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Dustry Field THE EFFECT OF FEDERAL MINING FEES AND PROPOSED FEDERAL ROYALTIES ON STATE AND LOCAL REVENUES AND THE MINING IN- DUSTRY FIELD HEARING BEFORE THE SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES OF THE COMMITTEE ON RESOURCES HOUSE OF REPRESENTATIVES ONE HUNDRED SIXTH CONGRESS FIRST SESSION MAY 15, 1999, RENO, NEVADA Serial No. 106±36 Printed for the use of the Committee on Resources ( Available via the World Wide Web: http://www.access.gpo.gov/congress/house or Committee address: http://www.house.gov/resources U.S. GOVERNMENT PRINTING OFFICE 58±947 u WASHINGTON : 1999 COMMITTEE ON RESOURCES DON YOUNG, Alaska, Chairman W.J. (BILLY) TAUZIN, Louisiana GEORGE MILLER, California JAMES V. HANSEN, Utah NICK J. RAHALL II, West Virginia JIM SAXTON, New Jersey BRUCE F. VENTO, Minnesota ELTON GALLEGLY, California DALE E. KILDEE, Michigan JOHN J. DUNCAN, JR., Tennessee PETER A. DEFAZIO, Oregon JOEL HEFLEY, Colorado ENI F.H. FALEOMAVAEGA, American JOHN T. DOOLITTLE, California Samoa WAYNE T. GILCHREST, Maryland NEIL ABERCROMBIE, Hawaii KEN CALVERT, California SOLOMON P. ORTIZ, Texas RICHARD W. POMBO, California OWEN B. PICKETT, Virginia BARBARA CUBIN, Wyoming FRANK PALLONE, JR., New Jersey HELEN CHENOWETH, Idaho CALVIN M. DOOLEY, California GEORGE P. RADANOVICH, California CARLOS A. ROMERO-BARCELO, Puerto WALTER B. JONES, JR., North Carolina Rico WILLIAM M. (MAC) THORNBERRY, Texas ROBERT A. UNDERWOOD, Guam CHRIS CANNON, Utah PATRICK J. KENNEDY, Rhode Island KEVIN BRADY, Texas ADAM SMITH, Washington JOHN PETERSON, Pennsylvania WILLIAM D. DELAHUNT, Massachusetts RICK HILL, Montana CHRIS JOHN, Louisiana BOB SCHAFFER, Colorado DONNA CHRISTIAN-CHRISTENSEN, Virgin JIM GIBBONS, Nevada Islands MARK E. SOUDER, Indiana RON KIND, Wisconsin GREG WALDEN, Oregon JAY INSLEE, Washington DON SHERWOOD, Pennsylvania GRACE F. NAPOLITANO, California ROBIN HAYES, North Carolina TOM UDALL, New Mexico MIKE SIMPSON, Idaho MARK UDALL, Colorado THOMAS G. TANCREDO, Colorado JOSEPH CROWLEY, New York RUSH D. HUNT, New Jersey LLOYD A. JONES, Chief of Staff ELIZABETH MEGGINSON, Chief Counsel CHRISTINE KENNEDY, Chief Clerk/Administrator JOHN LAWRENCE, Democratic Staff Director SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES BARBARA CUBIN, Wyoming, CHAIRMAN W.J. (BILLY) TAUZIN, Louisiana ROBERT A. UNDERWOOD, Guam WILLIAM M. (MAC) THORNBERRY, Texas NICK J. RAHALL II, West Virginia CHRIS CANNON, Utah ENI F.H. FALEOMAVAEGA, American KEVIN BRADY, Texas Samoa BOB SCHAFFER, Colorado SOLOMON P. ORTIZ, Texas JIM GIBBONS, Nevada CALVIN M. DOOLEY, California GREG WALDEN, Oregon PATRICK J. KENNEDY, Rhode Island THOMAS G. TANCREDO, Colorado CHRIS JOHN, Louisiana JAY INSLEE, Washington ÐÐÐ ÐÐÐ BILL CONDIT, Professional Staff MIKE HENRY, Professional Staff DEBORAH LANZONE, Professional Staff (II) C O N T E N T S Page Hearing held May 15, 1999 ..................................................................................... 1 Statements of Members: Bryan, Hon. Richard, a Senator in Congress from the State of Nevada, letter to Mr. Gibbons .................................................................................... 6 Cubin, Hon. Barbara, a Representative in Congress from the State of Wyoming, prepared statement of ................................................................. 5 Gibbons, Hon. Jim, a Representative in Congress from the State of Ne- vada ................................................................................................................ 1 Additional material submitted by ............................................................ 4 Prepared statement of ............................................................................... 3 Statements of witnesses: Carpenter, Ann, Vice President, Exploration and Business Development, Nevada Colca Gold, Inc., Reno, Nevada ...................................................... 81 Prepared statement of ............................................................................... 82 Coyner, Alan R., Administrator, Nevada Division of Minerals .................... 10 Prepared statement of ............................................................................... 13 Additional material submitted by .......................................................................... 15 Dempsey, Stan, Chairman, Royal Gold, Incorporated, Denver, Colorado ... 70 Prepared statement of ............................................................................... 72 Additional material submitted by ............................................................ 74 Drozdoff, Leo M., Chief, Bureau of Mining Regulation and Reclamation, Nevada Division of Environmental Protection, Carson City, Nevada ...... 56 Prepared statement of ............................................................................... 