals that the public gave them for 

free. 

According to the Frasier Institute, a center-right Canadian think 

tank which annually surveys mining companies around the world, 

three U.S. States, Nevada, Utah, and Wyoming, are ranked in the 

top 10 highest jurisdiction for investment, according to the opinions 

of mining company managers and executives from around the 

world. 

Environmental review does not discourage mining investment in 

the United States. We know this because the Frasier survey asked 

that question of these global companies, and the answer was no. 

This is not an issue of too many lawyers or regulators. It is an 

economics issue. Mining occurs where minerals are, and where the 

target mineral price makes the process economically viable. H.R. 

761 is a bill written for a problem that does not exist. This legislation would negatively impact the environment and our public lands 

29

and the communities surrounding them, while doing little to give 

mining companies the social license to operate that they often 

claim that they desire. 

By seriously impairing the public’s ability to review and provide 

input on the uses of its lands, this legislation simply adds another 

special favor to an overly blessed industry. What we believe is really needed is a concerted mining industry effort to work with communities to build more responsible mines, to reform outdated policies, and to play by the rules with which other industries already 

profitably comply. 

I would like to take my last minute and turn to H.R. 687, the 

Southeast Arizona Land Exchange and Conservation Act of 2013. 

This is a bill that is also opposed by Earthworks. A foreign-owned 

mining company is planning a massive mine in southeast Arizona. 

Because the area is partially protected and would be destroyed by 

the mining process, this company would like to privatize 2,600 

acres of public lands. 

As you will hear from the Chairman of the San Carlos Apache 

Tribe later today, the Oak Flat Campground, which has been protected since 1955 under the Eisenhower Administration, is a sacred 

area to Tribes and is used often for religious purposes. In addition 

to the destruction of this sacred site, this land exchange would end 

public access to some of the most spectacular outdoor recreation 

and wildlife viewing areas in Arizona. 

This bill would sacrifice the interests of Arizonans and all Americans in order to enrich foreign shareholders. We strongly urge you 

to protect these public lands for future use. Thank you. 

[The prepared statement of Ms. Krill follows:]

PREPARED STATEMENT OF JENNIFER KRILL, EXECUTIVE DIRECTOR, EARTHWORKS

H.R. 761—‘‘National Strategic and Critical Minerals Production Act of 2013’’

Thank you Mr. Chairman for the opportunity to testify before your Committee in 

opposition to H.R. 761, the National Strategic and Critical Minerals Production Act 

of 2013. My name is Jennifer Krill, and I am the Executive Director of Earthworks. 

We are a non-profit organization dedicated to protecting communities and the environment from the destructive impacts of mineral and energy development. We work 

closely with a broad coalition of local governments, Native Americans, citizen groups 

and other conservation organizations to improve the policies governing hardrock 

mining and oil and gas development. 

The authors and advocates of H.R. 761—the mining industry lobby and its champions—would have you believe that mining companies in the United States are stifled by the current regulatory system. They describe a country where mineral development is stymied by Federal rules that divert companies to spend their mineral 

investment dollars elsewhere. But the mining lobby’s vision of a mining-hostile 

United States is pure fantasy. 

In reality, hardrock mining companies in the United States enjoy subsidies and 

loopholes that create an extremely friendly regulatory environment for them. 

It starts with the 1872 Mining Law—a law that allows mining companies, foreign 

and domestic, to take gold, copper, silver, uranium and any critical or strategic minerals from public lands for free, without paying a royalty to the taxpayer. Years of 

case law define hardrock mining as the highest and best use of public lands; Federal 

land managers now give hardrock mineral extraction precedence over hunting, fishing, sacred sites and all other uses of public lands. The Forest Service has repeatedly said that because of this antiquated law, they cannot deny mine proposals on 

our national forests. 

In addition to royalty-free mining, the 1872 Mining Law collects no reclamation 

fee from the industry. The EPA estimates that the clean up cost of these hardrock 

abandoned mine sites is $50 billion—all of which is currently being paid for by the 

taxpayer. 

30

While operating under this 140-year-old law, mining companies are also given free 

rein to pollute our waters thanks to two Clean Water Act loopholes that allow mining waste to be dumped directly into streams, rivers, lakes and wetlands. The metals mining industry is the single largest source of toxic waste and one of the most 

environmentally destructive industries in the country. In fact, the Environmental 

Protection Agency estimates hardrock mining pollutes 40 percent of the headwaters 

of watersheds in the western United States. 

An extremely favorable tax code rounds out the regulatory fantasy for hardrock 

mining companies in the United States. The Percentage Depletion Allowance (PDA) 

permits a company to deduct a fixed percentage from their gross income according 

to the mineral extracted, ranging from 22 percent for uranium to 15 percent for silver and other hardrock minerals. In some cases this deduction actually exceeds 

costs. The result is a situation where mining companies not only pay virtually nothing for the deposit royalty for the public’s minerals, but also get paid by the government to mine public minerals they were freely given under the PDA. This subsidy 

costs taxpayers over $500 million every year. 

This trifecta of an outdated mining law, the ability to dump mine waste directly 

into fresh water and enormous tax breaks for the industry makes hardrock mining 

unique in this country, and renders H.R. 761 unnecessary and absurd. 

The United States of America is one of the world’s best places for mining investment. We have stable Democratic institutions, courts that enforce contracts, favorable tax and environmental policy, and an orderly and reliable process for public 

input in permitting decisions. 

Just ask the mining companies. According to the Fraser Institute—a center-right 

Canadian think tank who annually survey approximately 700 mining, exploration, 

development companies around the world—Nevada, Utah, and Wyoming, rank in 

the top 10 most attractive jurisdictions for mineral exploration investment, according to mining company managers and executives surveyed. 

THE NEVADA EXAMPLE

According to the University of Nevada Reno, more than 80 percent of Nevada’s 

surface area is public land managed by the Federal Government in trust for all 

Americans by the Bureau of Land Management and the U.S. Forest Service. Consequently, Federal law—and NEPA in particular—applies to the vast majority of 

Nevada. 

As a result, if permitting delays imposed on public lands were so burdensome, one 

would expect that Nevada would be unattractive relative to other potential mineral 

investment destinations.

The opposite is true.

Consider again the Fraser Institute survey and its most important criteria included in the composition its ‘‘Policy Potential Index’’ (i.e. policy attractiveness):

‘‘The Policy Potential Index is a composite index that measures the effects 

on exploration of government policies including uncertainty concerning the 

administration, interpretation, and enforcement of existing regulations; environmental regulations; regulatory duplication and inconsistencies; taxation; uncertainty concerning native land claims and protected areas; infrastructure; socioeconomic agreements; political stability; labor issues; geological database; and security.’’

Note what is absent from that ranking: mineral potential. The ranking is based 

on policies, and things that result from policies, alone. 

In the most recent survey (2012–2013 edition), Nevada—in terms of the aggregate 

effect of the various policies that apply to mining within the State—is the 7th most 

attractive mineral investment destination in the world. Wyoming, another State 

known for its abundance of public lands, ranks 5th. Utah, another public lands 

State, follows close behind. 

The aforementioned Policy Potential Index includes areas in which Nevada would 

score well but is conceivably not directly attributable to regulation (e.g. infrastructure). Do environmental regulation and permitting drag down mineral investment 

in Nevada and the rest of public lands in the United States? 

The answer is ‘‘no’’. In fact, the Fraser Survey also includes a ranking of the relative attractiveness of regions’ ‘‘current mineral potential with no regulations in 

place and assuming [only] industry best practices’’. 

If the claim that existing regulations actually restrict mineral investment in Nevada and Federal public lands around the nation were true—then one would expect 

31

survey participants to find the absence of regulations to increase Nevada’s mineral 

investment appeal. 

Instead, the opposite is true. According to the Fraser Survey, when mining industry insiders were asked to assume no government regulations in a jurisdiction, Nevada’s mineral investment attractiveness ranking in the 2012–13 survey remains 

unchanged. In past years, it actually dropped. 

Furthermore, the 2012–13 Fraser Survey directly asks survey respondents whether a jurisdiction’s environmental regulations deter investment, encourage investment, or have no effect. 69 percent of respondents said environmental rules in Nevada—80 percent of whose area is subject to Federal oversight—either encourage 

mineral investment or do not deter it. 

Taken as a whole, the Fraser Survey is a direct refutation for the need for this 

bill. In fact, the only evidence found in the survey suggest that existing oversight—

including Federal policies like NEPA—is a relative competitive advantage, not disadvantage. 

DEFINITION OF STRATEGIC MINERALS

The bill broadly defines critical and strategic minerals as those that ‘‘support domestic manufacturing, agriculture, housing, telecommunications, healthcare, and 

transportation infrastructure.’’ In other words, all minerals including gold, the most 

valuable mineral mined in Nevada. 

Gold is particularly inappropriate for designation as a critical or strategic mineral 

for the simple reason that the majority of it in the United States—54 percent in 

2011 according to the USGS—is used in jewelry fabrication. 54 percent is actually 

quite low in terms of jewelry’s historic percentage of U.S. gold demand. As recently 

as 2008, it was 84 percent. 

Since jewelry fabrication is neither a critical nor strategic use for gold, then no 

critical or strategic purpose is served by exempting its mining from our most basic 

environmental protections like NEPA review. 

THE IMPORTANCE OF PUBLIC PARTICIPATION, PUBLIC LANDS, AND ENVIRONMENTAL

PROTECTION

When the National Environmental Policy Act (NEPA) was enacted in 1969 by an 

overwhelming bi-partisan majority and signed by President Richard Nixon, the goal 

of the legislation was to create a process by which the environmental impacts of 

large industrial projects could be explored, weighed and eventually mitigated. 

NEPA makes sure that in addition to government and industry input, everyday 

citizens can take part in the development and oversight of projects that affect our 

social, economic, and environmental health. The NEPA process provides citizens an 

opportunity to learn about proposed Federal actions and offers agencies an opportunity to receive valuable input from the public. 

The average time it takes BLM to permit a large mine is 4 years—not 10, not 

even 7. When a particular permit takes longer, the reason either has to do with 

State processes or, more likely, delays created by the mining company themselves—

sometime for perfectly legitimate reasons like changes in market conditions. 

Under current law, agencies must fully evaluate the environmental impacts of actions that may significantly affect the environment. Though, it is important to point 

out that the law does not require that the decision-making agency choose the most 

environmentally-friendly option, it only requires that they weigh all the options. 

Furthermore, the NEPA process is the public’s window on how a mining operator 

plans to comply with environmental law. Without NEPA, the public is forced to rely 

on the mining company, and the permitting agency, to verify that mining operator’s 

plan of operations can realistically do so. 

While such faith is touching, the facts indicate it is sadly unfounded. 

In a unprecedented 2008 research paper commissioned by Earthworks, conducted 

by a member of the National Academies of Science Earth Science Board, and reviewed by regulators and industry, mining industry promises of environmental compliance for ‘‘major’’ mines undergoing full NEPA review were compared against 

what actually happened at the mines. The most disappointing finding: 100 percent 

of mines in the study predicted environmental compliance; 75 percent of them did 

not. 

The only reason we know of industry (and permitting agencies’) failure to adequately govern mining operations: NEPA review. If not for NEPA, citizens would not 

know how badly the mining industry performs, nor be able to use this information 

to pressure permitting agencies to improve its behavior. 

32

This legislation would run roughshod over the values of transparency and public 

participation that are at the heart of NEPA—essentially taking public review out 

of potential uses of our public lands. 

While mining on public lands helps stimulate economic activity, protection of 

those lands is also vital to the western economy. Last year, over 100 economists including 3 Nobel laureates, sent a letter to President Obama stressing the importance of the protection of our public lands to our national economy. They said:

‘‘The rivers, lakes, canyons, and mountains found on public lands serve as a 

unique and compelling backdrop that has helped to transform the western economy 

from a dependence on resource extractive industries to growth from in-migration, 

tourism, and modern economy sectors such as finance, engineering, software development, insurance, and health care.’’

They also note, ‘‘increasingly, entrepreneurs are basing their business location decisions on the quality of life in an area. Businesses are recruiting talented employees by promoting access to beautiful, nearby public lands . . . Together with investment in education and access to markets, studies have repeatedly shown that protected public lands are significant contributors to economic growth.’’

Section 103 reprioritizes the entire field of public land and environmental law regarding mineral operations, making ‘‘development of the mineral resource’’ the ‘‘priority of the lead agency.’’

Under current law, the Federal land agencies are subject to a variety of congressional mandates that attempt to balance mineral production with the protection of 

human health, water and air quality, wildlife, etc. For example, if a mining project 

may adversely affect a threatened or endangered species, then as the Supreme 

Court has held pursuant to the Endangered Species Act, ‘‘Congress intended endangered species to be afforded the highest of priorities.’’ TVA v. Hill, 437 U.S. 153 

(1978). If the ESA is not applicable, then other congressional policies apply, such 

as the prevention of ‘‘unnecessary or undue degradation’’ to public land under the 

Federal Land Policy and Management Act of 1976, 43 U.S.C. 1732(b). See Mineral 

Policy Center v. Norton, 292 F.Supp.2d 30, 33 (D.D.C. 2003) (discussing competing 

congressional mandates for mining operations on Interior Department lands). 

H.R. 761 essentially eliminates these long-standing congressional mandates, and 

subjects the BLM and Forest Service to a new ‘‘maximize mineral development’’ 

standard. Although Section 103 states that the agency must ‘‘mitigate environmental impacts,’’ that vague language does little to protect environmental values in 

light of the new overarching development standard. For example, under current environmental law, ‘‘mitigation’’ can mean simply ‘‘minimizing impacts’’ or ‘‘reducing 

the impact over time.’’ 40 CFR 1508.20. Coupled with the ‘‘maximize development’’ 

priority, as well as the requirement that the agencies ensure that ‘‘more of the mineral resource can be brought to the market place,’’ an agency’s ‘‘mitigation’’ authority is thus severely curtailed. 

EQUAL ACCESS TO JUSTICE ACT

H.R. 761 also allows regulators to exempt mining projects from the Equal Access 

to Justice Act (EAJA). In many cases, affected communities cannot afford to hire 

a lawyer, much less the litany of scientific and technical experts needed to mount 

a serious challenge to a major multinational mining corporation. The practical effect 

of this provision would leave many communities unable to sue for the contamination 

of their lands and waters. 

CONCLUSION

In sum, environmental reviews and legal challenges do not substantially affect 

mining investment, employment, or the reserves of certain critical minerals. The 

market has long ago priced in these costs and the result is that many of our Western States are among the best places for mineral investment and have substantially 

lower unemployment rates than surrounding communities. This is not an issue of 

too many lawyers or regulators; it’s an economics issue. Mining occurs where the 

target mineral price makes the process economically viable. 

NEPA has been in place for more than 40 years. Federal Government agencies 

and the mining companies they regulate understand the process well and value the 

market certainty NEPA creates and investors crave. Dismantling this well-established process could undermine the purported purpose of this bill of encouraging investment and securing more critical mineral resources. 

The consequences of H.R. 761 would negatively impact the environment of publicly owned lands within mining States, and the communities surrounding them, 

while doing little to give mining companies the social license to operate that they 

33

often claim they desire. By seriously impairing the public’s ability to review and provide input on the uses of its lands, this legislation simply adds another special favor 

to an already overly blessed industry. 

H.R. 761 is a bill in search of a problem that does not exist. What is really needed 

is a concerted mining industry effort to work with communities to build more responsible mines, to reform the outdated policies that haunt them, and to play by 

the rules with which other industries profitably, comply. 

H.R. 687—‘‘Southeast Arizona Land Exchange and Conservation Act of 2013’’

On behalf of Earthworks and the thousands of members we represent in Arizona 

and nationwide, we also urge you to oppose H.R. 687 the Southeastern Arizona 

Land Exchange and Conservation Act of 2013 (the ‘‘land exchange bill’’) that would, 

in part, revoke a mining prohibition on 760 acres of public lands in the Tonto National Forest in the area of the Oak Flat Campground 60 miles east of Phoenix. 

Resolution Copper Company (RCC), a foreign-owned mining company, is planning 

a massive block-cave mine and seeks to acquire Oak Flat Campground and the surrounding public lands through this land exchange bill. If they succeed, the campground and an additional 2,300 acres of the Tonto National Forest will become private property, forever off limits to many recreationists and other users. Privatization of this land would end public access to some of the most spectacular outdoor 

recreation and wildlife viewing areas in Arizona. And massive surface subsidence 

will leave a permanent scar on the landscape, eliminating the possibility of a diversified economy for the region. 

The Eisenhower Administration recognized the Oak Flat Campground as an important recreational resource in 1955, specifically placing it off limits to future mining activity. Oak Flat should remain under Federal jurisdiction for its continued 

protection. With tens-of-thousands of visitors each year, Oak Flat contains a worldclass natural resource for birding, bouldering, camping, hiking, hunting, picnicking, 

rock climbing and other recreational uses. On the eastern border lies Gaan Canyon, 

one of the crown jewels of Arizona’s State trust lands with some of the finest remaining riparian habitat in the State. 

Oak Flat Campground and the surrounding area has long been an important cultural site for Western Apaches. The Tonto National Forest recognized at least a 

dozen archeological sites in and around Oak Flat and traditional Apache continue 

to use the Campground area for performing religious and cultural rites. Privatizing 

Oak Flat and destroying its surface would forever eliminate Apache traditional practices in the area, since they would be unable to access the site. 

Transfer of part of our national forests to a multinational copper mining company 

will almost certainly deplete and contaminate water resources and nearby watersheds. Surface water, tributary water, and aquifers are located where the copper ore 

body resides. Excavating this ore risks contamination. Many billions of gallons of 

water are necessary to carry migrating slurry to and from the ore body over the decades long life of the mine. Altering the surface and subsurface geological structure 

of this area via the impending subsidence will forever change the natural state of 

aquifers and drainage of watersheds through out the region. 

Section 4(j) of H.R. 687 provides sham compliance with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321). This is because the environmental impact statement (EIS) occurs only after privatizing the land. By that point, 

the Government loses the opportunity to act on reasonable alternatives, and the 

mine becomes a forgone conclusion regardless of the potential impacts the EIS finds. 

In addition, as soon as this bill becomes law, the land becomes available for mining activities. Section 4(h) mandates that only laws pertaining to mining on private 

land will apply. The Secretary will also issue a special use permit for exploration 

of Oak Flat within 30 days of Resolution Copper’s request (Section 4(f)). Only after 

Resolution Copper has built mine shafts, adits, tunnels, and tailings deposition 

areas will the Secretary then receive a mine plan of operations. 

Finally, this land exchange bill would set a chilling precedent allowing for the revocation of similar land withdrawals such as parks, recreation areas, and wildlife refuges. Public lands such as Oak Flat that are set aside for recreation should remain 

protected for future generations. This land exchange bill would sacrifice the interests of Arizonans, and all Americans, to enrich foreign shareholders. It would destroy sacred sites for short terms gains. Thirty years from now—when the mining 

jobs once again leave—the region will be much worse off because the landscape will 

be ruined. We strongly urge you to protect these public lands for the public’s future 

use and preserve the unique opportunities for Arizonans that the Oak Flat area provides. 

34

H.R. 957—American Soda Ash Competitiveness Act 

Earthworks also respectfully opposes H.R. 957, The American Soda Ash Competitiveness Act. The experience gained from the last time Congress lowered the royalty 

on soda ash and related sodium minerals teaches us that this industry remains competitive regardless of the royalty rate. The U.S. Department of Interior’s Report to 

Congress on the Soda Ash Royalty Reduction Act of 2006 makes this clear. 

Despite cutting the royalty from a weighted average of 5.6 percent to 2 percent, 

the soda ash industry experienced almost no change in the volume of production, 

leases, or sales. Overall capital investment since FY 2006 has fallen. Domestic employment in the soda ash industry has similarly dropped since FY 2006. While industry revenues increased significantly, the Department of the Interior attributes 

this to a spike in prices coupled with a sharp decline in production costs—due to 

historically low prices of the natural gas used to power these operations. 

Instead, this bill amounts to an unnecessary extension of a taxpayer giveaway 

first granted in 2006. Without the royalty reduction, DOI estimates States alone 

would have received $62.1 million more from FY 2007–2010. They estimate total 

lost royalty revenues between FY 2007–2011 at more than $150 million. Additionally, BLM regulation (43 CFR 3513) provides an administrative process through 

which Federal sodium lessees may individually seek royalty rate reductions. Creating an industry wide reduction only encourages a trend toward shifting soda ash 

extraction from State and private lands to Federal lands just to take advantage of 

the lower royalty. The end result is simply lower government revenues, without the 

benefits of more jobs or greater global competitiveness. 

Mr. LAMBORN. Thank you. And thank you all for being here and 

providing testimony. We will now have a round of questions for the 

witnesses from the members of the Committee. And I will start by 

asking a question of Mr. Iwanicki. 

Later today on another panel we are going to hear from BLM 

and others that requiring agencies, including the EPA, to better coordinate on NEPA documents and mine permits is unnecessary and 

will somehow hinder their ability to follow their multiple-use mandate. How would you respond to that? 

Mr. IWANICKI. I am not quite sure of that question. I know for 

us, with our project with County Road 595, we had all private 

funds that were being used to build this county road. And, therefore, we did not have to go through the Federal process. And we 

did follow a lot of those guidelines in doing our permit process with 

our Department of Environmental Quality and with the EPA, but 

we did not follow all the rules of the NEPA process through our 

project. 

Mr. LAMBORN. OK, thank you. And I am going to ask a question 

now of Ms. Batulis and Mr. Melander. What advice do you have for 

us in Washington to try and streamline the permitting and NEPA 

processes so it doesn’t take 7 to 10 years, or even more, to permit 

a project? 

Mr. MELANDER. Want to go? Me? 

Ms. BATULIS. You go. 

Mr. MELANDER. Chair, Committee members, a response to that 

question is that I think looking at what the State of Minnesota, as 

indicated in my comments, what we call ‘‘The Minnesota Model’’ is 

something to look at. We have a State that is beautiful, other than 

being cold, as Ruthe had indicated, and we love our State. But we 

have opportunities here that we need to take advantage of in a safe 

way. But using the model that Minnesota has developed, I think, 

is a good start. 

Mr. LAMBORN. Ms. Batulis? 

35

Ms. BATULIS. I would agree with Harry. What really happened 

in Minnesota was both sides of the aisle worked together to find 

a common ground that would work for everyone. And it was about 

streamlining the process so that we can create jobs. It is all about 

jobs now. And we really saw some extraordinary work done across 

the aisle that we are all very proud of. So that would be our suggestion. 

Mr. LAMBORN. OK. Thank you. And I would like to note at this 

time that both Michigan and Minnesota—Michigan is represented 

very well by Representative Benishek, who is here on the Committee—are home to, in the case of Minnesota, the 3rd largest producer of non-fuel minerals, and Michigan, the 10th largest producer of non-fuel minerals in the country. So, there are significant 

deposits of strategic and critical minerals. 

Ms. Krill, I would like to ask you a question real quick here. Is 

there any new proposed mine in the United States that your organization does approve of? 

Ms. KRILL. Our organization approves of mines—I am sorry, am 

I on? Yes. 

Mr. LAMBORN. I can hear you. 

Ms. KRILL. Our organization would approve of mining that has 

attained the free, prior, and informed consent of indigenous communities, that does not pollute waterways or allow the dumping of 

tailings or mine waste into waterways, rivers, lakes, streams, and 

wetlands, that enjoy the community support of the local community, that do not impact areas of high biodiversity, and follow international labor organizational standards for labor organizing. 

At this time, there are some mines that follow some of these 

principles, and others that we would support. We haven’t found a 

mine in the United States that follows all of these principles that 

we would support. And we encourage industry and are working actively with industry in dialog to identify a way that we can move 

forward. 

Mr. LAMBORN. Well, it sounds to me that if there is no new mine 

in this country that you support, that you could be accused of opposing for the sake of opposing, that you will always find some reason to oppose. 

Ms. KRILL. We don’t oppose mines, either. In fact, many mines 

we don’t take a position on. There are some areas where we feel 

like mining is not an appropriate activity. And in those instances 

we do take a position of opposition. 

Mr. LAMBORN. OK. At this point I am going to turn to Representative Holt for his questions. 

Dr. HOLT. Thank you. Let me begin with just a comment following from that last exchange. I would say that the standards 

that Ms. Krill, that you laid out are attainable and desirable. And 

I would hope that all operations, mining and otherwise, would 

work to achieve those. 

Ms. Krill, the Interior Department has stated that H.R. 761 is, 

‘‘drafted in such,’’ and this is a quotation, ‘‘drafted in such a manner as to cover virtually all hard-rock mining on Federal lands.’’ Do 

you believe that a bill that is intended to deal with strategic minerals should also be broad enough to cover clay, coal, crushed stone, 

sand, gravel, scrap iron? 

36

Ms. KRILL. No, we do not. We oppose H.R. 761 because, in large 

part, because of how broad it really is. As I said earlier, mining 

companies mine where minerals are. The economics of mining in 

the United States favor the ability of mining companies to mine in 

the United States. 

Dr. HOLT. Ms. Batulis, simple question. Could you define for us 

a critical and strategic mineral? 

Ms. BATULIS. Copper, nickel. 

Dr. HOLT. OK. 

Ms. BATULIS. And I think the——

Dr. HOLT. And would you include crushed stone, granite, gravel, 

clay? 

Ms. BATULIS. Mr. Chair, Committee members, no. 

Dr. HOLT. No? Yes. Mr. Melander? 

Mr. MELANDER. The same question, sir? 

Dr. HOLT. Yes, please. 

Mr. MELANDER. As indicated by Ruthe, those precious metals. 

And regarding sand and gravel, I would not consider those precious 

metals. 

Dr. HOLT. Yes. I think we might have some redrafting to do, or 

some amending here, then. 

Do you include gold and silver in that? 

Mr. MELANDER. Gold, correct. 

Dr. HOLT. OK. Ms. Krill, in a later panel, we will hear testimony 

that the United States is putting itself at a competitive disadvantage with other countries, because of permitting time. And yet, in 

your testimony you say that the United States is one of the best 

places in the world for mining investment. Which is it? 

Ms. KRILL. Well, if Mr. Holt, if you listen——

Dr. HOLT. Would you care to elaborate on the statement that you 

made in your testimony? 

Ms. KRILL. Absolutely. If you listen to the opinions of mining 

managers from a global perspective, they do indeed favor the 

United States as a place for mining investment. The BLM says 

that the average time for permitting in the United States is 4 

years. With various other regulatory conditions, the United States 

is, indeed, considered a favorable place by mining investment, 

worldwide, to mine. 

Dr. HOLT. Ms. Krill, in light of the conditions under which the 

Mining Act of 1872 was passed—we were trying to build a Nation 

and expand to fill the western territories—would you say that this 

bill is up to date? In particular, do you think at a time that there 

is so much talk about reducing the deficit we should be asking mining companies to pay a royalty rate for extracting these minerals? 

Ms. KRILL. I——

Dr. HOLT. And should it be comparable to what is done for, say, 

oil and gas? 

Ms. KRILL. I absolutely agree that mining companies should be 

paying a royalty rate. Mining companies shouldn’t be granted access to public lands and public minerals for free. And if there is an 

interest in reforming how mining is done in this country, I would 

suggest we start with reforming the Mining Law of 1872. 

Dr. HOLT. Yes. The name itself suggests some dated characteristic of it. 

37

[Laughter.] 

Dr. HOLT. Just in the few seconds that remain, Ms. Krill, do you 

know whether Western States charge a royalty rate for extraction 

of minerals, different from the Mining Act of 1872, different from 

the Federal——

Ms. KRILL. There are Western States that charge a royalty rate 

for mining. federally, on a national level, we do not. 

Dr. HOLT. Well, I think my time has expired. I thank the witnesses and I thank the Chair. 

Mr. LAMBORN. Thank you. And I would point out to the Ranking 

Member that the Mining Law of 1872 has been amended many 

times over the years. So let’s keep up on the amendments. 

And, Ms. Krill, I would like to point out to you that when you 

say that minerals are extracted for free, you are neglecting State 

severance taxes, you are neglecting the taxes that are paid by mining companies on a corporate income, taxes paid by their employees 

on personal income, sales tax, property tax, and on and on and on. 

OK. We are going to go to our next witness—excuse me, next 

Committee member. I would like to point out that we are missing 

Representative Amodei. Unfortunately, his mother passed away 

earlier this week, so our thoughts and prayers are with him. But 

we will go instead next to Representative Gosar. 

Dr. GOSAR. Thank you. I want the record very, very clear. Ms. 

Krill, have you ever endorsed or supported—careful wording here—

any mining operation in the United States, your organization? 

Ms. KRILL. Have we ever endorsed——

Dr. GOSAR. Or supported a mining operation in the United 

States. 

Ms. KRILL. A single operation. 

Dr. GOSAR. Absolutely. 

Ms. KRILL. No. We have endorsed and supported principles 

for——

Dr. GOSAR. I am getting at that point. It seems like, I am going 

back with the Chairman’s connotation, that no is an answer. No is 

not an answer any more in America. It is how do we accomplish 

this under the protocols. 

Let me ask you the next question. In regards to the United 

States, isn’t it a lot about our mineral composition, that we are rich 

with minerals in the United States that so many foreign and national mining companies really would like to work here, because it 

is a concentration and plethora of minerals that we actually have 

here? Is that not true, compared to about any other continent? 

Ms. KRILL. Mining companies do mine where the minerals are. 

Dr. GOSAR. So we are very rich, and that is why. So I mean we 

want to make sure we are careful about how we look at those 

things. 

Chairman, for the record, what I would also like to do is, put in 

the record a letter from the Nature Conservancy and this is an op 

ed from the Arizona Republic, as well as a climbing recreational 

group from Queen Creek for the record that support this mine. 

Mr. LAMBORN. Seeing no objection, so ordered. 

[The information that Dr. Gosar submitted for the record has 

been retained in the Committee’s official files:] 

38

Dr. GOSAR. Let me ask you one more question, Ms. Krill. You 

know, has your organization ever been out to the mine? 

Ms. KRILL. I am sorry, which mine? 

Dr. GOSAR. Resolution Copper in Southeast Arizona. 

Ms. KRILL. Yes. 

Dr. GOSAR. You have actually toured the mine? 

Ms. KRILL. I have not personally, no. 

Dr. GOSAR. No, I don’t think anybody has toured the mine, frankly. I just checked with the company. You have not toured the mine, 

as far as I can understand. 

Let me ask you another question. 

Ms. KRILL. I thought you were referring to Oak Flat Campground. 

Dr. GOSAR. That is the campgrounds. 

Ms. KRILL. The site. 

Dr. GOSAR. I am looking at the mining site. 

Ms. KRILL. OK. 

Dr. GOSAR. You know, hands-on are a lot of different things. 

There is being able to see, to dialog about the facts. You know, 

facts are kind of an interesting thing. It is hard to argue around 

facts, because the facts set you free. I know that there was an invitation, was there not, from the company to come out and review 

the mine? 

Ms. KRILL. I have not received a invitation, but I would be 

happy——

Dr. GOSAR. I think you need to go back in your records to do your 

due diligence to find out that they actually extended that, and they 

were turned away. So I would hope that you would go back into 

your records. 

And I would invite you, like I would invite the Member from Arizona who has not been in his tenure, out to the mine. Because I 

think those are the things that answer questions. You know, facts 

set you free. And I think Arizona has been stalwart in that aspect 

in regards to doing this, with all the magical features that we have 

been able to do and to build Arizona. 

And I think that I would leave my questions at that. Thank you. 

I yield back, Mr.——

Mr. LAMBORN. All right, thank you. We will now go to Representative Grijalva. 

Mr. GRIJALVA. Thank you very much. Ms. Krill, a couple of quick 

questions. In reference to the first part of your testimony, there 

was a time prior to President Nixon signing the NEPA Act where 

there was no NEPA, that we can talk—it is not about ‘‘what if,’’ 

there was none. 

Consequences of that lack of oversight, transparency, public participation, what drove that Congress, that President to enact the 

NEPA Act? What was the situation in terms of not just the environment, but communities as well? 

Ms. KRILL. That is a very good question, Representative Grijalva. 

I think that the critical thing that NEPA provides to communities 

and to the public is an opportunity to participate in a clear and 

transparent and consistent process. The minerals, for example, in 

mining, which we are discussing, the minerals are minerals that 

belong to the public. And it is very important, in our democratic 

39

society, that the public has this opportunity to comment on and to 

participate in a process about what we do with public minerals. 

Mr. GRIJALVA. And you mentioned the H.R. 687. H.R. 761 is kind 

of the same process as H.R. 687, only taken to steroid quality, in 

the sense that we would do away with all regulatory controls, to 

do it after the fact, when there is nothing to bind, an action or a 

remedy. Fair or unfair comparison between the two bills? 

Ms. KRILL. I think that is a fair comparison. 

Mr. GRIJALVA. I was going to ask Mr. Melander, on all these 

issues, and I think my friend from Arizona has mentioned that this 

is about how you say yes, not just no. And I couldn’t agree more. 

But the point is that everything, and you said it is about the jobs 

and it is about creating that kind of a sustainability in Minnesota, 

and everybody is at the table at that effort. 

Verification of the job numbers, do you verify them yourself? Or, 

let’s say, for instance, we are working off in Resolution Copper, the 

job analysis by the company, themselves, and it is a movable target. And so, how do you validate that you are making a commitment, whether it is regulatory, whether it is government assistance, based on a sole source, proprietary source of analysis by the 

company on job production, or do you seek an independent source 

to verify that that is indeed what is going to be there at the end 

of the day, in terms of number of jobs? 

Mr. MELANDER. Chair, Representative—and that, too, is a good 

question. And one can get in trouble indicating the amount of jobs. 

The first part of your question, when we make reference to our 

specific State in regards to the opportunity in generational employment, it is done working with our partners in trying to get a realistic expectation. 

What we like to do, and we do this consistently, is we talk about 

work hours that will be generated. I mean it is really hard to describe, I mean, to really be clear. But when we, whether it is, and 

this has nothing to do with it, but whether we are building stadiums or projects, we base it off of work hours, because it is a better way to describe the opportunities for individuals, at least within 

our industry. 

Mr. GRIJALVA. OK. As you generate precious metals, copper, gold, 

and I think, I don’t know who stated that those are for use and for 

the industries as they grow here in that country, what is a ratio 

of export versus keeping the product domestic? What is the emphasis? For instance, the other legislation, the CEO, that said the Resolution Copper mine will help meet this need, and the need is that 

China will build three more cities larger than Sydney every year 

until 2030, and that the major stockholder in Rio Tinto, the parent 

company, is, indeed, China. 

