In early March of 2016 Governor Dayton's Executive Committee met to discuss the leasing of lands near Duluth and throughout the region of Northeastern Minnesota. The Minnesota State Auditor opposed the leases based on her assessment of the financial risks the leases posed. The Governor, Attorney General and Secretary of State ignored her cautionary words and voted to approve the leases. After the meeting, speaking to our representative, the Governor stated that people have become "hypersensitized" regarding mining and that mining has always been the plan for "your region". We oppose the actions taken by the Executive Committee and view the Governor's protection just days later of the Boundary Waters from mining exploration to be a more supportable path, and question why there is a strong desire on the part of the Governor to protect one area of the state, citing it as a great threat, while minimizing it elsewhere and labeling concerns "hypersentitization". Lake Superior, the St. Louis River and the Cloquet Rivers demand the same level of protection as the Rainy River watershed.
Meanwhile the Governor has showed his support for Polymet via the DNR's approval of the PolyMet Plan and moving toward permitting.
Our letter and documentation to the Executive Council are below and a map of the leasing area near Duluth is to the right.
Governor Mark Dayton and Lt. Governor Tina Smith (email@example.com)
Office of the Governor & Lt Governor
116 Veterans’ Service Building
20 W. 12th Street St. Paul, MN 55155
State Auditor Rebecca Otto (firstname.lastname@example.org)
Office of the State Auditor
525 Park Street, Suite 500 Saint Paul, Minnesota 55103
Attorney General Lori Swanson (email@example.com)
Office of Minnesota Attorney General
1400 Bremer Tower 445 Minnesota Street St. Paul, MN 55101
Secretary of State Steve Simon (firstname.lastname@example.org)
Office of the Secretary of State of Minnesota
Business Services Office:
Retirement Systems of Minnesota Building 60 Empire Dr., Suite 100 Saint Paul, MN 55103
February 29, 2016
Governor Dayton, Lieutenant Governor Smith, Attorney General Swanson, State Auditor Otto, Secretary of State Simon,
On behalf of the Friends of the Cloquet Valley State Forest, we are renewing our request that the Minnesota Executive Council decline to approve any new nonferrous metallic mineral leases until you have a clear understanding of what those leases may mean for many of Minnesota’s irreplaceable natural treasures, including the Cloquet Valley State Forest and the Cloquet River and its tributaries.
The Executive Council may believe that in approving leases, it is simply providing that a mining company can begin the process of exploration for minerals, and that the decision as to whether a mine is actually appropriate in a given location will not be made until it is known that marketable minerals actually exist at the site. But there is a very real possibility that as a legal matter, the approval of leases will turn out to be the decision that mining – including the mining of sulfide-bearing ore from enormous open-pit mines that destroy surface resources and leave the land forever scarred – is the preferred use of these public lands. We submit that neither the Executive Council nor the public knows enough about these lands, the resources they contain, and the public values they serve to make that decision at this juncture.
We have previously submitted comments regarding the cumulative effects of mineral exploration (which are unlikely to be addressed in 20-day reviews of single-lease exploration plans), the impacts of leasing on surface estate and neighboring landowners and local communities, and the extensive long-term impacts of sulfide mining. We hope that you will review these and other public comments before you address the proposed leases before you on March 9. However, our purpose in this letter is to highlight the legal morass that you may be wading into by granting property rights to private mining companies without a full consideration of the resources and values of the property itself.
Perhaps you have been given to understand that because leases “are subject to all applicable state and federal statutes, orders, rules and regulations,” the State will have the ongoing right to say “no” to an eventual mine plan that will destroy important public resources. Certainly the mine would be required to comply with Clean Water AcSt, Clean Air Act, Wetland Conservation Act, and Permit-to-Mine requirements, as would any mine on private property. But these laws may not protect the land itself, nor its ecosystems, and to a great extent they do not protect the needs of the local community. While this is an unsettled area of the law, a court might well view the State as a landowner who, with these leases, has given the leaseholder all the rights of a property holder to destroy the surface of the property in order to access the minerals below.
