Tom Kitchar

I am writing you today as President of the Waldo Mining District, which was established in May of 1852 (in what is now SW Oregon); and as an individual Miner & Prospector for the last 28 years. I, and thousands of other individual citizens like me, beg you to hear our plea, and remember us in your important deliberations; the outcome of which could destroy the living American Heritage of the “Individual Miner/Prospector”.

One hundred thirty-six years ago a Bill was passed by Congress unique to all the world and history. This Bill, the U.S. Mining Law of 1872, was promulgated from a blend of earlier mining laws, traditions, and most importantly from the methods and customs practiced by the miners themselves throughout the American west. For the first (and only) time in human history, individual citizens, without any prior approval from a government, and acting solely on their own initiative and at their own expense; were granted the right to enter the Public Lands to search for, locate, and extract the valuable minerals needed to supply this country’s needs and build a sound economy.

Was the 1872 Mining Law a success? For the answer to that question, all one has to do is look to history. At virtually no cost to the Nation and for well over one hundred years, most or nearly all of this country’s mineral requirements have been met by domestic mining. All the iron for all the steel to build the railroads, bridges, buildings, all the weaponry and ships to fight two World Wars (and then some), the automobile industry, etc.; all the copper needed to light the world; etc.; and enough gold to pay for it all came from mining under the 1872 Mining Law… and along the way, the United States became the richest and most powerful nation on Earth.

Last year, the House of Representatives passed H.R. 2262, the “Hardrock Mining and Reclamation Act of 2007”, which if enacted, would utterly destroy what little remains of this Nations once great mineral industry. This Committee now contemplates its own possible revision of the 1872 Mining Law. Because of the seriousness of these matters, and for the sake of this Nations continued wealth, security, and for the protection of a truly unique American heritage, I urge you to consider the following Testimony in your deliberations.

Although the 1872 Mining Law has been attacked and amended many times since enactment, a more recent series of attacks in the last twenty or so years has brought us to today, where over-whelming and complete revision is being proposed. Those proposing the revision of the 1872 Mining Law seem to be driven by the extremist environmental community, and a handful of Congressional members that ought to know better. In response to at least some of the “propaganda”, I submit the following:

RESPONSE: 99+% of all serious environmental harm from mining occurred before the 1960’s & 1970’s. Since the passage of tough federal and state environmental protection laws (e.g.; ESA, CWA, NEPA, etc.), no legally operating mine in this country poses a serious risk to the environment. Long gone are the days of unregulated environmental destruction. Amending the 1872 Mining Law will not undue the environmental damage of the past… and the laws are already in place to keep any such damage from occurring in the future.

The Committee is urged to keep in mind that “some” level of environmental disturbance will occur from mining (i.e.; you can’t dig a hole without moving some dirt). Due to the site-specific nature of mineral operations, the best way to minimize the effects from mining is to control it at the local level. Bureau of Land Management and National Forest Service mining regulations already require NEPA analysis approved Plans of Operation for all mining operations likely to cause a significant surface disturbance. This approval process can take anywhere from a year or two to well over ten years. If anything, this process is already too burdensome and prohibitive for all but a simple pick & shovel operation (which even then may require permitting at the state level).

Amending the 1872 Mining Law to place even tighter environmental protection restrictions and control on mining will bring nearly all mining to a screeching halt, destroying the industry along with hundreds of communities and thousands of families and individuals dependent on the mining industry.

B. CLAIM: All mining operations should be bonded to guarantee reclamation.

RESPONSE: Current Bureau of Land Management and National Forest Service mining regulations already require 100% reclamation bonding for all mineral operations that create a significant surface disturbance. This generally includes all but the smallest levels of mining, from 1-man with a bulldozer or backhoe to the largest of mines. Amending the 1872 Mining Law with tighter bonding requirements will only work to make a bad situation worse, as especially for the smaller operations, no one will issue a bond on mining operations forcing the operator to post a 100% cash bond, bankrupting many operations before they even stick a shovel in the ground.

C. CLAIM: Mining operations are getting the minerals for “free”; there should be a royalty.

RESPONSE: Mining, as with almost all other business, is all about spending money in the hope of making even more money. The big difference with mining is that small fortunes can be spent just to determine if a deposit is worth developing. For every successful mine there are dozens of unsuccessful prospects. To place a further economic burden on the successful mining operation by imposing a royalty (i.e.; “tax”) will do nothing but put that many more mines in the “unsuccessful” list.