And so, we take out our domestic taxpayer resource and ship it 

overseas, no royalties, no payback, no infrastructure, no sustainability in that community. Is there a ratio that you think is appropriate? Anybody can answer it. 

Mr. MELANDER. Chair, Representative, by no means were we prepared to start to give a statistical or analytical information in regards to export and import of these precious metals, strategic metals. 

Mr. GRIJALVA. I appreciate——

40

Mr. MELANDER. We were here today to talk about the opportunities that we believe are——

Mr. GRIJALVA. You are absolutely right, and it is probably an unfair question. If Resolution or Rio Tinto were sitting in your seat, 

they might have an answer. Thank you. 

Dr. GOSAR [presiding]. Thank you very much. I would like to 

yield to the gentleman from Michigan, Dr. Benishek. 

Dr. BENISHEK. Thank you, Mr. Chairman. I want to thank the 

Chairman for holding this important hearing today, and I want to 

also thank Mr. Jim Iwanicki from my district in Northern Michigan for coming to Washington to tell us about the tremendous obstacles he had in simply building a county road through a working 

forest in the Upper Peninsula, and the difficulties he has had with 

the EPA. 

Mr. Iwanicki, can you tell me some of the most frustrating part 

of dealing with the EPA? And I heard in your testimony about the 

changing goal post, how to deal with them, and they seem to 

change the rules halfway through the process. Can you elaborate 

on that a little bit more? 

Mr. IWANICKI. Well, the EPA was kind of cold to the idea of 

building a county road in this working woods area from the start. 

And it took great effort on our part locally and with your help and 

the help of our Democratic Senators to at least get them to listen 

and evaluate the permit, which we thought was a huge deal. And 

any time we seemed to come to a conclusion and thought we had 

solved their issue, they would come back and say, ‘‘Well, that is not 

really what we meant, we were looking for something more like 

this,’’ and that was very evident when you took a look a the wetland mitigation process and the process that went through the wetland mitigation. 

We first proposed doing some creation of forested wetlands, and 

the EPA said, ‘‘No, we don’t like the creation aspect; we would like 

more preservation.’’ We then turned around and came up with a 

preservation plan for them, and then they started with the issues 

of, ‘‘Well, we don’t like who the land stewards are going to be, we 

don’t like the way you have the mineral rights in protecting that 

preservation area and the lack of mineral rights for it.’’ So again, 

it was very frustrating. 

Dr. BENISHEK. Let me ask you a question. How many acres of 

wetlands would need to be mitigated by the construction of the 

road? 

Mr. IWANICKI. It was 25 acres of wetland that needed to be mitigated, and we proposed giving them 2.5 square miles of land. The 

wetland being protected was about 25-to-1, I believe, in that 2.5 

square miles, and that was next to a National Forest. And again, 

so it was very frustrating that they wouldn’t——

Dr. BENISHEK. Now, as I understand it, not only did you have to 

give—was it 2.5 square miles for the 25 acres? 

Mr. IWANICKI. Correct. 

Dr. BENISHEK. But you also had to have an environmental steward of that land in perpetuity. Is that correct? 

Mr. IWANICKI. That is correct. And again, none of the local agencies were considered a viable steward for that land. 

41

Dr. BENISHEK. This is the Michigan Department of Environmental Quality, is that correct? 

Mr. IWANICKI. Well, again, we worked with the Michigan Department of Environmental Quality and the State DNR. And the State 

DNR in December agreed that they would be the stewards of the 

land. And when we said that to the EPA, the EPA was not sure 

that the State DNR was an acceptable agency to be the steward of 

this land, and the State DNR addresses all the public lands and 

takes care of all the public lands the State owns in the State. 

Dr. BENISHEK. They are the stewards of all the public lands 

within the State. 

Mr. IWANICKI. Right. 

Dr. BENISHEK. The State-owned public lands, is that correct? 

Mr. IWANICKI. Correct. 

Dr. BENISHEK. And they have been doing that for hundreds of 

years, is that right? 

Let me ask you another question about this road, because this 

is dear to me. In other words, now I know that this road is a 22-

mile road which will take the place of a 66-mile road going through 

downtown Marquette that the ore trucks will now have to drive 

through. Can you explain to me, how is that better for our local environment, going through the 66 miles? 

Mr. IWANICKI. Again, it isn’t. And again, the EPA put the animals and the environment in front of all the concerns of public 

safety and safety of our community, in front of all those. So, again, 

it was very frustrating. And you can see from all of our public support that we had on the political end of things that it was something that the people wanted and something that we wanted, as a 

community. 

Dr. BENISHEK. Do you think there has ever been the kind of requirements of any other county road in the country that you are 

aware of to deal with the requirements this road needed? 

Mr. IWANICKI. I am unaware of any. And again, if these requirements are out there for all new road projects, it is a good thing our 

grandfathers and great-grandfathers built a lot of the infrastructure here in the United States. 

Dr. BENISHEK. I think my time has expired. Thank you very 

much, sir. 

Dr. GOSAR. I thank the gentleman. Now I would like to go to Mr. 

Lowenthal from California. 

Dr. LOWENTHAL. Pass. 

Dr. GOSAR. You are going to pass? That would be, then, Ms. 

Hanabusa from Hawaii. 

Ms. HANABUSA. Thank you very much, Mr. Chair. My questions 

are directed to Ms. Krill. Ms. Krill, I am talking here about H.R. 

687. And I just want to know if you are reading the bill very similarly to the way I am. 

My first question is really beginning on page 12, and that is the 

environmental compliance section, which if you just read it sort of 

quickly, it seems like NEPA applies. However, if you read it, I 

think carefully, it doesn’t kick in until after the transfer is made 

to Resolution Copper. And it is prior to the commencing of any production in commercial quantities of any valuable minerals. And 

42

then it gives 3 years for the Secretary to then actually complete a 

review under Section 102 of NEPA. Am I reading that correctly? 

Ms. KRILL. I believe you are reading that correctly. 

Ms. HANABUSA. So, as opposed to a situation where before the 

Secretary would even consider doing this transfer, which clearly 

has a lot of environmental implications, and what I am concerned 

about are the cultural aspects of it, as well, the EIS is not, and 

there is no requirement for any review. That is correct. 

Ms. KRILL. That is my understanding, yes. 

Ms. HANABUSA. OK. Now, the other part of this that I am concerned about in reading is the references, of course, to the Oak Flat 

withdrawal area, and Apache Leap. Apache Leap, as I understand 

it, is not directly covered by this potential transfer. 

Notwithstanding, the Secretary is told in this bill that they can 

give special use permits to Resolution Copper to actually tunnel 

under the surface of Apache Leap. It says you are not supposed to 

mine under Apache Leap, but you have the right to tunnel under 

Apache Leap. But Apache Leap is outside of the area of the transfer. Is that correct? 

Ms. KRILL. I believe so, although I would defer to the gentleman 

who will be testifying later from the San Carlos Apache Tribe. 

Ms. HANABUSA. I understand that. I just want to know if you are 

reading this bill very similarly to how I am. 

I am also curious about—and the same thing applies, by the way, 

to the Oak Flat area, which is supposed to be withdrawn, but you 

can still tunnel under it, or you can give a permit for tunneling 

under that. 

You do reference in here in your testimony the fact that there is 

a way of the extraction. And I think it is some kind of a—let’s see, 

block cave mine. 

Ms. KRILL. Yes. 

Ms. HANABUSA. Are you familiar with this methodology enough 

to explain it to me? What does it mean to be a block cave mining 

whatever? Massive block cave mine is what you are saying they are 

intending to do. Can you explain to me what you mean by block 

cave mine, and how you developed that understanding that Resolution Copper is going to do this? 

Ms. KRILL. I will do my best to explain it in layman’s terms. I 

am not a mining engineer, and I have never performed block cave 

mining. What block cave mining is, in my understanding, is creating a very large, open space, a cave, to extract the ore body with 

some supports, and then letting the supports go, so you have significant surface subsidence into the area. It is essentially creating 

an open pit, and turning the surface area into rubble above it. 

Ms. HANABUSA. So it is like extracting whatever minerals or 

whatever that they want underneath, and then, after that, letting 

nature take its course. In other words, you don’t fill it back up. Is 

that what you are saying? 

Ms. KRILL. Yes. 

Ms. HANABUSA. And evidence of this used in other areas have resulted with the ground settling and leaving pits in various locations? 

Ms. KRILL. Yes. The technique causes severe impacts on the surface. It also causes severe impacts to the water table below the 

43

mine. And this is a area where we are very concerned about water, 

as well. 

Ms. HANABUSA. So though they do not permit this block cave 

mining, it appears, under Apache Leap, which has very major cultural significance, as well as Oak Flat, what they are permitting, 

however, is for Resolution Copper to get a permit to tunnel under 

that. We have no idea what it means to tunnel under those specific 

areas. 

Ms. KRILL. That is correct. And we are very concerned for that 

reason about the impacts on those areas. 

Ms. HANABUSA. Thank you. I yield back, Mr. Chair. 

Mr. LAMBORN [presiding]. OK, thank you. We will now have 

questions from Representative Daines. 

Mr. DAINES. Thank you, Mr. Chairman. I am going to yield my 

time to the gentleman from Arizona. 

Dr. GOSAR. Thank you very, very much. First of all, I would like 

to address Ms. Hanabusa, just to make sure we understand this. 

In this language, that is why my bill will protect Apache Leap beyond the current land management situation. It places nearly 100 

acres of Apache Leap currently owned by the mining company into 

Federal stewardship. Additionally, as a condition of the land exchange, Resolution Copper will surrender its right to commercially 

extract any minerals under Apache Leap. 

Finally, I would like to point out that the company will have over 

a billion dollars of infrastructure located between the underground 

mine and Apache Leap. And, in other words, the company would 

have to destroy a billion—with a B—dollars before Apache Leap’s 

structural integrity could be jeopardized. Without a doubt, Apache 

Leap would be protected, more so than the current situation, if this 

legislation is signed into law. So, I wanted to make sure we are 

clear on that. 

Ms. Krill, what size of parcel of land would be too small to have 

a NEPA done? What kind of acreage would we have to do a NEPA 

on? 

Ms. KRILL. I am not sure of the answer to that question, but I 

can get back to you. 

Dr. GOSAR. Let me ask you a question, then. Let me ask you a 

question. So you are a homeowner, and what you do is you go buy 

a piece of property. Would that homeowner have to have a preNEPA? 

Ms. KRILL. No. 

Dr. GOSAR. Why not? 

Ms. KRILL. Because I know that is too small. 

Dr. GOSAR. Oh. Interesting. So, I mean, it is part of a plan. 

Let me ask you the next question. In regards to the mining operation, is anything—let me rephrase that—is anything in the NEPA 

process short-cutted with this process? 

Ms. KRILL. I am sorry, which process? 

Dr. GOSAR. In the process I outline in this bill. They cannot go 

forward, they cannot do anything, without a full NEPA going 

through. Is that true? 

Ms. KRILL. My understanding is that is after the land transfers. 

Dr. GOSAR. Well, I am making a correlation here, yes. But the 

NEPA, I mean, they can’t do anything to the land. They are just 

44

getting a transfer. So they can’t do anything on the land until the 

NEPA process goes through. Is that true? There are no shortcuts? 

Ms. KRILL. [No response.] 

Dr. GOSAR. Let me answer it for you. There are no shortcuts. 

There are absolutely no shortcuts. And our next witness will validate that, as well. 

This comes back to the facts. We have to deal in facts, because 

the facts set you free. Not scaring people, not fear-mongering. We 

have to deal in the facts. 

Let me ask you another question. You know how Arizona was 

founded? Do you know the five areas in which Arizona was founded? Its principle—what made Arizona special? It is called the five 

C’s: cattle, citrus, climate, cotton, and what would be the fifth one? 

Ms. KRILL. I believe that would be copper. 

Dr. GOSAR. I thank you very, very much. It is called gold-leaf 

copper, or leaf copper here. It forms naturally. 

You also made another comment in regards to that mining has 

been the source of the largest pollution in this country. I would like 

to see your facts on that. Because I would like to show you a case 

in point of Rio Tinto and stewardship. This is in Wisconsin, very 

close to Congressman Obey’s congressional district. This is an open 

pit mine. I just want to make sure we get this straight, too. This 

is an open pit mine, where we actually open a big, large top—OK? 

It is much more conventional in copper. And this is exactly how it 

was mitigated, OK? 

In block mining, what we do is we have a small opening where 

we go down. OK? So you are going deep in the ground. And that 

is where robotics come in, where we hear this problem with robotics. Because we want miners’ safe, do we not? I would really be 

concerned about mining safety. And so, the robots actually go down 

into the ground and mines this ore and brings it back up. Right? 

Am I right so far? 

Ms. KRILL. I am not familiar with that particular mine. 

Dr. GOSAR. Well, cave mining, you made a comment here, cave 

mining and open pit mining, very different. And once again, you 

need to make sure you are solidly on the facts, OK? But this shows 

mitigation. And it is wonderful. I mean this is an extraction. I 

think Congressman Obey would tell you this is incredible. This is 

a great company, OK? 

And are you familiar with all their investments and good stewardship in Superior? 

Ms. KRILL. Am I familiar with Rio Tinto’s investments? 

Dr. GOSAR. Yes. 

Ms. KRILL. No, but I would like to answer your earlier——

Dr. GOSAR. No? Would you also like to know that what they did 

is they actually came in and helped mitigate problems from previous mining claims? Now they have been a very good steward with 

us, the City of Superior. They have helped out all over. 

And so, I think, and this is getting back to what the Ranking 

Member and I were talking about back there, that is why I asked 

you the question, ‘‘Have you ever supported a mine claim,’’ because 

it is not good enough just to say we take no action, it is that you 

have to start rewarding good behavior and proper behavior that 

you illicitly want to see done. 

45

Ms. KRILL. The source for the statistic about the toxic releases 

of the mining industry is the Toxic Release Inventory, which is released annually. The mining industry tops the list of industries, as 

far as toxic releases in the United States. 

Dr. GOSAR. I would challenge that, in regards to the waste that 

comes out of urban areas. And so I think what we ought to do is 

go back to the facts and look carefully at what that is in mitigation. 

So I would like to see that answer. 

So, without further ado, I am out of time. 

Mr. LAMBORN. OK, thank you. Representative Lowenthal. 

Dr. LOWENTHAL. Thank you, Mr. Chair. I would like to yield my 

time to Mr. Grijalva. 

Mr. GRIJALVA. Thank you. Mr. Chairman. One of the things that 

Rio Tinto touts, Ms. Krill, part of the panel was about employment, 

so I won’t go back and ask any questions there, they tout the fact 

that they are an automated mine. They are the mine of the future. 

And you get mixed messages. 

You get the message where we did our job and we are going to have 1,500 people, and they are going to get paid from $40,000 to 

$100,000, and it will be the greatest boon that ever happened to 

Arizona. But in other statements that the executives and CEOs of 

Rio Tinto make talking about Resolution Copper, that it is the 

mine of the future, and that they will be able to reduce employment because of automation, and there will be a central place 

where there will be a minimum amount of maintenance work required there. So it kind of runs counter to the proposal that this 

is all about jobs. 

I preface that because I think there is an important point. I understand that we have to deal in facts, and I wouldn’t like anything 

better than for us to be able to factually deal with this question of 

Resolution Copper. But since all we have is the legislation to go by 

as fact, while I am a trusting person, I also like to verify. And part 

of the verification process has to be some independent look at what 

this mine is going to be. 

Let me ask you one question. Ms. Krill, the Forest Service in its 

testimony said that, ‘‘An environmental review document after the 

exchange would’’ and this is talking about Resolution ‘‘would preclude the U.S. Forest Service from developing a reasonable range 

of alternatives to the proposal and providing the public and local 

and tribal governments with opportunities to comment on the proposal.’’ As a result, wouldn’t the bill, as drafted, prevent the Forest 

Service from properly identifying or considering any mitigation 

measures that may be necessary, including the tunnels under 

Apache Leap and Oak Flat? 

Ms. KRILL. Yes, it would. Once the land is in private hands, then 

the Forest Service would not have the ability to develop alternatives, as they would if it continued to be on public lands. 

Mr. GRIJALVA. Thank you. And as my State that I love very 

much evolves, I try to add an additional C to the five C’s, conscientious compassion. I hope we get compassion as one of the C’s down 

the road. 

Anyway, I yield back, Mr. Chair. 

Mr. LAMBORN. OK, thank you. That concludes our questions for 

this panel. I know that those of you from Michigan and Minnesota 

46

didn’t know as much about Arizona issues, but I appreciate the testimony that you gave today, all four of you, so thank you for your 

testimony. 

Mr. MELANDER. Thank you. 

Mr. IWANICKI. Thank you. 

Ms. BATULIS. Thank you. 

Ms. KRILL. Thank you. 

Mr. LAMBORN. We will now go to our third panel, and I would 

like to invite forward Ms. Jamie Connell, BLM Acting Deputy Director in the U.S. Department of the Interior, accompanied by 

Larry Meinert, Mineral Resources Program Coordinator for the 

U.S. Geological Survey; and Ms. Mary Wagner, Associate Chief of 

the U.S. Forest Service within the Department of Agriculture. 

Like all of our witnesses, your written testimony will appear in 

full in the hearing record, so I ask that you keep your oral statements to 5 minutes, as outlined in our invitation letter. 

You have to press the button on the microphone to be heard in 

this room. The timing lights, as I said earlier, start at 5 minutes, 

runs down to turn yellow at one minute, and then runs out and 

turns red at 5 minutes. 

Thank you all for being here. And Deputy Director Connell, you 

may begin. 

STATEMENT OF JAMIE E. CONNELL, ACTING DEPUTY DIRECTOR, BUREAU OF LAND MANAGEMENT, U.S. DEPARTMENT 

OF THE INTERIOR 

Ms. CONNELL. Mr. Chairman, Members of the Subcommittee——

Mr. LAMBORN. Pull it a little closer, please. Thank you. 

Ms. CONNELL. Is that better? 

Mr. LAMBORN. Yes. 

Ms. CONNELL. Mr. Chairman, members of the Subcommittee, 

thank you for the opportunity to present testimony today on a 

number of bills on behalf of the Bureau of Land Management. My 

permanent job is as the BLM’s Montana-Dakota State Director, but 

I am currently acting in the position of Deputy Director for the 

BLM here in Washington. 

I am accompanied today by Larry Meinert with the USGS. He 

is a Mineral Resource Program Coordinator. He is available to answer questions on H.R. 981, the Resource Assessment of Rare 

Earths Act, and USGS-related questions on H.R. 1063, the National Strategic and Critical Minerals Policy Act. 

I have submitted testimony for the record on each of the bills 

being presented. I will briefly summarize the Administration’s position on each of these, and ask that my entire statements be made 

a part of the official record. 

The Administration has several concerns with the complex land 

exchange proposed in H.R. 687, the Southeastern Arizona Land Exchange and Conservation Act. Two of the Administration’s principal concerns with the legislation pertain to the timing of NEPA 

analysis and tribal consultation. In general, the Department of the 

Interior defers to the Forest Service on H.R. 687, as it relates primarily to Forest Service-managed lands and associated valuation 

issues. 

47

H.R. 697, the Three Kids Mine Remediation and Reclamation 

Act, provides legislative solutions to the issues surrounding the 

abandoned Three Kids Mine in Henderson, Nevada, and clears the 

way for the area’s development. The BLM supports innovative proposals to address the clean-up of the Three Kids Mine, and we support this proposal to transfer 948 acres of public land to the Henderson Redevelopment Agency at fair market value, subject to valid 

existing rights. 

The Department shares the Committee’s interest in developing 

rare earth elements and other critical mineral resources on our Nation’s public lands, consistent with environmental protection and 

public involvement in agency decisionmaking. H.R. 761 expedites 

critical mineral exploration and mine permitting on public lands 

managed by the Departments of the Interior and Agriculture. The 

bill would limit public involvement in review of mining proposals 

and the formulation of alternatives, which are vital components of 

the BLM’s multiple-use management of the Nation’s public lands. 

As such, the Department opposes H.R. 761. 

H.R. 767 expands the scope of the Federal permit streamlining 

project to include all of the field offices within the jurisdiction of 

BLM’s Montana-Dakota State office. The BLM supports the goal of 

the bill to better conform the pilot office authority to current permitting demands. This flexibility would be especially useful for the 

BLM’s North Dakota field office in Dickinson, North Dakota, where 

permitting demand has increased substantially in recent years. 

In addition, the BLM would like to work with the sponsor and 

the Committee in clarifying amendments as well as language that 

would provide additional flexibilities nationwide. There are many 

BLM field offices that are not part of the Pilot Project, but are receiving hundreds of drilling applications per year. 

H.R. 957, the American Soda Ash Competitiveness Act, would reinstate for 5 years the royalty rate reduction provided under the 

Soda Ash Royalty Rate Reduction Act of 2006, which expired in October of 2011. Because the bill would waive the fair market value 

requirements of the Federal Land Policy and Management Act, and 

the terms of any applicable leases, and for the reasons outlined in 

the Department’s 2011 report to Congress, the BLM cannot support 

H.R. 957. 

H.R. 1063 requires the Secretary of the Interior, through the 

BLM and the USGS, to assess the capability of the United States 

to meet the demands for minerals essential to manufacturing and 

competitiveness and economic and national security. The Department supports the goals of H.R. 1063. We would like to work with 

the Committee and other affected departments to further these 

goals, while taking into account time and resource considerations. 

Finally, H.R. 981 directs the Secretary of the Interior, acting 

through the Director of the USGS, to conduct a global assessment 

of rare earth elements. The Department supports the goals of this 

bill, although we note that the activities called for in H.R. 981 are 

within the scope of the existing Department of the Interior authorities. 

Mr. Chairman, thank you for the opportunity to testify today, 

and I would be happy to take any questions. 

[The prepared statement of Ms. Connell follows:]

48

PREPARED STATEMENT OF JAMIE E. CONNELL, ACTING DEPUTY DIRECTOR, BUREAU OF

LAND MANAGEMENT, U.S. DEPARTMENT OF THE INTERIOR

H.R. 761—NATIONAL STRATEGIC AND CRITICAL MINERALS PRODUCTION ACT AND

H.R. 1063—NATIONAL STRATEGIC AND CRITICAL MINERALS POLICY ACT

Introduction

Thank you for the opportunity to testify for the Department of the Interior on two 

bills pertaining to the development of strategic and critical mineral resources on our 

Nation’s public lands: H.R. 761, the National Strategic and Critical Minerals Production Act, and H.R. 1063, National Strategic and Critical Minerals Policy Act. 

These bills seek to expedite the development of strategic, critical and rare earth 

minerals on public lands managed by the Departments of the Interior and of Agriculture. This statement addresses the provisions relevant to the Department of the 

Interior. 

The Department shares the Committee’s interest in identifying opportunities for 

increasing efficiencies in the development of rare earth elements and other critical 

mineral resources on our Nation’s public lands consistent with environmental protection and public involvement in agency decision-making. We also encourage finding ways to make permitting less complex, costly, and time-consuming. The Bureau 

of Land Management (BLM) would like to work with the Committee to further these 

shared goals. 

The Department has concerns with these two bills. Public involvement in review 

of mining proposals and the formulation of alternatives—critical components of 

BLM’s multiple-use management of public lands—would be constrained under 

H.R. 761, and therefore, the Department opposes H.R. 761. While the Department 

supports the goals of H.R. 1063, we have concerns and would like to work with the 

Committee to address them. The Department looks forward to continuing a dialogue 

with the Congress on these important matters. 

Background 

The BLM administers over 245 million surface acres of public land located in the 

12 Western States, including Alaska, as well as 700 million acres of sub-surface 

mineral estate throughout the Nation. The public lands not only produce commodities, but also offer hunting, angling, and other recreational opportunities that help 

provide economic stability and growth for local and regional communities. Under its 

multiple-use mandate, BLM is working with local communities, tribes, State regulators, industry, and other Federal agencies to promote environmentally responsible 

development of mineral resources on Federal and Indian lands with a fair return 

to the American people. 

The BLM manages mineral development under a number of different authorities, 

including the Federal Land Policy and Management Act, the Mineral Leasing Act 

of 1920, the Materials Act of 1947, and the Mining Law of 1872. Each of these authorities, along with BLM regulations and guidance, provides a legal framework for 

the development of minerals. 

Global manufacturing demand for critical mineral commodities, including rare 

earth elements (REE), is on the rise, with increasing applications in consumer products such as renewable energy technology, computers, automobiles, aircraft, and 

other advanced technology products. While no REE are being mined on public lands 

at this time, some portions of the Federal mineral estate hold potential for REE development and deposits are being evaluated in three areas: the Bear Lodge Project 

in northeast Wyoming; the Bokan Mountain/Dotson Zone in southeastern Alaska; 

and potential expansion onto public lands of Molycorp’s Mountain Pass exploration 

operations in California. 

H.R. 761—National Strategic and Critical Minerals Production Act 

The stated purpose of H.R. 761, the National Strategic and Critical Minerals Production Act of 2013, is to increase the flow of critical and strategic minerals to the 

U.S. manufacturing sector by expediting the critical mineral exploration and mine 

permitting process on public lands managed by the Departments of the Interior and 

Agriculture. However, H.R. 761 is drafted in such a manner as to cover virtually 

all hard rock mining on Federal lands. H.R. 761 includes numerous provisions that 

circumvent sound Federal decision-making and existing law calling for the multiple 

uses of public lands, including public involvement, the application of the National 

Environmental Policy Act (NEPA), the management of permit applications, the review of Federal Register notices for such projects, and the handling by the courts 

of civil actions arising from disputes over mine proposals. The bill’s provisions also 

could apply retroactively to an application for a mineral exploration or mine permit 

that is pending at the time of the bill’s enactment, upon the request of the applicant 

49

to the lead agency. The legislation defines critical and strategic mineral mines as 

‘‘infrastructure projects’’ so that they will fall under the March 22, 2012, Executive 

order ‘‘Improving Performance of Federal Permitting and Review of Infrastructure 

Projects.’’

While the Department strongly supports the development of rare earth elements 

and other critical minerals, it strongly opposes H.R. 761. This legislation would remove many of the environmental safeguards for almost all types of hardrock mines 

on public lands, bypass evaluation of potential impacts under NEPA, and limit public involvement in agency decision-making. 

Additionally, H.R. 761 lacks clarity on a number of issues, including how the 

rights of surface owners in split estate situations might be affected in an expedited 

review process. It is also unclear how Section 103, which requires maximizing recoverable resources while mitigating environmental impacts, would affect the Department’s authority under the Federal Land Policy and Management Act to prevent 

‘‘undue and unnecessary degradation of the public lands.’’ H.R. 761 also does not 

discuss the consequences of missing the 30-month deadline on permitting decisions 

and how State permitting authorities relate to this timeline. The provision allowing 

for retroactive application of the bill to permit applications could have the effect of 

requiring the BLM or another agency to abandon in-progress environmental reviews 

of proposed actions. 

Some of the bill’s provisions also duplicate actions the BLM has already implemented, including the formulation of memoranda of understanding among agencies 

and proponents, the concurrent gathering and review of data, and the appointment 

of project leads who are assigned to a project through completion. 

Finally, the Department of the Interior defers to the Department of Justice regarding the provisions of H.R. 761 (Title II) pertaining to judicial review procedures. 

H.R. 1063—National Strategic and Critical Minerals Policy Act 

H.R. 1063 requires the Secretary of the Interior—through the BLM and the U.S. 

Geological Survey—to assess the capability of the United States to meet the demands for minerals essential to manufacturing competitiveness and economic and 

national security. It requires the Secretary, in consultation with the Secretary of Agriculture, to produce a report to Congress within 180 days of enactment that includes an inventory of the non-fossil-fuel mineral potential of lands under the jurisdiction of the BLM and the U.S. Forest Service. The report must identify anticipated 

mineral requirements for the U.S. manufacturing sector, current sources of these 

minerals, implications of shortages, timelines for mineral development projects on 

public lands, and the cost of litigation. In addition, the report must include an assessment of the Federal workforce and its ability to meet the challenges of the critical minerals issue. The report must also include an inventory of rare earth element 

potential on Federal lands, impediments and restrictions to exploration or development, and recommendations to reduce such impediments. Finally, the bill directs 

the USGS to conduct national and global assessments of critical mineral resources. 

H.R. 1063 requires far-reaching analysis of vast amounts of data spanning the jurisdictions of the Departments of the Interior, Agriculture, Defense, Commerce, and 

Justice, as well as the Office of Personnel Management. While we share the goals 

of H.R. 1063, it would entail much more than producing a report, likely requiring 

the development and implementation of data tracking systems and an ongoing commitment of staff resources to gather, input, analyze, and update the data. The administrative time and cost of this work would exceed the 180 days and $1 million 

authorized by the legislation. Regarding the national and global assessments of critical minerals, we note that these activities are already authorized by existing USGS 

authorities. These studies would require substantial resources and, absent authorized appropriations, would significantly impact other program mission activities. 

We would like to work with the Committee and the other affected Departments 

to further the goals of the bill taking into account time and resource considerations. 

We would also like to work with the Committee to provide clarification on some provisions of the bills, such as the minerals under consideration and the designation 

of impediments and restrictions. 

Thank you for the opportunity to testify on H.R. 761 and H.R. 1063. I will be glad 

to respond to questions. 

H.R. 687—SOUTHEAST ARIZONA LAND EXCHANGE AND CONSERVATION ACT

Thank you for the opportunity to present testimony on H.R. 687, the Southeast 

Arizona Land Exchange and Conservation Act. The legislation provides for the exchange of a 2,422-acre parcel of U.S. Forest Service-managed land to a private company in exchange for a number of parcels within the State of Arizona for management by the U.S. Forest Service (FS) and the Bureau of Land Management (BLM). 

50

Three of the private parcels are identified for transfer to the Secretary of the Interior. 

In general, the Department of the Interior (DOI) defers to the FS on the issues 

directly related to FS-managed lands and associated valuation issues. We believe 

that the intent of the legislation is to facilitate an exchange of land with Resolution 

Copper Mining, LLC. Resolution Copper has indicated its intention to develop a copper mine near Superior, Arizona, and wishes to acquire the 2,422-acre FS parcel 

overlying the copper deposit as well as the Federal subsurface rights. 

Conveyance of Parcels to the Bureau of Land Management

H.R. 687 provides for the conveyance of three parcels to the Secretary of the Interior to be managed by the BLM. The parcels identified are located in Gila, Pinal, 

and Santa Cruz Counties and include:

• 3,050 acres along the lower San Pedro River near Mammoth, Arizona; 

• 160 acres within the Dripping Springs area near Kearny, Arizona; and 

• the 940-acre Appleton Ranch parcel adjacent to the Las Cienegas National Conservation Area near Sonoita, Arizona.

We would note that the maps for these three parcels are inaccurately described 

in the legislation and we would like to work with the sponsor and the Committee 

to correct those descriptions. 

The lower San Pedro parcel is east of the town of Mammoth, Arizona, and straddles the San Pedro River. The acquisition of these lands would enhance key migratory bird habitat along the San Pedro River. H.R. 687 provides for the lower San 

Pedro parcel to be managed as part of the BLM’s existing San Pedro Riparian National Conservation Area (NCA) designated by Public Law 100–696. The lower San 

Pedro parcel lies along the same riparian corridor as the NCA, but it is at least 60 

miles downstream (north) of the existing NCA and has substantially different resource issues and needs. If this parcel is conveyed to the Secretary of the Interior 

and incorporated into the NCA, the Department recommends that the existing 80 

acres of adjacent BLM-managed public land likewise be included within the NCA 

to facilitate the efficient and effective management of this important riparian corridor. 

The legislation also proposes to transfer 160 acres in the Dripping Springs area 

near Kearny, Arizona, to the Secretary of the Interior. This private parcel is an 

inholding within a larger block of public lands and has important resource values, 

including sensitive Desert Tortoise habitat. 

Finally, the bill provides for the transfer of the 940-acre Appleton Ranch parcel 

to the Secretary of the Interior. This parcel is located on the southern end of the 

BLM’s Las Cienegas NCA. These lands lie within the ‘‘Sonoita Valley Acquisition 

Planning District’’ established by Public Law 106–538, which designated the Las 

Cienegas NCA. That law directs the Department to acquire lands from willing sellers within the planning district for inclusion in the NCA to further protect the important resource values for which the Las Cienegas NCA was designated. These 

lands are part of a significant wildlife corridor. The acquisition of these lands advances important conservation goals associated with this unique and special natural 

resource. 

General Concerns

The Administration has several concerns with the Southeast Arizona Land Exchange and Conservation Act and cannot support H.R. 687 as written. Two of the 

Administration’s principal concerns with the legislation pertain to the timing of 

NEPA analysis and tribal consultation. 

H.R. 687 requires the Forest Service to prepare an environmental review document under the National Environmental Policy Act (NEPA) after the land exchange 

is completed rather than in advance of the exchange. It is this Administration’s policy that NEPA be fully complied with to address all Federal agency actions and decisions, including those necessary to implement congressional direction. 

In addition, increasing and improving tribal consultation with Indian tribes by all 

Federal agencies is a key accomplishment of this Administration, and concerns have 

been raised by Indian tribes nationwide that the legislation is contrary to laws and 

policies and Executive orders that direct Federal land management agencies to engage in meaningful government-to-government consultation with interested Indian 

tribes, and to protect and preserve sites sacred to Native Americans. This consultation framework includes, including the recent Memorandum of Understanding 

among the Departments of Defense, Interior, Agriculture, Energy and the Advisory 

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tion for the Protection of Indian Sacred Sites, which was signed on December 4, 

2012. 

Many of the lands to be exchanged in this legislation hold significant cultural 

value to Indian tribes. In particular, the Apache Leap area, the Oak Flat Campground, and Devil’s Canyon are culturally significant to the San Carlos Apache 

Tribe and the Fort McDowell Yavapai Nation. For the San Carlos Apaches, and the 

Yavapai, this area is a place of ancient settlements and burial sites. Tribal members 

still go to these areas to pray, conduct ceremonies, and gather medicines and ceremonial items. 

The Administration is concerned that any consultations under H.R. 687 would not 

be meaningful under Executive Order 13175, ‘‘Consultation and Coordination with 

Indian Tribal Governments,’’ because the legislation limits the Secretary of Agriculture’s discretion regarding the land exchange. Engaging in government-to-government consultation prior to the Secretary of Agriculture’s public interest determination would better allow for meaningful consultation and coordination with interested 

tribes. 

Section 4(i) of H.R. 687 expresses the intent of Congress that the exchange be 

completed within 1 year. Based on our experience with exchanges, we believe the 

amount of time provided in H.R. 687 is insufficient to review and finalize the necessary environmental documents, mineral report, and appraisals, as well as to conduct the final verification and prepare title documents. We are also concerned that 

1 year may not be sufficient to complete analysis of any historic and sacred sites 

in the exchange area as required by the Native American Graves Protection Act and 

the National Historic Preservation Act. 