The Friends of the Cloquet Valley State Forest do not want to see any part of the Cloquet Valley Forest destroyed, and we do not know for certain that there will be another tribunal in the future with the legal authority to decide that it will not be.
As an example of what is at stake, six of the seven proposed leases within the Cloquet Valley State Forest are within a Minnesota Biological Survey area of high biodiversity. Areas of outstanding or high biodiversity are given priority for conservation in state and local government decisions. For example, a permit to destroy wetlands must be denied if it would permanently alter such areas. But no similar regulation protects uplands, and under the state Wetland Conservation Act a private landowner might have a regulatory takings claim if a wetlands permit is denied for this reason. At this point, we do not know what ecosystems, plants, or wildlife habitat might be unprotected if a marketable mineral resource is discovered, because no environmental review has been done.
The impacts on people who use and love these landscapes would be just as pronounced. Most mines are not small, isolated land uses. In most of the places where leases are offered, a significant “find” could mean the development of a new mining district, and the complete transformation of the local landscape and community. Most of the people who live in the Cloquet Valley do not want to live in a mining district. We have great respect for the communities of the Iron Range and mean nothing against them, but we have a different culture that we also would like to maintain. We understand property rights, and if a private property owner wants to locate a mine on his or her land in our community, we may have no recourse. But this should not be the case in regards to the mining of public property.
Why is it that when new mining development is proposed for the Iron Range, the concerns of the local community are so important, while the local community is ignored when mining development is proposed in other places? To reiterate, we recognize that no mine has yet been proposed in the Cloquet Valley, but we fear that with the granting of these leases, the State will not retain the legal right to consider impacts on the local community if and when that proposal comes.
In the 1970’s, a similar time period in terms of interest in nonferrous mineral extraction in Minnesota, the state undertook an extensive study of potential mining. The “Copper-Nickel Study” looked at a full range of potential impacts from various mining activities, long before any particular mine plan had been developed. But the study was limited to a narrow band of mineralization to the immediate southeast of the Mesabi Iron Range, stretching from Virginia to Ely. At the time of the Copper-Nickel study, there was no suggestion that mining might ultimately be spread over the entire northland, which may now prove to be the case. While we appreciate the fact that the DNR does not know where marketable minerals will be found, prior to leasing may be the State’s last opportunity to consider the possible ramifications of the development of extensive new mining districts.
Issues of state mineral leases and property rights have not yet landed in the Minnesota courts, and so it is informative to look to the federal government to see how it has handled similar issues. To that end, we are submitting a Solicitor’s Memorandum from the U.S. Department of the Interior. The federal minerals leasing system differs from the state system in that the federal government first issues a prospecting permit covering a certain acreage of land. If marketable minerals are found, the permit holder is then entitled to a lease. The primary issue, however, is essentially the same: what legal rights does the government retain to refuse permission to construct a mine after an initial property right has been granted?
Among other things, the Solicitor’s Memorandum addresses the degree of environmental review that is appropriate before a prospecting permit is issued. As with a state lease, the granting of a federal prospecting permit must be followed by approval of an exploration plan before any physical work is done that could alter the property. Nonetheless, the consensus among both courts and federal officials is that to the extent that the permit presents an “irretrievable commitment of resources,” (i.e., because the subsequent grant of a lease is to some extent nondiscretionary), a full review of the impacts of mining must be done before it is granted.
But our primary point in asking you to read this memorandum is that federal officials recognize the property rights implications of issuing a prospecting permit, and the limitations that might place on them in later decisions as to the use of federal property. As reflected in the Solicitor’s Memorandum, this has been a huge conundrum for the federal government, and the State would do well to consider that experience and the thought that has gone into addressing it before plowing ahead with the same mistakes that the federal government has suffered through.
