Bill Worsens Mining Climate with Taxes, Regulations
MADISON – WMC announced Wednesday it will oppose newly unveiled mining legislation because the plan worsens the state’s poor climate for mining with additional regulation and unfavorable tax policy.
“Wisconsin currently has one of the worst climates for mining in the world,” said Scott Manley, environmental policy director for Wisconsin Manufacturers & Commerce, “and this new proposal makes the situation worse.”
Earlier this week, Senators Dale Schultz (R-Richand Center) and Robert Jauch (D-Poplar) unveiled a bill that taxes and regulates mining in Wisconsin. A recent study of mining executives by the Fraser Institute found that Wisconsin ranks in the 10 worst places in the world to conduct mining.
“Wisconsin needs to pass legislation to expedite iron mining,” Manley said. “Their bill actually adds more red tape, more permitting uncertainty and more upfront taxes. It will not lead to an investment in Wisconsin, or the creation of mining jobs.”
WMC supports AB 426, which has passed the Assembly and offers the reforms needed to facilitate safe iron mining in Wisconsin. A $1.5 billion mine is under consideration near Hurley, and is projected to create more than 5,600 jobs statewide when fully operational.
WMC offered the following observations about the Schultz/Jauch legislation:
- The bill imposes a new front-loaded $25 million surtax for the privilege of operating an iron mine in Wisconsin for the first five years. No other industry in this state faces this type of punitive tax burden. This surtax will make it harder to operate a profitable mine in the beginning stages of mining, and will therefore make it harder to justify investing in our state.
- The bill contemplates a 540 day permitting process, plus an unlimited number of open-ended extensions…with no meaningful penalty for failure to meet the deadline. This allows the permit process to drag on indefinitely, with no clear timeframe for a decision. It is impossible for an applicant to attract investors when no one knows when or if a permitting decision will be made.
- The bill also provides mandatory and open-ended off ramps from the 540 day timeline if the Army Corps of Engineers asks for more time. The Corps will decide how long the delays will last – they get as much time as they want. This dangerous precedent is something we do not allow for any other type of environmental permit. Wisconsin should not allow federal agencies to dictate the length of our permitting processes.
- The bill includes the same mandatory lawsuit built into the process before a decision is made on the permit –and ensures that DOA, not DNR, will make the final decision on the permit. This costly and time-consuming trial maintains the same uncertainty that has prevented any significant investment in mining in Wisconsin. It is unclear how turning an environmental permitting process into a litigation process will lead to the creation of mining jobs.