Preparation of a mineral report is a crucial first step toward an appraisal of the 

Federal parcel because the report provides important information about the Federal 

mineral deposit. The bill does not address access to confidential exploration and development data and company analyses on the mineral deposits underlying the Federal land in order to ensure a timely and accurate appraisal. Such information is 

essential for the mineral report, particularly in the context of this exchange, because 

of the size of the proposed mining operation and the proposed mining technique. 

Section 6 of H.R. 687 provides for an annual value adjustment payment to the 

United States if the cumulative production of locatable minerals exceeds the projected production used in the appraisal required by section 4. This provision recognizes that an accurate projection of future production as part of the appraisal process will be difficult to develop, and provides a mechanism for additional payments 

to the United States if the actual production exceeds the projected production. The 

Department generally defers to the FS on the specific provisions of section 6 of the 

bill. However, we note that this section creates a new fund in the U.S. Treasury 

for the deposit of these value adjustment payments. The Department believes that 

these funds should be dedicated to Federal land acquisition in the same manner as 

the initial land equalization payments provided for in section 4(e)(2)(C) of the bill. 

Because these funds are to compensate for a possible initial inadvertent under-appraisal of land values, it is appropriate that the value when captured be used in 

the same manner as if it had been included in the initial appraisal. 

Finally, there are a number of issues of a more technical nature, including appropriate map references, which we would welcome the opportunity to discuss as this 

legislation moves forward. 

Conclusion

Thank you for the opportunity to testify. The exchange proposed in H.R. 687 is 

complex. The Departments of Agriculture and of the Interior seek to assure that the 

Federal Government’s interest is appropriately protected in any final legislation and 

tribal interests are considered. 

H.R. 697—THREE KIDS MINE REMEDIATION AND RECLAMATION ACT

Introduction 

Thank you for the opportunity to testify on H.R. 697, the Three Kids Mine Remediation and Reclamation Act. During the past 5 years, the Bureau of Land Management (BLM) has worked with Nevada governmental entities in search of administrative remedies to the problems posed by the abandoned Three Kids Mine, in Henderson, Nevada. The BLM supports H.R. 697, which provides legislative solutions to 

the issues surrounding the Three Kids Mine area and clears the way for its eventual 

development. 

Background

The Three Kids Mine is an abandoned manganese mine and mill site located 

along the south side of Lake Mead Drive, across the highway from Lake Las Vegas, 

52

in Henderson, Nevada. The mine and mill operated from 1917 through 1961 on 314 

acres of private land, in part providing steel-strengthening manganese to the defense industry and contributing to the United States’ efforts in World War I and 

II. Federal manganese reserves were stored in the area from the late 1950s through 

2003. 

H.R. 697 would direct that 948 acres of the public lands adjacent to the private 

site be conveyed to the Henderson Redevelopment Agency, bringing the total size 

of the project area to 1,262 acres. Of the 948 acres of public lands, 146 acres are 

contaminated and will require mine reclamation and environmental remediation. 

The most severe contamination appears to be on the 314 private acres where the 

mine and mill were located. No viable former operator or responsible party has been 

identified to remediate and reclaim the abandoned mine and mill site. Today, the 

site’s deep open pits, large volumes of mine overburden and tailings, mill facility 

ruins, and solid waste disposal areas pose significant risks to public health, safety 

and the environment. The Nevada Division of Environmental Protection (NDEP) 

identified the Three Kids Mine site as a high priority for the implementation of a 

comprehensive environmental investigation, remediation, and reclamation program. 

Representatives of the BLM, the Bureau of Reclamation, and the Department of 

the Interior Solicitor’s Office have worked with the City of Henderson and representatives of developer Lakemoor Canyon, LLC, to find solutions to the complex 

challenges this site presents. Discussions have focused on overlapping Federal agency jurisdictions, land management designations and other resource issues, Resource 

Management Plan amendments, future liability, and an important utility corridor 

that traverses the site. 

H.R. 697

H.R. 697 would designate the combined 314 acres of private land and 948 acres 

of public land as the 1,262-acre ‘‘Three Kids Mine Project Site’’ and provide for the 

conveyance of the public lands to the Henderson Redevelopment Agency. The legislation also provides that fair market value for the Federal lands to be conveyed 

should be determined through standard appraisal practices, and that, subsequent to 

that determination, the Secretary should determine the ‘‘reasonable approximate estimation of the costs to assess, remediate, and reclaim the Three Kids Mine Project 

Site.’’ That cost would then be deducted from the fair market value of the public 

land to be conveyed. The Henderson Redevelopment Agency would pay the adjusted 

fair market value of the conveyed land, if any, and the Federal Government would 

be released from ‘‘any and all liabilities or claims of any kind arising from the presence, release, or threat of release of any hazardous substance, pollutant, contaminant, petroleum product (or derivative of a petroleum product of any kind), solid 

waste, mine materials or mining related features’’ at the site in existence on or before the date of the conveyance. 

While the BLM has not established a range for the cost of cleanup, a proponent 

of the transaction, Lakemoor Canyon, LLC, estimates the cost of remediating the 

public and private lands at between $300 million and $1.3 billion. While it is possible that the cost of remediating and reclaiming the entire project area might exceed the fair market value of the Federal land to be conveyed, the cost of the transaction will only be known after the Secretary completes the appraisal and remediation cost estimate process as outlined in the legislation. 

The BLM supports innovative proposals to address the cleanup of the Three Kids 

Mine, and we support this proposal to transfer the entire 948 acres of public land 

to the Henderson Redevelopment Agency at fair market value, subject to valid existing rights. However, the BLM recognizes that the transfer would include a small 

portion of the River Mountains ACEC, and we would like to discuss with the committee opportunities to mitigate that loss. 

Conclusion

Thank you for inviting the Administration to testify on H.R. 697. The Three Kids 

Mine problem needs to be resolved, and we look forward to working toward a solution that protects the environment and serves the public interest. I would be happy 

to answer your questions.

H.R. 767—OIL AND GAS PILOT PROJECT OFFICES

Introduction

Thank you for the opportunity to testify on H.R. 767, which would amend the Energy Policy Act of 2005 to modify the Federal Permit Streamlining Pilot Project. The 

bill would expand the Federal Permit Streamlining Pilot Project to include all of the 

field offices within the jurisdiction of the BLM’s Montana/Dakotas State Office. The 

BLM supports the goal of H.R. 767 to better conform the pilot office authority to 

53

current permitting demands. However, the BLM would like to work with the sponsor and the Committee on clarifying amendments as well as language that would 

provide additional flexibilities nationwide to utilize the pilot office authority to respond as permitting demands shift over time. 

Background

Section 365 of the Energy Policy Act of 2005 established the Federal Permit 

Streamlining Pilot Project with the intent to improve the efficiency of processing oil 

and gas use authorizations and environmental stewardship on Federal lands. It designated seven pilot project offices: Miles City, Montana; Buffalo and Rawlins, Wyoming; Vernal, Utah; Grand Junction/Glenwood Springs, Colorado; and Farmington 

and Carlsbad, New Mexico. 

Section 365 also established the Permit Processing Improvement Fund, an account of approximately $18 million annually, to support the pilot project for 10 

years. Specifically, it directed 50 percent of the income derived from Federal onshore 

oil and gas lease rental payments outside of Alaska to the Fund. For FY 2006 

through FY 2015, the section made the Fund available to the Secretary of the Interior for expenditure without further appropriation to enhance coordination and processing of oil and gas use authorizations on Federal land under the jurisdiction of 

the designated pilot project offices. 

In addition to the BLM, Section 365 authorized the Secretary to transfer monies 

from the Permit Processing Improvement Fund as necessary to the Fish and Wildlife Service, the Bureau of Indian Affairs, the Forest Service, the Environmental 

Protection Agency, the Army Corps of Engineers, and the States of Wyoming, Montana, Colorado, Utah, and New Mexico. It also prohibited the BLM from establishing cost recovery fees for processing applications for oil and gas permits to drill. 

The President’s 2013 budget proposed to repeal this fee prohibition. In lieu of the 

budget proposal, we note that the Congress has implemented permit fees through 

appropriations language for the last several years. 

The agencies involved in the pilot project have made significant progress in a 

number of areas. Additional resources, such as personnel devoted to processing oil 

and gas use authorizations, have enabled the various bureaus and agencies to increase the pace of permitting and completing environmental reviews, particularly 

given the complex resource issues we face. The time taken for interagency consultations has been reduced due to improved communication and through programmatic 

streamlining efforts, which have been used in multiple projects and permits. 

Also, the BLM has increased inspection and enforcement capability as a result of 

the hiring of additional skilled specialists in the pilot project offices. The increase 

in inspections has led to better compliance by the industry and a reduction in major 

violations due to the increased number of inspectors in the field. Increasing the 

number of inspectors has allowed the BLM to identify issues early; intervene in nascent violation situations; and improve interim reclamation work on lands disturbed 

by oil and gas operations. The pilot project offices are also better staffed to help new 

industry permitting specialists understand the BLM’s requirements for obtaining an 

oil and gas use authorization. 

H.R. 767

H.R. 767 would substitute the BLM’s Montana/Dakotas State Office for the current pilot project office in Miles City, Montana, with the goal of broadening the geographic scope of the pilot project authority. This broadened geographic scope would 

allow BLM to better allocate some resources based on current permitting demands 

and new exploration and development of oil and gas fields and plays. For example, 

this flexibility would be especially useful for processing permits received in the 

North Dakota Field Office in Dickinson, North Dakota, which received 701 applications for permits to drill (APDs) in FY 2012, compared to 147 APDs received in FY 

2009. 

In addition, the BLM would like to work with the sponsor and the Committee on 

language that would allow greater flexibilities nationwide to adjust permitting resources based on demand. There are many BLM field offices that are not part of 

the pilot project, but are receiving hundreds of APDs per year. Of the 10 field offices 

that received the most APDs during FY 2012, only 5 are currently designated as 

pilot project offices. For example, in FY 2012, the Pinedale Field Office in Pinedale, 

Wyoming, received 325 APDs; the Bakersfield Field Office in Bakersfield, California, 

received 286 APDs; and the Oklahoma Field Office in Tulsa, Oklahoma, received 

157 APDs. Although these offices have received high volumes of APDs, none are currently designated as pilot project offices, and none would be designated as such 

under the bill. At the same time, some of the currently designated pilot project ofVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6621 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
54

fices have received relatively few APDs in recent years; for example, the Grand 

Junction Field Office received only 47 APDs in FY 2012. 

Conclusion

Thank you for the opportunity to provide testimony on H.R. 767. I would be happy 

to answer any questions you may have.

H.R. 957—AMERICAN SODA ASH COMPETITIVENESS ACT

Introduction

Thank you for the opportunity to testify on H.R. 957, the American Soda Ash 

Competitiveness Act. This bill would reinstate for five years the royalty rate reduction provided for under the Soda Ash Royalty Rate Reduction Act of 2006, which 

expired in October 2011. The BLM cannot support H.R. 957. 

Background

Soda ash is one of several products derived from sodium minerals mined on public 

lands and is used in many common products, including glass, pulp, detergents, and 

baking soda. The mineral trona is a naturally occurring mixture of sodium carbonate, sodium bicarbonate, and water. Soda ash may be either natural or synthetic. 

It can be extracted from mined natural trona deposits, or it can be manufactured 

synthetically. Synthetic soda ash production began in this country in the 1880s and 

increased as the demand for soda ash increased. In the early 1950s, the modern natural soda ash industry began in the Green River Basin of Wyoming, home of the 

world’s largest known natural deposit of trona, where soda ash, or ‘‘sodium carbonate,’’ is refined from trona mined at depths of between 800 and 1,600 feet below 

the surface. 

In 2012, the U.S. soda ash industry consisted of five companies that mine and 

mill soda ash, four of which operate five plants in Wyoming. One company in California produces soda ash from sodium-carbonate rich brines. At the end of FY 2012, 

there were 86 Federal sodium leases covering 111,185 acres in Wyoming, California, 

Colorado, Arizona, and New Mexico. Sixty-three of these Federal sodium leases were 

located in Wyoming. The soda ash industry is a substantial contributor to the gross 

domestic product of the United States, with the total value of domestic soda ash produced in 2012 being about $1.6 billion and the industry supplying over 2,200 direct 

jobs. Soda ash is also a key ingredient in many diversified products, including flat 

glass used by the automobile and construction industries. 

Soda Ash Royalty Rate Reduction Act 

In 2006, Congress passed the Soda Ash Royalty Rate Reduction Act (2006 Act), 

which reduced the Federal royalty rate for soda ash to 2 percent. Before the 2006 

Act went into effect, the BLM was charging royalty rates of 6 and 8 percent. The 

BLM established these rates based on a 1996 study to examine the fair market 

value in the sodium industry in Wyoming. The study reviewed many comparable 

State and private leases and found that fair market value in Wyoming appeared to 

be somewhat higher than the 5 percent being charged by the BLM previously. As 

a result of the study, the BLM determined that the royalty rate for all then-existing 

leases would be increased from 5 to 6 percent at the lease renewal date. The BLM, 

based on the study, also determined that the royalty rate on all new leases would 

be 8 percent. In the Green River Basin at that time, the royalty rate on most private land was 8 percent and 5 percent on State lands. 

Report to Congress

As mandated by the 2006 Act, the BLM reported to Congress in the fall of 2011 

on the impact of the reduction over the previous 5 years, in the ‘‘U.S. Department 

of the Interior Report to Congress: The Soda Ash Royalty Reduction Act of 2006.’’ 

The report found that the 2006 Act resulted in a substantial loss of royalty revenues 

to the Federal Government and the States which exceeded congressional estimates 

at the time of enactment. It also stated that the royalty rate reduction did not appear to have contributed in a significant way to the creation of new jobs within the 

industry, to increased exports, or to a notable increase in capital expenditures to 

enhance production. Furthermore, the report found that the royalty rate reduction 

appeared to have influenced a shift of production away from State leases and private lands and onto Federal leases, and that, with regard to global competitiveness, 

U.S. production remained stable. 

H.R. 957

H.R. 957 would reinstate for 5 years the 2 percent royalty rate for soda ash which 

expired in October 2011. Specifically, the bill would apply an across-the-board reducVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00058 Fmt 6633 Sfmt 6621 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
55

tion in the royalty rate on soda ash leases from an average of 5.6 percent to 2 percent. In FY 2012, the soda ash industry paid over $47 million in royalty for production from Federal lands. If the royalty rate had been reduced to 2 percent during 

FY 2012, the royalty revenue for that year would have been approximately $17 million, a reduction of about $30 million. Furthermore, the bill could be subject to the 

Statutory Pay-As-You-Go Act of 2010. 

H.R. 957 would waive the requirements of section 102(a)(9) of the Federal Land 

Policy Management Act of 1976 (FLPMA) and the terms of any applicable leases. 

Section 102(a)(9) of FLPMA states that it is the policy of the United States to receive fair market value for the use of public lands and their resources unless otherwise provided by statute. For these reasons and for the reasons outlined in the Department’s 2011 report, the BLM cannot support H.R. 957. 

Conclusion

Thank you for the opportunity to provide testimony on H.R. 957. I would be happy 

to answer any questions you may have.

H.R. 981—RESOURCE ASSESSMENT OF RARE EARTHS ACT OF 2013

Thank you for the opportunity to present the Department of the Interior’s views 

on H.R. 981, directing the Secretary of the Interior, acting through the Director of 

the U.S. Geological Survey (USGS), to conduct a global assessment of rare earth element resources. The Department supports the goals of this bill, although we note 

that the activities called for in H.R. 981 are within the scope of existing Department 

of the Interior authorities. 

The USGS is responsible for conducting research and collecting data on a wide 

variety of fuel and nonfuel mineral resources, including rare earth elements (REE). 

For nonfuel minerals, research is conducted to understand the geologic processes of 

concentrated known mineral resources at specific localities in the Earth’s crust and 

to estimate (or assess) quantities, qualities, and areas of undiscovered mineral resources, or potential future supply. USGS scientists also conduct research on the 

interactions of mineral resources with the environment, both natural and as a result 

of resource extraction, to better predict the degree of impact that resource development may have on human and ecosystem health. USGS mineral commodity specialists collect, analyze, and disseminate data and information that document current 

production and consumption for about 100 mineral commodities, both domestically 

and internationally for 180 countries. This full spectrum of mineral resource science 

allows for a comprehensive understanding of the complete life cycle of mineral resources and materials—resource formation, discovery, production, consumption, use, 

recycling, and reuse—and allows for an understanding of environmental issues of 

concern throughout the life cycle. 

Global demand for critical mineral commodities is on the rise with increasing applications in consumer products, computers, automobiles, aircraft, and other advanced technology products. Much of this demand growth is driven by new technologies that increase energy efficiency and decrease reliance on fossil fuels. In 

2010, the USGS completed an inventory of known domestic rare-earth reserves and 

resources (Long and others, 2010). The report documents 28 deposits and includes 

information on the location, exploration status, past production, and estimated resources. The report also includes an overview of known global rare-earth resources 

and discusses the reliability of alternative foreign sources of rare earths. Known 

U.S. deposits of REE comprise about 13 percent of the global reserve of REE and 

are located on a mix of public (BLM and USFS) and private lands in 14 States. The 

primary U.S. source for REE is the Mountain Pass mine in California, operated by 

Molycorp Minerals, a Colorado-based company. Advanced exploration projects for 

new REE deposits are underway at Bokan Mountain, AK and Bear Lodge, WY. In 

2011, USGS released two additional REE reports, ‘‘China’s Rare-Earth Industry’’ 

(Tse, 2011) and ‘‘Rare Earth Elements—End Use and Recyclability’’ (Goonan, 2011). 

The logical next steps are to (1) update a global inventory of rare earth resources 

published by the USGS in 2002 (Orris and Grauch, 2002), (2) review principal REE 

deposits outside of China and evaluate their geologic, economic, and development 

potential, and (3) conduct a comprehensive assessment of undiscovered REE resources. H.R. 981, the RARE Act of 2013, outlines a reasonable approach to properly 

assess the global endowment of REE resources, to identify potential future supplies 

of REE resources, and to better understand future potential sources of REE needed 

for United States industry. 

The USGS maintains a workforce of geoscientists (geologists, geochemist, geophysicists, and resource specialists) with expertise in critical minerals and materials, including REE. The USGS continuously collects, analyzes, and disseminates 

data and information on domestic and global REE reserves and resources, producVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00059 Fmt 6633 Sfmt 6621 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
56

tion, consumption, and use. This information is published annually in the USGS 

Mineral Commodity Summaries (USGS, 2013) and includes a description of current 

events, trends, and issues related to REE supply and demand. 

The USGS stands ready to fulfill its role as the sole Federal provider of unbiased 

mineral resource research on known REE resources, assessment of undiscovered 

REE resources, and information on domestic and global production and consumption 

of REE resources for use in global REE supply chain analysis. We note, however, 

that the activities called for in H.R. 981 are already authorized by existing authorities. Any study conducted to fulfill the objectives of the bill will require substantial 

resources that, without additional support, would significantly impact other program mission activities. 

Thank you for the opportunity to present the views of the Department on H.R. 

981.

References Cited

Goonan, T.G., 2011, Rare earth elements—End use and recyclability: U.S. Geological Survey Scientific Investigations Report 2011–5094, 15 p., available only at

http://pubs.usgs.gov/sir/2011/5094/.

Long, K.R., Van Gosen, B.S., Foley, N.K., and Cordier, Daniel, 2010, The principal 

rare earth elements deposits of the United States—A summary of domestic deposits 

and a global perspective: U.S. Geological Survey Scientific Investigations Report 

2010–5220, 96 p. Available at http://pubs.usgs.gov/sir/2010/5220/.

Orris, G.J., and Rauch, R.I., 2002, Rare earth element mines, deposits, and occurrences: U.S. Geological Survey Open-File Report 2002–0189, 174 p. Available at 

http://pubs.usgs.gov/of/2002/of02-189/.

Tse, Pui-Kwan. (2011) China’s Rare-Earth Industry. U.S. Geological Survey OpenFile Report 2011–2042. 

USGS, 2013, Mineral Commodity Summaries 2013, p. 128–129

QUESTIONS SUBMITTED FOR THE RECORD TO JAMIE E. CONNELL

QUESTIONS SUBMITTED FOR THE RECORD BY THE HONORABLE GRACE F. NAPOLITANO

Question. Can you clarify how many acre-feet of water will be utilized in the mining process to cool the drill? It is my understanding it would be about 40,000 acrefeet. of water. My concern is the current drought condition of the City of Superior 

and surrounding area. 

Answer. The Department of the Interior does not have this information. 

Question. Are there current environmental studies in process or have any been 

completed on the examination of the land prior to the exchange into private ownership? 

Answer. The Department of the Interior defers to the Forest Service on issues directly related to the transfer of Forest Service-managed lands and associated valuation issues. 

Question. Wouldn’t the normal process of requesting an environmental study be 

the first step? H.R. 687 waives compliance with NEPA prior to the exchange, meaning that the Forest Service or the public will never have access to information documenting the potential environmental impacts of a large copper mining operation in 

the area. 

Answer. It is the Administration’s policy that NEPA be fully complied with to address all Federal actions and decisions prior to the exchange. 

QUESTION SUBMITTED FOR THE RECORD BY THE HONORABLE KEVIN CRAMER, A

REPRESENTATIVE IN CONGRESS FOR THE STATE OF NORTH DAKOTA

Question. Ms. Connell, on page 2, 2nd paragraph of your March 21, 2013, pre-filed 

testimony, you stated:

‘‘The agencies involved in the pilot project have made significant progress 

in a number of areas. Additional resources, such as personnel devoted to 

processing oil and gas use authorizations, have enabled the various bureaus 

and agencies to increase the pace of permitting and completing environmental reviews, particularly given the complex resource issues we face. The 

time taken for interagency consultations has been reduced due to improved 

communication and through programmatic streamlining efforts, which have 

been used in multiple projects and permits.’’

57

Do you have specific results to show that this Pilot Project has improved the Federal permit process? (i.e. A backlog of X amount of Applications for Permit to Drill 

(APDs) has been reduced to X amount, reduced average time to process an APD 

from X to X, X amount of inspections before compared to X amount of inspections 

now.) 

Answer. The pilot office authority has allowed the BLM and other pilot office 

agencies to better coordinate permitting and related environmental reviews, which 

along with additional funding has allowed us to increase the pace of permitting. The 

pilot project offices approved approximately 54 percent of all APDs received from FY 

2006 to FY 2012. From FY 2006 to FY 2012, the amount of time it took for all BLM 

field offices to process and approve complete APDs fell from 127 to 77 days. The 

number of complete APDs pending more than 90 days (the ‘‘backlog’’) at all BLM 

offices declined from 1,486 to 551 from FY 2006 to FY 2012. (Note: only after an 

applicant has submitted all the required components of an APD package is the BLM 

able to complete its review and make a decision on an APD.) The number of inspections completed by all BLM offices rose 73 percent from FY 2006 to FY 2012, from 

19,974 to 34,571. 

Mr. LAMBORN. OK, thank you for being here and for your testimony. 

We will now hear from Ms. Wagner. 

STATEMENT OF MARY WAGNER, ASSOCIATE CHIEF, U.S. 

FOREST SERVICE, U.S. DEPARTMENT OF AGRICULTURE 

Ms. WAGNER. Good morning, Mr. Chairman and members of the 

Committee. Thanks for the opportunity to provide the Department 

of Agriculture’s views on H.R. 687, the Southeast Arizona Land Exchange and Conservation Act of 2013. 

We have had the opportunity to share our perspective on previous versions of this bill, and we have not changed our position 

since our last testimony. I know you have had an opportunity to 

review the detailed written testimony. I am going to focus on a few 

key points in my oral remarks. 

We support environmentally sound mineral development. We 

also recognize the benefit of copper mine development to economic 

and employment conditions in the State of Arizona and the Nation. 

We acknowledge the environmental benefits and qualities of the 

non-Federal land parcels considered in this exchange, and we appreciate the efforts to resolve land use issues for the Town of Superior. Last, we appreciate the recognition and protection of important values of Apache Leap. 

While the Department understands and appreciates the potential 

economic benefits and value of the lands to be acquired by the 

American public, the Department cannot support the bill as written, but is looking forward to working with sponsors and the Committee to resolve concerns. The two principal concerns with the bill 

are that it would require the Agency to prepare an environmental 

review document under NEPA after the land exchange is completed, and the land exchange and subsequent mining activities 

have the potential to impact a landscape considered sacred to a 

number of federally recognized Tribes, without environmental review or consultation with the Tribes. 

The Department believes that adhering to the Federal Land Policy Management Act and other laws that guide administrative land 

exchanges ensures a sound process for determining the public interest and disclosing environmental impacts. It requires that before 

making a discretionary decision, the Federal agency considers the 

58

environmental impacts of a proposed major Federal action, and alternatives of such an action. 

It is this Administration’s policy that NEPA be fully complied 

with to address all Federal actions and decisions, including those 

necessary to implement congressional direction. NEPA conducted 

in advance of the exchange would create an opportunity for meaningful tribal consultation, as envisioned by numerous laws that acknowledge that consultation with tribal governments is legally 

mandated and integral to the Federal Government’s trust responsibility to Tribes. Consultation becomes the vehicle where tribal concerns and interests are identified, addressed, and potentially mitigated. 

We have a number of technical concerns with the bill, including 

the timeframe to complete the land exchange, appraisal provisions, 

value adjustment provisions, and the purpose of funds from value 

adjustment payments. And we would like to work with the Committee to resolve those issues. 

This concludes my statement. I am happy to answer any questions you might have. 

[The prepared statement of Ms. Wagner follows:]

PREPARED STATEMENT OF MARY WAGNER, ASSOCIATE CHIEF, U.S. FOREST SERVICE, 

U.S. DEPARTMENT OF AGRICULTURE, ON H.R. 687

Mr. Chairman and members of the Committee, thank you for the opportunity to 

appear before you today to provide the Department of Agriculture’s views on 

H.R. 687, the ‘‘Southeast Arizona Land Exchange and Conservation Act of 2013’’. 

I am Mary Wagner, Associate Chief of the U.S. Forest Service. H.R. 687 would direct the Secretary of Agriculture to convey Federal land for use as an underground 

copper mine in exchange for environmentally sensitive non-Federal land in Arizona. 

We defer to the Department of the Interior on provisions relating to lands to be 

managed by the Bureau of Land Management (BLM). 

H.R. 687 would direct the Secretary of Agriculture to convey to Resolution Copper 

Mining, LLC (Resolution Copper), a 2,422 acre parcel of land on the Tonto National 

Forest. The Federal land to be conveyed, known as Oak Flat, contains a potentially 

sizeable copper ore body and adjoins an existing copper mine on private land owned 

by Resolution Copper. In exchange, Resolution Copper would convey five parcels of 

land to the Forest Service and three parcels of land to BLM. The total non-Federal 

acreage that would be conveyed by Resolution Copper is 5,344 acres, all of which 

are in Arizona. 

The Bill calls for an equal value exchange in section 4(e). If the value of the Federal land (including the ore body) to be conveyed exceeds the value of the parcels 

to be acquired, the Bill would allow for a cash equalization payment by Resolution 

Copper in excess of 25 percent. Under current law, cash equalization payments may 

not exceed 25 percent (section 206(b) of Federal Land Policy and Management Act 

of 1976 (43 U.S.C. 1716(b)). A cash equalization payment resulting from the exchange would be deposited in the Sisk Act account to be used, upon appropriation 

by Congress, for acquisition of land for addition to the National Forest System within the State of Arizona. 

Section 6(b) of the Bill would require Resolution Copper to make value adjustment 

payments if, as the mine is developed, production of the mine exceeds expectations 

documented in the appraisal. Those funds would be deposited in a special account 

in the Treasury to be used, upon appropriation by Congress, for maintenance, repair, and rehabilitation projects on BLM and National Forest System lands. The Department’s position is that any value adjustment payments should be used for land 

acquisition. 

The Bill also would provide for the sale of: a 30 acre parcel of land currently being 

used as a cemetery; a reversionary interest and reserved mineral rights in a 265 

acre parcel; and 250 acres near the Superior Airport at market value to the Town 

of Superior. Sale proceeds would be deposited in the Sisk Act account to be used, 

upon appropriation by Congress, for acquisition of land to the National Forest System in Arizona. 

59

H.R. 687 would require Resolution Copper to pay all costs associated with the exchange, including any environmental review document. The Bill provides that it is 

the intent of Congress that the exchange be completed not later than 1 year after 

the date of enactment. 

At the request of Resolution Copper, the Bill would require the Secretary, within 

30 days of such request, to issue a special use permit to Resolution Cooper to carry 

out mineral exploration activities under the Oak Flat Withdrawal Area, from existing drill pads located outside the area, if such activities would not disturb the surface of the Area. At the request of Resolution Copper, within 90 days, the Bill would 

require the Secretary to issue a special use permit to Resolution Copper to carry 

out mineral exploration activities under the Oak Flat Withdrawal Area (but not 

within the Oak Flat Campground), if the activities are conducted from a single exploratory drill pad which is located to reasonably minimize visual and noise impacts 

to the Campground. 

H.R. 687 would require the Secretary of Agriculture to complete an environmental 

review document after the exchange, and after the above-noted activities were permitted to take place, but before Resolution Copper’s commencement of commercial 

mineral production on the land it would acquire in the exchange. Specifically, once 

the land exchange is consummated, and these lands are in the private ownership 

of Resolution Copper, Resolution Copper is authorized to submit a mine plan of operation to the Secretary. Thereafter, the Secretary must complete an environmental 

review document within 3 years that is limited to section 102(2) of the National Environmental Policy Act of 1969 (NEPA). The environmental document would be used 

as the basis for any Federal action or authorization related to the proposed mine 

and mine plan of operations of Resolution Copper, including the construction of associated power, water, transportation, processing, tailings, waste dump, and other 

ancillary facilities. After the exchange, Resolution Copper may need to use the adjoining National Forest System land for ancillary activities related to the mining development, such as rights-of-way for electric lines, pipelines, or roads. 

The Bill would add five parcels of land totaling almost 1,200 acres to the National 

Forest System. Most of these parcels include riparian areas which are somewhat 

rare in Arizona. One of the parcels that would be acquired adjoins the Apache Leap 

area on the Tonto National Forest. Additionally, as a condition of the land exchange, 

Resolution Copper would surrender its rights to commercially extract minerals 

under Apache Leap. 

While the Department understands and appreciates the potential economic benefits and the value of the lands to be acquired by the American public, the Department cannot support the Bill as written but is looking forward to working with the 

Sponsor and the Committee. The principal concern is that the Bill would require 

the agency to prepare an environmental review document under NEPA after the 

land exchange is completed. Also of concern is the fact the Bill would immediately 

authorize mining exploration activities under an area that is considered sacred to 

a number of federally recognized Indian tribes (the Western Apache, including the 

San Carlos Tribe and of the Fort McDowell Yavapai Nation, and certain other tribes 

in Arizona and New Mexico) without a review or study or consultation with Tribes. 

NEPA is a forward looking statute setting out procedural obligations to be carried 

out before a Federal action is taken. It requires that, before taking a discretionary 

decision, the Federal agency consider the environmental impacts of a proposed 

major Federal action and alternatives of such action. It is this Administration’s policy that NEPA be fully complied with to address all Federal agency actions and decisions, including those necessary to implement congressional direction. 

The purpose of the requirement in the bill that the agency prepare a limited 

NEPA review after the exchange, when the land is in private ownership, is unclear 

because the bill provides the agency limited discretion to exercise. An environmental 

review document after the exchange would preclude the U.S. Forest Service from 

developing a reasonable range of alternatives to the proposal and providing the public and local and tribal governments with opportunities to comment on the proposal. 

In addition, the U.S. Forest Service does not have an understanding of the impacts 

the proposed mine will have on local or regional water supplies, water quality, or 

possible dewatering of the area. No studies or assessments of the water supplies 

have been conducted. That is information which could and should be obtained by 

the Forest Service with NEPA analysis before the exchange. A NEPA analysis after 

the exchange would not allow the Forest Service to recommend alternatives since 

the exchanged parcel would already be in private ownership. 

The Bill should be amended to require the preparation of an environmental analysis before the land exchange is completed. The purpose of preparing an environmental analysis before consummating the land exchange would be to analyze the 

effects of the transfer of the Federal land to Resolution Copper, any activities that 

60

are reasonably foreseeable to occur on the transferred land (including mineral development), and the acquisition of the non-Federal land resulting from the exchange. 

The agency would use the environmental analysis to make a decision on whether 

and how to proceed with the exchange and what mitigation conditions would be required to mitigate the identified impacts. 

The legislation states that it is Congressional intent that the exchange be completed within 1 year. Based on our experience with complex land exchanges, this 

is clearly an insufficient amount of time to complete the exchange. Given the requirement of mineral reports, appraisals, title documents, environmental analysis 

and government to government consultation with local Indian Tribes, a 2 to 3-year 

timeframe is much more realistic. 

The agency also understands that a number of federally recognized Indian tribes 

and regional and national tribal organizations are concerned that the H.R. 687 circumvents various laws, policies, and Executive order that directs the Federal land 

managing agencies to engage in formal consultation with the interested Indian 

tribes. Indian tribes have also raised important concerns that the Bill is contrary 

to various policies and Executive Orders that Federal land managing agencies protect and preserve sites that are sacred to Native Americans. The Forest Service understands that the land is considered sacred by the tribe and holds significant traditional and historic value. Because of these expressed concerns and because this specific site has been the focus of historic Government protection it is important that 

this Bill provide for the process of formal tribal consultation to ensure both tribal 

participation in cultural impact analysis and protection of this site. 

We hold in public trust a great diversity landscapes and sites held sacred by Indian tribes. Last year, the Department and the Forest Service issued the ‘‘Indian 

Sacred Sites Policy Review and Recommendations’’. The Report acknowledges that 

consultation ‘‘with Tribal governments is legally mandated and integral to the agency’s trust responsibility to tribes. Among the laws that specifically require consultation are the Archeological Resources Protection Act (ARPA), Native American 

Graves Protection and Repatriation Act (NAGPRA), and the National Historic Preservation Act (NHPA).’’ On December 5, 2012, the Departments of Defense, Interior, 

Agriculture, and Energy, and the Advisory Council on Historic Preservation entered 

into a Memorandum of Understanding (MOU) Regarding Interagency Coordination 

and Collaboration for the Protection of Indian Sacred Sites to improve the protection 

of and tribal access to Indian sacred sites through enhanced and improved interdepartmental coordination and collaboration. The MOU is based on the requirements of Executive Order 13007, Indian Sacred Sites, and provisions of the National 

Historic Preservation Act. 

