Nevada lawmakers oppose Gore’s proposal for royalties on hardrock mining

Bart Jansen

Wednesday, Nov. 17, 1999 | 10:11 a.m.

WASHINGTON - Vice President Al Gore's campaign proposal to start charging billions of dollars in royalties on hardrock mining could kill the industry and cost thousands of jobs, say his critics in Congress and the industry.

Sen. Harry Reid, the assistant Democratic leader, wrote Gore that the mining industry shouldn't be taxed because Congress failed to fully fund programs to buy public land.

"I believe that conservation and mining are compatible goals and feel strongly that mining should not be used as a scapegoat for our failure to adequately fund our conservation priorities," said Reid, the son of a hardrock miner.

Another Democrat, Sen. Richard Bryan, also criticized the proposal.

"While the senator supports efforts to control suburban sprawl, he does not feel we should needlessly sacrifice the mining industry to achieve that worthwhile goal," said Dave Lemmon, a spokesman for Bryan. "In addition, the senator supports reasonable mining reforms, but this proposal runs the risk of irreparably harming Nevada's second-largest industry."

Gore proposed spending $2 billion over 10 years to buy open space for parks in urban areas. He would fund the program through royalties on hardrock mining.

Under the 1872 mining law, the federal government doesn't levy such a royalty on hardrock mining for minerals such as gold, silver and copper. By contrast, coal, oil and gas producers pay federal land royalties ranging from 8 percent to 12.5 percent. Other industries consuming natural resources on federal lands, such as logging, also pay royalties.

Gore maintained that the mining law requiring no royalties for mining gold, silver and copper on federal lands must be updated for the 21st century, according to campaign spokesman Chris Lehane.

Several conservation groups called a hardrock royalty long overdue. But the groups said it was less urgent than killing legislation in a pending Interior Department appropriations bill to allow dumping mine waste on public lands and in streambeds.

"The vice president is right," said Stephen D'Esposito, president of the Mineral Policy Center. "However, any royalty should be coupled with mining law reform that protects clean water and public lands from dangerous mine waste."

Rep. Jim Gibbons, R-Nev., said hardrock mining differs from oil and gas development because of its large overhead expenses and small profit margin. He opposed burdening the mining industry with problems of sprawl that it didn't create.

"With a royalty that is based on just the production, rather than the commodity price, you will put hardrock mining out of existence," he said.

The National Mining Association criticized the proposal as an unreasonable tax that could result in the closure of mines and the loss of thousands of mining and related jobs.

The group advocated a "fair" royalty that would be made available to states to clean up and restore abandoned mines.