In particular, we draw your attention to a situation described on pages 13 and 14 of the attached Solicitor’s Memorandum:
One protracted dispute involving the Forest Service's consent to the issuance of a preference right lease sounds a cautionary note. In the 1960s, BLM issued prospecting permits under the MLAAL for phosphate exploration on acquired federal lands in Florida. These prospecting permits pre-dated the development of the joint Forest Service/BLM stipulation now in use, but did contain other stipulations required by the Forest Service to protect surface resources in the event leases were issued. The permittees then applied for preference right leases. Following preparation of an environmental impact statement under NEPA, the Forest Service submitted stipulations to be included in the leases. One of these required the lessee to reclaim the area to the conditions that existed prior to mining. An interagency task force was formed to determine whether reclamation to this standard was technologically feasible. When the task force reported that there was no reasonable likelihood the area could be reclaimed to this standard, the Secretary of the Interior rejected the preference right lease applications.
The permittee sued, and the federal district court upheld the Secretary. Ken-McGee, 630 F. Supp. 621. The Court of Appeals vacated the decision and dismissed the case as moot, because Congress had, in the meantime, designated the permit area as part of the National Wilderness Preservation System, effectively prohibiting mining. The Court noted that the permittees could bring a takings action in the U.S. Claims Court, intimating no view on the merits of such a claim. 840 F.2d 68 (D.C. Cir. 1988). Kerr-McGee subsequently sued in the Claims Court, and when the trial judge expressed doubts about jurisdiction, the lessees obtained a congressional reference. (Congress enacted a bill asking the Court of Claims for an advisory opinion.) The Court of Claims then decided to address whether the Forest Service and Interior had given the company an adequate opportunity to determine whether reclamation was possible. Kerr-McGee Corn. v. United States, 36 Fed. C1. 776 (1996). Eventually the case was settled when the U.S. agreed to give the permittees several million dollars in return for dismissing the claims. While this dispute ultimately did nothing to clarify the law regarding the scope of the Forest Service's consent and its authority to incorporate protective terms and conditions in a prospecting permit, it illustrates possible limits on federal agency authority over mineral development once a prospecting permit is issued.
Substitute “mineral lease” for “prospecting permit” and this is exactly the type of situation the State of Minnesota is likely to face ten, twenty or thirty years from now.
In the context of the interpretation of deeds that grant or reserve mineral rights, the Pennsylvania Supreme Court noted:
[I]n view of the surface violence, destruction and disfiguration which inevitably attend strip or open mining, no land owner would lightly or casually grant strip mining rights, nor would any purchaser of land treat lightly any reservation of mining rights which would permit the grantor or his assignee to come upon his land and turn it into a battle-ground with strip mining.
We fear that “casually granting strip mining rights” is precisely what the DNR and the Executive Council may turn out to be doing in entering into these leases. While Friends of the Cloquet Valley State Forest would be the first to argue that the state leases grant no such rights if a case were to go to court, realistically we have to say that this is an open question that counsels every caution in your leasing decisions.
We urge you to take a trip to the Iron Range and visit one of the mines. Look around at the piles of waste rock that dominate the landscape in the Range Cities, even outside of current mining areas. And then drive through the Cloquet Valley State Forest and some of the other areas that are currently up for lease, and imagine a similar transformation. And if you are not absolutely certain that such a transformation would be in the best interests of the people of Minnesota, including and especially the people who live, vacation, and/or recreate in the area, do not approve these leases at this time.
The aforementioned Solicitor’s Memorandum includes options for protecting the federal government’s right to refuse to allow a mine on federal property once prospecting permits are issued. We would like to suggest that the State of Minnesota consider similar options for state leases, and amend the regulatory lease language before any new leases are granted. The DNR and the Executive Council apparently believe that the time to consider the implications of mining is after marketable minerals have been discovered and a plan is on the table. Please, let’s make sure that the State does not lease away the right to consider and act on those implications before we even know what they are.
Friends of the Cloquet Valley State Forest
A map of the study area from the Executive Summary is attached. Map
Recently approved leases near Duluth
Click here for large detailed MAP