The Committee on Natural Resources, Agriculture, and Mining was called to order at 1:40 p.m., on Wednesday, March 24, 1999. Chairman Marcia de Braga presided in Room 4100 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mrs. Marcia de Braga, Chairman

Mrs. Gene Segerblom, Vice Chairman

Mr. Douglas Bache

Mr. John Carpenter

Mr. Jerry Claborn

Mr. Lynn Hettrick

Mr. David Humke

Mr. John Jay Lee

Mr. John Marvel

Mr. Harry Mortenson

Mr. Roy Neighbors

Ms. Genie Ohrenschall

Ms. Bonnie Parnell

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

After roll was called, the Chairman made an announcement concerning A.B. 380.

Chairman de Braga said A.B. 380 would not be considered today because all proposed amendments had not yet been received. The measure would be considered as soon as possible. All concerned parties would be notified as soon as the measure was rescheduled.

The Chairman opened the hearing on A.J.R. 19.

Tim Crowley, representing the Nevada Mining Association (NMA) was the first to testify in support of the proposed legislation. He pointed out A.J.R. 19 was an important piece of legislation to the mining industry. He introduced Cy Wilsey, representing NMA, as the next speaker.

Mr. Wilsey said he was a certified land manager for Homestake Mining Company and chairman of the Public Lands Committee of NMA. Mr. Wilsey presented the committee with proposed revisions to Bureau of Land Management (BLM) surface management regulations, also known as the 3809 regulations (Exhibit C).

Mr. Wilsey pointed out the State of Nevada had a mining permitting and regulatory program, which was a model program for other states. The program was administered by Nevada Division of Environmental Protection (NDEP). He explained the revised 3809 regulations, as proposed, would unnecessarily duplicate requirements currently part of existing state and federal programs that protected air, water, and wildlife. Also, the proposal by BLM would significantly increase the costs of mining, both in terms of out of pocket expenses and costly delays, without significant benefit to the environment. Mr. Wilsey’s testimony was included in its entirety in Exhibit D.

Mr. Marvel said the legislature had been aware of BLM 3809 regulations for a long time. He asked if there was a consensus of opinion among all western states regarding BLM regulations. Mr. Wilsey responded in the affirmative. Mr. Marvel said Nevada’s reclamation laws were the best in the nation. He asked what the new 3809 regulations would do to Nevada. Mr. Wilsey said they would lay an additional layer of bureaucracy on top of existing state reclamation laws, which would duplicate current state laws. The additional BLM regulations might be in conflict with State of Nevada reclamation laws. The new regulations would have a significant negative affect on the mining industry throughout the country. Some mines would possibly be forced to shut down if the regulations were adopted, particularly small mining operations. Large corporate mines and mining exploration activities would not be spared the negative impact of the new regulations.

Chairman de Braga said the BLM 3809 regulations stated wherever state and federal reclamation laws conflicted, federal regulations took precedence, unless state laws were stricter. She asked if 3809 regulations were approximately a decade old and had never been passed by Congress. Mr. Wilsey said the original 3809 regulations were put in place in 1981 as a result of legislation Congress enacted in 1976 entitled the Federal Land Policy Management Act. At that time BLM announced it would review the 3809 surface management regulations contained within the act. In the late 1980’s, BLM held hearings to solicit input to determine if problems existed with the legislation. It was determined the legislation was acceptable. In 1997 Secretary of the Interior Bruce Babbit announced problems existed within the mining industry, which lead to changes within the regulations. Hearings were held in the early part of 1997, which led to the writing of the new draft regulations.

Chairman de Braga pointed out Alan Coyner, administrator of the Division of Minerals suggested including a strong statement in A.J.R. 19, which would be considered a no action alternative. Mr. Wilsey said he would support the statement if it was the will of the committee.

