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MINING LAW REPEAL LEGISLATION COSTS JOBS AND REVENUES, STUDY SHOWS

MINING LAW REPEAL LEGISLATION COSTS JOBS AND REVENUES, STUDY SHOWS
 WASHINGTON, Jan. 28 /PRNewswire/ -- The American Mining Congress issued the following:
 Legislation introduced to repeal the General Mining Law of the United States would threaten as many as 30,000 jobs and cost the federal government as much as $230 million annually in lost revenues and increased spending, according to a study released today.
 "The bottom line is clear. The Mining Law repeal effort will cost American jobs and will not generate revenue, as repeal proponents contend," American Mining Congress (AMC) Chairman Milton H. Ward said at a new conference releasing the study's findings.
 The study, prepared by the accounting firm of Coopers & Lybrand and the law firm of Davis, Graham & Stubbs, offers the first comprehensive examination of the financial repercussions of legislation pending in Congress by Sen. Dale Bumpers (D-Ariz.) and Rep. Nick J. Rahall (D-W.Va.), provisions of which would increase fees and add royalty payments to mined minerals.
 "Both proposals, if enacted, will radically change mining as we know it in the United States," Ward said.
 The study concludes, in part, that, "The bills so thoroughly alter the way minerals may be developed in the United States that they introduce considerable uncertainty to the industry. ... The bills shake the very foundation of America's industrial base."
 The Mining Law gives citizens the right to enter public lands, explore for minerals, and upon their discovery, perfect ownership of the mining location.
 "In today's economy, we cannot allow bumpersticker rhetoric to drive away more American jobs and revenues," Ward said. "The United States cannot afford a mistake here."
 Given today's economic conditions and assuming the legislation already had been in place, here is what the study showed the mining industry would look like today:
 -- With the fee and royalty provisions in place, some mines would never have been built and other expenditures would not have occurred, costing 10,000 to 30,000 jobs in mining and related activities in the West.
 -- With the legislation proposed by Bumpers in place, the federal government would have suffered a net loss of approximately $230 million per year, while legislation proposed by Rahall would cost the federal Treasury more than $125 million annually in lost revenue and increased expenditures.
 -- Economic activity would stall in the 12 western states where most of the mining on public lands occurs. Under Bumpers, $3.8 billion worth of economic activity would be lost to the states annually; under Rahall, $1.5 billion per year. The affected states include: Alaska, Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington and Wyoming.
 This loss of economic activity is not distributed evenly. Most of the jobs lost are in Colorado and Nevada -- where much of mining's customers, consultants and suppliers are based.
 "State treasuries depend on the mining industry for income taxes, sales taxes, property taxes and mine production taxes," Ward said. "In the end, taxpayers will be asked to find some way to replace what had been a dependable source of revenue supporting the schools, hospitals and highways in their states."
 While hardrock mining pays no royalty under the Mining Law, it returns millions of dollars annually to federal and state governments in the form of severance and other taxes specific to mining, corporate taxes, property taxes, sales taxes and income taxes. A royalty, however, would increase the cost of mining, making some mining projects so expensive they will be abandoned.
 "It is clear that miners are not the only people affected when a mining project is killed," Ward said. "The dominoes fall in every facet of our economy. Geologists and environmental engineers will not be hired. Trucks and heavy machinery will not be ordered. New roads, schools and hospitals won't get built and established communities won't get maintained."
 The study was based on more than 10,000 pages of data concerning 75 mining projects of 35 U.S. mining companies. Researchers used a modeling system developed by the U.S. Department of Commerce to evaluate economic impact on a regional basis based on actual mining industry experience and assuming current economic conditions.
 The American Mining Congress maintains that the Mining Law works very well, and can continue to accomplish the basic goal of allowing orderly and market-directed exploration and development of minerals on public lands, consistent with publicly recognized environmental standards. But there remains a public perception that abuses have occurred in the law's implementation.
 To address these perceived abuses and to demonstrate the industry's interest in maintaining responsible mining activity on the public lands, AMC has identified a number of areas where the law can be modified to respond to public concerns.
 These changes include the payment of a patent fee at fair market value based on highest non-mining use of the surface land. AMC also is not opposed to paying a holding fee, which could be an alternate to performing annual assessment work in some years.
 The American Mining Congress is the principal trade association of the mining industry in the United States. Its member companies mine and process most of the metals, industrial and energy minerals, other than oil and gas, produced in America.
 -0- 1/28/92
 /CONTACT: Keith Knoblock of the American Mining Congress, 202-861-2851/ CO: American Mining Congress ST: District of Columbia IN: MNG SU: LEG


DC -- DC002 -- 4122 01/28/92 10:01 EST
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Date:Jan 28, 1992
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