The Bill would require the Secretary to prepare a management plan for Apache 

Leap. Further, the Federal lands to be exchanged (Oak Flat) hold significant cultural values to Indian Tribes. Although the Bill would require government-to-government consultation, any consultation would not be considered meaningful under 

Executive Order 13175, ‘‘Consultation and Coordination with Indian Tribal Governments’’, because the bill as introduced, limits the Secretary’s discretion regarding 

the land exchange. The focus of the consultations would likely be the management 

of those areas over which the agency would have discretion, namely, the Federal 

land adjacent to the mine and Apache Leap. 

For example, the Secretary would not have discretion over the conveyance or onsite management of the Oak Flat site, which under the legislation would be conveyed to Resolution Copper. The San Carlos Apache Tribe considers the Oak Flat 

area to be a sacred site. They have expressed concerns that block cave mining would 

cause subsidence that would impact the fundamental religious nature of the site. 

They have also expressed concerns regarding potential impacts on water quality. 

They have detailed in correspondence to Secretary Vilsack, the importance of traditional acorn gathering and religious ceremonies which still occur on this site. The 

Department has a responsibility to consider the Tribes’ concerns and these can only 

be adequately addressed if a pre-exchange environmental analysis is the first step. 

There is no doubt that the lands that would be acquired and managed by the U.S. 

Forest Service under H.R. 687 have important resource values that should be protected. It is also clear that the economic benefits from the production of copper could 

be significant in creating family wage jobs in tough economic times. However, it is 

important to more fully understand the scope of the project before proceeding and 

address potentially significant environmental concerns and sites of high importance 

to local Tribes. In addition to the concerns expressed in testimony, the Department 

would like to work with the Committee on a number of significant technical concerns. 

This concludes my statement and I would be happy to answer any questions you 

may have. 

61

Mr. LAMBORN. OK, thank you for your testimony and all three 

of you for being here. We will now have questions from the Committee. And I will start, and I will ask the first one to Ms. Connell. 

Can you tell me how many acres are currently being explored, 

developed, or mined on BLM lands under a notice of intent or plan 

of operation? 

Ms. CONNELL. We have plans of operations on more than 260,000 

acres of public lands in the United States. 

Mr. LAMBORN. OK. Thank you. That is exactly what I have. In 

fact, I have, when you combine those two categories together, approximately 260,000 acres. So our numbers correlate exactly. 

Now, out of the 247 million acres of land that BLM manages, 

260,000 is about 1⁄10 of 1 percent, when you do the math. So, 1⁄10

of 1 percent of the lands you actually manage are authorized for 

disturbance and it is not all disturbed today, it is just theoretically 

could go up to that amount for mineral exploration, development, 

or mining. I don’t see a problem, when the mission of BLM is to 

allow for multiple uses of public lands, recreation, hunting, fishing, 

hiking, et cetera, et cetera, why 1⁄10 of 1 percent for mining is 

overdoing it in any way, and is a cause for huge concern. Could you 

respond to that? 

Ms. CONNELL. Certainly the Department of the Interior, the Bureau of Land Management has a multiple-use mission that includes 

mining. And we very much support mining development on public 

lands in the United States, subject to the public involvement requirements, the environmental protection requirements. It is definitely a part of our mission, and we look forward to working with 

the Committee on any issues related to that. 

Mr. LAMBORN. So, what objection is there, for instance, in working more with other agencies, State and Federal agencies, as some 

of these bills call for? 

Ms. CONNELL. We work very——

Mr. LAMBORN. And is your microphone on? 

Ms. CONNELL. It is. You want me to—I will try and speak up. 

Mr. LAMBORN. Sure, thank you. 

Ms. CONNELL. We do not have a concern with working closely 

with other agencies. In fact, I have been a field manager in the 

BLM for more than 20 years before I became a State director. And 

some of our most successful efforts have occurred in working at the 

local level with local managers from other agencies. And I have 

seen that at the regional level, as well. 

And so, the concerns that we have are not with the requirements 

for our organizations to work closely together. 

Mr. LAMBORN. OK, thank you. I have a question now for Ms. 

Wagner. And Mr. Meinert, if you want to chime in at any point, 

feel free to do so. 

Do you believe that understanding the mineral resource needs of 

the Nation and knowing where they are located should have an 

equal priority to things that are already in the budget for BLM for 

things like figuring out what surface changes might occur if climate 

gets warmer or colder? 

Ms. WAGNER. I will defer to the Department of the Interior for 

that. 

Mr. LAMBORN. Excuse me? 

62

Ms. WAGNER. I would like to defer to the—excuse me. I would 

like to defer to the Department of the Interior for that question. 

Mr. LAMBORN. Oh, I am sorry. I should have redirected that. 

Thank you for the clarification. Yes. 

Ms. CONNELL. The question is regarding whether or not we 

should place priority on identifying where our particular minerals 

are. And certainly the Department of the Interior is interested very 

much in understanding the resources that we hold in trust for the 

American public. And I think that any way that we can gain better 

information to make better decisions is a good thing. 

I would ask if my colleague from the USGS has comments on the 

ability to collect that information and the cost that might be associated. 

Mr. MEINERT. The gist of your question is really a policy question 

about relative priorities, which, for the United States Geological 

Survey, I can’t really get into, because we are a science agency. 

But for the part of the question concerning the knowledge about 

mineral resources, that is a central part of our mission. It goes all 

the way back to the founding Organic Act that says that it is part 

of our job description to understand about the mineral resources of 

the United States. And we have a very high level of scientific expertise to bring to bear on those subjects, and that is something 

that we do on a continuing basis. 

Mr. LAMBORN. Well, thank you. I like that answer, because this 

does get back to the original mission. And unfortunately, my figures show that zero dollars are being spent now in locating rare 

earth and critical mineral and strategic mineral resources, and 

what the obstacles are to using those, that is getting zero dollars. 

And yet there is $25 million going to climate change centers. 

So, even though you say there is the mission to know where our 

resources are located, as two of these bills call for, you are allocating zero dollars to do that. Yet there is $25 million going for climate change centers. So I think that that first category, knowing 

where our resources are, is just as important. So I think——

Mr. MEINERT. I couldn’t agree more. 

Mr. LAMBORN [continuing]. We shouldn’t have—excuse me? 

Mr. MEINERT. About the importance of mineral resources. And 

we have many ongoing programs looking exactly at that question. 

So I don’t think it would be true to say that there are zero resources being allocated to this. We, in fact, have many ongoing programs looking at mineral resources. 

Mr. LAMBORN. Well, I am glad to hear that. But I am perplexed 

by the opposition to the legislation. 

OK. I am at this point going to recognize Representative Holt for 

questions. 

Dr. HOLT. Thank you, Mr. Chairman. I thank the witnesses. It 

is good to see you here. I appreciate your good work. 

Ms. Connell, you indicated that public involvement in the review 

of mining proposals would be constrained under H.R. 761. You also 

testified that ‘‘public lands not only produce commodities, but also 

offer hunting, angling, and other recreational opportunities.’’

I am trying to understand. Do you think that H.R. 761 would adversely affect other uses of public lands, such as hunting, fishing, 

recreational shooting, and so forth? 

63

Ms. CONNELL. Based on our review of the language of this bill, 

our concerns lie more with the language in the bill. Our concerns 

lie with our ability to conduct a timely version of the environmental review and public involvement. And so, we certainly support the development of rare earth elements and any critical minerals that exist on the public lands in the United States——

Dr. HOLT. Yes, we are talking—I am sorry, we are talking about 

H.R. 761. 

Ms. CONNELL. H.R. 761, which is the Critical Minerals Production Act. 

Dr. HOLT. Yes. 

Ms. CONNELL. Right. 

Dr. HOLT. OK, OK, I am sorry. 

Ms. CONNELL. So that is what I was answering. 

Dr. HOLT. I beg your pardon. OK. 

Ms. CONNELL. OK. 

Dr. HOLT. Please go ahead, then. Thank you. 

Ms. CONNELL. But that is a concern that we have with this bill, 

is the way that the language isn’t clear to us that it provides as 

much of an opportunity for public involvement as we would have 

liked to have seen. 

Dr. HOLT. OK. Now, further on H.R. 761, do you agree that this 

bill has little to do with critical and strategic minerals, and would 

cover lots of other things? Perhaps even coal mining? 

Ms. CONNELL. The language, when we reviewed it, it was unclear 

as to the definition of what ‘‘strategic’’ or ‘‘critical minerals’’ might 

be, and it could actually incorporate a large number of the mineral 

activities. 

Dr. HOLT. OK. 

Ms. CONNELL. And it was uncertain to us as to whether that was 

the intent of the bill or not. 

Dr. HOLT. And probably would include gold and silver, as written? 

Ms. CONNELL. All of the basic——

Dr. HOLT. OK. 

Ms. CONNELL [continuing]. Basic minerals that were mined 

under the 1872 Mining Law, as amended. 

Dr. HOLT. Let me turn to H.R. 957, Ms. Connell. The 2011 report 

by the Department said that royalty reduction for soda ash mining 

meant a loss of some hundreds of millions of dollars of revenue to 

the Government, which is five times the amount anticipated by 

Congress. The industry, those who use the soda ash, disputes these 

findings and the conclusion of the report. 

So, I wanted to ask if you have met with the industry on this, 

if the Bureau or the Department has met with the industry, and 

if you can help me understand what the disagreement is, and how 

that would be resolved. 

Ms. CONNELL. Well, certainly——

Dr. HOLT. Do you still stand by the report, for example? 

Ms. CONNELL. The report that you are speaking of is the 2011 

Report to Congress——

Dr. HOLT. Yes. 

Ms. CONNELL [continuing]. That BLM was required to submit. 

Correct? 

64

Dr. HOLT. Yes. 

Ms. CONNELL. And that is accurate, that the numbers that were 

concluded in that report by the Department of the Interior and its 

partners were basically the data, when we compared that data with 

the information that came out from the industry’s report, the data 

was very, very similar. It was the conclusions or the interpretations 

of that data where we found differences. 

And, I apologize, I am not familiar with any meetings that have 

occurred between the BLM and industry, but we could certainly get 

that information to you on the record, if you would like us to do 

that. 

Dr. HOLT. I would appreciate it if you would provide that to us. 

And, well, in the three-quarters of a minute remaining, let me 

ask what might be a quick question, Ms. Wagner, on H.R. 687. 

What can you say in general terms about the impact on water for 

local communities in the area from these activities that would take 

place there? 

Ms. WAGNER. For the mining operation, the question is still a bit 

outstanding. The company has not submitted a mine plan of operations, and with this proposed bill would not be required to do so 

until 3 years after the land exchange was codified. The lands would 

be in private ownership at that point in time, and be governed by 

the State of Arizona’s provisions for private land——

Dr. HOLT. So we would not know in advance of voting on this 

bill, and maybe we should, do you think? 

Ms. WAGNER. The absence of a provision for NEPA to explore the 

issues surrounding the land exchange, some of which might be impacts to the highest and best use of that land, in this case, perhaps 

mineral development, would not be known prior to the land exchange. 

Dr. HOLT. Thank you. 

Mr. LAMBORN. OK, thank you. Representative Gosar? 

Dr. GOSAR. Thank you. Thank you, Ms. Wagner, and thank you 

for being so quick with your comments. That is a long day. I have 

a quick question for you, not just on the Administration, but a 

question came up in testimony last year that I want you to clarify. 

When the United States Forest Service does an appraisal, they 

use what they call the DOJ Yellow Book, or the DOJ’s guidelines 

for appraisals, is that not correct? 

Ms. WAGNER. We use the uniform appraisals standard guidebook. 

Dr. GOSAR. So more specifically, the appraisal must comply with 

Section 254.9 of Title 36, Code of Federal Regulations and Nationally Recognized Appraisal Standards, which include the uniform 

appraisal standards for the Federal land acquisitions and the uniform standards of professional appraisal practice. Right? 

Ms. WAGNER. Correct. 

Dr. GOSAR. OK. Now, the Department of Justice guidelines for 

appraisals has been very carefully drafted, revised, and updated 

over many decades. It requires the appraiser to look at the actual 

facts that apply to a particular property, including associated mineral values. 

Last year, some in the minority tried to make the case that my 

legislation requires some unusual appraisal process. I would like to 

point out that Section 4 of H.R. 687 specifically requires the same 

65

appraisal standards that the agencies are required to use to determine fair market value. There is nothing unusual about it; it is a 

standard procedure. 

When Resolution files its Mine Plan of Operation, then it will go 

through the NEPA process, and the public will have ample opportunity to provide comments, as guaranteed under the law. Is that 

not true? 

Ms. WAGNER. The Mine Plan of Operations, as I understand the 

bill, Mr. Gosar, would be looking at the ancillary activities to the 

plan of operations outside of the private land. So, if the mine needed utility corridors, power corridors, roads, tailing, waste dump, ancillary facilities, that would be what the question on the Federal 

lands would be about. 

Dr. GOSAR. I think that what you have is a full NEPA disclosure. 

There would be no shortcuts for the NEPA process in regards to 

the way this language is written. 

Ms. WAGNER. On the private land, would they not be governed 

by the laws of Arizona for private land mineral development? 

Dr. GOSAR. I mean, in fact, in some cases, Arizona is more stringent than the U.S. Code. Is it not? 

Ms. WAGNER. So, to your point, what would govern the private 

land, should the land exchange go forward, would be the laws governing private lands in the State of Arizona. 

Dr. GOSAR. And the full NEPA process is not subjugated or 

shortchanged. 

Ms. WAGNER. If that is what is required in the State of Arizona. 

Dr. GOSAR. That is exactly what is required here. So I wanted 

to make sure, because we had a witness prior that could not answer that question appropriately. 

Ms. Connell, in your testimony you mention my bill doesn’t touch 

on the disclosure of mineral reports. In Section 4(d)1 on page 6, 

language was inserted to ensure that the appraisal must comply 

with the requirements of Section 254.9 of Title 36, Code of Federal 

Regulations. Section 254.9 of Title 36, Code of Federal Regulations 

states, ‘‘Appraisals prepared for exchange purposes must contain 

the following minimum information: 11, copies of relevant written 

reports, studies, or summaries, conclusions prepared by others in 

association with the appraisal assignment, which were relied upon 

by the appraisal to estimate value, which may include, but is not 

limited to, current title reports, mineral reports, or timber crews, 

as prepared for qualified specialists.’’

Can you clarify why you don’t believe we don’t touch on mineral 

reports? Because our intention is full disclosure, and I believe the 

code we cite in the bill requires our full disclosure. 

Ms. WAGNER. I am not an expert appraiser, obviously, but my 

understanding of the concern was that some of the information 

that might be needed to develop an appraisal would be not accessible to the Federal Government unless it were made available by 

a private entity. 

Dr. GOSAR. And what part would that be? 

Ms. WAGNER. The mineral quantities from the samples——

Dr. GOSAR. Now let me ask you a question. Isn’t that part of the 

State jurisdiction and oversight? You don’t trust the State? 

Ms. WAGNER. I can’t answer that question for you. 

66

Dr. GOSAR. I mean we have kind of a funny thing about facts 

here, is that the State is very, very articulate about this. And once 

again, some of the State laws are much more onerous than the 

Federal laws. 

What about Section 6 that specifies the Resolution Copper must 

report annually to the Federal Government and the State of Arizona if the total mine production ever exceeds appraisal production, 

estimates Resolution Copper must make an annual royalty-like adjustment payment to the United States on all excess productions? 

Would that also require mineral reports? Correct? 

Ms. WAGNER. That is correct. 

Dr. GOSAR. Yes. That is what I thought. So I have further questions, but we will start that under somebody else. Thank you. 

Mr. LAMBORN. OK, thank you. We will now hear questions from 

Representative Grijalva. 

Is your microphone on? 

Mr. GRIJALVA. Sorry. The public interest requires a complete and 

full informed appraisal, equalization of values be performed prior 

to a congressional passage of this bill, not after. Do you see that 

as a public interest requirement or a requirement in the appraisal 

process as you see it, that the appraisal process be done prior to, 

rather than after the passage of the bill? 

Ms. WAGNER. Is that question to me, Mr. Grijalva? 

Mr. GRIJALVA. Yes. 

Ms. WAGNER. The public interest determination that is usually 

done when a land exchange is considered is actually pre-NEPA. It 

actually looks at the qualities of the non-Federal parcels, the issues 

of the Federal parcels. It is not predicated on a appraisal of the 

lands, a complete appraisal of the lands. An estimate of values is 

done to determine a public interest. 

Mr. GRIJALVA. And that is for both witnesses. Throughout his 

Administration, President Obama has been committed to enhancing the partnership with Native Nations and the Federal Government, very vocal about his support for a real consultation process, 

and a government-to-government relationship that has formality 

and process. 

If this bill were to become law, will the Federal Government be 

able to meet its commitment, whether it is a memorandum of understanding your agency might have, or the initiative of the President, would you be able to meet that commitment to a meaningful 

consultation with Native Nations affected by this legislation? 

Ms. WAGNER. The Department of Agriculture doesn’t believe that 

meaningful consultation can occur without the NEPA process preceding the land exchange decision. 

Mr. GRIJALVA. Resolution Copper’s mining operation is going to 

require 20,000 acre-feet per year. That is their number. Apparently, the company says that it has been banking water, and has 

indicated it will use excess CAP water to support its mine operations. 

Just so that I am clear, has Resolution Copper provided any 

analysis about any potential impact or any mitigation plan in place 

to protect the resource? The resource being ground water in the 

area, the resource being acid mine drainage into the ground water. 

And an analysis, is this 20,000 feet per year enough to support the 

67

mining activities for the life of the mine? Have any of those been 

provided to you, the agency, or any that you know of? 

Ms. WAGNER. The NEPA that has been conducted with the 

Forest Service and Resolution Copper has been on pre-feasibility 

exploration by the company on parcels adjacent——

Mr. GRIJALVA. NEPA question. And correct me. I just want to be 

clear, we keep going over this. NEPA is triggered if a Federal action is likely to have significant impact on human development. 

While numerical values of proposed action are relevant, the number of acres or megawatts, or whatever, there is no numerical cap 

or limit on NEPA application. The point is to determine environmental impacts and things like the number of acres involved cannot always answer the question. 

This bill, I think, plainly waives NEPA with regard to the land 

exchange. The decision to trade Federal land, forest land, particularly land that was set aside during the Eisenhower Administration, and withdraw it from mining—to a mining company, a foreign-owned mining company, is likely to impact the human environment. NEPA would be required prior to the exchange, if this bill 

did not specifically waive that application. Right or wrong? 

Ms. WAGNER. That is correct. 

Mr. GRIJALVA. And just, I think, for the record, because we were 

talking about 1⁄10 of 1 percent, Mr. Chairman, I am happy to announce that the Federal judge in Arizona threw out the case, the 

withdrawal of the 1 million acres around the Grand Canyon. And 

we can rest assured for a little while that beautiful icon will continue to be a beautiful icon. I yield back. 

Mr. LAMBORN. We will now hear from Representative Cramer. 

Mr. CRAMER. Thank you, Mr. Chairman and Ranking Member, 

and thank you to the witnesses. My, of course, interest is on my 

bill, H.R. 767, and all my questions will be for answering by Ms. 

Connell. 

And, first of all, let me say, publicly thank you for your service 

and for being here. Having been an energy and environmental regulator for nearly 10 years in North Dakota, I always found the relationship between the State and your agency to be very professional and productive, and I appreciate that, which is why I think 

this makes so much sense, what we are talking about today. 

You know, H.R. 676 simply just adds the word ‘‘Dakota,’’ basically, to the Montana-Dakota State office, since that is our State 

office, and it wasn’t originally part of the original bill in 2005, the 

Act in 2005. But this Pilot Project probably, in 2005, wasn’t even 

envisioned to be as active as it is today. And so we want to include 

North Dakota as part of the streamlining Pilot Project. 

Could you in the first few seconds or minute, describe what that 

Pilot Project is, exactly? What specifically helps streamline the permitting process? And is there any environmental compromising as 

a result of it? 

Ms. CONNELL. The Energy Policy Act of 2005 identified 7 offices 

managed by the Bureau of Land Management that would receive 

funding which is acquired from rentals for public land leases across 

the Nation. And, as a result of that additional source of income, we 

were able to establish some teams that would be set aside in each 

of those various offices to focus on developing the oil and gas reVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00071 Fmt 6633 Sfmt 6602 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
68

sources in that area. At the time, the price of natural gas was very 

high, and so many of those offices are areas where we have natural 

gas activity. 

North Dakota has boomed, the Bakken play there is a worldclass, amazing oil resource for this country. And the Dickenson 

field office for the BLM has very much been trying to keep up with 

the activity. Should the Dickenson office be made a part of this 

pilot effort, we would be able to take advantage of utilizing extra 

resources from across the county in our ability to bring the oil reserves from the Bakken from the Federal lands and from Indian 

Trust estate to the surface and make it part of the oil resources 

available to the American public. 

Mr. CRAMER. Exactly how does that happen? In other words, how 

is the streamlining—how does that happen? What do you do to 

streamline, if you——

Ms. CONNELL. Well, we streamline in some ways by bringing everyone close together: representatives who work for the Bureau of 

Indian Affairs, for the BLM, for the Fish and Wildlife Service. We 

are located very close together, and we have streamlined some of 

the processes at the local level, depending on what the issues are. 

We have actually been able to streamline some of the work that is 

done out in the field. 

The number of environmental inspections has more than doubled, as well as the drilling and production inspections. And we 

also in the pilot office have been able to process more drilling permits with an equal amount of environmental oversight that we 

were before the implementation of the law. 

Mr. CRAMER. Thank you. Now I want to get to your testimony 

where you have some suggestions for us. And I have been sort of 

thinking about it all morning. Realizing that this pilot project is 

due to expire at the end of 2015, so we are about 7.5 years into 

it, as I understand, and your suggestion is that perhaps we could, 

by giving BLM more flexibility, utilize the resources in places other 

than those original 7-plus North Dakota offices. 

Do you have any concern that would dilute the intent of the pilot, 

or would we be better off, and I am really asking, I really don’t 

know, or would we be better off sticking sort of to this mission, seeing how it goes, realizing you now have a world-class play right in 

the middle, surrounded by public and State activity, that we could 

do a real experiment, if you will, and gather real information, and 

then perhaps look at doing something larger down the road? And 

I am just honestly asking. 

Ms. CONNELL. I think that broadening the effort across the Nation would help in a few other places that are having similar struggles to the Bakken area. I think you would still continue to see the 

focus of the pilot efforts in the highest density of drilling areas, 

North Dakota would and Eastern Montana would likely remain in 

the eye of that development activity for the foreseeable future. 

Mr. CRAMER. All right. Thanks for the clarity. And again, thanks 

for the great job you do in protecting our resources. And I just look 

forward to continuing that same level of protection, while also providing opportunity for economic growth. 

Thank you, Mr. Chairman. 

69

Mr. LAMBORN. You are welcome. We will now hear questions 

from Representative DeFazio. 

Mr. DEFAZIO. Thank you, Mr. Chairman. Mr. Chairman, I do 

have questions about H.R. 687 that I hope to get to. But I do, given 

the opportunity of having Deputy Chief Wagner here, there is 

something of immediate concern, which is I disagree strongly with 

the Office of Management and Budget that the safe and secure 

county rural schools funds are subject to sequestration, particularly 

since these were funds for Fiscal Year 2012, when sequestration 

did not exist. 

We seem somehow to have lost that battle. We have been sequestered on the BLM funds. And now we are being told you are going 

to sequester the funds from the Forest Service. So my question is, 

since the money has been dispersed to the States and spent or programmed for education and public works roads purposes, where are 

you going to get that money? How are we going to do it? The only 

thing I can see that you might be able to do is to cut out Title 2 

funds. And Title 2, of course, actually benefits the Forest Service, 

in terms of projects on Forest Lands, and employs people. 

So, is that where we are headed? We are about to do this sequestration to the detriment of activities on the Forest Service lands 

and loss of jobs? Is that where we are headed? 

Ms. WAGNER. We had the secure rural schools funding distributed as quickly as we could because it works for schools, for 

roads——

Mr. DEFAZIO. Right, right. 

Ms. WAGNER [continuing]. For emergency protection and services. 

And last, Title 2 funds are investments in conservation projects. 

It is unfortunate, but we find ourselves in a situation of having 

to have notified the States of the impacts of sequester, and that we 

are going to have to ask for a return of 5.5 percent of those funds 

back to Treasury. We have done that, and the only option as we 

see right now, because, as you said, those funds have been programmed to important investments at the county level, would be 

to consider using the Title 2 as offsets to return the 5.5 percent to 

treasury. 

Mr. DEFAZIO. But what happens, not everybody gets a Title 2. 

Ms. WAGNER. Exactly. 

Mr. DEFAZIO. So you are going to take sort of doubly out of the 

States where they get Title 2 money, will be penalized more? 

Ms. WAGNER. It is unfortunate we have to ask for that money 

back, but that is where we find ourselves. 

Mr. DEFAZIO. This is extraordinary, and I just find this very, 

very hard to believe. 

Back to a more general question about H.R. 687, for many years 

I have been involved in the fight over mining reform, and I did the 

royalty amendment back in 1994, when we passed a bill on mining 

reform. This seems to me a very unusual process by which we 

would, the taxpayers would, realize value from this unbelievably 

valuable asset. And I don’t understand why we wouldn’t just want 

to assess a straight-up royalty, which would be predictable both to 

the producer, and it would be predictable to or more predictable, 

to the government and benefit the taxpayers. 

70

Have you reviewed this proposal on how we would get future revenues from the production of this asset, either—yes, OK. 

Ms. WAGNER. Yes, Mr. DeFazio. The company would be, should 

the estimate of mineral value or quantity differ from what was assumed in the appraisal process, if the company actually produced 

more than what was estimated, there is a provision in this bill for 

an income capitalization approach to the taxpayers receiving 

some——

Mr. DEFAZIO. Is this something routinely used, income capitalization for this sort of an asset? 

Ms. WAGNER. I am not aware of other——

Mr. DEFAZIO. So this would be a first impression. They get to deduct——

Ms. WAGNER. I am not aware of other——

Mr. DEFAZIO [continuing]. All of their estimated construction, operating, maintenance costs on an annual basis, from their production, and then that would come up with this theoretical appraised 

or annual value. 

Ms. WAGNER. The appraisal actually would be done by somebody 

who has expertise in appraising properties that have mineral 

value. And they would use a cost sale comparison methodology. 

They might use the income capitalization approach. It is a multifaceted approach to get——

Mr. DEFAZIO. Right. But why would we create a new and novel 

process for such an incredibly valuable asset? Why wouldn’t we just 

say we want a royalty? 

Ms. WAGNER. My understanding is that it is the vehicle to protect the interests of the public if the appraisal estimate of material 

removed from the mine didn’t match up with the actual production 

of the mine. 

Mr. DEFAZIO. Yes, but if we are doing a royalty on growth, that 

is very predictable, and there is no way to harm the public there. 

Ms. WAGNER. We would be happy to work with the Committee 

on language that would work to achieve the public interest that I 

think that provision was intended to achieve. 

Mr. DEFAZIO. I am not following that at all. Thank you, Mr. 

Chairman. 

Mr. LAMBORN. OK, thank you. Representative Lummis. 

Mrs. LUMMIS. Thank you, Mr. Chairman. I am going to concentrate my time on the soda ash bill. I appreciate Ms. Connell’s 

remarks about how the data was very similar between the BLM 

and the industry, and the fact that it is how you interpret it that 

makes the difference. 

And there is a reason that the interpretations that were drawn 

by the employer and employee groups that support this bill convinced both the gentleman from New Jersey and the gentleman 

from Oregon here present to support this bill in the last Congress. 

And the reason is that both the employer and employee organizations, industry and labor unions, are supporting this bill because 

they recognize what China is doing. 

Soda ash is a natural product. And it is produced in the United 

States and shipped overseas, a large part of it. It is used to make 

glass and soda, baking soda, and laundry detergent, and things like 

that. It is a hard rock. China produces synthetic soda ash in great 

71

quantities, and subsidizes it to the tune of $30 million annually. 

So, if we increase the royalty, which we have now allowed to occur 

on naturally occurring soda ash in the United States, we are charging $25 million more annually for soda ash, while the Chinese are 

subsidizing theirs to the tune of $30 million. And that just creates 

a lopsided competitive disadvantage for U.S. soda ash that costs 

jobs and costs production, costs our competitive edge around the 

globe. So, that is why this bill enjoys the support of both labor 

unions and industry. 

Congress set a 2 percent royalty rate back in 2006. And during 

those following 5 years of the 2-percent royalty rate, U.S. soda ash 

manufacturers increased employment, increased production and exports, and increased the royalties paid to the Federal and State coffers, as compared to the previous 5 years. Now, that royalty rate 

of 2 percent was allowed to expire. It has gone up to 6 percent. And 

that is why labor unions and industry have joined forces on this 

bill to allow for more royalty dollars to be paid to the U.S. Government and the taxpayers of this country, by allowing our product to 

remain competitive globally against this Chinese synthetic product 

that is subsidized. 

So, Mr. Chairman, I want to point that out and maybe conclude 

with this question for Ms. Connell. Isn’t it true that during the 

years 2006 to 2011 the United States suffered a recession and unemployment levels were at double digits? But at the same time, 

when we had a lower royalty rate on soda ash, its employment base 

increased, the production increased, exports increased, and we actually collected more than the previous 5 years under a 6 percent 

royalty? 

Ms. CONNELL. During the year that you are asking about would 

have been during the 5 years while the royalty rate was lower. Correct? 

Mrs. LUMMIS. While the royalty rate was at 2 percent we enjoyed 

an increase in production and an increase in employment in the 

soda ash industry because our product was more competitive overseas, as compared to the Chinese synthetic product. 

Ms. CONNELL. Certainly the soda ash industry in the United 

States has remained very competitive, worldwide. And from the information that I have been provided, it has remained competitive 

through 2012, despite the fact that we have had economic difficulties, as well as the increase in the royalty rate. 

Mrs. LUMMIS. Well, it is not easy, once employment and contracts have been established globally under a 2-percent royalty 

rate, to immediately change those contracts. And isn’t that the 

case? I mean some contracts to provide soda ash would run beyond 

the expiration of the 2-percent royalty rate, simply because the contract term runs beyond the expiration of the 2-percent royalty rate. 

Isn’t that possible? 

Ms. CONNELL. That could definitely be true. 

Mrs. LUMMIS. Thank you, Mr. Chairman. My time is up and I 

yield back. 

Mr. LAMBORN. Thank you. I want to thank the panel for being 

here today. Let me ask a couple of clarifications. 

72

Mr. Meinert, you referred earlier to the fact that USGS was 

working on some projects to both search for and list critical and 

strategic minerals today. Could you supply me with that list? 

Mr. MEINERT. To clarify, I stated that we have many projects researching mineral resources, including strategic minerals. And we 

would be happy, for the record, to provide you with further information about those projects. 

Mr. LAMBORN. Please do so. Thank you for that offer. And to 

clarify something you said, Ms. Wagner, during your testimony, is 

it your position that NEPA should be complied with before land exchanges and conveyances take place? 

Ms. WAGNER. That is the position of the Administration, yes. 

Mr. LAMBORN. OK. I thought you would be interested to know 

that we passed a bill yesterday in this Committee, Full Committee, 

and it also passed the last Congress by unanimous consent. It is 

a bill by Representative Grijalva, H.R. 507, to convey land into a 

trust involving a golf course without NEPA being complied with. 

Ms. WAGNER. It is certainly true that Congress has the authority 

to waive provisions of NEPA. 

Mr. LAMBORN. OK. Thank you for that clarification, and thank 

you for being here. Members of the Committee may have questions 

for you to follow up, and we would ask that you respond to those 

questions, if they are submitted to you in writing. Thank you. 

We will now go to our fourth and final panel. And I would like 

to invite forward the witnesses for this panel: Mr. Stephen Miller, 

Chairman of the Board of Supervisors of Pinal County District 3; 

Mr. Hal Quinn, President and CEO of the National Mining Association; Mr. Dan McGroarty, Principal and Director of American 

Resources Policy Network; Mr. Mike Hohn, General Manager of the 

Soda Ash Business of OCI Chemical Corporation; Mr. Terry Rambler, Chairman of San Carlos Apache Tribe; Mr. Pierre Neatby, 

Vice President of Sales and Marketing for Avalon Rare Metals; and 

Ms. Soyla Peralta, Council Member of the Superior Town Council. 

Like all of our witnesses, your written testimony will appear in 

full in the hearing record, so I would ask that you keep your oral 

statements to 5 minutes. You have to turn on the microphone to 

be heard. The countdown begins at 5 minutes with a green light, 

turns to yellow after 4 minutes, and then turns red after 5 minutes. 

Thank you all for being here. We look forward to your testimony, 

and we will start with Mr. Miller. Thank you for being here. 

STATEMENT OF STEPHEN Q. MILLER, CHAIRMAN OF THE 

BOARD OF SUPERVISORS, PINAL COUNTY DISTRICT 3

Mr. MILLER. Mr. Chairman and members of the Subcommittee, 

my name is Steve Miller, I serve as Chairman of the Pinal County 

Board of Supervisors. I appreciate the opportunity to testify before 

you——

Mr. LAMBORN. Are you speaking into the microphone? 

Mr. MILLER. I believe I am. Is that better? 

Mr. LAMBORN. OK. Make it a little closer. Yes, thank you. 

Mr. MILLER. OK. I appreciate the opportunity to testify before 

you today and would like to personally thank Congressman Paul 

Gosar and Congresswoman Ann Kirkpatrick for working together 

73

in a bipartisan manner to advance legislation which is important 

to the people of Arizona. 

I must acknowledge my colleagues in the Pinal County Board of 

Supervisors, and especially Supervisor Pete Rios, who hoped to testify here today, but was not able to make it. I know that my complete testimony will appear in the record, so let me be brief and 

summarize my remarks. Then I will be pleased to answer any 

questions. 

First, support for this bill is bipartisan and very strong. Support 

for this bill from a bipartisan Board of Supervisors is unanimous, 

and the vast majority of residents of Pinal County and all Arizona 

supports this land exchange and this mine. 

Nowhere is the support stronger than the citizens of Superior. 

Fourth generation resident Mila Besich Lira spoke at the Board of 

Supervisors meeting and said, ‘‘Resolution Copper has been very 

generous and transparent with the people of Superior and the entire mining triangle.’’ She credited Resolution for the exponential 

rise in the elementary school math scores and the success of the 

local schools in the competition with the schools throughout the 

Southwest. 

