AmidThe recent skirmishesWhile rewriting the reconciliation bill, also known as the Build back Better Plan, lawmakers once more missed an opportunity to reform the General Mining Law of1872.
This outdated law allows hardrock miner to extract lucrative minerals such as gold or silver from public lands without paying federal royalties. Despite being challenged numerous times over the decades, mainly by Democrats and other parties, the law has not been substantially updated for the nearly 150 years that it was passed.
In August, a House committee, chaired by Raúl Grijalva, D-Ariz., tried to modernize the legislation by adding language to the reconciliation bill to establish federal royalties of between 4 percent to 8 percent These mines. This would have been the most significant update to the mining law in the almost 15 decades since President Ulysses S. Grant created it.
Democratic Sens. prevented hardrock royalty reform from reaching a vote. Joe Manchin (D-W.Va.), and Catherine Cortez Masto(D-Nev.). Manchin made his fortune in coal mining. Manchin was born in China. signaled support for the royalty provisions in October when he spoke in front of the Senate Committee on Energy and Natural Resources, stating that he could “never imagine that we don’t receive royalties on so many things we produce in this country.” But he later reversed course and reportedly promised Cortez Masto that he’d block any mining royalties, effectively killing reform before it even reached the full Senate. On November 4, royalty legislation was officially out of both Senate and House bills.
These senators’ actions all but guarantee that the US public will continue to miss out on billions of dollars in revenue that could have supported the Build Back Better Plan’s priorities, including paid family leave and important climate investments. The bill would have required companies to clean up abandoned mines that litter the West. Instead, mining corporations will continue to exploit public land in order to make their own money.
The General Mining Law of 1872 law was passed in the wake of the mid-19th century California gold rush as part of a push to encourage white settlement of the West. Prospectors had previously staked claims on land without permission from the federal government. This was not the case for Indigenous people who were being displaced from the land.
Congress passed a few early mining laws to regulate the industry’s growth, beginning in 1866. These laws were replaced by the General Mining Law of 18.72. It created the location system, which allowed miners and corporations to stake claims on mineral discoveries in the public domain on land that was never in private ownership.
A long list of royalty-free minerals besides gold and silver fall under this “location-system” regulation, including lithium and copper, which are becoming more valuable due to their use in green energy technologies like solar panels and electric vehicles. Since 1872, the industry has extracted about $300 billion worth of these minerals on public lands. Earthworks. Even though mining companies have come a long way since the days of digging with pickaxes, they still make a small profit for the American people.
It is therefore important to reform the 1872 law. This is why there is a wide base of critics, from legislators to conservation groups. Currently, the government earns hardrock mining fees for things like registration and annual maintenance, which generated about $71 million in revenue in fiscal year 2019, but it’s a small amount compared to the money that would be derived from royalties.
In September, the House Natural Resources Committee suggested a new royalty to have raised money. $2 billion over 10 years. And that’s likely a conservative estimate: The federal government has no data on the amount or value of the hardrock minerals extracted from public lands, which account for more than 80 percent of the mineral mines on federal lands, according to the Government Accountability Office.
Mines that operate under the more tightly regulated leasing system for resources like coal or oil shale account for only 17 percent of federal land mining, but generate more revenue through royalties. They generated $550 million in royalties alone in fiscal 2018. Lease-system mining is dominated by coal as the main revenue generator.
The reforms proposed would have also added a reclamation fee to abandoned mines and raised the yearly maintenance fees for claims from $165 – $200 per claim. $1 billion in revenue over the next decade.
This money could be used to help address the many environmental and health issues that have been caused by mining in the Western US. Before the 1970s, for example, companies abandoned mines once work was complete—leaving behind tens of thousands of often-toxic scars on the land that could cost over $50 billion to address.
Reform attempts the General Mining Law have been going on for years, but a well-funded network of lobbyists and special interest groups has continued to thwart any success. Mining interests regularly spend north of $16 million annually on lobbying; this year, they’ve already spent over $13 million.
According to data from OpenSecrets (a non-profit lobbying and campaign finance watchdog organization), the National Mining Association spent $1.5 million in 2021. Numerous companies that would be directly affected in the future by mining law reform are opposed to it, including Newmont Corp. (a gold-mining company) that has invested over $800,000.
This helps explain why one ongoing effort to reform the law—the Hardrock Mining and Reclamation Act—has stalled in recent years. Since 2007, at least six times have the legislation been introduced in Congress by Democrats. The bill’s most recent iteration, in 2019, failed amid a major industry-led lobbying blitz. It was opposed by mining giants BHP Group and the National Mining Association, which targeted the bill in a $1.2 million lobbying campaign.
The power of the mining industry lobbyists extends beyond their financial influence. They are also closely linked to the government. OpenSecrets claims that there are over 2,000 mining industry lobbyists. nearly 65 percent of the industry’s lobbyists previously worked in the government, many in positions related to mining.
The lobbying campaigns help illuminate why Manchin, who said in October that it was time to bring the “outdated law into the 21st century” was willing to suddenly reverse course. According to OpenSecretsHe received more campaign donations from the mining sector than any other Congressman, raising nearly $50,000 for the industry in the current fundraising cycle. Cortez Masto’s campaign also benefited: Both the National Mining Association trade group and Barrick Gold Corp., one of Nevada’s largest mining companies, have recently donatedFollow her campaign.
Nevada’s economy depends on gold mining; nearly $8.2 billion worth of the metal was extracted in the state in 2020. Cortez Masto’s predecessor, former Nevada Democrat Harry Reid, was against any challenges to the 1872 Mining Law, calling them “ill-conceived reform efforts that would have hurt rural Nevada” in a 2009 op-ed. It seems that Cortez Masto is picking up right where Reid left off, protecting the industry in an attempt to keep rural voters.
Cortez Masto but not Manchin responded to our requests for comment.
This story was created in collaboration with the Project on Government Oversight, a nonpartisan independent watchdog that investigates and exposes waste, corruption and abuse of power.