Analysis of the “Wisconsin Way Mining Reform Act”

Analysis of the “Wisconsin Way Mining Reform Act”
By Carl Sack

The outline below represents my reading of the Jauch/Schultz substitute amendment to AB 426, the iron mining bill currently under consideration. In no way do I claim to be objective or unbiased, but my goal is to give fair consideration to all changes the bill makes to current mining legislation.

First of all, make no bones about it—this is a pro-mining bill. That is not to say it is all bad for the environment or the communities that would be impacted, nor would it be nearly as destructive as AB 426. It is also important to consider which legislation, or which parts of each piece of legislation, will be favored to pass by the majority party in the legislature. We should not yield the ground that just because the mining laws can be changed in relation to the proposed G-Tac mine, they should be changed.

With that being said, here is what’s “good” about the bill:

  • It is much smaller than AB 426 and does not create an entirely new law for iron mining, but keeps the current mining law largely intact. It does not include any of AB 426’s provisions directly relating to environmental statutes.
  • It establishes that the greater of the current net proceeds tax from mining or $5,000,000 must be paid by the company to the local impact fund over the first five years of mining. If they “overpay” what would have been collected in taxes, they can claim the difference as credit against their taxes after 5 years of operation.
  • It increases the three initial payments that the permit applicant must make to the local impact fund from $50,000 each to $75,000 each.
  • Any wetlands mitigation for mining in the Ceded Territories must take place within the Ceded Territories. (No mention of how far from the destroyed wetland—it falls back on the wetlands law for that specification).

The not-so-great:

  • Like AB 426, the bill creates a new definition for “ferrous mining,” but unlike AB 426, defines it as “the mining of ferrous minerals at a mining site where the department determines that it is not likely that any of the disturbed areas will contain significant amounts of sulfide minerals.” What qualifies as a significant amount of sulfide minerals or how this is determined is not specified.
  • Rather than 100% of the net proceeds tax revenue going to the local impact fund as under current law, this is reduced to 70%. Of the remaining 30%, 10% would go into a local infrastructure fund to pay for mining-related infrastructure, and 20% would go into a new “regional Wisconsin diversification program.” This official corporation would disperse the money in grants to businesses within 100 miles of a ferrous mining site for purposes of “diversification.” (The closest analogue to this is Minnesota’s IRRRB, which is ostensibly for economic diversification but overwhelmingly uses its funds to support mining).
  • The DNR would face a time limit of 270 days (9 months) from the date the permit application is filed to hold an information session, and another 270 days (9 months) to grant or deny the permit, giving a total of an 18-month timeline.
    • The company may request unlimited extensions in the timeline, which are automatically granted.
    • The DNR may request up to 3 extensions in the timeline, which are granted if the company agrees, or if they don’t but the hearing examiner does (see below).
    • (Just for consideration, most mining permits take a minimum of 3-5 years to run through the review process, meaning that this is still an unrealistic timeline).
  • The applicant has to pay the full cost of the EIS, but reimbursement for other costs to the DNR related to the mining permit is capped at $2 million.
  • An automatic extension is granted if more time is needed for the DNR to work with the Army Corps on granting wetlands permits.

The very bad:

  • The bill creates the assignment of a “hearing examiner” to a mining proposal, one person who would be appointed by the administrator of the Division of Hearings and Appeals in the Department of Administration. This person has the following powers:
    • They would preside over all information sessions and public hearings related to the exploration, prospecting, and mining permits.
    • They hold a pre-hearing meeting with DNR staff, company officials, and other concerned parties, and determine what evidence is allowed as testimony during the contested case hearing. Only what they say is allowed can be brought up.
    • In cases in which the DNR asks for a time extension and the mining company doesn’t agree, they arbitrate and decide whether the DNR’s request is granted, and if so, how long the extension will be.
  • An EIS is not required for prospecting for ferrous minerals unless “significant” sulfide minerals are determined to be present.