No mining operation is getting something for nothing… larger operations expend millions of dollars in exploration and development work before any mineral comes out of the ground. That’s millions of dollars of investment money spent into local communities as wages, supplies, lodging, etc. and to equipment suppliers worldwide… plus all the continued expenses if the mine is successful. [1] Even the smallest of operations, such as the 1-man with a small underwater vacuum (“suction dredge”) may invest $3-10,000 in equipment.

Another problem with the royalty issue is the potential “takings” issues, in that the owners of existing mining claims already own the minerals as granted and guaranteed by the existing law.

RESPONSE: No one is patenting land for $2.50 - $5.00 per acre. The proof is that if land could be patented for that amount, there would be no land left to patent! In reality, since the early 1990’s, Congress has placed a moratorium on the patenting of mining claims. Furthermore, even when patents were still being issued, most claimants expended $20-30,000 (in 1980’s dollars) per acre before and during the patenting process.

Considering the incentive value of the patenting of mining claims, it would seem wiser to find a way to continue the practice rather than totally abolish it. I respectfully suggest that the problem with patenting is the fault of Congress, who in over 100 years never revised the payment amounts of $2.50 - $5.00 per acre. At the time of enactment, even $2.50 was a lot of money to pay for an acre of land, let alone mountainous wilderness. If based on the value of an ounce of gold in the late 1800’s (i.e.; $20/oz), $2.50 was equal to 1/8^th of an ounce. At today’s price (nearly $900/oz), that same 1/8^th of an ounce is now worth $112.50.

RESPONSE: One of the more popular battle cries, opponents to the Mining Law argue that the Law needs massive revision just because it’s an old law. If that were the case, then maybe Congress should consider the creation of the Natl. Park Service and Yellowstone Natl. Park…as they too were enacted in 1872. Or how about the U.S. Constitution and the Bill or Rights… they are even older than the Mining Law and following this logic (old must be bad) suggests the oldest needs to be revised first. Maybe we should revise the Declaration of Independence… as it’s oldest of all.

Revising the Mining Law just because its 136 years old is nothing but bad news for this nation. “If it ain’t broke, don’t fix it” seems to aptly apply… and it ain’t broke, at least not in the sense proclaimed by those seeking reform. (It is broke in the sense that the environmental protection pendulum has swung way too far into the realm of needlessly restrictive to the point of prohibitive, causing untold economic hardship throughout the West.

I beg the Committee’s indulgence to bring up a special issue in regards to any reform of the 1872 Mining Law, which is the plight of the Individual Miner/ Prospector. Yes, we are still out there, searching for our own version of the American Dream. Every summer the gold regions of the West are visited by thousands of individuals and families usually in pursuit of placer gold using methods used 150 years ago. [2] The most popular form of this “small-scale” mining is with a “surface suction dredge”. [3]

Contrary to what the extremist environmentalist community claims, suction dredge mining is the most environmentally friendly method yet devised for the recovery of heavy minerals, such as gold, from active streambed gravels. For the most part, all signs of the operations are reclaimed naturally with one winter flow; and, as numerous studies have shown, suction dredge mining, as currently regulated by the individual states, has a net beneficial affect on the environment. [4]

The largest of the common suction dredges is the 8” dredge. It might have a floating barge 8 ft. wide X 16 ft. long, and be powered by a 40 hp Volkswagon engine. These dredges are used in larger rivers, and might move 1-3 cu/yrds/hr. For the most part, suction dredge and lessor mining/prospecting operations do not require an approved Plan of Operations under current BLM or FS regulations, but do require state permits [5] which regulate for the protection of fish and fish habitat, etc..

By far, this level of small-scale mining is the most popular… and the most like the gold rush days 150 years ago. By the thousands, individuals spend their summer vacations or retirement out in the great outdoors, practicing the methods developed over 5,000 years ago. And just like during the gold rush days, some go away empty-handed, most find at least something, many pay their expenses, and a certain few actually do pretty good. For the most part, nobody is getting rich. All however are continuously pumping their own money into the operation, on average of $2-3,000 per person per year.