Second, the bill and the proposed mine will be a net positive environment. The mine’s operation being proposed by the Resolution 

Copper looks very different than the standard open pit mine. Based 

upon the county’s long-standing working relationship with Resolution Copper, we believe this project is going to be one of the most 

environmentally-sensitive mines in the Nation, even the world. 

They have taken it upon themselves to reclaim an old mine in Superior decades before they were required to do so at the cost of $50 

million. 

One parcel in Pinal County that the Federal Government will receive is the 7B Ranch, 3,050 acres of ranch land, covers 7 miles of 

both sides of the San Pedro River. Resolution Copper has already 

put it under the management of Nature Conservancy. And in addition, stepped up to the plate, and at their own expense, have addressed the huge problem of illegal dumping on an otherwise pristine piece of property. Actions speak louder than words. 

Third, this mine is just the kind of economic stimulus our county, 

our State and our Nation needs. The citizens of Pinal County need 

more high-quality paying jobs. Our unemployment rate is about 8 

percent. The unemployment rate on the Indian Reservation is more 

than triple that number. The Resolution Copper project will put 

over 1,400 people in excellent jobs, direct jobs, as a result of passage of this legislation. It will create thousands more indirect jobs, 

combine these jobs, have the potential of creating more than $60 

billion of economic benefit over the life of the mine. 

This project also benefits the public sector beyond the lands the 

U.S. Government will receive. The mine will yield more than $16 

billion in new revenues to the Federal Government. Last I checked, 

you could use a few billion here. 

Back in Arizona, in the State, county, and local governments, 

they will receive another $2 billion in revenue. Every day that 

passes without this legislation, we lose out on all these economic 

benefits. As an elected official, my responsibility is to improve the 

quality of life for the constituents. I came here today to urge you 

74

to join me and the citizens of Pinal County to support the land exchange. I ask that you pass H.R. 687 immediately. The residents 

of Pinal County and the State of Arizona are looking to you for action. 

Mr. Chairman, thank you for the honor of appearing here today, 

and I look forward to answering any questions. 

[The prepared statement of Mr. Miller follows:]

PREPARED STATEMENT OF CHAIRMAN STEPHEN Q. MILLER, PINAL COUNTY

BOARD OF SUPERVISORS, DISTRICT 3, ON H.R. 687

Mr. Chairman and Members of the Subcommittee:

My name is Steve Miller. I serve as the Chairman of the Pinal County Board of 

Supervisors. I appreciate the opportunity to testify before you today, and would like 

to personally thank Congressman Paul Gosar for inviting me to testify. I would also 

like to thank Congresswoman Ann Kirkpatrick for her leadership on the issue before us today. 

I was born in Arizona and have lived in Pinal County for almost 42 years. During 

that time, I’ve been through a lot of ups and downs in our community. As a husband, father, and grandfather, economic and community issues drove me to get involved in public and community service. Sure, I had my livelihood as a builder and 

truss manufacturer to consider, but I have always known people are what matter 

and few issues today are as important to the people of this County as this legislation and the jobs that will be created by the development of the Resolution Copper 

Mine. 

I am fortunate to serve with some great leaders and I must acknowledge my colleagues on the Pinal County Board of Supervisors, especially Supervisor Pete Rios. 

Pete also hoped to testify here today, but could not be here. He has been an ardent 

supporter of the Resolution Copper Mining project from the days when he served 

in the Arizona State Senate to now. 

The Pinal County Board of Supervisors, made up of Republicans and Democrats, 

just unanimously passed a resolution supporting H.R. 687. The vast majority of residents of Pinal County support this land exchange and this mine. Nowhere is support stronger than with the citizens of Superior, Arizona where polling shows support of the mine exceeds 80 percent. Strong words of support were spoken at our 

Board meeting by Superiorites like fourth generation resident Mila Besich Lira who 

stated that Resolution Copper has been very generous and transparent with people 

in Superior and the entire mining triangle. She credited Resolution’s support of local 

schools for the exponential rise in elementary school math scores and the success 

local Superior schools have had in competitions with schools throughout the Southwest. 

Let me tell you a little about Pinal County. We are right in the middle of the 

State between Arizona’s two largest counties—Maricopa to the north and Pima to 

the south. Like many of the counties in Arizona, we have a large geographic footprint—just a little larger than Connecticut. Our population has exploded from 

60,000 in 1965 to more than 375,000. We need high quality, good paying jobs for 

our citizens today and into the future. Passage of this bill will help create those 

jobs. 

Pinal County is not only large, but also diverse. The western part of the County, 

which I represent, is mostly low desert where irrigated farming has dominated over 

the years. The eastern part of the County is mountainous with elevations as high 

as 6,000 feet. It is home to what we’ve called the ‘‘copper triangle’’—an area known 

for its long history as a copper mining region. 

While I may be new to the Board of Supervisors, I’m not new to Pinal County 

and I’m very familiar with this legislation and the proposed mine. Mr. Chairman 

and Members, you need to understand the mining operation being proposed by Resolution Copper looks very different than the standard open pit mine. Based upon the 

County’s long-standing working relationship with Resolution Copper, we believe this 

project is going to be one of the most environmentally-sensitive mines in the Nation 

. . . even the world. On behalf of our citizens, the Board will hold Resolution to the 

highest standard of environmental stewardship; and based on their actions so far, 

it is clear to me they intend to hold themselves to the same standard. 

Let me explain what I see as evidence of Resolution Copper’s commitment to the 

environment. First, the legislation being considered today is the result of extensive 

consultation between Resolution Copper, Federal agencies, and various non-governmental organizations like The Nature Conservancy and the Audubon Society to find 

75

the best lands to exchange for the Oak Flat Campground. The Federal Government 

is the overwhelming beneficiary of this lands package. For example, one parcel in 

Pinal County the Federal Government would receive through passage of this bill is 

known as the 7B Ranch—3,050 acres of ranch land that covers 7 miles on both sides 

of the San Pedro River. Resolution Copper has already put it under the management of the Nature Conservancy, and has additionally stepped up to the plate and, 

at its own expense, addressed the huge problem of illegal dumping on this otherwise 

pristine piece of property. Actions speak louder than words. Resolution Copper set 

a high standard for others to follow. 

Resolution Copper’s actions also speak loudly in Superior, Arizona. It took over 

the nearly century-old Magma Mine site in Superior, which required an extensive 

environmental cleanup. Resolution Copper was not obligated to complete cleanup for 

decades, but decided to begin the $50 million reclamation. Today, that cleanup is 

over 70 percent complete. These actions will ensure a safer, cleaner and healthier 

environment for the residents of Superior. Resolution Copper knows what it takes 

to be a good corporate citizen and a good community partner. They are helping improve Superior schools, send high school graduates to college, make it possible for 

younger kids to play little league on a field with grass, provide funding for community programs such as Superior’s signature event, Apache Leap Mining Festival, and 

provide much needed support for the fire and police departments. They understand 

that Superior is their home and the home to many of their current and future employees. 

Let me say something more about economic growth. The citizens of Pinal County 

need more high-quality, good paying jobs. Our unemployment rate is about 8 percent. The unemployment rate on our Indian reservations is more than triple that 

number. The Resolution Copper project will put over 1,400 people into excellent 

jobs—direct jobs as a result of the passage of this legislation. It will create thousands more indirect jobs. Combined, these jobs have the potential to create more 

than $60 billion in economic benefit over the life of the mine. 

This project also benefits the public sector beyond the lands the U.S. Government 

will receive. The mine will yield more than $16 billion in new revenue to the Federal Government. Last I checked, you could use a few billion dollars. Back in Arizona, the State, county and local governments stand to receive another $2 billion 

in revenues. It has been said by many others, far better than I can say it, but this 

bill is a true stimulus bill that doesn’t cost taxpayers one dime. By the way, dimes 

are currently made with 91 percent copper. 

As an elected official, my responsibility is to improve the quality of life for my 

constituents. I came here today to urge you to join me, and the citizens of Pinal 

County, in support of this land exchange. I ask you to pass H.R. 687 immediately. 

The residents of Pinal County and the State of Arizona are looking to you for action. 

Mr. Chairman, thank you for the honor of appearing before your subcommittee. 

I look forward to answering any questions the Subcommittee may have. 

QUESTION SUBMITTED FOR THE RECORD TO STEPHEN Q. MILLER

QUESTION SUBMITTED FOR THE RECORD BY THE HONORABLE. GRACE F. NAPOLITANO

Question. Is it the normal process for the county to give the mining business to 

companies outside the United States, in this case to the UK and Australia? Why 

not seek U.S. owned companies to build U.S. investments in our companies? 

Answer. Pinal County is a firm believer in the free-enterprise system, a system 

that today thrives within a global economy. As such, the county does not dictate 

company ownership or where a mining company may choose to stake claims and invest its capital to develop a mine. The practice of isolationism in this country in the 

past was not found to be practical or profitable for the nation. 

Pinal County did not choose the mining company and direct them to make an investment here. Resolution Copper, a subsidiary of Rio Tinto, explored this site and 

has determined that the ore body in Superior, Arizona is one of the 10 largest ore 

bodies in the world. The company has made multimillion dollar investments in exploring high-tech ways to extract the ore that sends the fewest number of miners 

underground. The company will be able to mine this ore through the extensive use 

of robotics and skilled workers. 

The jobs created at the mine will be American jobs, pulling a global commodity 

from American soil to make the sorts of products that power this Nation—from motors to cell phones, to the piping that runs through our homes. 

Pinal County seeks to provide opportunity for any company that wants to make 

investments in our county which will generate wealth and provide economic growth 

76

and opportunity for our citizens. Pinal County enjoys the presence of a number of 

foreign companies which have created a tremendous number of jobs. 

Some of those companies are:

Hexcel Composites Abbott Nutrition Phoenix Mart 

ACO Polymers ASARCO Groupo Bright International 

It strikes me that this project presents the single biggest opportunity for Congress 

to show America that it is serious about creating jobs, spurring a healthy economy, 

producing a commodity that is in global demand and reducing our dependence on 

foreign sources of raw materials. 

Dr. GOSAR [presiding]. Thank you, Mr. Miller. 

Now I would like to have Mr. Quinn for 5 minutes. 

STATEMENT OF HAL QUINN, PRESIDENT AND CEO, NATIONAL 

MINING ASSOCIATION 

Mr. QUINN. Thank you, Mr. Chairman, members of the Committee. I appreciate the invitation to testify today on H.R. 761. And 

I also want to thank you all for your continued efforts in trying to 

find and advance enabling public policies that will positively affect 

our mineral supply chain here in the United States. 

Let me begin maybe with a little global context to frame out not 

only H.R. 761, but also a number of the other pieces of legislation 

on minerals that you are considering today. Today about threequarters of all the economic growth globally comes from emerging 

economies. And some estimate at this rate, by 2050, 80 percent of 

the entire global GDP will be allocated to what is today the emerging nations and economies. 

Now, these trends are often compared to the Industrial Revolution, but their pace and scope today are simply unprecedented. 

Consider that in the space of 25 years the GDP of China grew by 

a factor of 10, took the better part of 70 years for Britain’s GDP 

to grow by a factor of 4 after 1830. And while the Industrial Revolution was a story of about perhaps 100 million people, the story 

unfolding before us today that we are witnessing really involves 

billions of people and for the foreseeable future. 

And I say the foreseeable future, because the developing nations 

have per capita consumption rates of energy and commodities that 

are still just a fraction of the developed world. 

So resource competition will be fierce over the next 20 years. Demand for minerals will soar, and stable and reliable supplies will 

become increasingly difficult to sustain. Here in the United States, 

our share of global exploration investments is less than half the 

levels attracted 20 years ago. At the same time, our dependence 

upon foreign sources of key minerals has doubled. Today domestic 

minerals supply less than half the needs of all U.S. manufacturing. 

Now, these trends are not due to the lack of mineral resources. 

In fact, in the United States we are blessed with a world-class mineral resource base. Unfortunately, we are cursed with a third-world 

permitting system, one that is cumbersome, duplicative, and unpredictable. Now, finding minerals in developing mines requires substantial investments, hundreds of millions and even billions of dollars. As a consequence, regulatory certainty is a highly valued commodity. Lengthy delays and permit reviews compromise the commercial viability of projects by increasing costs, reducing the net 

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present value of those projects, and impairing financing arrangements. 

So, the efficiency and predictability of the permitting process 

matters in decisions where to invest. The choice can be very stark. 

Invest in countries that provide a predictable pathway for receiving 

permits within 2 to 3 years, or here in the United States, where 

it may take three to five times longer. 

Now, let me be clear. Valid concerns about environmental protection should be fully considered and addressed. At the same time, 

they should not serve as an excuse to trap mining projects in a 

limbo of duplicative, unpredictable, and endless review without a 

decision point. We should not confuse the length of the process 

with the rigor of the review. Countries like Canada and Australia, 

which share our same core principles of responsible resource development, have demonstrated that permit views and decisions can be 

both thorough and timely. They understand that we are in a global 

competition for mining investment, and that an effective and efficient permitting process provides a competitive advantage. 

H.R. 761 provides a big step for the United States to catch up 

in this race for investments in minerals. The bill reflects best practices for coordination among State and Federal agencies, clarifies 

responsibilities, minimizes duplication, sets goals and timeframes, 

and, frankly, brings just more accountability to the process. 

H.R. 761 provides the opportunity to establish a permitting system that prepares us for the challenges of the new global reality, 

one that will allow our manufacturing, technology, and other industries to compete with the world’s fastest-growing economies. 

Thank you very much for the opportunity to testify today. 

[The prepared statement of Mr. Quinn follows:]

PREPARED STATEMENT OF HAL QUINN, PRESIDENT AND CEO, NATIONAL MINING

ASSOCIATION, ON H.R. 761 

Good morning. I am Hal Quinn, President and Chief Executive Officer of the National Mining Association (NMA). NMA is the national trade association representing the producers of most of the Nation’s coal, metals, industrial and agricultural minerals; manufacturers of mining and mineral processing machinery, equipment and supplies; and engineering and consulting firms, financial institutions and 

other firms serving U.S. mining. 

Today I am testifying in support of H.R. 761, the National Strategic and Critical 

Minerals Production Act of 2013. I want to thank Representative Amodei for reintroducing this very important legislation. It enjoys bi-partisan support and addresses 

a key issue for the country’s future economic growth and manufacturing revival: the 

painfully slow permitting process for the mines that supply metals and minerals essential for our basic industries, our national defense and the consumer products we 

use. I also want to thank the subcommittee, especially Congressman Lamborn, for 

the leadership and persistence in raising the visibility of a growing problem—the 

availability and security of mineral supplies critical to innovation, manufacturing, 

national security and our economic growth. 

U.S. Mining’s Contribution to Society

Mining’s contributions to our economy and society are significant. The value 

added by major industries that consume the $77 billion of minerals produced in the 

United States was an estimated $2.4 trillion in 2012, or 15 percent of our GDP. 

Mining’s direct and indirect economic contribution includes nearly 2 million jobs 

with wage and benefits well above the State average for the industrial sector. In 

addition, domestic mining generated $50 billion in tax payments to Federal, State 

and local governments. 

In addition to these economic contributions, U.S. metals mining’s commitment to 

employee safety and health has led to continuing improvements in our performance 

and includes the introduction of our CORESafety® initiative last year, which relies 

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1See National Resources Council, Hardrock Mining on Federal Lands, National Academy 

Press (1999); U.S. Department of Energy, Critical Materials Strategy (Dec. 2010); U.S. Geological Survey USGS, the Principal Rare Earth Elements Deposits of the United States—A Summary 

of Domestic Deposits and a Global Perspective, (2010); Behre Dolbear, Where Not to Invest

(2012). 

on a systems approach to eliminate fatalities and reduce the injury rate at U.S. 

mines by 50 percent within 5 years. We also developed last year a systems approach 

to environmental management at hardrock mines with a special emphasis on practices to assist smaller operations with improvements in environmental outcomes. 

U.S. Mining’s Potential

Mining’s potential is even greater than its current performance. The United 

States has an immense and enviable mineral endowment waiting to be tapped. For 

example, Resolution Copper’s world class copper deposit represents one of the largest undeveloped copper resources in the world and is anticipated to have a 50 year 

mine life that will support over 3,700 jobs annually. 

Overall, when viewed through the lens of resource potential, the United States 

is underperforming, a fact that will have increasing consequences as global demand 

for minerals becomes more competitive due to the demands of developing economies, 

where millions are being propelled into a rising global middle class. Last week, the 

United Nations Development Program released a report that examines the profound 

shift in global dynamics driven by the fast-rising new powers of the developing 

world. 

The report, The Rise of the South: Human Progress in a Diverse World, includes 

in its classification of ‘‘the South’’ nations in the Southern Hemisphere as well as 

China and India. The report emphasizes the shift is occurring not just in large middle-income developing nations such as Brazil, Argentina, India and China, but also 

in more than 40 other up-and-coming countries that in recent decades have made 

astonishing gains in what’s called human development. As one of the report’s authors noted, ‘‘The Industrial Revolution was a story of perhaps a hundred million 

people, but this is a story about billions of people.’’

Clearly demand for minerals will continue to grow, fueled by these fast growing 

economies. Growing demand presents opportunities and challenges for both U.S. 

mining and the Nation. These trends point to enormous growth and job-creation opportunities if U.S. mining is allowed to perform to its potential. If we do not and 

become increasingly marginalized, the consequences are severe for our Nation’s 

global competitiveness, forcing us to become more reliant upon extended and unstable supply chains for what we can produce here. 

Permitting Poses a Major Obstacle

So while the United States has one of the world’s greatest mineral repositories, 

our ability to get these minerals into the supply chain to help meet more of America’s needs is threatened. A major obstacle to the U.S.’ reaching its potential is the 

length of time consumed in obtaining permits to mine in the United States. Authorities ranging from the National Academy of Sciences to the Departments of Energy 

and Defense to international mining consulting firms have identified permitting 

delays as among the most significant risks and impediments to mining projects in 

the United States.1

The United States has one of the longest permitting processes in the world for 

mining projects. In fact, the length, complexity and uncertainty of the permitting 

process are the primary reasons investors give for not investing is U.S. minerals 

mining. In the United States, necessary government authorizations now take approximately 7 to 10 years to secure, placing the United States at a competitive disadvantage and forcing our economy to become increasingly reliant on foreign producers for minerals we can produce domestically. Our dependence on foreign minerals has doubled in the past 20 years. 

Despite the Nation’s rich mineral endowment, our flawed permitting system significantly impedes the ability to attract investment to our shores. In 1993, the 

United States attracted 20 percent of worldwide exploration investment dollars. 

Today, our share has eroded to just 8 percent. The percentage of global exploration 

spending the United States attracts is critically important since exploration spending is a leading indicator of where future development capital will be deployed. 

The Permitting Scheme Harms U.S. Manufacturing

More than the future of domestic mining is at risk from our cumbersome and inefficient permitting scheme. Today, less than half of the mineral needs of U.S. manufacturing are met from domestically mined minerals, a trend that has been building 

for nearly 30 years and will only worsen unless we reform the permitting process 

79

responsible for it. Our broken permitting process also slows creation of high-wage 

jobs supported by mineral mining. 

As the recent Rand Corporation study, Critical Materials: Present Danger to U.S. 

Manufacturing, warns:

While the United States has extensive mineral resources and is a leading 

materials producer, a high percentage of many materials critical to U.S. 

manufacturing are imported, sometimes from a country that has the dominant share of a material’s global production and export. In this situation, 

U.S. manufacturers are vulnerable to export restrictions that limit their access to these materials and that can result in two-tier pricing, under which 

domestic manufacturers in the producing country have access to materials 

at lower prices than those charged for exports, thereby hindering the international competitiveness of U.S. manufacturers and creating pressure to 

move manufacturing away from the United States and into the producing 

country. (p. ix)

The Rand Study also notes a potential ripple effect on U.S. innovation:

The U.S. science and technology base that support manufactured products 

was built on and depends upon the presence of U.S. manufacturers producing these products from raw and semi-finished materials. Prolonged disruption in the supply of raw and semi-finished materials required by these 

manufacturers could put the science and technology base in jeopardy, which 

would further reduce U.S. innovation capability and competiveness in the 

development of new, higher-performance products. (p.1)

To ease mineral supply constraints on U.S. manufacturers, the study indicates the 

most effective action that can be taken would be to encourage diversified production, 

i.e., the operation of mines in several different countries. This diversification should 

include the United States and would be accomplished by encouraging domestic production of the resources needed for the manufacturing supply chain through modernization of our permitting structure. 

The Solution is a Modern Permitting Process

Similar to the bill passed overwhelmingly by the U.S. House of Representatives 

in the 112th Congress, H.R. 761 carefully addresses the deficiencies of our outdated 

and underperforming permitting system. Without changing environmental and other 

protections afforded by current laws and regulations, it provides for efficient, timely 

and thorough permit reviews and incorporates best practices for coordination between State and Federal agencies. 

As an example, Canada is a global mining leader that continues to take advantage of its efficient permitting system, large pool of junior explorers and explorationfocused tax incentives to attract 16 percent of all global exploration dollars in 2012. 

Canada maintains an expedient, approximately 2-year, permitting timeline by implementing a flexible system that seeks to minimize duplication, uncertainty and 

delays. Canada recognizes mining is a key economic driver. A recent Conference 

Board of Canada report, The Future of Mining in Canada’s North, anticipates the 

country’s overall metal and non-metallic mineral production will grow by 91 percent 

from 2011 to 2020. Canada recognizes long-term global demand for commodities is 

increasing and is positioning itself to take advantage of this opportunity and provide 

minerals for both domestic and global use. 

Further, many of the approaches contained in H.R. 761 are comparable to those 

recently praised by the Government Accountability Office as significantly improving 

the permitting process for wind and solar renewable energy projects on Federal 

lands. The GAO report, Renewable Energy: Agencies Have Taken Steps Aimed at Improving the Permitting Process for Development on Federal Lands, found that wind 

and solar permitting times at the Bureau of Land Management were reduced from 

4 years for applications filed in 2006 to 1.5 years for applications filed in 2009. Ironically, the same agency that permits these alternative energy projects cannot 

streamline the permitting process for mining projects that supply minerals essential 

for building renewable energy infrastructure and technology. 

Conclusion

Using our country’s minerals responsibly and efficiently must be a bi-partisan priority for strengthening our manufacturing base and the jobs it provides. NMA urges 

Congress to pass H.R. 761 to provide a more predictable regulatory environment, 

one that will attract additional investments and allow U.S. mining to build on our 

positive contribution to the U.S. economy and host communities. The legislation will 

bring the United States in line with our competitors for minerals exploration and 

80

development investments—countries such as Australia and Canada that have already modernized their permitting regime. The permitting efficiencies set forth in 

H.R. 761 will allow the United States to unlock its full potential. Thank you for the 

opportunity to testify today. 

Dr. GOSAR. Thank you, Mr. Quinn. Mr. McGroarty—hopefully I 

said that right. 

Mr. MCGROARTY. You did, thank you. Am I being heard? All 

right. 

STATEMENT OF DAN MCGROARTY, PRINCIPAL AND 

DIRECTOR, AMERICAN RESOURCES POLICY NETWORK 

Mr. MCGROARTY. Thanks to the Committee for the opportunity 

to testify today. I am Dan McGroarty, President of American Resources Policy Network, a nonprofit think tank and experts organization dedicated to informing the public and the ongoing policy debate on the importance of developing U.S. minerals and metals resources, and reducing America’s dangerous dependency on foreign 

sources of supply. I am also an officer and director of U.S. Rare 

Earths, developing rare earths properties in three States, with the 

aim of adding to domestic supply of these metals that are so critical 

to our high-tech and green-tech sectors, as well as our advanced 

military weapons systems. 

The subject before the Subcommittee this morning is key to so 

many of the pressing policy issues before the Congress today, 

whether it is restoring America’s manufacturing prowess or supporting our high-tech sector and our green-tech transition. And, of 

course, as the last portion of the title today suggests, securing 

America. 

As a significant first step toward aligning our public policy with 

the goals of strengthening our resource sector, I want to focus on 

one of the bills before this Committee and this Congress, 

H.R. 1063, the National Strategic and Critical Minerals Policy Act 

of 2013, introduced by Chairman Lamborn. As the bill notes—and 

I quote—‘‘The United States has vast mineral resources, but is becoming increasingly dependent on foreign sources.’’ The bill buttresses this statement. With data on the degree to which the 

United States is 100 percent foreign-dependent on certain metals 

and minerals, 18 at present, triple the number 25 years ago. 

Last year, when my organization did a risk screen for metals 

used in defense applications, we derived a risk pyramid with 46 

metals on it, China being the single largest provider. But when we 

looked at known resources in the United States, we found that the 

U.S. is home to 40 of the 46 metals and minerals on our risk pyramid. In other words, if we are foreign-dependent for a wide range 

of hard rock resources, it is a dependency that is largely self-inflicted. 

The Lamborn bill takes three steps that would help the United 

States formulate a targeted policy to reduce and, in the case of 

many metals, eventually eliminate our foreign dependence. 

First, via Section 4, the bill strengthens our assessment capability. We can’t begin to reduce our resource dependence if we lack 

current and comprehensive data on the depth of that dependence. 

Because in a world of resource nationalism, foreign dependence for 

81

critical metals can be used as leverage, commercial, but also strategic, that can induce economic shock to the American system. 

The second key section in the Lamborn legislation is eliminating 

needless duplication in the mine permitting process, a process that 

today, in the leading independent study, earns the United States 

the worst in the world ranking, tied for last with Papua New Guinea, with an average mine permitting process in the United States 

taking 7 to 10 years. And this metric is getting worse, not better. 

Just 4 years ago in 2009, the same study found the U.S. process 

took an average of 5 to 7 years. Little wonder why. One day the 

DOD releases a study showing 23 metals and minerals in potential 

shortfall, and the DOE declares a dozen minerals critical to greentech and clean energy transition, but at the very same time the 

U.S. EPA moves to stop a proposed American copper mine, a metal 

whose short supply DOD tells us has already caused a significant 

weapons system delay, before the permitting process has even 

begun. 

With so many mixed signals coming from the Federal Government, let’s ask ourselves if you were an American manufacturer, 

dependent on metals and minerals engineered into your products, 

could you risk waiting for a reliable source of American supply? Or 

would you build your new facility where the metals are? In China 

perhaps, exporting jobs and intellectual property, sacrificing GDP, 

and feeding a negative balance of trade as we buy back products 

that could have been, that should have been, made here in America? We need to recognize that Made in America often begins with 

Mined in America. And the Lamborn bill puts us back on that 

track. 

The final feature in H.R. 1063 that I would like to focus on today 

is the call for a national mineral assessment updated at 2-year intervals. Critical metals are technology-dependent. As technology 

evolves over time, so too will our tool kit of critical metals. In 

Roman times sodium chloride, salt, was a critical mineral essential 

to preserving food for armies on the march. In our Moore’s Law 

world, as technology cycles are measured in months, not years, we 

must constantly update our understanding of what metals and 

minerals deserve to be called critical. 

The Lamborn bill is a solid test of our seriousness on this issue. 

If enacted, it would provide the fact base for a data-driven assessment of the obstacles that stand between us and a greater degree 

of resource independence. Thank you. 

[The prepared statement of Mr. McGroarty follows:]

PREPARED STATEMENT OF DANIEL MCGROARTY, PRESIDENT, AMERICAN RESOURCES

POLICY NETWORK, ON H.R. 1063

Chairman Lamborn, my thanks to you and your colleagues on the House Subcommittee on Energy and Mineral Resources for the opportunity to testify today. I 

am Daniel McGroarty, President of the American Resource Policy Network, a nonprofit think tank and experts organization dedicated to informing the public—and 

the ongoing policy debate—on the importance of developing U.S. mineral and metals 

resources—and reducing America’s dangerous dependency on foreign sources of supply. 

I am also an officer and director of U.S. Rare Earths, a publicly-held company currently developing Rare Earths properties in three States, with the aim of adding to 

the domestic supply of metals critical to our high-tech and green-tech sectors, as 

well as the U.S. military’s advanced defense systems. The subject before this subcommittee this morning—America’s Mineral Resources: Creating Mining & ManuVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00085 Fmt 6633 Sfmt 6621 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
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facturing Jobs and Securing America—is critical to so many of the pressing policy 

issues before the Congress today, whether it’s the restoration of American manufacturing prowess, or restoring our economy to sustainable growth, or supporting our 

high-tech sector and our green-tech transition—and of course, as the last portion of 

our title today suggests: ‘‘Securing America.’’

As a significant first step toward aligning our public policy with the goal of 

strengthening our resource sector, I want to focus on one of the bills before this 

Committee and this Congress: H.R. 1063, the ‘‘National Strategic and Critical Minerals Policy Act of 2013,’’ introduced by Chairman Lamborn. 

As the bill notes—and I quote—‘‘the United States has vast mineral resources but 

is becoming increasingly dependent on foreign sources.’’ The bill buttresses this 

statement with data on the degree to which the United States is 100 percent foreign-dependent on certain metals and minerals—18 at present—up from 6—25 

years ago. Last year, when my organization, American Resources, did a risk screen 

for metals and minerals used in defense applications, we derived a ‘‘risk pyramid,’’ 

with 46 metals on it—with China being the single largest supplier. But as we looked 

further at known resources located in the United States, we found that the United 

States is home to resources for 40 of the 46 metals and minerals on our risk pyramid.

In other words, if we are foreign-dependent for a wide range of hard rock resources, it is a dependency that is largely self-inflicted. 

As I see it, the Lamborn bill takes three steps that would help the United States 

formulate a targeted policy to reduce—and in the case of many metals, eventually 

eliminate—our foreign dependence. 

First—via Section 4—the bill strengthens our assessment capability. We can’t 

begin to systematically address our resource dependence if we lack current, comprehensive data on the depth of that dependence. And that assessment, in turn, requires solid data on the extent to which potential resources might be found on Federal lands—including lands withdrawn from mineral exploration and development—

as well as the uses to which various metals are put across our economy and in our 

defense sector—and finally, a review of our current foreign suppliers, with an assessment of the likelihood of shortfalls or supply disruptions. Because in a world of 

resource nationalism, foreign dependence for critical metals can be used as leverage—commercial, but also military—that can induce economic shock to the American system. 

And yet even before the U.S. Government begins collecting data, the agencies involved must begin by sorting through a half-dozen conflicting definitions of critical 


80077.001.eps
83

and strategic metals—one so tight that it produced a single strategic metal to the 

exclusion of all others—and some so vague that the entire Periodic Table might be 

eligible for inclusion. 

The second key section in the Lamborn legislation concerns eliminating needless 

duplication in the mine permitting process—a process that today, in the leading 

independent study, earns the United States worst-in-the-world ranking, tied for last 

with Papua New Guinea, with the average mine permitting process in the United 

States taking 7–10 years. And this metric is getting worse, not better: Just 4 years 

ago, in 2009, the same study found the U.S. process took an average of 5 to 7 years. 

And little wonder why. One day, the DOD releases a study showing 23 metals and 

minerals in potential shortfall, while the DOE declares a dozen minerals critical to 

the green-tech and clean-energy transition. But at the very same time the U.S. EPA 

moves to stop a proposed American copper mine—a metal whose short supply, DOD 

tells us, has already caused ‘‘a significant weapon system production delay’’—before 

the permitting process has even begun. 

So with so many mixed signals coming from the Federal Government, let’s ask 

ourselves: If you were an American manufacturer, dependent on metals and minerals engineered into your products, could you risk waiting for a reliable source of 

American supply? Or would you build your new facility where the metals are—in 

China, perhaps—exporting jobs and Intellectual Property, sacrificing GDP and feeding a negative balance of trade as we buy back products that could have been, 

should have been, made here in America? 

Mr. Chairman, we need to recognize that Made in America often begins with 

Mined in America. The Lamborn bill puts us back on that track. 

The third feature in H.R. 1063 that I want to mention today is the requirement 

for a National Mineral Assessment, updated at 2-year intervals. Critical metals are 

technology-dependent; and as technology evolves over time, so too will our tool-kit 

of critical metals. In Roman times, sodium chloride—salt—was a critical mineral, 

essential to preserving food for armies on the move. In Adam Smith’s time, he 

classed gunpowder and sailcloth as critical materials, and the father of free-market 

theory warned Britain against being dependent on foreign sources of supply. In our 

Moore’s Law world, as technology cycles are measured in months, not years, we will 

need to constantly update our understanding of what metals and minerals deserve 

to be called critical. 

The Lamborn bill is a solid test of our seriousness on this issue. If enacted, it 

would provide the fact-base for a data-driven assessment of our domestic resource 

potential, our vulnerability to foreign supply, and the obstacles that stand between 

us and a greater degree of resource independence. 

I commend the Chairman for his leadership on the critical issue of critical metals, 

and for the Committee’s focus today on the various bills that are the focus of this 

hearing. America has the good fortune to be a resource-rich nation. Sound policy can 

help ensure that our resources will be used to support our economic strength and 

our national security—and reduce the dangers of resource dependence in our uncertain world. 

Thank you. 

Mr. LAMBORN [presiding]. Well, thank you for your excellent, excellent testimony. 

[Laughter.] 

Mr. LAMBORN. I would like to now hear from Mr. Hohn, please. 

STATEMENT OF MIKE HOHN, GENERAL MANAGER, SODA ASH 

BUSINESS OCI CHEMICAL CORPORATION 

Mr. HOHN. Chairman Lamborn and members of the Committee, 

my name is Mike Hohn, and I am the General Manager of Soda 

Ash Business for OCI Chemical Corporation. I am here today on 

behalf of the U.S. Soda Ash industry, and I thank you for the opportunity to testify on this vital legislation for our industry. The U.S. soda ash industry contributes some $1 billion net positive to the U.S. balance of trade annually, and is the single largest 

inorganic chemical export from the United States. Soda ash is produced by one of two methods: the natural method used in the 

84

United States; and through synthetic processes elsewhere in the 

world, and primarily in China. 

The cleaner, natural method only accounts for 25 percent of the 

global soda ash production. The American Soda Ash Competitiveness Act will lead to the growth of jobs at U.S. soda ash facilities, 

the growth of jobs in the transportation sector that supports the 

U.S. industry, and the growth of jobs at the ports that support 

growing exports, including the ports in Portland, Oregon; Long 

Beach, California; and Port Arthur, Texas. 

During the recent economic downturn, when a similar royalty reduction was in place, the U.S. soda ash facilities experienced the 

addition of about 100 jobs in the United States. Now, while that 

may not seems significant, it certainly beats the 1,000-plus jobs 

that the industry lost in the period from 1996 to 2006, when the 

royalty rate was 6 percent, which is the current Federal royalty 

rate. 

