BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chairman
1103 (Aanestad)
Hearing Date: 05/27/2010 Amended: 04/06/2010
Consultant: Brendan Mccarthy Policy Vote: NR&W 7-1
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BILL SUMMARY: SB 1103 allows owners of idle surface mining
operations to pay a reduced regulatory fee.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
Reduced fee revenues $145 $290 Special
*
from idle mines
Reduced fee revenues Up to $400 per year Special
*
from potentially idle mines
* Mine Reclamation Account.
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STAFF COMMENTS: SUSPENSE FILE.
Current law, the Surface Mining and Reclamation Act (SMARA),
regulates the operation and reclamation of surface mines in the
state. Under SMARA, mines are categorized as active or idle.
(Mines no longer producing and in the process of reclamation are
considered active.) The owners of all surface mines are required
to have in place a reclamation plan for post-mining cleanup of
the site and financial assurances that are sufficient to pay for
the ultimate reclamation of the mine. In addition, owners of
idle mines are required to file Interim Management Plans that
detail how the mine will be maintained during the idle period.
Mines that are not in compliance with these provisions are
considered abandoned.
Under current law, owners of active and idle mines are required
to pay a regulatory fee to the Department of Conservation. The
minimum fee is $3,407 per year and the maximum fee is $4,676.
The fee level is based on production amount. In addition,
certain active mines may qualify for the "low gross exemption"
fee of $468 per year. In order to qualify for the low gross
exemption, a mine must have gross income of less than $100,000
per year and the mine operator must have an approved reclamation
plan on file and financial assurances in place.
Currently there are 100 idle mines in the state. In addition,
the Department indicates that there are an additional 136 mines
that have sufficiently low production to qualify as idle.
SB 1103 provides that operators of idle mines that are in
compliance with the requirements of SMARA may pay the low gross
exemption fee rather than the standard fee.
By allowing idle mine operators to pay the low gross exemption
fee rather than the standard fee, the bill will reduce fee
revenues. Based on the current number of idle mines in the state
the Department is expected to see reduced annual fee revenues of
about $290,000 per year. In addition, it is likely that some
operators of active mines that have very low production levels
would report their mines as idle in order to qualify for the low
gross exemption. The amount of reduced fee revenues from these
additional mines is unknown, but could be up to $400,000 per
year.