Next up the scale of operations involves mechanized earthmoving, typically a small 1-2 man (or husband & wife) seasonal bulldozer-backhoe trommel & sluice operation. Even the smallest of these operations usually requires an approved Plan of Operations and reclamation bond. This level of operations is not as popular as the smaller levels of operations due to the considerably higher costs involved (a medium sized dozer or backhoe along with pumps, and some type of wash plant will cost $50,000 on up), the tremendous burden of getting an approved Plan of Operations and posting a bond, along with the plethora of state permits that may be required.

Currently, this level of mining is nearly impossible due to the complexity of the regulations and the undue delays in the approval process. There are literally thousands of small-scale mineral deposits throughout the West well worth working at this level (but are far too small to work at the large scale)… but aren’t being developed due to the burden of obtaining approval. Any more restriction placed on this level of mining will stop the few hundred operations still in existence.

In order to preserve and protect the small-scale miners and prospectors, and along with them the hundreds of small communities and businesses dependent on the economic boost brought by mining, I respectfully urge the Committee to incorporate the following items in any proposed revision to the 1872 Mining Law:

A. GRANDFATHERED RIGHTS: All existing claims at the time of any revision must have grandfathered rights back to the rights granted on the date of location.

B. RETAIN THE 10-CLAIM SMALL-SCALE MINERS EXEMPTION: In order to maintain the small-scale mining industry (which pumps well over $20-30,000,000 into the economy annually), the exemption on the $125 per claim per year maintenance fee and the performing of assessment work must be retained.

C. OCCUPANCY: Small-scale miners & prospectors must be able to occupy the areas they are working for several reasons:

D. NO APPROVAL NEEDED FOR INSIGNIFICANT DISTURBANCE: Current BLM and FS regulations are sufficient to protect the Public Lands from any unnecessary disturbances. Any revision to the Mining Law should not contain any pre-set arbitrary conditions, as each mining operation is site-specific and needs the management of local authorities to be affective. Operations deemed not likely to cause a significant surface disturbance, at least up to an including most suction dredge mining operations, should not require an approved Plan of Operations. Simple exploration with a dozer or backhoe should also not necessarily require Plan approval. It really needs the local man on the ground to determine the possible extent of the disturbance, and the possible protection measures reasonably needed.

Low thresholds for needing an approved Plan of Operations will cause the extinction of the smaller levels of mining, and will bury the BLM and FS in endless and needless tons of paperwork. It is currently estimated that the average “simple” FS Plan of Operations takes over $20,000 to approve, and most Natl. Forests are budgeted to approve 1-2 Plans per year. Simply requiring all suction dredge miners to obtain an approved Plan would cause the submittal of thousands of Plans to the FS, which would destroy the suction dredge industry (due to delays), and take all the efforts of the whole FS staff to even make a dent in the pile of Plans to be approved. And all for no good reason.

E. NO ROYALTY ON SMALL-SCALE MINING: Even if the Committee proposes a royalty, all small-scale operations producing less than $100,000 annual net profit should be exempted to avoid placing undue economic hardship on the small miner, and to save the collection agency thousands of hours of paperwork attempting to collect trivial amounts of money (i.e.; the govt. would probably spend way more in the collection and any amount collected).

And although I believe a royalty is wrong, and harmful to the industry on the whole, if there must be a royalty, then it should be on “net” returns, not on the “gross” as proposed by the House. A royalty on the “gross” will work to make way too many mining prospects uneconomical.

F. NO SPECIAL STATUS FOR THIRD PARTY APPEALS & SUITS: Already one of the main reasons for lengthy undue delays in obtaining approval on Plans of Operation is the constant harassing interference usually by non-profit tax-exempt environmental organizations (NGOs) out to save the planet. The laws, rules and regulations already give all interested parties ample opportunity to raise issues of concern and object to any proposed mining operation requiring an approved Plan.

Just by following the FS appeal process (and without going to court), NGOs can and do tie up and delay approval of almost any Plan for proposed mining for easily a year or more based on the flimsiest excuse or slightest technicality in preparation of the required NEPA analysis and document. What’s worse, even after forcing the FS into spending on average over $30,000 preparing the required NEPA documents, and after causing the total waste of years of the miners life waiting for approval (and as many individual small-scale miners get involved in mining in their later years, many fall into ill health or even die while waiting 2, 3, 4, all the way up to 10 or more years for approval; even when the NGOs that caused all this are found to be wrong, they loose nothing.