It should be noted that these are high-paying jobs in a very rural 

community, with an average wage roughly six times higher than 

the U.S. minimum wage. We have already witnessed significant 

market downturn over the last year that is similar to what the industry was facing in the late 1990s, and we do not want to risk 

a full-blown return to those conditions. 

OCI is one of 4 companies that produce about 90 percent of the 

world’s natural soda ash in Sweetwater County, Wyoming. The remainder is produced in Trona, California. U.S. soda ash producers, 

on average, emit about three times less greenhouse gas emissions 

and three times less energy consumed than the synthetic soda ash 

plants in the rest of the world. Export growth is essential to job 

growth in the U.S. soda ash industry. One of every two jobs in the 

U.S. soda ash is directly attributable to exports. 

Therefore, policies which help to grow exports will mean a 

growth in U.S. jobs. We believe the Soda Ash Competitiveness Act 

will accelerate this job growth. Exports increased by some 11.7 percent in the period during which the 2 percent royalty was in effect, 

2006 to 2011. U.S. soda ash exports also rose by more than 1 million tons in the same period. Thus, the 2 percent rate resulted in 

the sort of jobs and export growth consistent with the President’s 

national export initiative. 

Now, during that period, the U.S. soda ash industry increased investment in the local community and U.S. soda ash facilities 

through increased capital investments, which led to increased economic activity in the communities in which we operate. 

In our current environment, we believe that U.S. soda ash jobs 

are at risk to Chinese expansion, export, and pricing practices. Chinese soda ash production is now the largest in the world, and they 

are currently engaged in a price war for valuable export business 

in Asia, Africa, and South America. In the decade of the 1990s, 

China went from importing over 1 million tons of soda ash per year 

to becoming a 1 million-ton net exporter. By 2000, China had become the world’s largest producer of soda ash, though not the most 

efficient. Maintaining our competitiveness is important, as we compete with state-owned Chinese producers. 

Mr. Chairman, we hear a lot of discussion about how Congress 

can help U.S. manufacturing to restore jobs and economic growth, 

85

i.e. to recapture our economic swagger. As an industry, we were encouraged by the President’s State of the Union Address when he 

referenced climate change and the need to do something. He also 

indicated he wants to increase job growth through exports. The 

U.S. soda ash industry provides a unique opportunity to accomplish 

both of these goals. Our industry has proven that it will increase 

jobs by increasing exports. 

And by increasing the U.S. industry’s market share, we will also 

be reducing greenhouse gases. Because the U.S. soda ash industry 

uses a natural method of producing soda ash, the U.S. industry 

uses roughly, again, three times less energy and emits three times 

less greenhouse gases than our Chinese competitors relying the 

synthetic method for production. 

Make no mistake. Throughout history, soda ash is required to 

produce glass, for autos, homes, and bottles, containers, as well as 

detergents and chemicals that are demanded by an emerging middle class. The demand for soda ash will be met in some way. This 

Committee has the opportunity to reduce global greenhouse gases 

and increase jobs by investing in the U.S. soda ash industry. 

We would suggest the bill before you has already proved successful in doing so for one important sector of our economy. We believe 

the 2 percent rate should be reinstated. 

Thank you for your consideration of our views. I would be 

pleased to take any questions from the Committee. 

[The prepared statement of Mr. Hohn follows:]

PREPARED STATEMENT OF MIKE HOHN, GENERAL MANAGER, SODA ASH BUSINESS

OCI CHEMICAL CORPORATION, ON H.R. 957

Chairman Lamborn and Ranking Member Holt, I would like to thank you for the 

opportunity to testify on H.R. 957, the ‘‘American Soda Ash Competitiveness Act.’’ 

I am the General Manager, Soda Ash Business for OCI Chemical Corporation, and 

I am here today on behalf of the U.S. Soda Ash industry. I am pleased to report 

that the soda ash mined and processed on Federal lands contributes nearly $1 billion annually to our balance of trade, $20 million in Federal royalties, and some 

3,000 direct jobs. 

Up until October of 2011 when the BLM raised our royalty from 2 percent to 6 

percent, our industry was experiencing job growth, and there were plans for expansion, despite the economy still suffering from the worst recession in decades. Enactment of H.R. 957 is important to insuring that we remain a strong American employer and exporter in the years ahead. It means the industry will continue to pay 

our fair share for the privilege of mining on Federal lands, while creating the conditions for positive economic growth that are in all of our best interests. 

From the recent experience of the 2006 Soda Ash Royalty Reduction Act, we know 

that a 2 percent, as opposed to 6 percent Federal royalty rate, can have positive impacts:

• First, it will lead to robust export growth consistent with the President’s National Export Initiative (NEI). 

• Second, it will lead to expanded domestic manufacturing capacity and jobs 

growth; and 

• Third, it will result in an increase, rather than a decrease, in Federal royalty 

revenues by spurring development of the resource.

Mr. Chairman, the 2006 act was enacted by Congress out of a recognition that 

global economic conditions, specifically the emergence of stiff Chinese competition, 

was eroding America’s natural soda ash advantage. We need to continue the positive 

trajectory that Act created for this important domestic manufacturing sector by enacting H.R. 957. 

Indeed, our continued competitiveness in world markets is far from certain, in fact 

over the last year since the royalty increase has been in effect, the industry has 

seen a steady decline in our total exports. This reality was well recognized by Congress in 2006, when it enacted the Soda Ash Royalty Relief Act, which reestablished 

86

a 2 percent royalty on every ton of soda ash produced. In October 2011, the BLM 

saw fit to raise the rate to 6 percent. We believe this rate increase is not only counterproductive to increasing Federal revenues from soda ash production, but threatens our industry’s exports and jobs growth. 

Let me briefly revisit the global conditions that caused Congress to set the rate 

at 2 percent in 2006. In the 15 years between 1982 and 1997, our domestic soda 

ash industry enjoyed a steady and significant growth in exports. But after 1997, our 

export growth slowed dramatically. By 2003, our U.S. exports were only 4 percent 

above their 1997 levels. This rapid decline in export growth resulted from a sudden 

and dramatic change in global competition. In the brief span of the decade of the 

1990s, China went from importing over 1 million tons of soda ash per year to becoming a 2 million ton net exporter. By 2000, China had become the world’s largest producer of soda ash, though hardly the most efficient. A growing number of state 

owned Chinese producers making soda ash from a more energy intensive and more 

greenhouse gas generating synthetic process flooded international markets with 

lower priced material aided by an export VAT rebate incentive. Not only were these 

exports responsible for a greater carbon footprint, they were also hurting our cleaner, more efficient American natural soda ash producers in growing markets, particularly those in Asia and South America. 

Faced with this state owned competition, we identified innovative ways to reduce 

spiraling structural costs, and the increasing prices we paid for energy and transportation. However, as our export growth slowed in the early part of the last decade 

we also had to reduce employment. To remain globally competitive, we regrettably 

shed almost 1,000 jobs as an industry. Mr. Chairman, this was not a preferred option. It was in this context that we decided to ask the Congress to consider that 

the royalty we pay on each ton of soda ash be assessed at 2 percent as called for 

originally in the underlying Minerals Leasing Act. 

Mr. Chairman, in 2006, just as today, our low cost natural soda ash production 

process when allowed to compete fairly on a level playing field can beat any other 

producer in the world. In sum, then as now, if conditions are equal, we know we 

can compete with any other global producer. We can mine the vast underground 

trona ore reserves in Wyoming or in lakebeds in California, and bring this raw material to be processed into soda ash. We can then ship it by rail to Long Beach, California, Portland Oregon, or Port Arthur, Texas, and deliver it to any Asian or South 

American port and effectively compete for our fair share of global business against 

the Chinese. 

Mr. Chairman, as a result of the action Congress took in 2006, our industry came 

out of its downward spiral and experienced sustained growth driven by our ability 

to again grow exports. Despite a global recession and a continuing slow recovery, 

the American Natural Soda Ash industry did not lose jobs during the recent recession, and in fact added almost 100 new jobs in 2010. To put this in perspective, one 

out of every two jobs in our U.S. soda ash industry is now the direct result of exports. U.S. soda ash exports had risen by more than 1 million tons since enactment 

of the soda ash royalty legislation. As Mr. Robert Abbey, former Director Bureau 

of Land Management, stated in his Senate testimony on August 3, 2011, exports increased by some 11.7 percent in the 5-year period during which the 2006 Act was 

in place. It thus puzzled us as to why the BLM saw fit to immediately reinstate 

the 6 percent rate when the 2006 Act expired in October. 

Very simply, the 2006 Act allowed us to grow exports in large part because we 

could reinvest in our business at higher rates. During the 5 years this Act was in 

effect, we reinvested in our businesses at rates well above those before its passage. 

In 2005, the year before the royalty was enacted; the U.S. soda ash industry spent 

some $88 million in capital improvements. In 2006, the year after passage, and with 

the predictability of a stable 2 percent royalty, the U.S. soda ash industry nearly 

doubled its rate of investment in our future, spending over $158 million dollars to 

expand capacity and make needed improvements. 

However, Mr. Chairman since the BLM reinstated the 6 percent royalty, the industry is headed towards a bleaker future similar to the circumstances in place in 

the early 2000s. Across the industry, jobs are going unfilled, planned expansions are 

being put on hold, and our exports have fallen off significantly. While the BLM had 

indicated that they would entertain individual lease-by-lease application for waivers 

of their 6 percent royalty, nothing in their 100-page guidance document addresses 

export growth. When we attempted as an industry last year to submit a streamlined 

application for relief that was based upon maximization of production on Federal 

lands, we were denied. We would be pleased to make our application available to 

the Committee for its review. 

Thus, Mr. Chairman, we again turn to Congress to restore the 2 percent royalty 

rate by enacting H.R. 957. In sum, soda ash production represents hardcore U.S. 

87

manufacturing at its best. We hear every day how American manufacturing jobs are 

disappearing and we have a shrinking middle class. The production of soda ash from 

U.S. natural resources in Wyoming and California is done by skilled workers with 

an average salary of about $85,000 per year in very small, rural communities. Growing U.S. soda ash exports will increase the number of those jobs. Moreover, it will 

help grow revenues at Treasury. When the Congressional Budget Office (CBO) produced cost estimates for legislation implementing the 2006 royalty reduction, it concluded that the Government would lose $15 million in direct spending and $15 million in payments to States in which the royalties were generated. In actuality, over 

the 5-year period, royalties tallied over $85 million because of the increased production the royalty reduction helped to generate. 

Mr. Chairman, we hear a lot of discussion about how Congress can help U.S. manufacturing to restore jobs and economic growth; i.e., to recapture our economic swagger. As an industry, we were encouraged by the President’s State of the Union address when he referenced climate change and the need to do something. He also indicated he wants to increase job growth through exports. The U.S. Soda Ash industry provides a unique opportunity to accomplish both of these goals. Our industry 

has proven that it will increase jobs by increasing exports, and by increasing the 

U.S. industry’s market share we will also be reducing greenhouse gases. Because 

the U.S. soda ash industry uses a natural method of producing soda ash, the U.S. 

industry uses roughly three times less energy and emits three times less greenhouse 

gases than our Chinese competitors relying on the synthetic method for production. 

Make no mistake, throughout history; soda ash has been produced to supply the 

glass (glass for autos, homes and bottles) as well as detergents and chemicals that 

are required by emerging markets to grow. The demand for soda ash will be met 

in some way. This Committee has the opportunity to reduce global greenhouse gases 

and increase jobs by supporting the U.S. Soda Ash industry. We would suggest the 

bill before you has already proved successful in doing so for one important sector 

of our economy. We believe the 2 percent rate should be reinstated. Thank you for 

your consideration of our views. I would be pleased to take any questions from the 

Committee. 

Dr. GOSAR [presiding]. Thank you very, very much. 

Now, Mr. Neatby. 

STATEMENT OF PIERRE NEATBY, VICE PRESIDENT, SALES 

AND MARKETING, AVALON RARE METALS 

Mr. NEATBY. Thank you very much, Mr. Chairman. My name is 

Pierre Neatby, and I am Vice President of Sales and Marketing for 

Avalon Rare Metals, Inc. I will briefly describe Avalon and then 

provide some comments in support of bill H.R. 981. 

Avalon Rare Metals is a Canadian-headquartered mineral development company publicly traded in New York and Toronto. Our 

flagship project is the Nechalacho Rare Earth Deposit at Thor 

Lake, Northwest Territories, Canada, that contains 25 percent 

heavy rare earths, which are the truly rare rare earths, and our 

project plan is to mine and do initial processing in the Northwest 

Territories and further refine the rare earths in Geismar, Louisiana, in the United States. 

H.R. 981 proposes to fund a study of current and future rare 

earth deposits and an analysis of the rare earth supply chain. I believe the focus of the bill should be on the analysis of the supply 

chain. There are hundreds of deposits that have been identified 

around the world. But the biggest issue facing our industry is the 

processing of rare earths and the production of downstream products that can be used as inputs into final products. 

Why are rare earths important? They are important for jobs and 

economic growth. They play a vital role in a multitude of applications, many in the clean energy sector. These includes motors for 

electric and hybrid vehicles, generators for wind turbines, solar 

88

panel systems, and phosphors for energy-efficient lighting. We believe the next few years will be critical for the development of the 

clean energy sector. 

I have highlighted clean energy applications of rare earth, but 

other very significant end-use applications include smart phones, 

oil refining catalysts, MRI machines, and various military uses that 

are also growing. 

Rare earth demand is expected to grow at a rate of 7 to 12 percent per year to the year 2020. This demand needs a secure supply 

chain outside China, if the demand is going to grow outside China, 

and specifically to determine if the new jobs stemming from this 

growth are going to be here in the United States and other western 

countries, or in China. 

So, China produces over 95 percent of the world’s rare earth elements, and China has recently been implementing a range of policies to control its domestic rare earth industry: consolidation of 

ownership, restriction of foreign ownership, export taxes, export 

quotas, environmental regulations, limiting illegal mining, and 

price controls. The outcome of these policies has been the ability to 

restrict exports and increase prices outside China. China limited 

exports in 2010, and this caused prices to increase dramatically in 

2011. China is in a better position today to restrict exports and manipulate prices outside China than it was in 2010. 

The supply chain includes mining, processing, separation, metal 

and alloy production, and manufacturing of products sold to end 

users. We would like to add recycling and the human resource aspect to the supply chain. Recycling makes the supply chain more 

efficient and less costly to the end user. This is important for competitiveness. Human resources are the people that bring know-how 

to the supply chain: geologists, engineers, technicians, operators, 

and researchers. 

Growth can’t take place if there is no expertise in the processing 

and use of rare earths. This is where universities, colleges, and 

government can take a key role in our industry, possibly in conjunction with an industry association, such as the new Rare Earth 

Technology Alliance, right here in Washington. China has hundreds and hundreds of scientists dedicated to rare earths, and have 

rare earth courses in universities. If North America is going to develop its rare earth infrastructure, it needs educated people specializing in rare earths. 

In conclusion, many growth industries depend on rare earths, 

and China will continue to be the dominant supplier, not only in 

mining, but also in processing and manufacturing of final products. 

China wants the downstream for manufacturing, because that is 

where the jobs are. We need action now to stem the flow of jobs 

going to China. Thank you very much. 

[The prepared statement of Mr. Neatby follows:]

PREPARED STATEMENT OF PIERRE NEATBY, VICE PRESIDENT FOR SALES AND

MARKETING, AVALON RARE METALS INC., ON H.R. 1063, H.R. 761, AND H.R. 981

Avalon Rare Metals Inc. is Canadian headquartered mineral development company, publicly traded in Toronto and New York, with a primary focus on the rare 

metals and minerals in North America. Americans comprise a high proportion of our 

current shareholders. 

89

Our flagship project, the 100-percent-owned Nechalacho Rare Earth Element Deposit, Thor Lake, Northwest Territories, Canada is one of the largest undeveloped 

rare earth elements resources in the world. Its exceptional enrichment in the more 

valuable Heavy Rare Earth Elements (HREEs) is key to enabling advances in clean 

energy technologies, national defense and other growing high-tech applications. 

Nechalacho is one of the few potential sources of these critical elements outside of 

China, currently the source of over 95 percent of the world supply. 

Avalon is well funded to complete its Feasibility Study (expected in Q2 2013) and 

has no debt. Our project includes a mine and processing facility in the Northwest 

Territories of Canada and plans for a refinery in Geismar, Louisiana. This project 

will cost over $1.2 billion to build. It is one of very few projects outside China to 

be at the final Feasibility stage, the last stage before full project financing is secured and construction begins. 

Avalon also explores for and owns other rare metals and minerals project in Canada and the United States, of which two are at advanced stages of development: 

Separation Rapids (lithium) in Ontario, and East Kemptville, Nova Scotia, a tin-indium-gallium-germanium project where large inferred resources have been identified requiring further drilling to bring the project to the pre-feasibility stage. 

Avalon is proud to be a charter member of the Rare Earths Technology Alliance 

(RETA), a Washington, DC-based international industry association (non-lobbyist) 

whose membership includes producers and users of rare earths and also includes 

academic institutions engaged in rare earths research and development. RETA’s primary goal is to promote the development of the rare earth industry through education, market development and dealing with common issues facing the industry. It 

is in that spirit of education and insight into this emerging industry, in recognition 

of the U.S.-Canada trade relationship, and in support of clean technologies and their 

contribution to future growth economies that we appear before the committee today 

to support the RARE Act of 2013. 

Rare Earths—Jobs and Economic Growth

According to the Industrial Minerals Corporation of Australia (IMCOA), an Australian-based authority on the rare earth market, rare earth demand is expected to 

grow at a rate of 7–12 percent per year to 2020. Rare earths are used in a multitude 

of applications, many in the clean energy sector. These include electric and hybrid 

vehicles, wind turbines, solar panels, and energy-efficient lighting. The next few 

years will be crucial to the clean energy sector as it develops. Rare earth magnets 

and phosphors are key building blocks for companies developing these technologies 

and they need access to a competitive and secure rare earth supply chain to prosper. 

Other end use applications include smart phones, oil refining catalysts, MRI machines, other medical diagnostics and treatments, and various military applications. 

Demand outside China is expected to grow from 35,000 tonnes in 2012 to 55,000 

tonnes in 2016. This increase in demand assumes that export quotas from China 

will remain around 30,000 tonnes and that no new export restrictions on rare earths 

are imposed so that rare earth consuming industries outside China will be allowed 

to grow. 

China’s Dominance—Threat to Jobs in the U.S. and North America.

Today, China produces over 95 percent of the world’s rare earth elements, even 

as new sources are being developed in other countries, including the United States, 

Canada, and Australia. However, China has been implementing a range of policies 

to control its domestic rare earth industry: reducing the number of companies involved in the extraction and processing of rare earths, imposing limits on foreign 

ownership in the rare earth sector, imposing export taxes, export quotas, curbing 

illegal mining, implementing and enforcing strict environmental regulations, and attempting to set prices. The outcome of these policies is reduced availability of rare 

earths outside China, higher prices and potentially greater price volatility outside 

China and the threat of further export restrictions, which ultimately create the potential for severe supply shortages. While we currently see relatively low rare earth 

prices, our interest is that when they spike again, the United States and North 

America should not be impacted as much as we have been. Industry experts believe 

export restrictions, specifically on the scarce heavy rare earths, are likely in the 

coming years. Western companies are essentially being forced to set up manufacturing inside China, which puts at risk their intellectual property and eliminates 

jobs in countries like the United States. This is troublesome not only for Avalon, 

but other companies along the supply chain and should remain a major security concern for western governments. 

90

The Importance of the Secure Supply Chain

Avalon is pleased to see the introduction of the RARE Act of 2013 with its focus 

on conducting global census of the identity and availability of rare earths elements 

and an analysis of the supply chain. We believe that the results of this proposed 

undertaking will better inform industry participants and end-users on how all parties can work collaboratively to offset actions by a single monopolistic supplier (i.e., 

China) that can disrupt pricing, availability, and security of supply. Given the wide 

variety of applications of rare earths in many critical sectors such as clean energy, 

defense and national security, we believe this type of assessment and analysis is 

more important than ever before. 

I believe that the U.S. Geological Service (USGS) and U.S.-based experts like 

Technology Metal Research (TMR), have endeavored to identify the hundreds of potential rare earth deposits outside China. (For example TMR currently tracks the 

development of over 440 projects in 37 countries and closely follows some 46 projects 

it defines as ‘advanced’ in 14 countries). These projects will generally only produce 

mixed concentrates or possibly separated rare earth oxides, with very few projects 

pursuing the further value-added processing of such into phosphors, metals, alloys, 

magnets or motors which are essentially the products that consumers need. China’s 

strategy has been to fulfill the needs of the full downstream processing supply chain 

and end products, generating more profits and, more importantly, creating more 

high skilled labor and greater job opportunities in China. 

One suggested addition to H.R. 981 is to include recycling and human resources 

to the discussion about fulfilling the rare earth supply chain. Recycling is the key 

to an efficient use of resources in the rare earth supply chain to achieve low cost 

manufacturing. A diverse range of people (e.g. geologists; metallurgical, chemical, 

process engineers and technicians; business people, operators, researchers) are required to establish, maintain and improve a supply chain outside China. 

It is not enough to establish mines and processing plants outside China. End consumers want reliable, long term, price competitive supply chains. Currently, some 

companies are specifying inferior solutions for certain applications due to fears of 

high prices or fear of lack of availability of neodymium and dysprosium (e.g. substituting ferrite and other magnets where rare earth magnets increase performance). This strategy is highly detrimental to longer term business and domestic economic development. Using less efficient inputs (such as ferrite magnets rather than 

rare earth magnets) in certain applications could lead to loss of competitiveness and 

replacement by most probably foreign-based suppliers, that can build more efficient 

products using superior raw materials. 

The supply chain analysis that H.R. 981 would provide will help government and 

industry determine where the most sensitive and cost effective investment should 

take place and highlight the importance of investment at all levels of the supply 

chain to be able to effectively offer a secure alternative to China. 

Corporate Social Responsibility

Social responsibility and environmental stewardship are corporate cornerstones 

for Avalon. Avalon believes that environmental, economic and social responsibility 

are integral to the upstream and downstream activities used to create these critical 

materials; from exploration and development to production. In 2010, Avalon was 

recognized by the Prospectors and Developers Association of Canada with its award 

for Environmental & Social Responsibility. Avalon is also one of only a very few junior resource companies in the world to have published a comprehensive Sustainability Report, prepared to the Global Reporting Initiative standard, in which Avalon fully discloses its policies and practices on social and environmental responsibility, including its performance against specific targets. 

Permitting

The permitting and environmental assessment process is different across the 

world, and is dependent upon the national and local jurisdictions in which the deposit and or operating facilities are to be established. Avalon’s Nechalacho deposit 

is located in the Northwest Territories and is regulated under the Mackenzie Valley 

Resource Management Act. Avalon is nearing completion of the Environmental Assessment for the project, a critical step in the permitting process, and has already 

established strong community relationships with local Aboriginal groups where Avalon is considered an industry leader in best practice. In Geismar, Louisiana Avalon 

has an option on a property where permitting for a separation plant was initiated 

in December 2012 and is expected to be completed by the end of 2013. 

Dr. GOSAR. Thank you very much. 

91

Our next witness is Chairman Terry Rambler. 

STATEMENT OF TERRY RAMBLER, CHAIRMAN, SAN CARLOS 

APACHE TRIBE 

Mr. RAMBLER. Can you hear me? OK. Good morning, Chairman 

Lamborn, Ranking Member Holt, and members of the Subcommittee. My name is Terry Rambler, I am the Chairman of the 

San Carlos Apache Tribe, and President of the Inter-Tribal Council 

of Arizona. On behalf of my Tribe and ITCA, thank you for this opportunity to testify. 

Joining me today are San Carlos Apache Councilman Windsor 

Nosy, Sr., tribal leaders, local elected officials from communities directly impacted by this bill, and representatives from different organizations throughout the country. I would like for all of them to 

stand. Thank you. This group is diverse and growing. And it also 

includes Tribes and tribal organizations nationwide. We bring our 

united front in strong opposition to H.R. 687. 

We strongly oppose this bill and the land transfer it mandates 

for three reasons: one, it will destroy our sacred areas; two, it will 

deplete and contaminate the region’s already overdrawn water supply; and three, it is a bad deal for the American taxpayer. H.R. 687 

would transfer 2,422 acres of our sacred land, known as Oak Flat 

in the Tonto National Forest, to Resolution Copper to develop a 

massive copper mine. Oak Flat is one of our holy places, where 

spiritual deities reside. Just as a church is a place of worship to 

Christians and the Vatican is a holy place to Catholics, Oak Flat 

is the equivalent for Apaches, Yavapais, and others. My people 

have always gone to Oak Flat to pray, to gather ceremonial items, 

to seek peace, and to conduct ceremonial dances of our ancestors, 

such as the sunrise dance that celebrates a young woman coming 

of age. You can see some of those. 

I have a map here that shows the Oak Flat in relation to our 

Reservation. As you can see, the forest borders our Reservation, 

and Oak Flat is just 15 miles away. These lands are our aboriginal 

homelands. I have a second map here that shows Oak Flat and the 

forest outlined in red. The black outline shows land withdrawn 

from mining by President Eisenhower’s public land order, which 

protected this area. Federal laws and policies require meaningful 

consultation with Tribes before Federal action. However, once Oak 

Flat is held in private ownership, as this bill directs, these Federal 

protections will disappear and the sacred area will be destroyed 

without our input. 

Resolution Copper plans to use the block cave method to extract 

the copper ore body underneath Oak Flat because it is far cheaper 

than other methods. However, the process is also more destructive 

to the land. The diagram here depicts the block cave mining process. The company would dig a tunnel 7,000 feet down and then dig 

a horizontal tunnel to extract 1 cubic mile of ore. It will take 1,400 

Cowboy Stadiums to hold 1 cubic mile of ore. The next diagram 

shows what happens next. The surface will eventually collapse, and 

the area will become an open pit about 2 miles in diameter. Like 

a crater, the pit will be visible from outer space. 

Our second major concern is the loss of water in the region, and 

our water rights. One of the primary purposes for establishing the 

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Tonto National Forest in 1905 was to protect the watersheds and 

the quality of the water. H.R. 687 undermines these purposes because this project will require at least 20,000 acre-feet of water annually to keep the mine from flooding. To put that in perspective, 

that amounts to the annual life water supply for 180,000 Arizona 

citizens. According to a recent study, this massive groundwater 

pumping would be unsustainable, harmful to the region’s water 

supply, and threatens surface water resources and riparian habitats. 

Here is a picture of a perennial spring at Oak Flat. Mining here 

will contaminate and dry up this spring and other water resources 

at Oak Flat. Here is another picture of the Oak Flat area, an ancient oak tree that has nourished us for centuries with its acorns. 

It takes a century to produce the first acorn from these trees. 

These trees will be destroyed when the land collapses. 

My final point is that at a time when all Americans are being 

asked to tighten our belts, this bill will result in a giveaway of 

American wealth to a foreign-owned mining company. The appraisal requirements included in H.R. 687 do not insure that the 

public will receive fair value. As a result, the American taxpayer 

stands to receive only a small fraction of what the Federal minerals 

are worth. 

In closing, the Federal Government should continue to be stewards of this land to sustain the well-being of my people. Our people 

dance and pray at Oak Flat, just as our ancestors did. I ask for 

your help to ensure that our children and theirs will be able to do 

the same, well into the future. 

Again, thank you for this opportunity. [Speaks in Apache.] What 

I said to you was, ‘‘May God watch over you and give you guidance.’’ Thank you. 

[The prepared statement of Mr. Rambler follows:]

PREPARED STATEMENT OF TERRY RAMBLER, CHAIRMAN, SAN CARLOS APACHE TRIBE, ON H.R. 687

My name is Terry Rambler. I am the Chairman of the San Carlos Apache Tribe 

(‘‘Tribe’’), representing 15,000 tribal members. The San Carlos Apache Reservation 

(‘‘Reservation’’) is located within part of our aboriginal territory, and spans 1.8 million acres in southeastern Arizona. I am also President of the Inter Tribal Council 

of Arizona (‘‘ITCA’’), a non-profit organization representing 20 federally recognized 

Indian tribes. Thank you for the opportunity to testify about our views on H.R. 687, 

the Southeast Arizona Land Exchange and Conservation Act of 2013. On behalf of 

the San Carlos Apache Tribe and ITCA, we strongly oppose H.R. 687 and respectfully urge Members of the Subcommittee to oppose this bill for the reasons set forth 

below. 

Summary of Objections to H.R. 687

H.R. 687 would direct the Secretary of Agriculture to convey 2,422 acres of U.S. 

Forest Service lands in an area called Oak Flat and the copper ore body underneath 

it into the private ownership of Resolution Copper Mining, LLC (‘‘Resolution Copper’’ or ‘‘Resolution’’)—a subsidiary of foreign mining giants Rio Tinto (United Kingdom) and BHP Billiton, Ltd. (Australia) for block cave mining. The bill would require this transfer of the Oak Flat area to Resolution Copper within 1 year of enactment. 

In the decade since this project has been in development, Resolution Copper has 

consistently refused to provide details regarding the environmental and economic 

impacts of the project to the local community and region. H.R. 687 would give the 

Oak Flat area to Resolution Copper for a bare fraction of its actual value. Once the 

land is privatized under H.R. 687, Federal laws and policies that currently protect 

the area and tribal rights would no longer apply. 

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As details about the impacts of H.R. 687 have emerged, public opposition has 

grown and is diverse. Joining us today are local officials representing the Town of 

Superior and the Queen Valley Homeowner’s Association. In addition, the City of 

Globe recently tabled its support for this project. These communities located near 

the Oak Flat area have either expressed opposition to H.R. 687 or serious concerns 

about it. Further, many tribes and tribal organizations nationwide oppose the bill 

because it would transfer Federal land encompassing a known tribal sacred area to 

a mining company whose mining activities will ultimately destroy the area and circumvent government-to-government consultation requirements with Indian tribes. 

Tribal organizations opposing this bill include the National Congress of American 

Indians, the Inter Tribal Council of Nevada, the United South and Eastern Tribes, 

Midwest Alliance of Sovereign Tribes, the Great Plains Tribal Chairman’s Association, the Affiliated Tribes of Northwest Indians, the Eight Northern Pueblos Council, the All Indian Pueblo Council, and many other tribes and tribal organizations. 

Other groups that oppose this bill include the Association of Retired Miners, the Arizona Mining Reform Coalition, the Sierra Club, the Audubon Society, and others. 

Our opposition to H.R. 687 is based upon the following points: (1) the bill would 

desecrate and destroy an area of religious and sacred significance to the Apache and 

Yavapai people, which conflicts with Federal laws and policies governing meaningful 

consultation with Indian tribes and protection and preservation of sacred sites; (2) 

the bill mandates, in direct violation of NEPA, the transfer of the Oak Flat area 

to Resolution Copper without first informing the public about the adverse impacts 

on the quality and quantity of the region’s precious water supply, the environment, 

and the potential health and safety risks to the public; and (3) the bill constitutes 

a multi-billion dollar giveaway to a foreign-owned mining company that is 

partnering with the country of Iran on a uranium mine in Namibia. Simply put, the 

American public cannot afford this deal. 

H.R. 687 Would Result in Desecration and Destruction of a Native American Religious and Sacred Site

The 2,422 acres of lands to be conveyed pursuant to H.R. 687 are located in the 

Tonto National Forest and include the 740 acres of the Oak Flat Withdrawal where 

the Oak Flat Campground is located and the surrounding area (collectively referred 

to as the ‘‘Oak Flat area’’). The San Carlos Apache Reservation is bordered on the 

west by the Tonto National Forest. The Oak Flat area is 15 miles from our Reservation. The Forest and the Oak Flat area are part of our and other Western Apaches’ 

aboriginal lands and it has always played an essential role in the Apache religion, 

traditions, and culture. In the late 1800s, the U.S. Army forcibly removed Apaches 

from our lands, including the Oak Flat area, to the San Carlos Apache Reservation. 

We were made prisoners of war there until the early 1900s. Our people lived, 

prayed, and died in the Oak Flat area. At least eight Apache Clans and two Western Apache Bands document their history in the area. Since time immemorial, 

Apache religious ceremonies and traditional practices have been held at Oak Flat. 

Article 11 of the Apache Treaty of 1852, requires the United States to ‘‘so legislate 

and act to secure the permanent prosperity and happiness’’ of the Apache people. 

Clearly, H.R. 687 fails to live up to this promise. The Oak Flat area, as well as other 

nearby locations, are eligible for inclusion in, and protection under, the National 

Historic Preservation Act of 1966, as well as many other laws, Executive orders and 

policies. 

Today, the Oak Flat area continues to play a vital role in Apache ceremonies, religion, tradition, and culture. In Apache, the Oak Flat area is Chich’il Bildagoteel (a 

‘‘Flat with Acorn Trees’’). The Oak Flat area is a place filled with power—a place 

where Apaches today go for prayer, to conduct ceremonial dances such as the sunrise dance that celebrates a young woman’s coming of age, to gather medicines and 

ceremonial items, and to seek and obtain peace and personal cleansing. The Oak 

Flat area and everything in it belongs to powerful Diyin, or Medicine Men, and is 

the home of a particular kind of Gaan, which are mighty Mountain Spirits and Holy 

Beings on whom we Apaches depend for our well-being. 

Apache Elders tell us that mining on the Oak Flat area will adversely impact the 

integrity of the area as a holy and religious place. Mining the Oak Flat area will 

desecrate the Gaan’s home and would diminish the power of the place. Without the 

power of Gaan, the Apache people cannot conduct our ceremonies. We become vulnerable to a variety of illnesses and our spiritual existence is threatened. There are 

no human actions or steps that could make this place whole again or restore it once 

lost. 

The unique nature of the Oak Flat area has long been recognized and not just 

by the Apache. The Oak Flat Withdrawal was set aside from appropriation under 

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1Public Land Orders 1229 (1955) and 5132 (1971). 

2See http://www.ohchr.org/english/issues/indigenous/declaration.htm. 3 Available at http://www.state.gov/s/tribalconsultation/declaration/index.htm. 4See S. Hrg. 110–572, p. 44 (July 9, 2008) (Hearing before the Subcommittee on Public Lands 

and Forests of the Committee on Energy and Natural Resources, United States Senate, S. 3157 

110th Cong.). 5See Resolution Copper website available at http://www.resolutioncopper.com/sdr/2011/environment. 6See Executive Order 13007: Indian Sacred Sites (May 24, 1996); the Native American Graves 

Protection and Repatriation Act, 25 U.S.C. 3001 et seq.; the American Indian Religious Freedom 

Act, 42 U.S.C. 1996; the National Historic Preservation Act, 16 U.S.C. 470 et seq.; the Religious 

Freedom Restoration Act, 42 U.S.C. 2000bb et seq.; and Executive Order 13175: Consultation 

with Indian Tribal Governments (Nov. 6, 2000). 7 59 Fed. Reg. 22951 (April 29, 1994). 