57 Letter to Ms. Cherie Sexton ..................................................................... 65 Letter to Ms. Cherie Sexton ..................................................................... 109 Letter to Mr. Paul McNutt, ...................................................................... 125 Letter to Mr. Dave Aberswerth and Bob Anderson, ............................... 129 Letter to Mr. Bob Anderson, .................................................................... 138 Fields, Russell A., President, Nevada Mining Association ........................... 6 Prepared statement of ............................................................................... 8 Guinn, Hon. Kenny C., Governor, State of Nevada, prepared statement of ..................................................................................................................... 35 Additional material submitted for the record by: Ingle, Hugh, President, Nevada Miners and Prospectors Association, Yerington, Nevada ........................................................................................ 83 Prepared statement of ............................................................................... 84 Kennedy, Larry, Exploration Manager, Battle Mountain Gold, Reno, Ne- vada ................................................................................................................ Lewis, F. W., F.W. Lewis, Incorporated, Reno, Nevada ................................ 86 Prepared statement of ............................................................................... 87 Miller, Glenn C., Cochair, Mining Committee, Toiyabe Chapter, Sierra Club, Reno, Nevada ...................................................................................... 41 Prepared statement of ............................................................................... 43 Myers, Tom, Director, Great Basin Mine Watch, Reno, Nevada .................. 44 Prepared statement of ............................................................................... 47 Parratt, Ronald L., Commissioner, Commission on Mineral Resources, State of Nevada ............................................................................................. 25 Prepared statement of ............................................................................... 26 Rhoads, Dean A., Chairman, Natural Resource Committee, Nevada State Legislature ..................................................................................................... 35 Prepared statement of ............................................................................... 38 Soberinsky, Victoria, Deputy Chief of Staff for Governor Kenny Guinn, State of Nevada ............................................................................................. 33 (III) IV Page Additional material submitted: Backgound Memo from the Committee .......................................................... 104 Federal Register, Notice of Intent and scoping .............................................. 120 Loptien, Greg D., Sparks, Nevada, prepared statement of ........................... 105 Western Governors' Association, letters and prepared statement of ........... 113 Women's Mining Coalition, Reno, Nevada ..................................................... 157 Guinn, Hon. Kenny C., Governor, State of Nevada, prepared state- ment of .................................................................................................... 35 THE EFFECT OF FEDERAL MINING FEES AND PROPOSED FEDERAL ROYALTIES ON STATE AND LOCAL REVENUES AND THE MINING INDUSTRY SATURDAY, MAY 15, 1999 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES, COMMITTEE ON RESOURCES, Reno, Nevada. The Subcommittee met, pursuant to call, at 2 p.m. at the Washoe County Commission Chambers, 1001 E. 9th Street, Building A, Reno, Nevada, Hon. Jim Gibbons presiding. STATEMENT OF HON. JIM GIBBONS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEVADA Mr. GIBBONS. Ladies and gentlemen, it's my honor to open this Subcommittee on Energy and Mineral Resources hearing here in Nevada. To begin with, I want to welcome all of you here. We're going to make a slight change in the format simply because some of the witnesses that were on the first panel have been unavoidably detained, so we will end up starting with the second panel. Let me also tell you that at the end of all of the hearing time for those people that are on scheduled panels, we're going to try to open it up, time permitting, for an open mike to let those public citizens out here that want to have a voice to be heard, we're going to offer them a minute or a minute and a halfÐI know that sounds like a short time, but when the TV cameras are on you, it's a long time. So figure out what you're
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