Mr. Neighbors asked if some mines would be grandfathered in and therefore not subject to the new BLM 3809 regulations. Mr. Wilsey said any existing plan of operation or notice of intent currently in place would be exempt from the new regulations; however, if a new notice or plan was requested, the new regulations would apply. Mr. Neighbors asked if an effective date had been set by the Federal Government. Mr. Wilsey responded in the negative. Mr. Neighbors asked how small mining operations would fare under the new regulations. Mr. Wilsey said BLM regulations were unclear regarding small mining operations, but they would probably be held to the same strict guidelines established by BLM for large operations.

Mr. Neighbors asked how the new reclamation regulations would affect bonding of mining operations. Mr. Wilsey said BLM was proposing reclamation bonding at 100 percent of the cost of the claim for notice level and plant level operations; and the industry supported the arrangement. He said every operation should be able to post a bond. Operators of small mines would have the opportunity to utilize the state bond pool. Mr. Neighbors asked if operators of small mines would be required to post bonds for assessment work. Mr. Wilsey replied in the affirmative, especially if any amount of land was disturbed or if a notice of intent had been filed.

Mr. Marvel asked Mr. Wilsey what his opinion was regarding the provision within A.J.R. 19 requiring a study be conducted by the National Academy of Sciences. Mr. Wilsey said it was a good idea to request reasonable people conduct an analytical review of the mining industry in the State of Nevada.

Mr. Carpenter asked if the new 3809 regulations were only proposals, would the state have to go through the process of reviewing BLM reclamation requirements again in the future. Mr. Wilsey replied in the affirmative, adding formal hearings were being held throughout the western United States for the next few months. BLM would be gathering formal comments from the public, environmental agencies, and from the mining industry. Final regulations would be issued sometime in the fall of 1999 along with an environmental impact statement.

Mr. Mortenson asked if reclamation laws would be retroactive. Mr. Wilsey responded in the negative. Some change would have occur in a company’s mining operation for the new regulations to apply.

Mr. Marvel said the Nevada Legislature was prepared to take as strong a stand as necessary to demonstrate its complete support of the mining industry throughout the state.

Allen Biaggi, administrator of Nevada Division of Environmental Protection, was the next proponent of A.J.R. 19 to testify. He said the proposed legislation expressed the concern of the legislature for the proposed BLM regulations pertaining to hardrock mining. The State of Nevada, through the Division of Environmental Protection, had strong, enforceable mining regulations and reclamation programs in place for over 10-years. Although NDEP recognized the need for state and federal land management programs to work together to regulate the mining industry, it was recognized the proposed 3809 regulations would negatively impact Nevada and the state’s relationship with BLM (Exhibit E).

Alan Coyner, administrator of Division of Minerals, was unable to attend the hearing on A.J.R. 19; however his testimony and comments were provided to the committee and included in Exhibit F. Mr. Coyner stated his agency was very concerned about the potential negative impact the proposed BLM reclamation regulations would have on the mining industry throughout the state. It was his suggestion that the proposed legislation include a strong statement regarding the "No Action Alternative" suggested by BLM.

Leo Drozdoff, Bureau of Mining Regulation and Reclamation Bureau chief for NDEP, said his agency, one of several state agencies that regulated mining operations in Nevada, was charged with ensuring the quality of Nevada ‘s water resources were not degraded as a result of mining operations and that land was properly reclaimed after mining activities ceased. NDEP had also closely monitored the efforts of BLM to rewrite 3809 regulations. Mr. Drozdoff pointed out BLM needed to review mining projects mandated to be in compliance with existing 3809 reclamation requirements and current state laws to determine if regulatory problems existed (Exhibit G).

Mr. Carpenter pointed out the draft regulations stated BLM would have to concur with each state decision and approve plans of operations. If that language was included in BLM’s final regulations, would NDEP have input in the process of reviewing plans of operations and how expensive would it be to have plans approved. Mr. Drozdoff said there would be a great deal of duplication between state and federal reclamation laws. The process would be counter- productive, time consuming, and costly. Mr. Carpenter asked Mr. Drozdoff what he thought BLM’s motives were in drafting the new regulations. Mr. Drozdoff said it would be unwise to speculate; however, he considered BLM’s actions to be well intended although harsh.

