Written By Crystal Howard.
Last updated April 14, 2014, 7:14 AM PST
This analysis provides an overview of the proposed changes to the California Surface Mining and Reclamation Act (SMARA) which are presented in Senate Bill 1270 (Pavley). Senator Fran Pavely of Senate District 27 is carrying the bill. District 27 covers Malibu, Thousand Oaks, Simi Valley, Moorpark and parts of Santa Clarita and the San Fernando Valley. Sen. Pavley is also the Chair of the Senate Committee on Natural Resources and Water. The bill is sponsored by the Sierra Fund, a nonprofit organization dedicated to the Sierra Nevada and they are located in Nevada City, California.
What is changing?
- The Office of Mine Reclamation (OMR) would be renamed “Division of Mines.”
Impact: May have no impact
- Creation of the State Mine Inspector whom would be appointed by an unspecified person or group. The State Mine Inspector would be in charge of the Division of Mines.
Impact: The listed required qualifications for this position will limit choices for qualified candidates. Potential candidates must be chosen from the ranks of existing state employees (minimum one year of service).
- Annual reports would be submitted to the State Mine Inspector.
Impact: No significant change.
- Annual reporting fee will be a minimum of $1,000 with no maximum. Currently, the fee is capped at $4,000 but cannot be lower than $100. The proposed annual fee would be calculated on a per acre basis. The per acre rate is not specified. The board has the ability to adjust the fee any time and for any reason.
Impact: Increased costs. Imagine, if you have a 200 acre site, and the fee was set at $100/acre, you would be looking at $20,000 annually. Increased uncertainty. Annual fees could increase at anytime and their use or need is unknown. Needs always outstrip resources – unless the source of resources is unlimited.
- The annual reporting fees shall be deposited in the Mine Reclamation Account and the Board can recommend expenditures of the funds as part of the annual budgeting process. Currently, the funds only go to the Mine Reclamation Account.
Impact: Uncertainty and mistrust. Costs can change and no nexus is required.
- An affected operator, lead agency or any affected person (member of the public) may appeal to the board the department’s decision to place an operation on the AB3098 list or remove an operation from the list. The bill provides specific requirements for appeals. An operation wanting to be placed on the list cannot be put on the list until there is a final outcome of the appeal. However, a mining operation appealing the department’s removal from the list, shall remain on the list until there is a final outcome of the appeal. This [new] risk could be faced quarterly coinciding with the AB3098 listings.
Impact: Increased risk and legal fees. Availability of materials needed for public works and infrastructure projects could be delayed and costs increased.
- A Reclamation Plan would need to be certified by a registered professional.
Impact: A reclamation plan is a document that contains a variety of technical documents. The technical documents have always had to be certified by a professional. One certified professional may not be able to certify the full reclamation plan because it might contain items outside of their expertise (i.e., what do engineers know about revegetation?).
- The Director of the Department of Conservation (DOC) would be required to prepare or adjust the Financial Assurance Cost Estimate annually.
Impact: Increased costs. The State is allowed to review and approve the document they prepare. Lead Agencies maintain liability of reclamation should a site be abandoned. DOC currently states that the majority of sites have inadequate financial assurances. As a result, you should expect the value of the financial assurances to increase.
- Currently, SMARA allows for any person to challenge the denial of the lead agency to approve a Reclamation Plan or Financial Assurance. SB 1270 would allow anyone to challenge the approval or denial of the Reclamation Plan or Financial Assurance.
Impact: Increased risk from delays in acquiring entitlements. Increased legal fees.
- The schedule for reclamation would need to be updated annually.
Impact: May require an amended plan on an annual basis, resulting in a never ending permitting process.
- SB 1270 states that if no time period is identified in a Reclamation Plan, or if the time period specified is not acceptable to the lead agency, the lead agency shall determine a time period for reclamation, if one cannot be agreed upon.
Impact: Regulatory determinations would overrule market realities.
- The State will conduct inspections.
Impact: Lead Agencies lose control of compliance for reclamation plans they approved. In most cases, operators will be subject to double inspections and costs; one from the State for the reclamation plan and one from the lead agency for the use permit.
- If a violation is identified during an inspection, a Notice of Violation MUST be issued by the Director or Lead Agency with a schedule of steps to rectify the problem.
Impact: Lead agency loses the ability to use its own discretion based on site specific conditions.
It is also important to note that this bill would impose additional duties on lead agencies; creating a state-mandated local program. The industry would be responsible for providing the funding for the mandated program. Funds would be collected from the industry through the proposed revisions to the fee structure and through payments to local agencies (varies by agency).
SB 1270 was introduced February 21, 2014 and referred to the Senate Committee on Natural Resources and Water and the Committee has placed it on their April 22, 2014 agenda. Comment letters must be provided to each committee member by April 15th to be included in the record. At the committee meeting, public comment will be allowed. If it passes the committee, it may be referred to the Appropriations Committee and then it will be sent to the Assembly. Please contact and send letters to your local Assemblyman and let them know your position on the bill.
(Update 4/11/2014 10:26 AM PST: SB 1270 has been postponed and removed from the April 22, 2014 Senate Committee on Natural Resources and Water agenda. A new date has not been scheduled.)
(Update 4/14/2014 7:14 AM PST: SB 1270 has been added to the April 29, 2014 Senate Committee on Natural Resources and Water agenda.)
If you have questions regarding this bill, please do not hesitate to call Crystal Howard at EnviroMINE, (619) 284-8515. We are encouraging everyone to submit a letter to their legislators listed in the link below explaining how the bill will affect their business. We have provided sample letters for your convenience. Again, letters to the Senate Committee members on Natural Resources and Water must be received by April 15th. Letters to your local elected officials can be received after that date.
Sample Letter from Operator (Word Document)
Sample Letter from Lead Agency (Word Document)
If you use a sample letter in its entirety, it should be faxed (not emailed) do to the character limitations on the Senators’ email forms.
Crystal Howard is an economist and market analyst for EnviroMINE, Inc.