State regulators in Maine throw fiscal responsibility to the wind with proposed mining regulations
December 5, 2013
State regulators in Maine are developing new rules for hardrock mining that throw fiscal responsibility to the wind.
The rule, which is currently up for public comment, will allow mining corporations to post just 50% of mine clean-up costs up front, rather than the 100% that’s normally required -- transferring the risk of clean-up costs from the mining corporation to taxpayers.
The concept of requiring financial assurance up front (commonly known as a mine reclamation bond) is similar in concept to a security deposit for an apartment rental -- posting money up front to cover damages that weren't fixed upon leaving. Same concept with mining, except the mining operator knows in advance that it's going to do damage, and that it's going to cost tens to hundreds of millions of dollars to fix.
States must have this money in hand to pay for clean-up if the company runs out of money, files for bankruptcy or refuses to do the work. It happens. Metal prices are volatile, and a “boom” when gold or copper prices are high, can quickly change to “bust” when they drop.
Sadly, there are no shortages of examples. Taxpayers are already saddled with billions in mine clean-up costs around the nation. Maine regulators need to take a more fiscally responsible approach, and put the cost of clean-up where it belongs – on the industry.comments powered by Disqus