Bob Cuffrey, consulting geologist for White Knight Gold, was the next to testify in support of the measure. He explained White Knight Gold was a junior company that conducted mining exploration in Nevada. The proposed changes to 3809 mining regulations were not well received in a public hearing recently held to review the BLM proposal. The "No Action Alternative" was by far more favorably received. Mr. Cuffrey pointed out public comments were not solicited in order to help the federal agency decide which alternative to choose, or to modify provisions in the proposed regulations. Public hearings were held only because they were a legal formality required by BLM, as all public testimony against the new 3809 regulations fell on deaf ears. He said BLM was forcing unnecessary regulations on the mining industry. Environmental protection was a smokescreen, he said, because the new regulations had little or nothing to do with concern for the environment. BLM regulations were designed to slowly strangle the mining industry through regulatory red tape (Exhibit H).

Mr. Carpenter asked Mr. Cuffrey if he had any suggestions for the committee regarding strong language for the BLM. Mr. Cuffrey said he did not consider himself qualified to offer language against the BLM proposal, but he considered the issue important enough to warrant a strong retort, particularly in defense of state’s rights. He said it was a state’s rights issue because BLM was seriously threatening the future of the mining industry in Nevada.

Shirene Urton, representing the Women’s Mining Coalition, testified in support of A.J.R. 19. She said she agreed with the preceding testimony and had nothing further to add except genuine appreciation for the committee.

Debra Strohsacker, representing the Midas Joint Venture, was the next proponent of the proposed legislation. She said the measure was a very important issue for the State of Nevada and she urged the committee to support A.J.R. 19. She invited members of the committee to tour the mine, which was a state of the art and environmentally proactive venture of which she was very proud.

Jim Chavis, public affairs manager for Placer Dome U.S., Incorporated, was the next to testify in support of the proposed legislation. He said the new 3809 regulations would be extremely detrimental to rural parts of the state, especially over a long period of time. Permitting of new mining properties would decrease and much of the infrastructure needs of rural communities would be seriously affected in an adverse way because mining companies participated in the development and maintenance of rural infrastructure.

Ruth Carraher, private citizen, said the new 3809 regulations would seriously damage mining in Nevada. It would put many people out of work in the United States and send mine workers oversees to find employment.

Steven Weiss, private citizen, said his remarks were similar to testimony previously given. He explained that, as a mining geologist and consultant, the revised BLM 3809 regulations would negatively impact mining in the State of Nevada. Implementation of strict federal regulations governing the mining industry in a state that had exemplary reclamation programs in place would accomplish nothing. The existing environmental framework currently in place needed no altering. Mr. Weiss’ testimony was included in its entirety in Exhibit I.

Frank Lewis, private citizen, spoke in support of A.J.R. 19. He said he had been employed in the mining industry as a prospector since 1953. The new regulations would kill the mining industry in the state; and individuals like him, particularly in rural areas, would suffer greatly. He suggested writing strong language to the Federal Government stating the "No Action Alternative" was the only acceptable alternative provided.

Mr. Hettrick stated he empathized greatly with Mr. Lewis because he, too, had a small mining claim at one time. The little guy was the one to suffer the most by needless legislation, which was also hurting large corporate mining operations as well. It was virtually impossible to patent a claim anymore, he said. The Federal Government kept stacking more regulations on the mining industry, which would, in time, effectively eliminate the mining industry entirely. He said he would support any document that sent a message to BLM demanding the agency cease making regulations that harmed rural Nevada.

Mrs. Segerblom asked if the fee to stake a claim had recently been raised. Mr. Lewis said it was recently raised to $100 and another increase was expected soon.

