On Thursday, July 12, 2012, the House is scheduled to consider H.R. 4402, the National Strategic and Critical Minerals Production Act of 2012, under a rule. The bill was introduced on April 19, 2012, by Rep. Mark Amodei (R-NV) and referred to the committee on Natural Resources, which held a mark up and reported the bill by a vote of 24-12 on May 16, 2012. The bill will be considered under a rule making seven amendments in order. A summary of the amendments made in order under the rule is available below.

H.R. 4402 would streamline approval of domestic mineral exploration and development projects by eliminating duplicative analysis, providing for timely filings for litigants, and allowing 30 months for the lead agency to prepare, consider and reach a decision on permitting for mine development. The bill would also define domestic mine projects that provide strategic and critical minerals as “infrastructure projects” in order to expedite the permitting process.

DEVELOPMENT OF DOMESTIC SOURCES OF STRATEGIC AND CRITICAL MINERALS

H.R. 4402 would define any domestic mine projects that would provide strategic and critical minerals as “infrastructure projects,” which would allow federal permitting authorities to use state reviews when appropriate to determine if a project should be carried out. The bill would define “strategic and critical minerals” as any minerals that are necessary for national defense, energy infrastructure, to support domestic manufacturing and other economic sectors, and to support the nation’s economic security as a whole.

The bill would also require agencies responsible for issuing mineral exploration and mining permits to appoint project leaders to coordinate with relevant agencies to minimize approval delays and adhere to timelines and schedules for completion of project approvals. In addition, the bill would require the lead agency with responsibility for issuing mineral exploration or mine permits to determine that any permitting action would not constitute a major action that significantly affects the quality of the environment as defined by the National Environmental Policy Act (NEPA). The lead agency would make such a determination if the permitting process provides an adequate mechanism to ensure that environmental factors are taken into consideration. The bill would define a “lead agency” as any agency, department, or other unit of federal, state, local, or tribal government, or the Alaska Native Corporation, that is responsible for issuing mining permits.

In addition, the bill would require the lead agency with responsibility for issuing a mineral exploration or mine permit to enhance coordination on the permitting process by avoiding duplicative reviews, minimizing paperwork and engaging other agencies and stakeholders early in the process. The bill would require the lead agency, at the request of a project supporter, to set time limits for each part of the permit review process, which includes the following steps:

• The decision on whether to prepare a document required under the National Environmental Policy Act of 1969.
• A determination of the scope of any document required under the National Environmental Policy Act of 1969.
• The scope of and schedule for the baseline studies required to prepare a document required under the National Environmental Policy Act of 1969.
• Preparation of any draft document required under the National Environmental Policy Act of 1969.
• Preparation of a final document required under the National Environmental Policy Act of 1969.
• Consultations required under applicable laws.
• Submission and review of any comments required under applicable law.
• Publication of any public notices required under applicable law.
• A final or any interim decisions.

The bill would require that the total permit review process not exceed 30 months, unless agreed to by the signatories of the agreement. The bill would also alleviate requirements that the lead agency must address public comments that were not submitted during the prescribed public comment periods. The bill would require that it must be the priority of the lead agency to maximize the development of the mineral resource while mitigating environmental impacts. The bill would also require that the process currently practiced by the Department of the Interior for placing and reviewing Federal Register notices must be completed within 30 days, barring any extraordinary circumstance.

JUDICIAL REVIEW OF AGENCY ACTIONS RELATING TO EXPLORATION AND MINE PERMITS

The bill would require that a civil action regarding agency action affecting a mineral exploration or mine permit must be filed within 60 days of the final federal agency action which approved the permit.  The bill would require courts to hear and determine any civil action in an expeditious fashion. The bill would also prohibit the payment of any civil relief beyond what is necessary to correct the violation of the legal requirement specified in the complaint. Finally, the legislation would bar the payment of attorneys’ fees by the federal government in such cases.

According to findings listed in the legislation, the availability of minerals and mineral materials are essential for economic growth, national security, technological innovation, and the manufacturing and agricultural supply chain. Additionally, the bill states that the exploration, production, processing, use, and recycling of minerals contribute significantly to the economic well-being, security and general welfare of the nation. According to House Report 112-583, H.R. 4402 would address mineral permitting timelines, which the Committee states is the most significant barrier to domestic mineral exploration and development. Permitting delays put the U.S. at a competitive disadvantage with other mineral rich countries. The bill would address these issues by attempting to eliminate duplicative analysis, providing for timely filings for litigants, and allowing 30 months for the lead agency to prepare, consider and reach a decision on permitting for mine development.