Even if they loose the appeals (of which there are at least two levels available), there is always the option of suing in court to stop or just delay the proposed mining operation. (Sometimes the window of opportunity for the miner is less than the time it takes to fight his way to approval, and he either goes broke from legal fees, or grows too old or dies. The NGOs know that with the right arguments and a determined effort, they can easily delay the approval of any Plan of Operations for at least ten years. Even though they can cost the FS and the miner thousands of dollars in defense, even when they are found wrong and loose in court, in many instances, they (the NGOs) somehow receive legal fees paid by the taxpayers. (NOTE: The whole environmental protection industry has grown by leaps and bounds beyond the realm of simply over-protective. A whole “environmental law” industry has formed milking the taxpayers of hundreds of millions of dollars. They actually get paid for destroying this Nation’s natural resource industries… in part by the very taxes paid by those same industries.

Please do not give the future of the United States Mineral Industry over to the hands of the NGOs by giving them or other third parties special status, they already have far too much influence and is costing this Nation dearly.

The basic premise of our whole system of government is that the least amount of government governs best, and the closer we get to individual freedom and capitalism the better off we all are. Mining of minerals is a prerequisite for all civilization. So is a clean and healthy environment. The two are not necessarily incompatible, but rather can go hand-in-hand so that they both thrive.

Under the current levels of regulation (and contrary to what some might say), no legally operating mining operation is seriously harming the environment. On the other-hand, many overly and unnecessarily restrictive regulations and policies are unnecessarily harming the mineral industry.

Considering that everything humankind needs ultimately comes from one of two sources (i.e.; agriculture or mining), there can be no doubt that a strong nation requires a strong domestic mineral industry. I respectfully submit to this Committee that due to the over-whelming success of the 1872 Mining Law, any reform of the 1872 Mining Law should work to strengthen the mineral industry, not act to further destroy it.

I can think of no other law still on the books today that practices the tenants of pure republican democracy and the “American Dream” like the 1872 Mining Law. In the tradition of a Horatio Alger “rags to riches” story (whereby the poor hero achieves success and wealth solely through honest hard work), the rights granted in the 1872 Mining Law alone allow nearly anyone to pursue the American Dream of Self-Sufficiency and Happiness.

Without the 1872 Mining Law, none of the tremendous benefits to the Nation (e.g.; national economic wealth, mineral self-sufficiency, the taming and settling of the West, technology, millions of jobs, etc.), would have occurred, and this Nations history would be quite different.

I, Tom Kitchar, do herby swear that the above is true and correct to the best of my knowledge and understanding, and I humbly thank the Committee for considering my Testimony.

Subcommittee Members

Ron Wyden (Chairman)
Daniel K. Akaka
Tim Johnson
Mary L. Landrieu
Maria Cantwell
Ken Salazar
Robert Menendez
Blanche Lincoln
Bernard Sanders

John Barrasso
Larry E. Craig
Lisa Murkowski
Richard Burr
Jim DeMint
Jeff Sessions
Gordon Smith
Jim Bunning

[1] [CASE IN POINT: In 1984, the largest underground gold mine in the Western Hemisphere, the “Homestake Mine” in Lead, S.D., was expending $280.00 to recover one ounce of gold worth about $330.00. The mine put 1,000 miners underground, with another 500 workers above ground per day in two shifts. For nearly 120 years, this one mine pumped 100’s of millions of dollars into the local, state, and national economy. The mining company and its stockholders all paid income taxes, as did the thousands of Homestake employees.]

[2] [The use of picks, shovels, gold pans, small portable sluice boxes.]

[3] [The “suction dredge” is a small portable unit used in running streams comprised of a floating sluice box, and a small lawn-mower type engine (on average 5 to 15 hp) which powers an underwater vacuum used to suck up streambed sediments and gold and deliver them via a hose to the sluice box floating on the surface. Suction dredges are sized by the inside diameter of the suction hose, and range from 2” hose all the way to 8”, with the 4” dredge being by far the most popular. The operator usually works totally underwater wearing a full wetsuit and breathing through a regulator similar to a scuba diver. The dredge will suck up anything that fits in the hose, all over-size rocks are moved by hand by the miner. At best, most suction dredge miners move 1-2 cu/yrds/day.]

[4] [Suction dredges remove and recover lead and mercury, create deep cold water refuge holes for fish to hold in during hot summer months, and can create high quality spawning beds for years to come by loosening and cleaning the steambed gravels.]

[5] [In Oregon and California, over 4,000 individual suction dredge mining permits are issued annually.]