Stephanie Licht, representing Elko County, was the last to testify in support of A.J.R. 19. She said Elko County was a county heavily dependent on natural resources, agriculture, and mining. Elko County supported the mining industry and viewed the new BLM regulations as harmful to rural Nevada.

The Chairman asked if there were any additional questions or comments on the proposed legislation and there were none. She closed the hearing on A.J.R. 19 and opened the hearing on A.J.R 20.

Paul Scheidig, director of Regulatory and Environmental Affairs of the Nevada Mining Association, testified in support of A.J.R. 20. He explained the issue was important to the mining industry because since 1998 the United States Environmental Protection Agency (EPA) had included the mining industry under the Toxic Release Inventory (TRI) program. Many of the chemicals included in the inventory were found naturally in the environment. The guidelines established by EPA were misleading and inaccurately presented the environmental consequences posed by those naturally occurring chemicals. Once again, misleading information had been used by the Federal Government against the mining industry, which could adversely affect the economy of the state. Mr. Scheidig said the proposed legislation, along with a proposed amendment, would resolve the issue. He presented the committee with proposed language for an amendment (Exhibit J).

Ms. Parnell said the proposed amendment needed stronger language requiring the EPA to prepare a separate form of reporting requirements that had a direct application to mining activities and exclude naturally occurring elements from the reporting requirements of the mining industry. Richard DeLong, representing Environmental Management Association, agreed, explaining the wording should be made stronger.

Mr. Hettrick said he preferred the language, which removed the mining industry from reporting requirements. He said he agreed with Ms. Parnell that the language needed to be stronger.

The Chairman called upon Allen Biaggi, administrator of Nevada Division of Environmental Protection, to comment on A.J.R. 20 and the new language proposed by Ms. Parnell and Mr. Hettrick. Mr. Biaggi said he supported the proposed legislation and he concurred with the revisions presented by the Nevada Mining Association. NDEP had a policy of supporting community right to know legislation, which allowed citizens to learn of potential hazards in their neighborhoods. His agency had an aggressive regulatory program in place, which closely monitored the environmental impacts of mining. Those programs were successful and effective in the protection of humans and the environment.

Mr. Biaggi explained waste materials generated from the extraction of naturally occurring minerals were high in volume and low in toxicity. The vast majority of the waste materials, which were monitored by NDEP permits, did not contain chemicals above low levels or diminutive concentrations. Nearly all metal mines in Nevada were located in remote locations, further reducing potential impacts to the environment and human health. Metal mines throughout the state were legally and responsibly managing waste materials. The mining industry under section 313 of the federal Emergency Planning and Community Right to Know Act of 1986 would not result in any additional prevention of pollution or reduction in waste, and inaccurately portrayed the threat to human health and the environment. The unnecessary administrative burden would outweigh any possible benefits to the public. Although NDEP was not required to regulate or report TRI, the burden of responding to the public would fall upon NDEP.

Chairman de Braga asked if Mr. Biaggi would care to comment on the proposed new language. Mr. Biaggi said he agreed with the suggestions made by Ms. Parnell and Mr. Hettrick. He suggested making the language as strong as possible and to add exemption language in as well.

Dan Geary, representing National Environmental Trust (NET), was the last speaker to testify in support of A.J.R. 20. He explained his agency was a nonprofit educational foundation based in Washington, D.C., which worked to advocate sound environmental policies such as the Community Right to Know Act. Mr. Geary said he approved of the proposed new language of the measure and urged the committee to support the measure. He pointed out his organization was willing to work with Nevada’s congressional delegation to develop reporting formats for the mining industry. He supported the notion of pollution prevention without regulation and encouraged Nevada’s participation in EPA’s online database. He said NET and TRI had been developed to address the problems of manmade chemicals released into the environment during mining and mineral extraction processes. Citizens were entitled to know what environmental dangers were being manufactured and stored in their communities.