In the 2012 Ranking of Countries for Mining Investment, the U.S. ranked with Papua New Guinea as last out of 25 major mining countries in permitting delays, and towards the bottom regarding taxes, fees and social issues affecting mining. Permitting timelines for hard rock mines on federal land take the longest of the 25 mineral producing nations. On average it can take seven to ten years or more to acquire all of the permits and to work through litigation brought by environmental groups. According to the Natural Resources Committee, mining of mineral resources creates tangible value, introducing new money into the nation's economic system. Additional tangible value is added to the raw mined product through manufacturing, construction, and other uses. In addition, harvesting domestic mineral resources contributes to local economies, creates jobs, and benefits our nation's overall economic security.

According to CBO, “implementing H.R. 4402 would have no significant impact on the federal budget.”

Amendment No. 1—Rep. Tonko (D-NY): The amendment would narrow the definition of “strategic and critical minerals” under the bill to include only the following:

1. Minerals and mineral groups identified as critical by the National Research Council in the report titled ‘‘Minerals, Critical Minerals, and the U.S. Economy;” and

2. Additional minerals identified by the Secretary of the Interior based on the National Research Council criteria in such report.

The amendment would also prohibit sand, gravel, or clay from being defined as “strategic and critical minerals.” In addition, the bill would narrow the term “mineral exploration or mine permit” to mean a mineral permit for strategic and critical minerals (as narrowly defined under the amendment) that includes a plan of operation issued by the Bureau of Land Management (BLM) and the Forest Service.

Amendment No. 2—Rep. Hastings (D-FL):The amendment would extend the time limits on the mineral permit review process (30 months in the underlying bill) under certain circumstances. The amendment would state that the review process could exceed 30 months in one of the two following circumstances:

1. A longer review process is agreed to by the signatories of the agreement.

2. The lead agency has determined that an adequate review has not been completed due to issues arising not contained in the permit application or otherwise unforeseen by the signatories at the time of submittal of the permit application.

If it is determined that an adequate review has not been completed, the agency would be allowed to extend the review time for an additional six months. If, at the end of this six-month period, the review issues have not been completed, the process would be extended by an additional six months. Only after two six-month extensions, the agency would be authorized to make its final determination.

Amendment No. 3—Rep. Markey (D-MA):  The amendment would require a royalty payment of 12.5 percent of the value of any minerals extracted on federal land under a permit for hardrock mineral exploration. The amendment would require the lead agency to assess the royalty, which would be made available to the Secretary of Interior for abandoned hardrock mine lands reclamation. 

Amendment No. 4—Rep. Young (R-AK):The amendment would require the lead agency, with respect to strategic and critical minerals within a federally administered unit of the National Forest System, to do the following:

1. Exempt all areas of identified mineral resources in Land Use Designations, other than Non-Development Land Use Designations, in existence as of the date of the enactment of this Act from the procedures detailed at and all rules promulgated under Federal Regulations;
2. Apply such exemption to all additional routes and areas that the lead agency finds necessary to facilitate the construction, operation, maintenance, and restoration of the areas of identified mineral resources; and
3. Continue to apply such exemptions after approval of the Minerals Plan of Operations for the unit of the National Forest System.

Amendment No. 5—Rep. Cravaack (R-MN):The amendment would apply mineral permit streamlining provisions to a mineral exploration or mine permit for which an application was submitted before the date of the enactment of this Act if the applicant for the permit submits a written request to the lead agency for the permit. The lead agency would be required to begin implementing this section with respect to such applications within 30 days after receiving such written request.

Amendment No. 6—Rep. Hastings (D-FL): The amendment would exempt non-profit organizations and individuals from provisions in the bill which bar the payment of attorneys’ fees by the federal government arising from civil actions against a mining permit.

Amendment No. 7—Rep. Grijalva (D-AZ): The amendment would exempt the provisions in the bill from applying with respect to any mineral exploration or mining permit that a lead agency determines would diminish opportunities for hunting, fishing, grazing, or recreation of public lands.