8See Letter from USDA Secretary Vilsack to Chairman of the Senate Energy and Natural Resources Committee, Subcommittee on Public Lands and Forests (July 13, 2009). 9 74 Fed. Reg. 57881 (Nov. 5, 2009). 

the mining laws by President Eisenhower and reaffirmed by President Nixon.1 U.S. 

Department of Agriculture (USDA) Secretary Tom Vilsack has acknowledged the 

Oak Flat area as a ‘‘special place’’ that should be protected from harm ‘‘for future 

generations.’’ Protecting the Oak Flat area as a sacred site is consistent with the 

articles of the United Nations Declaration on the Rights of Indigenous Peoples, 

which was adopted by the U.N. General Assembly in September of 2007, and for 

which President Obama announced U.S. support in December of 2012.2 The Obama 

Administration tied its support of the Declaration to the current Federal policies of 

government-to-government consultations with Indian tribes and maintaining cultures and traditions of Native Peoples.3

The mining project proposed by Resolution Copper will destroy the Oak Flat area. 

The block cave mining technique will permanently ruin the surface of the area. As 

explained below, the water required for the project will forever alter the medicinal 

plants and trees in the area upon which our people rely for healing and prayer. The 

ore body that Resolution seeks lies 4,500 to 7,000 feet beneath the Oak Flat area. 

Resolution admits that the ore body is ‘‘technologically difficult’’ to mine, that it may 

take up to a decade to develop this technology, and that temperatures as high as 

175 degrees Fahrenheit will be encountered.4 It also acknowledges that the land 

above the ore body, the Oak Flat Campground, will subside and cave in.5 The mine 

will destroy the nature of the land, its ecology, and its sacred powers forever. For 

my constituents, this reason alone is enough to oppose H.R. 687. 

H.R. 687 Circumvents Federal Laws and Policies Designed To Protect Native American Religious and Sacred Sites

Indian tribes, including the San Carlos Apache Tribe, ceded and had taken from 

us hundreds of millions of acres of tribal homelands to help build this great Nation. 

The United States has acknowledged that, despite the transfer in title of these lands 

to the United States, it retained an obligation to accommodate access to and ceremonial use of religious and sacred sites by Native Americans. This solemn obligation 

is codified in a number of Federal laws, regulations, and policies.6 A core aspect of 

each of these Federal enactments is the requirement that the United States must 

conduct meaningful government-to-government consultation with affected Indian 

tribes prior to making a decision that will impact a Native sacred area. 

Executive Order 13175 on tribal consultation requires Federal agencies to conduct 

consultations with tribes when proposed legislation has substantial direct effects on 

one or more Indian tribes.7 USDA Secretary Vilsack acknowledged ‘‘it is important 

that [the Southeast Arizona Land Exchange] engage in a process of formal tribal 

consultation to ensure both tribal participation and the protection of this site.’’ 8

President Obama stated in his 2009 Memorandum affirming and requiring agency 

implementation of E.O. 13175, that ‘‘[h]istory has shown that failure to include the 

voices of tribal officials in formulating policy affecting their tribal communities has 

all too often led to undesirable and, at times, devastating and tragic results.’’ 9

To strengthen Federal polices pertaining to Indian tribes, the Obama Administration recently acted to improve protections of Native religions and sacred areas. In 

December of 2012, the USDA released a report titled, ‘‘USDA and Forest Service: 

Sacred Sites Policy Review and Recommendations,’’ which provides a framework for 

how and why the United States, and specifically USDA and the Forest Service, is 

legally obligated to protect and preserve sacred areas located on Federal lands. The 

Report acknowledges, ‘‘Like almost all public and private lands in the United States, 

all or part of every national forest is carved out of the ancestral lands of American 

Indian and Alaska Native people.’’ It affirms and lists the Administration’s Federal 

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10Section 4(i) of the bill states, ‘‘the land exchange directed by this Act shall be consummated 

not later than 1 year after the date of enactment of this Act.’’ (Emphasis added). 11See Technical Guide to Managing Groundwater Resources, U.S. Forest Service, FS–88, pp. 

20–22 (May 2007). 12See S. Hrg. 112–486, pp. 28, 29 (Feb. 9, 2012) (Hearing Before the Committee on Energy 

and Natural Resources, United States Senate, 112th Congress). 

legal obligations to protect and provide access to Indian sacred sites and to consult 

with tribes on any Federal actions that will impact sacred sites. 

On December 5, 2012, five Federal agencies, including USDA, the Departments 

of the Interior, Defense, Energy, and the Advisory Council on Historic Preservation 

entered into a MOU to develop guidance for the management and treatment of Native sacred areas, to develop a public outreach plan to acknowledge the importance 

of maintaining the integrity of Native sacred areas and to protect and preserve such 

sites, and to establish practices to foster the collaborative stewardship of sacred 

sites, among other goals. On March 5, 2013, these Federal agencies adopted an action plan to implement the MOU, which entails working to ‘‘improve the protection 

of and tribal access to Indian sacred sites, in accordance with Executive Order 

13007 [on Indian Sacred Sites] and the MOU, through enhanced and improved 

interdepartmental coordination and collaboration and through consultation with Indian tribes.’’

H.R. 687 will make an end run around these legal and policy obligations by transferring the Oak Flat area to Resolution Copper in private ownership. Once the lands 

are in private hands, the obligations to protect the Tribe’s religious and sacred areas 

and accommodate tribal access will have no force of law. Section 4(c) of the bill requires tribal consultation, but earlier provisions of the bill mandate that the land 

be transferred regardless of the outcome of that consultation, rendering the act of 

consultation a mere formality with no meaningful effect. 

H.R. 687 Authorizes the Project To Move Forward Without Informing the 

Public of the Adverse Impacts to the Region’s Water, Environment, and 

Health and Human Safety

Bill Circumvents NEPA and Public Interest Requirements

H.R. 687 undermines the National Environmental Policy Act (NEPA), which requires an analysis of potential impacts, including providing public notice and an opportunity to comment, before Federal actions are taken. The bill fails to require an 

environmental review, including consideration of mitigation measures, of the mining 

project before the land exchange is completed. The bill mandates that USDA convey 

the lands to Resolution Copper within 1 year of enactment.10 Once the lands are 

transferred to Resolution Copper, NEPA review will not have any real impact because the land would already be in private ownership. Because the bill is a mandatory transfer, the Secretary of Agriculture has no discretionary authority to determine under the Federal Land Policy Management Act (FLPMA) or other laws 

whether the exchange is a bad deal for the American taxpayer, the local residents, 

and the local economy, which would be the case if an administrative transfer were 

required. 

In May 2007, the Forest Service published its ‘‘Technical Guide to Managing 

Groundwater Resources.’’ The Technical Guide examined the Forest Service’s compliance with FLPMA and NEPA.11 The Guide references the Service’s experience 

with the Carlota Mine also located in the Tonto National Forest. It was determined 

through the evaluative procedures of FLPMA and NEPA that Carlota Mine’s 

groundwater pumping would impact the Tonto Forest’s surface waters and the Service’s appropriated water rights. The Carlota Mine was required to mitigate the impacts of its groundwater demands for the mining operation before the mine was permitted. The Carlota project illustrates the importance of NEPA review before this 

land exchange is completed. The surface waters and aquifers that were affected by 

the Carlota Mine are the same surface waters and aquifers that will be impacted 

by Resolution Copper’s mine. Under H.R. 687, Resolution Copper will be able to 

evade this type of analysis and can ignore mitigation conditions. 

Resolution Copper has no intention of sharing any relevant information with the 

public prior to taking the lands in private ownership. Resolution’s Jon Cherry told 

the Senate Environment and Natural Resources Committee in February of 2012 

that Resolution Copper ‘‘will be in a position to file our Mine Plan of Operations 

(MPO) which will begin the NEPA EIS process over the entire project area including 

the area of the subject exchange’’ by the ‘‘second quarter of 2012.’’ 12 To our knowledge, Resolution Copper has not fulfilled this promise. 

Section 4(j)(1) of H.R. 687 requires only that Resolution Copper submit a MPO 

to the Secretary prior to commencing production in commercial quantities. There are 

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13See S. HRG. 111–65 (June 17, 2009) p. 41, Hearing before the Subcommittee on Public 

Lands and Forests of the Committee on Energy and Natural Resources, United States Senate 

(S. 409 111th Cong.). 14See S. HRG. 112–486 (June 14, 2011) p. 16, Hearing before the Committee on Energy and 

Natural Resources, United States Senate (H.R. 1904 and S. 409 112th Cong.). 15See Letter from USDA Secretary Vilsack to Chairman of the Senate Energy and Natural 

Resources Committee, Subcommittee on Public Lands and Forests (July 13, 2009) (emphasis 

added).

no requirements to guarantee that the MPO will contain a complete description of 

mining activities and measures Resolution Copper will take to protect environmental and cultural resources, which are normally required by law. Under Resolution Copper’s proposed timeline, the MPO could take close to a decade. Regarding 

actual environmental review, Section 4(j)(2) of the bill requires only that the Secretary, within 3 years of receiving Resolution Copper’s MPO, prepare an environmental review that must be conducted under the framework of subparagraph 

4322(2) of NEPA. Again, this review will be conducted long after the lands are exchanged and in private ownership.

Section 4(h) of the bill makes clear that Federal laws will not limit Resolution 

Copper’s activities on the land after the mandated exchange. It provides that the 

lands conveyed ‘‘shall be available to Resolution Copper for mining and related activities subject to and in accordance with applicable Federal, State, and local laws 

pertaining to mining and related activities on land in private ownership.’’ As a result, the Secretary will have no discretion to exercise meaningful authority over the 

MPO or mining activities on private land after the exchange absent a Federal 

nexus. There is no requirement in the bill for the Secretary to examine the direct, 

indirect and cumulative impacts of exploratory activities, pre-feasibility, feasibility 

operations, or mine facility construction that will be conducted after the exchange. 

Further, upon enactment of H.R. 687, Resolution Copper will almost immediately 

begin activities that will harm our sacred area and the region’s water supply, again 

without any public disclosures of information. Section 4(f) mandates that the Secretary ‘‘shall’’ provide Resolution with a special use permit within 30 days of enactment to engage in mineral exploration activities at Oak Flat Withdrawal and, within 90 days, the Secretary is required to allow mineral exploration. The integrity of 

Oak Flat could be substantially harmed by exploratory activities before the limited 

environmental review requirements in Sec. 4(j)(2) are triggered. The limited environmental review of the MPO will have little or no benefit. The Secretary lacks any 

authority to propose alternatives to interim activities that might be necessary to 

protect water resources, landscape, plants, ecosystems or the integrity of Oak Flat 

as a traditional cultural property and sacred site. The immediate exploration of Oak 

Flat contemplated by Section 4(j) constitutes an ‘‘irretrievable commitment of resources’’ in contravention of NEPA. 

Joel Holtrop, Deputy Chief of the National Forest Service, stated that a MPO containing subsurface information is ‘‘essential in order to assess environmental impacts, including hydrological conditions, subsidence, and other related issues.’’ 13

Similar concerns were expressed by the Forest Service Associate Chief Mary Wagner 

who noted that the Service could not support the bill given that it ‘‘limited the discretion’’ of the Service to develop a reasonable range of alternatives and lacked the 

opportunity for public comment on the proposal.14 Likewise, USDA Secretary 

Vilsack stated: 

The purpose of a requirement that the agency prepare the EIS after the exchange, when the land is in private ownership, is unclear because the bill 

provides the agency with no discretion to exercise after completing the EIS.

If the objective of the environmental analysis is to ascertain the impacts of 

the potential commercial mineral production on the parcel to be exchanged, 

then the analysis should be prepared before an exchange, not afterwards, 

and only if the agency retains the discretion to apply what it learns in the 

EIS to its decision about the exchange. It seems completion of the exchange 

prior to the EIS would negate the utility of the EIS. 15

Further, H.R. 687 does not allow for a supplemental EIS document if additional 

review is needed to examine the direct, indirect and cumulative impacts of mining 

activities by Resolution. Sec. 4(j)(2) makes clear that the Secretary may only use the 

single environmental review document prepared within 3 years of the submission of 

a MPO as the basis for all ‘‘decisions under applicable Federal laws, rules and regulations regarding any Federal actions or authorizations related to the proposed mine 

or plan of operations.’’ (Emphasis added). 

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16See Arizona Travel Impacts 1998–2009p, July 2010 Report, Arizona Office of Tourism, Phoenix, Arizona. 17Previously on Resolution Copper webpage, now missing file: http://

www.resolutioncopper.com/res/environment/ddnav.css 18 Id. 19See Resolution Copper webpage. 

Again, the bill conflicts with the purposes of NEPA and the bill fails to vest any 

real discretion in the Secretary to address the many concerns presented by the mining operation proposed for Oak Flat. It simply does not make sense for this bill to 

limit the Secretary’s discretion, undermine the NEPA process, and ignore the environmental and tribal concerns related to the mining project. 

Moreover, the potential for negative economic impacts to the local economy 

through a loss of recreation and tourism could be substantial. In 2009, detailed direct travel impact estimated for Pinal County totaled $421 million dollars, with over 

$16 million spent by those visiting the nearby campground areas.16 Many of these 

dollars were spent in and around the area of this proposed mine. 

If enacted, H.R. 687 will result in disastrous consequences, which Resolution 

seeks to downplay and conceal given that the bill requires no cost-benefit analysis 

of the potential environmental impacts. Resolution would be able to mine copper 

without environmental permitting, cultural protections or financial assurances necessary for responsible stewardship. As a limited liability corporation, the Company 

could simply walk away from potentially billions of dollars of environmental and infrastructure damages to this sacred area. 

Southeast Arizona’s Water Supply Cannot Sustain This Project

Resolution Copper has not been transparent with the public or its neighbors in 

the Oak Flat area. In 2009, Resolution explained that it was purchasing water and 

reclaiming contaminated waters in order ‘‘to build the needed water supplies for 

mining activities that are a full decade or more away.’’ Resolution claimed to be 

‘‘managing water by taking into account the needs of both current and future users 

of this precious resource.’’ 17 Resolution claimed that it had purchased and ‘‘banked’’ 

over 120,000 acre feet of Central Arizona Project (‘‘CAP’’) water from 2006 through 

2008 with Irrigation Districts near Phoenix, enough to operate the mine for 6 years 

at a projected use of 20,000 acre feet per year.18 Resolution further reported in 2008 

that it ‘‘installed several hydrology wells to assist in developing models that will determine if mining may affect the regional aquifers, and . . . what mitigation options 

are viable.’’ 19

H.R. 687 does not require Resolution Copper to perform or disclose its studies of 

the impacts on the regional water supply and hydrology. Repeated requests for an 

independent agency, such as the U.S. Geological Survey (‘‘USGS’’), to conduct studies have been ignored or opposed. Resolution Copper’s failure to disclose critical information about the impacts on the region’s water has united a diverse group that 

opposes H.R. 687. 

Our neighbors to the West in Queen Valley have already felt Resolution’s insatiable thirst for water. Since 2008, Resolution has been pumping groundwater to 

dewater parts of the decommissioned Magma Mine. Water levels in the Magma 

shaft have declined nearly 2,000 feet and water levels in the surrounding aquifer 

will inevitably decline as well. The Queen Valley Homeowners Association reported 

that since Resolution began pumping 900,000 gallons of water a day, the community’s water supply fell to a historic low requiring water rationing for the community golf course. The Association passed a resolution opposing the mine. 

According to USGS records, since 2008, the average streamflow in Queen Creek 

(downstream from the mine site) has been less than half the average streamflow 

for 2001–2007 before Resolution began dewatering at Magma Mine. Resolution’s 

dewatering efforts removes far less water than the mine sought, though H.R. 687 

will require (approximately 920 acre feet per year compared to the mine’s eventual 

need for 20,000 acre feet per year). The simple act of dewatering will have negative 

effects on regional water supplies. If Resolution depends on even more groundwater 

for its mining operations, the negative impacts will grow.

In 2009, Senator Bingaman questioned the Forest Service about the impacts of 

the mine on the local water supplies and quality. Deputy Chief Holtrop responded:

At this time the U.S. Forest Service does not have an understanding of the 

impacts of the proposed mine will have on local or regional water supplies, 

water quality, or possible dewatering of the area. No studies or assessments 

of the water supplies have been conducted. That is information which could 

be obtained by the Forest Service with NEPA analysis before the exchange. 

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20See S. Hrg. 111–65, p. 42 (June 17, 2009) (Hearing before the Subcommittee on Public 

Lands and Forests of the Committee on Energy and Natural Resources, United States Senate, 

S. 409 111th Cong.) (emphasis original). 21Letter from LEA Principal Geologist, James T. Wells, PhD, PG, to San Carlos Apache Tribe, 

Chairman Terry Rambler (March 18, 2013) (Attached to this testimony) (hereinafter ‘‘LEA Analysis’’).

A NEPA analysis after the exchange would not allow the Forest Service to 

recommend alternatives since the exchanged parcel would already be in private ownership. Data and analyses in the possession of Resolution Copper 

Mining would be of assistance to the Forest Service in evaluating the impacts of the proposed mine on local and regional water supplies and quality.20

In order to better inform the public of the potential impacts, L. Everett & Associates (LEA), an internationally recognized environmental consulting firm made up of 

hydrogeologists, engineers, and geologists, conducted a review recently of potential 

environmental impacts to the region that would be caused by H.R. 687. The following excerpts from the review clearly rebuff Resolution Copper’s water claims:

‘‘[I]t is highly speculative that CAP water will be a reliable source for Resolution over the decades-long lifetime of the mine. In fact, Resolution correctly admitted that ‘excess CAP water will not always be available for purchase and other sources will be needed.’ It seems apparent that Resolution 

will need to rely on local groundwater resources to provide a significant percentage of Resolution’s water supply if it is to be a viable project.

‘‘It is virtually impossible for Resolution to meet even a fraction of its water 

needs from local groundwater in a sustainable manner: the amount of 

water needed is just too vast for the natural processes that recharge the 

aquifer in this arid region of Arizona to replenish the needed withdrawals.

‘‘Because groundwater and surface water systems are intimately interrelated, pumping too much groundwater will have a negative impact on 

nearby surface water resources because lowering the water table can starve 

the local streams of recharge from the aquifer. This is a serious issue that 

is very difficult if not impossible to mitigate. For example, the nearby 

Carlota Mine uses much less water than the proposed Resolution Mine (approximately 1,000 acre feet per year). In a 25-day pump test at the Carlota 

Mine, stream flow in Haunted Canyon (2,300 feet from the nearest well) declined from 45 gallons per minute to 5 gallons per minute, thus threatening 

the sensitive riparian habitat.’’ 21

Following its assessment of the dewatering process that will be required to operate Resolution’s mine, LEA added, ‘‘Given the depth of the ore body and the need 

to dewater the mine workings that are deep below the water table, Resolution will 

have to aggressively pump groundwater from the aquifer. The effect of this pumping 

will be felt far beyond the boundaries of the mine.’’

Throughout the mining process, water will migrate to the vacant ore body and 

mining tunnels. For example, Resolution estimates that inflows to the existing 

workings at Magma Mine are 300 million gallons per year. If mining production on 

this new project is authorized, the mine dewatering will deplete many billions of 

gallons of water from surface waters and groundwater throughout the region, resulting in the loss of important seeps, springs, and streams and depleting the perennial 

pools in Gaan (Devil’s) Canyon and streamflows in Queen Creek and other surface 

waters. 

The alteration of subsurface and surface geological structures because of block 

caving and the admitted collapse of the land surface will alter the natural state of 

the aquifers and surface drainage of the watersheds forever. Resolution has refused 

to publish the potential impacts on the water supplies of the region despite the fact 

that this legislation has been introduced in the Congress over the past 8 years. Instead, Resolution has simply claimed that it is urgent for Congress to pass this land 

exchange. 

Additional Damage to the Southeast Arizona Environment

While water is a paramount concern for the opponents of H.R. 687, it is not the 

only concern. Resolution Copper has failed to provide data pertaining to its mining 

and post-mining subsidence analysis, water quality contamination analysis (including acid mine drainage and subsequent pollution), air quality compliance, tailings 

and overburden storage and placement. 

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22See S.110–52 (Nov. 1, 2007), pp. 4, 5, 8 (Legislative Hearing before the Subcommittee on 

National Parks, Forests and Public Lands of the Committee on Natural Resources U.S. House 

Of Representatives, 112th Congress).

On March 15, 2013, the local Town of Superior adopted a resolution opposing 

H.R. 687. The nearby City of Globe has tabled a proposed resolution to support the 

bill until its questions about the bill have been satisfactorily answered about the 

impacts of this mine. This bill touts jobs for the local economy. But local community 

leaders rightfully ask: ‘‘What good are jobs if our communities are environmental 

disaster areas lacking water to support our citizens?’’

It is common knowledge that acid mine drainage leaking into groundwater and 

surface water is a widespread consequence of copper mining. Acid-generating mines 

pollute surface water and groundwater requiring expensive reclamation and longterm water treatment. The water Resolution is pumping from the Magma Mine 

shaft is contaminated with heavy metals. That water is being treated at Resolution’s 

water treatment facility. In order for that treated water to be reclaimed and re-used, 

it has to be diluted with clean CAP before being transported for use on crops to the 

Irrigation Districts. 

Instead, Resolution and its foreign corporate parents avoid the true costs of environmental compliance through this land exchange. Once these public lands are conveyed, under the permissive mining and reclamation laws of the State of Arizona, 

Resolution will probably not be required to post a cash bond to underwrite either 

the cost of remediation during its mining operations or for clean-up upon mine closure. Typically, only self-bonding or corporate guarantees are all that is required. 

This is woefully insufficient to protect the public from bearing the potentially 

astronomic costs of clean-up resulting from a limited liability company’s massive 

mining operations. As stated earlier, Resolution can simply walk away from damage 

to the Oak Flat area. As a result, American taxpayers would be left without any 

revenue and will be on the hook for the future cost of any environmental remediation. 

There are too many environmental questions that Resolution Copper has failed to 

answer. This land exchange allows Resolution to avoid responding to these questions that Federal law otherwise requires every other company in America to answer. The Subcommittee should ask why Resolution deserves special treatment? 

H.R. 687 is a Massive Giveaway of Taxpayer Resources to Foreign, Special 

Interests

At a time when all Americans are being asked to tighten our belts, H.R. 687 will 

result in a giveaway of American wealth to a foreign-owned mining company. The 

appraisal requirements of H.R. 687 are unique to this land transfer and do not adequately ensure that the public will receive fair value. Since the bill does not afford 

the Federal agencies the opportunity to perform a substantive economic evaluation 

of the lands along with the copper and other minerals to be exchanged to Resolution, it is impossible for the Congressional Budget Office and/or Office of Management and Budget to effectively evaluate H.R. 687. The public interest requires that 

a complete and fully informed appraisal and equalization of values be performed 

prior to Congressional passage of H.R. 687, not after. Resolution Copper has variously estimated the mineral wealth in the lands ranging from $100 to $200 billion. 

Resolution’s self evaluation of the ore body underlying Oak Flat is orders of magnitude greater in value than that of the non-Federal parcels offered in exchange to 

the public. 

A significant amount of information is required for a meaningful and accurate appraisal. Under the Uniform Appraisal Standards for Federal Land Acquisition 

(UASFLA) requirements, a detailed mining plan is necessary to properly assess the 

value of the exchanged land. UASFLA requires that production level estimates 

should be supported by documentation regarding production levels achieved in similar operations. However, it is unknown at this time what Resolution Copper’s production estimates are since mining plan data has not been forthcoming. 

UASFLA royalty income approach also requires several economic predictions including a cash-flow projection of incomes and expenses over the life-span of the 

project and a determination of the Net Present Value (NPV), including the NPV of 

the profit stream, based on a discount factor. 

Deputy Chief Holtrop and BLM Deputy Director Luke Johnson informed the Subcommittee on National Parks, Forests and Public Lands on an earlier version of this 

bill that the completion of the exchange within 1 year (as required by H.R. 687 Section 4(i)) was insufficient time to complete the required appraisals.22 Specifically, 

Mr. Johnson stated: 

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Based on our experience with exchanges, we do not believe that this is sufficient time for the completion and review of a mineral report, completion 

and review of the appraisals, and final verification and preparation of title 

documents. Preparation of a mineral report is a crucial first step toward an 

appraisal of the Federal parcel because the report provides the foundation 

for an appraisal where the land is underlain by a mineral deposit. Accordingly, adequate information for the mineral report is essential.

Given the evaluation standards prescribed by the UASFLA, coupled with the lack 

of factual data from Resolution, the American taxpayer will once again be shortchanged. 

Resolution Copper’s Corporate Parents Partner With Iran and China

Resolution is not deserving of the special treatment given it under H.R. 687. The 

Company is a subsidiary of Rio Tinto (55 percent majority owner) (UK headquarter/

Australian offices) and BHP Billiton (45 percent shareholder) (Australia headquarter/UK offices). Rio Tinto is a partner with Iran in the Ro ̈ssing uranium mine 

in Namibia. 

Rio Tinto currently owns a majority stake in the Ro ̈ssing mine; while, the Iran 

Foreign Investment Company (IFIC) owns a 15 percent stake in the same mine. The 

IFIC is wholly owned by the Iranian government. United Against Nuclear Iran 

(UANI) raised concerns about Rio Tinto partnership and called on Rio Tinto and 

Ro ̈ssing to sever ties with the Iranian government. In a letter to the Chairman of 

Rio Tinto, UANI President, Ambassador Mark D. Wallace, wrote:

Thank you for the letter of November 8, 2010 from the Rio Tinto Group. 

While your letter attempts to address some of the concerns . . . the largest 

issue—the current Iranian government’s 15 percent stake—remains outstanding and is of serious concern to UANI and many within the international community . . .. You dismiss the concerns raised by UANI because 

the government of Iran initially acquired its share in the Ro ̈ssing mine in 

1975 . . .. This fact is not relevant in 2011 when the government that has 

been profiting from the mine for over three decades is one that is pursuing 

an illegal nuclear weapons program, [and] sponsoring terrorism in the region . . ..’’

Letter from Former U.S. Ambassador and UANI CEO Mark Wallace to Rio Tinto 

Group Chairman Jan du Plessis (Jan. 13, 2011).

In addition, there are no guarantees that the copper mined pursuant to H.R. 687 

will even be processed or used in the U.S. Chinalco, owned by the Chinese government, holds a 9 percent stake in the Rio Tinto Group. Nothing in the bill requires 

Resolution Copper, Rio Tinto’s subsidiary, to process or sell the copper to U.S. companies or even use U.S. resources to mine the copper. 

Based upon the history of parent company Rio Tinto’s business relations with Iran 

and China and in light of the U.S. and international sanctions against Iran, it is 

not in America’s interests to trade valuable Federal land to this foreign-owned mining company. 

Speculative Economic Benefits

Without substantiation, Resolution has touted local job creation as the primary 

justification for this land exchange. Resolution’s jobs claims have varied widely over 

the years that this project has been proposed. Because Resolution is not required 

to publicly disclose a MPO before the land transfer, Resolution’s jobs claims are 

speculative at best. Resolution takes pride in the fact that they are building the 

mine of the future. Resolution’s Vice President stated, ‘‘Our grandfathers wouldn’t 

recognize the mines of today.’’ The proposed mine, under H.R. 687, will be highly 

automated and the likely actual jobs produced will come in far below the speculative 

figures promised. In addition, Resolution has opposed all efforts to amend the bill 

to require that: (1) the project headquarters to be located in Southeast Arizona; (2) 

local Arizonans be considered first for any job opportunities that may result from 

the project; and (3) the ore is processed and used in the United States—and not in 

China or another foreign nation. Further, Resolution has admitted that it will take 

at least 10 years to develop technology to access the ore body given that it is 1-mile 

beneath the surface of the earth where it is a temperature of 175 degrees. 

Conclusion

In 1871, the U.S. established our Reservation. Since then, the United States diminished our Reservation several times due to the discovery of silver, copper, coal, 

water and other minerals and natural resources. Our burial sites, living areas, and 

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farmlands on our Reservation were flooded for a Federal dam for the benefit of others. Based upon this history and for the reasons stated above, the Tribe strongly 

opposes H.R. 687 or any other conveyance of our tribal ancestral lands in the Oak 

Flat area to Resolution Copper for mining that would permanently destroy this sacred site. Once done, this action cannot be undone.

[Note.—The material attached to Mr. Rambler’s Prepared Statement and the letter 

referred to in footnote 21 have been retained in the Committee’s official files.] 

QUESTIONS SUBMITTED FOR THE RECORD TO TERRY RAMBLER

QUESTIONS SUBMITTED FOR THE RECORD BY THE HONORABLE GRACE F. NAPOLITANO

Question. Where are tribal sacred sites located? 

Answer. Apache culture, heritage and religion do not focus upon a specific site or 

place as sacred, in the traditional convention of Anglo-European site location. Instead, an area or region is deemed by the Apache People to have cultural, sacred 

and religious significance. 

The Apache lands which are impacted by the land exchange with Resolution Copper Mining cover a wide area and include lands known in Apache as Chi’chil 

bigagoteel. Chi’chil bigagoteel encompasses the Oak Flat campground. Nearby is 

Dibecho Nadil (Bighorn Sheep Are Put There), the geological feature known as 

Apache Leap. Chi’chil bigagoteel is bounded by Gan Bikoh (Crowndancers Canyon), 

also known as Devil’s Canyon. To the north it is bounded by Ga’an Daszin (Mountain Spirits Standing), also called Queen Creek Canyon. 

This area is documented as the ancestral home of the Pinal and Aravaipa Apache 

Bands of the Western Apache, San Carlos Apache Group. It was also known to have 

significance to the Western Apache, Tonto Apache Group. 

Apache spiritual beings, Ga’an, live and exist within the sacred sites of Oak Flat, 

Ga’an Canyon (Devil’s Canyon) and Apache Leap. The Ga’an are spirit entities 

made for the Apache People by Yusn, Life Giver, and are responsible for teaching 

the Apache People the proper way of living. Chi’chil bigagoteel is recognized as 

home of the Ga’an.

Oak Flat has, for generations, played a crucial role in the exercise of the religious, 

traditional and cultural practices of the Western Apache. These practices continue 

to this day. Oak Flat and the surrounding area have long been used—and are used 

today—for religious ceremonies, sweat lodge ceremonies, and Sunrise Dances (puberty ceremonies). Chi’chil bigagoteel provides plants and other natural resources 

for spiritual, ceremonial and medicinal uses. It has been said by San Carlos Apache 

Tribal Cultural Officer, Vernelda Grant, that the uniqueness of the ecosystem of 

this area adds to significance and sacredness of the area to the Apache People. 

Losing access to these ecosystems, both by their closure [to Apache People] or 

their destruction profoundly weakens the strength to both Apache and Indigenous 

peoples’ prayer and ceremony, and severely limits the abilities of Apaches and Indigenous peoples to effectively practice their religion, ultimately resulting in physical 

and spiritual harm to Apaches and Indigenous peoples and neighboring communities. 

Question. Are sacred sites in jeopardy? 

Answer. There is no question that Apache sacred areas are in jeopardy as a consequence of the Southeast Arizona Land Exchange and Conservation Act of 2013.

The ore body which Resolution Copper Mining (RCM) seeks to exploit lies directly 

under Oak Flat, Chi’chil bigagoteel. As pointed out in my testimony on March 21, 

2013, the surface lands of Oak Flat will collapse as a result of the mining method, 

block caving, RCM will employ to extract the ore body. RCM’s own website admits 

to such subsidence. The exhibits which were presented with my testimony exemplify 

how the block cave mining method works and the land subsidence which inescapably follows. Virtually the entirety of Chi’chil bigagoteel will be destroyed by RCM’s 

mining operation. 

RCM’s mining operation will also require enormous quantities of water estimated 

at 20,000 acre feet per annum, or 600,000 acre feet over the life span of the mine. 

Groundwater pumping will inevitably be a large source for that water. Seeps, 

springs and streams well beyond the physical boundaries of Oak Flat will be affected by this pumping. Furthermore, in order to operate the mine at depths of 

4,500 to 7,000 feet below the surface of the earth, RCM will be required to pump 

groundwater to keep its mine from flooding further depleting water resources 

throughout the area. RCM’s groundwater pumping activities will destroy the medicines and plants that we gather, which will effectively suffocate the practice of our 

religion. 

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Certainly, the land subsidence and groundwater pumping will destroy Apache sacred areas. Without belaboring the point, other aspects of the mining operation, 

such as toxic water pollution associated with copper mining and tailings waste sites, 

will further contribute to the destruction of areas sacred to the Apache and other 

Indigenous people. 

Question. Does H.R. 687 provide adequate protections to avoid the land from collapsing? 

Answer. H.R. 687 provides no protections to avoid the land from collapsing. Indeed, the protections which are usually afforded the public under various Federal 

laws, such as National Environmental Policy Act (NEPA), to assess potential harms 

and suggest possible alternatives are circumvented by H.R. 687. Once the land is 

in the private ownership of Resolution Copper and its parent corporations Rio Tinto 

and BHP Billiton, NEPA and other protections will be lost. H.R. 687 virtually eliminates the Secretary of Agriculture’s discretionary authority to determine under the 

Federal Land Policy Management Act (FLPMA) or other laws the best interests of 

the public and the American taxpayer. Please see my written testimony at pages 

four to seven. 

Dr. GOSAR. Thank you, Chairman Rambler. 

Our next guest is Ms. Soyla Peralta, otherwise known as Kiki. 

STATEMENT OF SOYLA ‘‘KIKI’’ PERALTA, COUNCIL MEMBER, 

SUPERIOR TOWN COUNCIL 

Ms. PERALTA. Good morning, members of the Subcommittee. My 

name is Kiki Peralta, and I am councilwoman for the Town of Superior. The project mandated by H.R. 687 will have the most direct 

and greatest impact on our town. This project will be in our back 

yard. And we can’t let that happen, because this is our town. We 

were born and raised in Superior. I was married in Superior, and 

I raised my children in Superior. 

Unfortunately, we are here because we want our voices heard. 

Our county and Arizona Delegation is not listening. 

I support the mining industry. The Town of Superior supports 

the mining industry and recognizes the role that copper mining has 

played in Superior’s history and economy. My father, brother, husband were all miners. As a matter of fact, I was the first female 

hired by Magna-Copper Company in 1975 as a laborer. 