Mr. Hettrick said if Nevada decided to report activities of the mining industry under the TRI program, the information would probably not go onto the Internet. He asked if Internet reporting would be a requirement of NET endorsement of the proposed legislation. Mr. Geary replied in the negative, adding TRI reporting was the first public online accessible databases ever produced by the Federal Government. The service was provided to the citizens of the United States in order to inform them of what hazardous materials were being stored in their neighborhoods.

Mr. Hettrick clarified the point he wanted to make regarding posting information regarding toxic releases on the Internet. He asked if the state was required to report on the Internet, nothing in A.J.R. 20 or Mr. Geary’s proposed amendment would prohibit NET from posting it there. Mr. Geary responded in the affirmative. Mr. Hettrick said he was also concerned about Mr. Geary statement regarding manmade chemicals. Mr. Hettrick explained the discussion was not about manmade chemicals, but rather naturally occurring elements in the top crust of the earth, which were disturbed in the mining process. Because such large quantities of dirt were moved during mining, it appeared there was a huge problem, which was inaccurate. For that reason, Mr. Hettrick explained, he had a problem with Mr. Geary’s request to post information regarding toxic releases on the Internet. The information could easily be misinterpreted and the mining industry would be misrepresented.

Mr. Geary said he deliberately used the term manmade to describe toxic releases into the environment because his organization recognized the difference between manmade chemicals and naturally occurring elements. NET would be willing to work with the Committee on Natural Resources, Agriculture, and Mining and the mining industry to produce a unique set of reporting requirements, which would distinguish between manmade chemicals and naturally occurring elements. Mr. Hettrick said he was opposed to strict reporting requirements that could hurt the mining industry if all that was going on was the moving of large volumes of naturally occurring elements.

Mr. Lewis, private citizen, said he wanted to go on record as being in support of A.J.R. 20. He contributed no further testimony. Mrs. Licht requested the same.

Mr. Scheidig asked to clarify a point. He explained his organization, the Nevada Mining Association supported the proposed legislation with the proposed amendments they submitted. He said his organization also appreciated the comments and suggestions offered by Mr. Geary; however, he was concerned about a particular point he made. Mr. Scheidig urged the committee not to include the request of NET to include mandatory reporting of onsite pollution, particularly the use of cyanide by the mining industry as an extraction agent. He urged the committee to move cautiously in terms of reporting onsite pollution. Advancements were being made in the mining industry to substitute other agents for that chemical, but until that time, it would be advantageous to proceed with caution regarding reporting requirements for fear they would prove misleading.

Chairman de Braga asked if there were additional questions or comments regarding the proposed legislation and there were none. She closed the hearing on A.J.R. 20 and reopened the hearing on A.J.R. 19. She explained the committee could do one of two things. The committee could amend the legislation and wait for the amendments to be received or the committee could pass the measure as it was and draft a letter from the committee, which would incorporate the various views expressed.

Ms. Ohrenschall suggested voting on the measure and if it passed, incorporating the new language in a letter from the committee.

Mr. Carpenter said he wanted to see stronger language included in the measure. He said he was particularly concerned about including a statement that would demonstrate to the Federal Government the importance of the mining industry to rural communities and how well NDEP regulated the mining industry in Nevada. Mr. Carpenter reminded the committee it would be advantageous to include in the proposed amendment the no action alternative. The Chairman agreed the proposed amendment would include all the new language suggested.

Mr. Neighbors said amendments would be rapidly produced and he did not anticipate long delays in waiting for them. He asked if A.J.R. 19 could be moved quickly as an emergency measure. The Chairman responded in the affirmative.

Mr. Hettrick said Ms. Eissmann was more than capable of drafting the language of the proposed amendment for A.J.R. 19. He suggested voting on the measure and if it passed, amend the measure on the floor of the assembly or in the senate Committee on Natural Resources.

