Mining and the bureaucracy

To maintain a healthy economy, our industries need reliable access to raw materials.  The American mining industry helps fill that need by providing good, relatively high-paying jobs and the critical minerals we need to bolster our economy and provide the materials that keep us going.  Yet, government, especially the federal government, seems to put many roadblocks in the way of developing our abundant natural resources.

In Arizona we are witnessing governmental delays in the permitting process for the Rosemont copper mine south of Tucson.  Near the small town of Dragoon, Arizona, a proposed marble mine has been delayed for more than 15 years due to US Forest Service bureaucracy including establishing a Roadless Area which encompasses the quarry site, even though there is a dedicated county road to the quarry.  In Alaska, the EPA is delaying what could be one of the largest copper and gold mines in the world, the Pebble mine, because of some unwarranted concern over salmon.

Some of the permitting delays are due to activists in government and radical environmentalists who don’t want any development.  But much of the delay is caused by inefficiency and lack of coordination in and among federal agencies.

Hal Quinn, president of the National Mining Association notes that permit delays are among the biggest hurdles for mineral development.  “The length, complexity and uncertainty of the permitting process are the primary reasons investors give for not investing is U.S. minerals mining. In the U.S., necessary government authorizations now take close to 10 years to secure, resulting in decreased competitiveness and increased reliance on foreign sources of minerals.”

These bureaucratic delays affect businesses other than mining, because the supply of raw materials gets harder to obtain and more expensive.

This is not just a recent problem, but one that is growing as more and more agencies are embracing “green” or “sustainable” principles.  In 1999, the National Academy of Sciences’ National Research Council found that: “The process has become much slower and more costly than was originally intended or than it needs to be. It commonly imposes data collection and analysis requirements on the applicant and the regulatory agency that are poorly coordinated, excessively expensive, and of uneven value in protecting the environment. Mining operators are entitled to a permitting process that is as timely and cost effective as possible while still achieving compliance with all statutes and regulations.”  There has been no improvement since that study.

Quinn notes that “Behre Dolbear, the international consulting firm that advises mining companies globally, has identified the U.S. as having one of the longest permitting processes in the world for mining projects, placing domestic mining investments at a competitive disadvantage.”  It also means  that we will need to import more and more of our minerals.

The US Geological Survey studied domestic permitting and found that “permitting time frames are often lengthy and unpredictable” sometimes taking as long as 17 years and even with an “expedited permitting schedule” taking seven years.

Quinn says that “more efficient permitting does not mean less environmental protection.”  Among the needed reforms in the permitting process are:

Clearly defining the responsibilities of a lead agency to include the establishment of binding time frames, coordination with other agencies and reliance on existing data and reviews.  Limiting the total review process for issuing permits to 30 months unless signatories to the permitting time line agree to an extension. Reduce delays posed by litigation over permitting decisions by requiring challenges to be filed within 60 days of the final agency action.

It’s not just the mining industry that suffers under a bureaucratic bottleneck.  Investor’s Business Daily notes that the Obama administration has issued more regulations than Bush and Clinton combined.  Just the EPA and Department of Transportation have increased the regulatory burden on manufacturing by $142 billion per year.

If you want your automobiles and iPhones, a reliable electricity supply, transportation, and jobs, we need to cut the red tape and make access to and production of the raw materials for industry more efficient and timely.  That can all be done while providing rational environmental protection and in doing so will prove to be a boon to our economy.

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