I have to let you know up front that in the past this Council has 

supported this project. However, for the following reasons, the 

Town of Superior now opposes the Southeast Arizona Land Exchange. Information has been difficult to come by. But with the little information that we have, we have learned the true impacts of 

this project. This has forced me and our Town Council to rethink 

our position. 

Our opposition to this project is based on three major points: 

number one, the lack of a NEPA study to show what impacts we 

will be facing; number two, the impact of our water and/or hydrology studies; and three, the impacts of block cave mining on our environment, and the lack of jobs that it will produce. 

First, on the NEPA and Mining Plan of Operation. We strongly 

oppose this land exchange moving forward without first performing 

the NEPA studies and informing our town about the negative impacts of this project. Section 4(h) of the bill provides that if this bill 

is passed, the lands will be treated as if they are in private ownership. As a result, no tribal consultation or no NEPA studies will 

be required. 

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A Mining Plan of Operation will also help inform our community. 

Where will the tailings and waste products be dumped? What impacts will they have on our town and surrounding communities? 

My question is, once again, why must this project move forward before informing our community what we can expect? This is like 

playing Russian Roulette with our community. 

Next, the water. It is often said that whiskey is for drinking and 

water is for fighting. Water in Southeast Arizona is more precious 

than gold, and it is surely worth more than copper. Where will this 

water come from? And what effects will such large water consumption have on the regional water balance? Again, where are the hydrology studies? Again, I ask, how can this project move forward 

before a question as vital to our lives as water is answered? 

Finally, we have serious concerns with the block cave method of 

mining. Block cave mining historically has not been used in Superior. We know mining, and this method is proven to be destructive 

and harmful to the environment. My other concern with block cave 

mining is the jobs. Resolution promises jobs for our community. 

But in reality, with the use of block cave mining, most of it will 

be mechanized and employ only a small workforce. 

I wish that Resolution Copper would answer these questions 

today, and I wish that the Arizona Delegation and Congress would 

demand these answers. But the bottom line is that today I am here 

to represent my community and to protect the long-term interest 

of my town. 

It was great to hear Pinal County Chairman Miller speak today. 

Unfortunately, this is the first time I have seen him. Neither him 

nor Congressman Gosar or Kirkpatrick have met with us on this 

issue. Yet again, our town will suffer the most direct impacts of 

this project. Our water, our environment, our air will all be 

harmed. Yet no one has come to me with our Council. Unfortunately, our county and congressional delegation are not listening. 

I wish that my Congresswoman, Ann Kirkpatrick, could have 

stayed to listen. 

With that said, I am here to fight for my community and I am 

glad that you are here to listen. I urge you to oppose this bill. The 

Town of Superior can’t afford this deal. I again want to thank you 

for this opportunity. 

[The prepared statement of Ms. Peralta follows:]

PREPARED STATEMENT OF SOYLA ‘‘KIKI’’ PERALTA, COUNCIL MEMBER, SUPERIOR

TOWN COUNCIL, ON H.R. 687

The Town Council of the Town of Superior, Arizona realizes that Superior, Arizona, was born as a mining community and has lived through the mining booms 

and busts of the Silver King Mine, the Queen Mine, the Belmont Mine, the Magma 

Mine and the Broken Hill Proprietary Mine over the history of our 100 plus years. 

Because we recognize that mining is a large part of our history and will potentially 

be a larger part of our future, we are not opposed to mining. In fact, we strongly 

support responsible mining policies, and practices in and around our community. 

However, we believe that H.R. 687 is unacceptable as it presents serious negative 

impacts to us and our surrounding community as it seeks to circumvent the important National Environmental Policy Act (NEPA) review and analysis process. This 

is public land, and the public must be heard openly and fairly under the NEPA 

process. A decision regarding these public lands should be made with the utmost 

knowledge and care. Once these lands are lost to the public, they can never be regained. 

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We appreciate and thank you for the opportunity to express our views and voice 

our concerns about H.R. 687, the Southeast Arizona Land Exchange and Conservation Act of 2013 that will profoundly affect our Town and Region. 

Oak Flat Land Exchange and Loss of Important Public Campground and 

Recreational Areas

Resolution Copper Mining, LLC, owned by Rio Tinto based in the United Kingdom, and BHP-Billiton based in Australia, is planning a massive block-cave mine 

and seeks to acquire Oak Flat Campground and the surrounding public lands for 

its use through this land exchange bill. If they succeed, the campground and an additional 2,406 acres of the Tonto National Forest will become private property and 

forever off limits to recreationists and other users. Privatizing this land would end 

public access to some of the most spectacular outdoor recreation and wildlife viewing 

areas in Arizona. It would deprive the Town of Superior, currently land-locked at 

only 4 square miles, from economic diversification in and around our community. 

It would also deprive the San Carlos Apache Tribe of their religious and cultural 

attachments to the area. 

Located just 5 miles east of Superior, Oak Flat and Devil’s Canyon are recognized 

as some of the most unique, scenic, popular and unspoiled areas in the State of Arizona; and they are an important part of our history and our economic diversification. It has long been prized for its recreational variety. This area is exquisite and 

easily accessible to millions of visitors from the Phoenix and Tucson metropolitan 

areas, as well as the outlying areas of Gold Canyon, Queen Valley, Florence, Kearny, Winkelman, Hayden, Globe, Miami, Top of the World and Superior. It is significant to our citizens, our neighbors, and the Apache people, for their cultural values 

and religious heritage. 

The Oak Flat Campground, Apache Leap, and the surrounding area are important 

to the Apaches who gather acorns and pine nuts that are used both traditionally 

and ceremonially. Apache Leap is an historical land known as the Apache’s Masada. 

It is there that many Apaches leaped to their deaths rather than be captured by 

the U.S. Army approximately 125 years ago. One of our local historians, Christine 

Marin, Ph.D., Archivist and Historian for Arizona State University and who is a 

former resident of Globe, Arizona, and still has family in Superior, Arizona, published an article in the Copper Country News dated June 11, 2008. In her article 

entitled, ‘‘Apache Leap Legend: Now We Have ‘The Rest of the Story’,’’ Dr. Marin 

indicated that the story of the Apache warriors is verified by two historical publications. We believe that these lands have significant import to the Apaches and that 

their wishes should be carefully considered and respected. It is because of this that 

our Resolution No. 451 (attached) includes this reference. 

You, our Federal legislators, are being asked to give up these publicly owned 

lands that have been in trust for the American and Native peoples since 1955, when 

President Eisenhower signed BLM Public Land Order 1229. This Order specifically 

put Oak Flat off-limits to all future mining activity. In 1971, President Nixon issued 

BLM Public Land Order 5132 to modify PLO 1229 and allow ‘‘all forms of appropriation under the public land laws applicable to national forest lands—except under the 

U.S. mining laws.’’ These two executive orders from two different Republican administrations both mandated that these lands were to be preserved in perpetuity 

with special emphasis on prohibiting mining activities on Oak Flat. There is no compelling reason for these Orders to be overturned. 

We are particularly concerned that this legislated land exchange of the Oak Flat 

Campground and surrounding area would bypass critical environmental impact 

studies. We fear that natural and cultural resources will not be protected. We know, 

without a doubt, that subsidence will occur and that it will adversely affect our community. We don’t have any information regarding RCC’s proposed disposition of the 

massive amounts of tailings that will be produced and where they will reside. We 

are terrified that downstream pollution will affect the Town of Superior and everyone who depends upon the nearby aquifers for drinking water. Our local water supplier recently imposed an additional ‘‘arsenic surcharge.’’ While The Magma Mine 

was operational, local residents were told that there was no pollution or effects on 

the water supply. Now, 20 plus years later, we find that there was—and continues 

to be—a price to pay for giving a foreign-owned mining company carte blanche because we trusted the mine explicitly. We are also worried that a mine would dry 

up not only the Town of Superior’s water supply, but a portion of the water supply 

for the Phoenix metropolitan area. We also have good reason to believe that mining 

at Oak Flat will destroy the riparian habitat not only at Oak Flat, but the nearby 

Devil’s Canyon which is one of Arizona’s great undiscovered riparian treasures. It 

is for these reasons and many more that we oppose the enactment of the Southeast 

Arizona Land Exchange and Conservation Act prior to proper NEPA reviews. 

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Water, the Environment, and Destruction of Land Surface

The Town believes it is critical that Hydrology Surveys, Environmental Impact 

Studies, Subsidence Analyses and Transportation and Circulation Plans be conducted PRIOR to discussion of any land exchange and/or different use. 

Resolution Copper Company’s Environmental Impact Assessment Manager, Bruce 

Marsh, has indicated that the new mine would utilize 40,000 acre feet of water per 

year. He further indicated that they would be buying excess water from the tribes 

and other sources, however, they are merely banking those water rights and the 

sources are not secured. This is a concern because: (1) Arizona is still in the grip 

of a decades long drought with dwindling Central Arizona Project supplies, and we 

do not have any assurances that water will still be available when Resolution Copper Company begins mining in the next 10 years; (2) Superior is located in the Maricopa AMA rather than the Pinal AMA, and Phoenix metropolitan area water supplies depend upon the Queen Creek aquifers; (3) The close proximity of the Queen 

Creek aquifer to such a massive mining operation will negatively disrupt the underground water flow and negatively impact hundreds of thousands of residents; and 

(4) Neither the State of Arizona nor the local residents should have to bear the burden of restoring clean and sustainable water utilized by mining. 

RCC has already begun to dewater shafts to prepare for additional exploration of 

the ore deposit. We fear that in removing the more than 2 billion gallons of water 

that have accumulated in the mine since it was last shut down in 1996 will upset 

the water balance of the Oak Flat, Apache Leap, and Devil’s Canyon riparian areas. 

In 1946, Queen Creek was called a perennial flowing stream. Our Town elders tell 

us that when the Magma Mine was in full production during the 60s and 70s, riparian areas at Oak Flat and in the Town of Superior dried up. An independent analysis of the impact of a potential mine at Oak Flat to the water balance of the entire 

region should be conducted before this bill should even be considered by Congress. 

The Town is alarmed about the issue of subsidence from Resolution Copper Company’s proposed block-cave mining method and its effect on Oak Flat Campground, 

Apache Leap escarpment, US Highway 60, and the Town of Superior. Resolution 

Copper Company has admitted to only ‘‘minimal subsidence.’’ However, they admittedly chose this method of mining as it is the least expensive and quickest method 

to approach this massive ore body. However, experts have demonstrated that there 

will be irreparable destruction of unknown extent to the surface utilizing the blockcave method of mining. This is absolutely unacceptable. Does block cave mining 

eventually lead to open pit? 

Resolution Copper Company has not yet determined the manner in which the 

tailings will be accumulated. Since there will be a considerable volume of tailings 

that will be created by this method of mining, The Town is concerned about the contamination associated with this activity. We are also concerned regarding reclamation of these tailings upon mine closure. 

H.R. 687 mentions the National Environmental Policy Act (NEPA) but the bill 

does not provide for even the most basic study and analysis of these issues and concerns prior to obtaining the land exchange. Furthermore, if the land exchange is 

granted, the ‘‘NEPA’’ language in the bill is so vague that the company could easily 

avoid doing any ‘‘NEPA’’ analysis. Even if a ‘‘NEPA’’ study were to be conducted 

after the land exchange went into effect, the results would be meaningless as the 

outcome of the study would already be mandated by law. 

The Town believes that Resolution Copper Company should not be exempt from 

the required national permitting studies and analyses that have been required of 

the other mines in the area by virtue of a land exchange. No other mining corporation in this area has been allowed to bypass the Federal permitting 

and NEPA process.

If the start-up timeframe proposed by Resolution Copper Company is correct, then 

there is plenty of time to conduct the full public review process. Additionally, if Resolution Copper Company is as ‘‘transparent’’ as they profess, they should welcome 

this endeavor to put all the ‘‘cards on the table’’ and hear everyone’s input. 

We also believe that details of the project and potential impacts (Mining Plan of 

Operation) should be made available to our residents and to the general public up 

front. We continually hear that Resolution Copper Company will make this plan 

available later—after the land exchange. We feel that if the land exchange is of utmost importance, Resolution Copper Company should accelerate production of their 

plan NOW—before the land exchange. 

Threat to the Town of Superior’s Economic Diversification and Sustainability

Many citizens of the Town have lived through the boom and bust cycle of mining. 

After closure of the Magma/BHP mine in the 1990s, many people fled the commuVerDate 0ct 09 2002 15:05 Mar 18, 2014 Jkt 000000 PO 00000 Frm 00109 Fmt 6633 Sfmt 6621 X:\01ENER~1\01MA21\3-21-1~1\80077.TXT MARK
106

nity in search of jobs, medical treatment facilities and amenities that were not 

available in Superior. Voters taxed the political body to create a more diversified 

and sustainable economic base for its residents. The Town received grants to develop an Industrial Park, a low-income housing subdivision, a new swimming pool, 

second fire station, airport, rest stop and numerous parks and trails. These projects 

were initiated to create jobs for our local residents, to increase State-shared revenue 

and local taxes and to encourage eco-tourism. 

The Town believes that in order to sustain growth and development, we cannot 

rely on any one industry to support us. Mining has an allure and historical ties in 

our community. However, just as in the past, mining has a short life. We cannot 

base our future on one single industry or employer. Additionally, the process of mining in the 21st century is very technologically advanced and requires specialized 

training. Resolution Copper Company has not indicated that they will hire untrained, local labor. In fact, today’s activity on the project reflects an influx of mining technicians from outside the community. We routinely see vehicles with license 

plates from Utah, Colorado and Mexico. We are seeing more and more articles regarding the development of robotic workers for future mining activities. These 

robotic systems are being tested today in South American and Australian mining 

operations. It would be no surprise if many of the technical jobs that are available 

will be held by highly trained individuals sitting at a computer in another state—

or even another country—controlling our robotic work-force remotely. The loss of 

this natural resource and already protected public lands compromises the potential 

for our community to foster and promote a more diversified economy based upon 

tourism and outdoor activity. At a minimum, the Boyce Thompson State Park to the 

west and the Oak Flat Campground to the east create a natural flow of traffic to 

and through the Town. Tourists, Boy Scout troops and other individuals and groups 

routinely pass through to camp overnight at the Oak Flat Campground. They stop 

for gas, sundries and refreshments at local establishments in far greater numbers 

than local workers. Superior is a natural ‘‘pit stop’’ for eco-tourism and this is the 

type of activity that sustains our economy. 

While Resolution Copper Company has promised great hope for another ‘‘boom,’’ 

they do not willingly embrace annexation into our town limits, they have purposely 

depreciated their land values in anticipation of the land exchange and they have 

strong-armed our local government into accepting less than adequate compensation 

for future use of the Town’s services and support. 

Summary

Resolution Copper Company has divided this community by demanding that the 

Town Council speak for the residents of Superior in unwavering and unqualified 

support of a land exchange that is not necessary in order for Resolution Copper 

Company to mine. Behind the scenes, their representatives have attempted to force 

the firing of individuals opposing the Land Exchange. Those individuals who question Resolution Copper Company in any fashion are deemed to be ‘‘anti-mine.’’ Businesses deemed ‘‘anti-mine’’ are not supported by Resolution Copper Company, their 

employees or agents—in fact RCC employees are urged to boycott! These strong-arm 

tactics should not be allowed to pervade a community already distraught from previous ‘‘boom and bust’’ mining cycles. 

H.R. 687 does not represent a land exchange that is in the broader public interest. 

It is clear to the Town that Presidents Eisenhower and Nixon believed that they 

were protecting Oak Flat from big business interests in acquiring public lands for 

development, mining and transportation. Oak Flat has been important enough to 

protect from mining and other elements for over 50 years, and it should not be so 

easily conveyed to a foreign-owned mining interest. This land exchange would set 

a terrible precedent. 

The Town urges this Committee to ensure that the concerns of all public interests are addressed prior to consideration of any Federal land exchange. We believe you should protect these public lands for the public’s future use and preserve 

the unique opportunities for Arizonans—and especially Superiorites—that the Oak 

Flat area provides. 

For these and many other reasons, we oppose H.R. 687, the Southeast Arizona 

Land Exchange and Conservation Act of 2013 and feel that it should be rejected, 

until such time as our concerns are at least addressed through proper NEPA studies. 

Thank you for your time and consideration. 

Dr. GOSAR. Thank you very, very much. There are two things 

now—if we can have the screens cleared, please? Thank you. 

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The Chairman would like, by unanimous consent, to have two 

things, the ‘‘Pentagon Warns of Mineral Shortfalls,’’ and a Congressional Research memorandum to be included in the record. So ordered? 

[No response.] 

Dr. GOSAR. No objections, so ordered. 

[The information submitted for the record by Dr. Gosar has been 

retained in the Committee’s official files:] 

Dr. GOSAR. I would like to acknowledge myself for the first aspects of questioning. 

Ms. Peralta, thank you for coming here today. I noticed in your 

testimony that you made the following statement, ‘‘This is public 

land, and the public must be heard openly and fairly under the 

NEPA process.’’ You are aware that when Resolution files its Mining Plan of Operations, that it will go through the environmental 

review process, and that the public will have opportunity to provide 

comments, as guaranteed in the law. Are you familiar with that? 

Ms. PERALTA. Yes, I am. 

Dr. GOSAR. Thank you. Sections 4(i) and 4(j) address explicitly 

and implicitly compliance with the Federal environmental laws and 

regulations pertaining to conveyances of Federal land and approval 

of Mining Plan of Operations. My bill is clear that the mine can 

only move forward following preparation of a full environmental 

impact study that is in accordance with NEPA and all other applicable Federal laws and regulations. That includes national historic 

preservation acts, endangered species acts, Executive orders pertaining to wetlands and floodlands, and hazardous material surveys. 

Additional environmental compliance requirements will also have 

to be addressed at the State and local levels in order for this mine 

to be developed. As you know, and should know, many of Arizona’s 

environmental compliance laws are even stronger than those of the 

Federal laws. This legislation promotes economic development in 

an environmentally responsible way. 

Now, I agree that the public should be heard, and that is why 

we invited you here today. Why do you feel it is so important for 

the public to be heard in the NEPA process, while you and your 

colleagues silenced the voices of almost 200 citizens last week at 

your Council meeting when you adopted your resolution to oppose 

this bill? You stated that you had made up your mind, no executive 

session was necessary, no public input would be taken, and that if 

anyone acted up, they would be escorted out by the police. Is that 

fair, Ms. Peralta? 

Ms. PERALTA. Once again——

Dr. GOSAR. Is it fair, ma’am? 

Ms. PERALTA. Yes, it is. According to the open meeting law, I had 

those rights. I was the Chair of the meeting. 

Dr. GOSAR. Thank you very much. For the record, even my chief 

of staff went to the meeting at my request, tried to meet with 

members of the Council prior to the meeting, and was not given the 

opportunity to address the Council. In fact, everyone in the town 

that attended your 4-minute meeting—4 minutes, 4-minute meeting—was threatened with police removal if they spoke. It doesn’t 

really sound like you or your town manager want to engage at all. 

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I have been humbled by the outpouring of support of your community that was given to Congressman Kirkpatrick and myself in 

our efforts to take action. I have been submitted, in regards to the 

record, over 400 letters and petition signatures opposing the town’s 

actions and supporting our bill collected over the span of just 3 

days. The Town of Superior has little over 2,500 residents. This is 

pretty incredible. 

Ms. Peralta, is it true that petitions have been taken out to recall 

you from your seat on the Council? 

Ms. PERALTA. Yes, it is. 

Dr. GOSAR. Yes, it is. They were actually filed this morning. 

Ms. PERALTA. But—yes, they were. 

Dr. GOSAR. Yes, thank you. 

Ms. PERALTA. And I think they have been taken out before——

Dr. GOSAR. The Town of Superior held local elections just a week 

ago, after the current Council broke its Mutual Benefits Agreement 

off with Resolution Copper. The two top vote-getters in the pickthree election were the only two candidates in the race to express 

vocal opposition to the current Council’s actions. Two of the current 

Council members who were part of this action were the bottom two 

vote-getters. 

I would like to submit for the record the results of the March 

12th election and the statements of the opposition to the current 

Council’s actions. 

I would also like to submit the local media accounts of the report: 

the Superior Sun: ‘‘Business Owners, Townspeople React to Superior’s Council Decision;’’ ‘‘Thank You, Town Council, for Losing Superior’s Jobs with Resolution Copper,’’ right here on the front page. 

‘‘The Copper New Superior Council Meeting Stirs Anger.’’

Ms. Peralta, it appears the only person dividing your Council is 

you and the three Council members that have spearheaded this effort. I encourage you to read these letters, these petitions, and hear 

from your citizens and what they are telling you. I am hardpressed to believe that you would be here today with your position 

if you had listened to your community. 

Ms. Peralta, what is the current financial situation and status of 

the town? 

Ms. PERALTA. We are broke. 

Dr. GOSAR. Yes. My understanding is the community is in dire 

financial conditions. Four months ago you could not even meet payroll or pay for garbage collection. Is it true that Resolution advanced monies due in 2013 under your Mutual Benefits Agreement 

to cover these bills? 

Ms. PERALTA. Yes, it is. 

Dr. GOSAR. Hardly sounds like a bad partner. Supervisor Miller, 

why do you think the Town Council has taken such a radical reversal in position? 

Mr. MILLER. Congressman Gosar, I don’t know what the total 

motivation was. I thought it was interesting that, at my board of 

supervisors meeting, we had 12 residents from Superior in support 

of the resolution that we passed, and 2 against it, one of which was 

the new town manager, who stood up and advised us that they 

were broke, that they couldn’t even put two police cars back into 

duty. I thought that was awfully telling as to their status. 

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Dr. GOSAR. Supervisor Miller, just one last question. In my tenure in representing District 1, have you seen my presence in and 

around Superior in regards to being accessible and answering questions? Because the witness prior said that I was not accessible and 

never had been consulted about this mine. 

Mr. MILLER. Congressman Gosar, you have been one of the most 

accessible legislators I have ever seen. And if there was an issue 

and we called you, you made yourself available at any time. 

Dr. GOSAR. For the record, without objection, I would like to 

highlight those things that I highlighted. And one last exception is 

a letter in regards to Chairman Rambler dated April 15, 2011 in 

regards to my office in regards to the issues with tribal consultation and tribal issue in regards to this mine that was prepared by 

my staff and experts in Native American law that I would like submitted for the record. 

[No response.] 

Dr. GOSAR. No objection, so done. 

[The information submitted for the record by Dr. Gosar has been 

retained in the Committee’s official files:] 

Dr. GOSAR. I would like to now turn it over to the Ranking Member, Rau ́l Grijalva. 

Mr. GRIJALVA. Thank you very much, Mr. Chairman. Ms. 

Peralta, welcome and thank you for taking the time. Can you tell 

us about the City Council? There is a number of your colleagues 

that can’t vote on this issue. Is that correct? 

Ms. PERALTA. That is correct. We——

Mr. GRIJALVA. How many? 

Ms. PERALTA. We have our Mayor and our Vice Mayor, John 

Tameron, who are in conflict. 

Mr. GRIJALVA. Conflict because of what? 

Ms. PERALTA. Our Vice Mayor’s son is employed by Resolution. 

Mr. GRIJALVA. It is because of employment? 

Ms. PERALTA. And then our Mayor’s daughter is married to him, 

so that puts him in conflict, also. And our Councilman John 

Tameron has a contract with Resolution for cleaning services he 

provides. 

Mr. GRIJALVA. It is my understanding that one of the councilmen, I don’t know how recently, left the Council after some adjudication? 

Ms. PERALTA. Yes, which is why we had to—which is why the 

mutual benefits agreement is null and void. Councilman Hank 

Gutierrez was indicted for conflict of interest. 

Mr. GRIJALVA. And he works where? 

Ms. PERALTA. He has a contract with Resolution. 

Mr. GRIJALVA. Thank you, Ms. Peralta. I also wanted to ask you. 

There was a, you know, we get into the discussion, and I appreciate 

the Supervisor’s point that Resolution has not only raised the reading scores in the area but is prepared to spend $16 billion of revenue. At some point we will follow up with the Supervisor and get 

some information and some facts. It is nice to put a little facts, figures around, but you know, at some point you have to substantiate 

them. And we will be following up with questions. 

Chairman Rambler, and thank you very much for being here, as 

well. Oak Flats’ significance; you hear that we are going to leave 

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the surface alone, so what is the problem? Proponents of the legislation say, ‘‘We are going to leave the surface alone, so what is the 

problem?’’ And would you please tell them what the problem is 

going to be down the road, not only in terms of a sacred site, but 

in terms of the excavation that could potentially occur underneath? 

Mr. RAMBLER. Yes, thank you. I know in reading some parts of 

the bill itself, the proposed bill, it talks about surface, but it doesn’t 

talk about subsurface. So, on the surface, for example, Oak Flat 

and Apache Leap itself, even though in this particular case the bill 

itself may say Apache Leap will not be disturbed and a fence may 

be put around it to not disturb it further, but there is nothing there 

that prevents it from being disturbed underneath. 

So, when we look at it, we look at it in total, the sacredness of 

the whole area in total. And so, when underground it is going to 

be disturbed, when there is going to be a big hole left under there, 

and we don’t know what the potential impact is to the water resources, but we know from history that when there is a big hole 

and it rains and it snows and water comes running down, where 

is that water going to go, it is going to go to that big hole, and so 

we don’t know what the impacts are, and that is how we believe 

that what is going to happen under ground is going to affect whatever is going to be on the surface. 

Mr. GRIJALVA. Thank you. And there has been discussion saying 

that this bill does not weaken the NEPA process, and so people are 

convinced that the State of Arizona permitting process for mines 

and private lands is the same as NEPA. Even if we side-step NEPA 

on this one, that is absolutely not true. The State is far weaker. 

The public comment period is short. There is no quick turnaround 

in the submission of critical documents. There is no pre-scoping, 

and the process does not require bonding to guarantee a clean-up 

and reclamation after the fact. And that is just the environmental 

side of it. On the consultation, that is a whole other story that 

doesn’t exist. 

And so, there is no substitute for, one, skipping over NEPA and 

doing it after the fact where there is no enforceability, and saying, 

well, the State can take care of it. The State can’t take care of it. 

The State won’t take care of it. This NEPA process guarantees not 

only the people of Superior and the surrounding community, but 

the viability and the intended or unintended consequences of this 

mine everybody is going to know up front. 

And I, for the life of me, you know, many of the critics of this 

process could have, would have been shut up a long time ago, 5 

years ago. But for some reason there is a drive to get it done without NEPA, do it after the fact. If there would have been agreement, 

‘‘Let’s do NEPA now,’’ we would be waiting and resolving and debating what the remediation would have had to be. The consultation government-to-government, we would have dealt with those 

consequences, and maybe they wouldn’t have been good. 

One suspects, and it is only a suspicion, that a full-blown NEPA 

process with public comment is going to disclose and make transparent some consequences that not only the Tribes and the Council 

lady from Superior are going to be opposed to, they are going to 

have some consequences that the whole region will be very, very 

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concerned, particularly around water and sacred sites. Thank you 

very much, Mr. Chairman. 

Dr. GOSAR. Thank you. I would like to acknowledge the gentlewoman from Wyoming, Ms. Lummis. 

Mrs. LUMMIS. Thank you, Mr. Chairman. And I would like to slip 

back in to the much more mundane topic of soda ash in Trona. 

[Laughter.] 

Mrs. LUMMIS. Mr. Hohn, give everybody just a little break, could 

you explain a little bit about China and its trade practices that are 

distorting the markets for soda ash, globally? 

Mr. HOHN. Absolutely. You know, the facts are China’s capacity 

to produce synthetic soda ash is growing. Another fact is that China’s exports of soda ash are growing. Another known fact is that 

China has incentives such as the VAT that enables China to sell 

soda ash below their cash costs. These are all facts that we are 

dealing with within the global soda ash markets. 

Mrs. LUMMIS. I have another quick question, and it relates to the 

checkerboard. I think a lot of people don’t understand that the 

Union Pacific Railroad, when it was given its right-of-way across 

the Untied States, was given every other section, and that this 

area where the Trona resource lies is within that checkerboard. 

So, the surface, and, therefore, the subsurface mineral interests 

under it—lie 640 acres of private land, and next to that, 640 acres 

of public land, and that the mining technology is such that when 

you are mining a long wall, those things are enormously expensive 

to move. Almost indescribably expensive to move, a long wall, once 

you set it up and start along its mining course of action. 

Is it possible to just lift those up, or lift your mining up and go 

where the royalty is the lowest? 

Mr. HOHN. It is very, very, very difficult. It requires years of advanced mine planning as we look at how we mine the checkerboard, as you just described. I can assure you with confidence that, 

prior to my current role as General Manager of the Soda Ash Business for OCI Chemical Corporation I was the Site Manger out in 

our facility out in Green River, Wyoming. And while we employ a 

bit of a different mining technique, it is a continuous miner operation with room and pillar advancement—it is impossible to pick 

up and just change a mine plan very, very rapidly. And while I 

don’t have the long wall mining experience, I can assure you also 

that from my education, that also requires many years of advanced 

mine planning. 

Mrs. LUMMIS. Thank you. And, Mr. Chairman, I will save the 

rest of my time and yield back to you to use for whatever purpose 

you wish to use it for. 

Dr. GOSAR. I thank the gentlelady. Before her time runs out I 

would like to address some issues laid out in the Administration’s 

testimony regarding tribal consultation and the protection of historical significant sites. 

As someone who has lived among Native Americans my entire 

life, first in Wyoming, then in Creighton University in Omaha, Nebraska, and finally in Northern Arizona, tribal consultation and 

Congress’s trust responsibility to Tribes is very important to me. In 

fact, I have been very outspoken in favor of the policies that benefit 

Tribes in my short time in Congress. That is why, in crafting this 

112

legislation, I have taken specific measures to protect those interests. 

However, regarding Oak Flat Campground, I wanted to correct 

some of the misinformation that has been thrown around here. 

When the Oak Flat Picnic and Campground was withdrawn in 

1955 by a Public Order, PLO1229, in the text it read, ‘‘Reserving 

lands within National Forests for use of the Forest Service as 

campgrounds, recreation areas, and for other public purposes.’’ The 

withdrawal was done to protect the Federal Government’s interest 

in the capital improvement of the campground. It made no mention 

of tribal sacred sites. In fact, members of communities that surround the area have given firsthand accounts that the San Carlos 

did not utilize the area for ceremonies until this project was announced about a decade ago. I will submit a variety of accounts 

longtime residents of the area have provided for the record. 

I would also like to point out on September 20, 1971 the Oak 

Flat Picnic and Campground withdrawal area was modified by 

Public Land Order 5132 by Assistant Secretary of the Interior Harrison Loche. Since then, the 760 acres, known as Oak Flat Picnic 

and Campground Area, has been eligible for disposal by land exchange and other disposal authorities of the Forest Service. 

Once again, I would like to keep the discussion about facts, because the facts set you free. 

The Ranking Member has two articles that he would like to be 

included? 

Mr. GRIJALVA. Thank you, Mr. Chairman. And an inventory and 

a list of all the Native Nations and tribal governments that are in 

opposition of the legislation. Also we will be submitting for Chairman Lamborn a kind of an explanation between fee simple and 

trust land that is for the purpose and use by Native Tribes under 

law. 

And, Mr. Rambler, thank you. I like the NEPA process, I like 

consultation, government-to-government, because I don’t try to tell 

you what to do and what you need. 

Dr. GOSAR. Without objection, so ordered. 

[The information submitted for the record by Mr. Grijalva has 

been retained in the Committee’s official files:] 

Dr. GOSAR. As of this, with no further objections—oh, no, I am 

sorry. Mr. Cramer? 

Mr. CRAMER. I have nothing, Mr. Chairman, but would yield my 

time to the Chair, if he needs it. 

Dr. GOSAR. Well, thank you very, very much. Without further 

ado, I know a number of you have to catch your planes. So thank 

you very, very much for the testimony, and as of now—thank you—

we stand adjourned. 

[Whereupon, at 2:05 p.m., the Subcommittee was adjourned.]

[Additional Materials Submitted for the Record] 

The documents listed below have been retained in the Committee’s official files. 

Submitted for the record by Representative Paul A. Gosar on 

H.R. 687: 

113

• Letters of support from the State government delegation of the 

affected region: Governor Jan Brewer, State Senator Barb 

McQuire, State Representatives Frank Pratt, T.J. Shope, and 

Brenda Barton 

• A resolution unanimously passed by the bipartisan Pinal County Board of Supervisors and letters of support from the entire 

bipartisan Gila County Board of Supervisors. These two counties encompass the areas most affected by the exchange.

Additional material submitted for the record by Representative 

Paul A. Gosar: 

• Article: Hope for Resolution Copper mine is bipartisanship, By 

Editorial board, The Republic/azcentral.com, 2/19/13

• E&E Article—Pentagon Warns of Mineral Shortfalls, 3/20/13

• Letter of support from Senate President Biggs 

• Letter from the Queen Creek Coalition (rock climbing group) 

• Superior Town Council election results with quotes from two 

candidates and links to news articles where they were quoted 

• News Articles: Superior Sun and the Cooper Country News 

• CRS Report on Earnings of Mining and Tourism Industries 

• Letter from Representative Paul A. Gosar to Chairman Rambler dated April 15, 2011

• Petition and letters of support for H.R. 687, 400 signatures 

• Letter of support from The Nature Conservancy 

• Letter of support from the Sonoran Institute

Additional material submitted for the record on H.R. 687: 

• Access Fund Executive Director Brady Robinson 

• Affiliated Tribes of NW Indians 

• Colorado River Indian Tribes 

• Fort McDowell Yavapai Nation • Inter Tribal Council of AZ Tribes • National Center for Policy Analysis Finding Sources of Rare 

Earths beyond China • Ramona Band of Cahuilla Indians 

• Letters from the Mayor of the Town of Payson, the Mayor of 

Globe, Terry Wheeler, Superior Councilman John Tameron, 

and a resolution of support from the Town of Kearney

Submitted for the record by Representative Rau ́l M. Grijalva: 

• Written Testimony of Roger Featherstone, Director, Arizona 

Mining Reform Coalition, Testimony on H.R. 687

Submitted for the record in response to James M. Iwanicki’s 

testimony: 

• Keweenaw Bay Indian Community 

• Upper Peninsula Environmental Coalition

Submitted for the record by Representative Joseph J. Heck on H.R. 

697: 

• Historic Defense Plant Corporation areas 

• Three Kids Mine and Mill Site Layout 

• Three Kids Mine Project Site Map Final 

• Statement of the Honorable Andy Hafen, Mayor, City of 

Henderson, Nevada, on H.R. 697

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