Mr. Claborn said he strongly objected to the bonding requirement. Chairman de Braga agreed that was an important issue in the 1997 with which the Committee on Natural Resources, Agriculture, and Mining also disagreed.

The Chairman asked if there were any additional questions or comments on the proposed legislation and as there were none, called for a vote on A.J.R. 19.

THE MOTION CARRIED. MR. CLABORN VOTED NO ON A.J.R. 19.

Chairman de Braga reopened the discussion on A.J.R. 20. She explained the proposed legislation was a committee measure; therefore, the committee could decide what new language could be added to the proposed amendments. She called for comments from the committee.

Mr. Hettrick said he would accept the proposed amendments offered by Paul Scheidig. He added the new language could state the State of Nevada resolved that if the United States Environmental Protection Agency did not remove the mining process from the reporting requirements of the Toxic Release Inventory it must develop a separate form of reporting requirements that had direct application to mining activities, and exclude naturally occurring elements from the reporting requirements of the mining industry.

The Chairman asked the committee if it accepted the proposed amendment as described by Mr. Hettrick, excluding the clauses starting with the word resolve. Also, the word toxic was removed from several places in the proposed legislation and the word whereas would be removed from page 2, line 5 of the original measure, which would effectively eliminate the entire paragraph that followed.

Mr. Mortenson said the suggestion to use the word elements was, by definition, the wrong word to use in the new language of the proposed amendment. He stated scientifically it was more accurate to use the word chemicals.

The Chairman said the committee needed to consider each paragraph that had been altered by the committee. She called for a motion on considering the first whereas, which would change the word areas to area by requiring a certain and before the word designated, insert the word federal. In the second whereas, the proposal was to require to annually report. In the fourth whereas, to insert either the word elements or chemicals. The committee responded by majority it preferred the word elements. In the fifth whereas, the suggestion was to insert the phrase in largely urban areas. She called for a motion on the suggested new language for the proposed amendment.

Chairman de Braga asked for discussion regarding the third amendment to the proposed legislation. She pointed out the proposal was in the first resolve in the amended version of the measure, which concerned mineral processing as opposed to mining activities. She asked Mr. Hettrick to clarify the proposed language, which would affect the second resolve. Mr. Hettrick explained the first resolve urged the United States to look at a separate form of reporting requirements for the mining industry. What the committee wanted, he pointed out, was to keep the wording from the first resolve from the original measure that stated jointly, the members of the Seventieth Session of the Nevada Legislature hereby urged the Environmental Protection Agency to remove the mining industry. He suggested the wording of the second resolve in the original measure to state that if the Environmental Protection Agency did not remove the mining process from the reporting requirements if must develop a separate form for the mining industry.

* * * * * * * * * * *

Chairman de Braga closed the hearing on A.J.R. 20 and opened the hearing to a work session on A.B. 199.

Ms. Eissmann presented the committee with a handout detailing proposed amendments to A.B. 199 (Exhibit K). She explained the revised amendment added a paragraph authorizing the Division of Wildlife to administer and enforce the provisions of the legislation, as well as certifying instructors to conduct boating safety courses. The proposed amendment also eliminated section 5 of the original legislation, which required passengers of personal watercraft wear personal flotation devices as well as increasing the age requirement of operators of personal watercraft from 12 to 16 years of age.

Ms. Eissmann provided the committee with two letters of support for A.B. 199, both from individuals not present at the hearing. One was from John Donaldson, member of the Personal Watercraft Industry Association Board of Directors (Exhibit L) and the other was from Alan O’Neill, superintendent of the United States Department of the Interior National Park Service (Exhibit M).

The Chairman asked if there were any further questions or comments and there were none. She called for a motion.

There being no further business before the committee the hearing was adjourned at 4:06 p.m.

RESPECTFULLY SUBMITTED:

Sharon Spencer,

Committee Secretary

APPROVED BY:

Assemblywoman Marcia de Braga, Chairman

DATE: