- July 23 - Mining expert Jim Kuipers from the Center
for Science in Public Participation testified before the House Resources Subcommittee
on Energy and Mineral Resources today that taxpayers may have to pay as much as
10 billion dollars to clean up polluted mine sites on public lands. Recent rule
changes require the mining industry to ensure adequate funding for mine clean-ups
before mining begins. In response to industry lobbying against these rules, the
Bush Administration formed a task force that is likely to propose changes to allow
ineffective "corporate guarantees" rather than real financial guarantees.
This would make it much easier for mining companies to avoid financial responsibility
for clean-ups and shift the costs to taxpayers.
"At a time when the Enron and Worldcom scandals have rocked
public confidence and demonstrated a need for much greater
corporate accountability, why is the Bush Administration about to
allow the mining industry to evade responsibility for paying to
clean up toxic pollution from mines?" Kuipers told the committee.
"Instead of proposing to weaken the regulations, the Bush
Administration should enforce current regulations and seek new
tools to ensure that polluters pay, not taxpayers."
Under existing federal regulations, mining companies are
required to purchase bonds or cash equivalents to cover the costs
of environmental clean-ups from mining operations on public lands.
The up-front bond purchases ensure that toxic pollution will be
cleaned up and mutilated landscapes reclaimed when a company is
unable or unwilling to pay. These financial guarantees are needed
because the mining industry has left a trail of toxic
contamination: 500,000 abandoned mines across the county; the
pollution of 40 percent of Western watersheds; and nearly 30 mine
sites currently on the EPA's Superfund National Priority List of
the most contaminated sites in the nation.
Typically, a large mine site will disturb more than 10,000 acres
of land. At many mines, acid drainage can result in the leaching of
toxic and carcinogenic contaminants such as arsenic into water
sources. The costs of addressing this pollution can climb above
one hundred million dollars per mine. Mining companies have been
underestimating the cost of the clean-ups, and have failed to
provide adequate guarantees to ensure that the mines will be
cleaned up. Kuipers estimates that mining companies in the U.S.
have a potential gap of $10 billion in clean-up coverage. If the
mining companies won't be able to pay for the clean-ups, taxpayers
will have to pay.
Now, in the midst of corporate accountability scandals, the
mining industry is seeking relief from the Bush Administration. It
has asked the administration to eliminate the bond requirement and
replace it with a worthless paper "corporate guarantee" without any
financial resources attached to it. The only financial guarantee
would be the taxpayer. The Environmental Protection Agency
Superfund has already paid out more than $500 million to clean up
The mining industry claims there is a crisis in the availability
of bonds. Prices have risen for legitimate financial guarantees,
but it is reflective of the track record of the mining industry's
underestimation of costs. The true crisis is the potential costs of
repairing public lands from mining operations.