USA President
Barack Obama
14 February 2012 – In his proposed $3.8 trillion budget for fiscal 2013 released Monday, President Barack Obama has once again called for creation of a hard abandoned mined land fund, as well as a hardrock mining royalty of not less than five percent of gross proceeds.

Interior Secretary Ken Salazar, who hails from the mining state of Colorado, estimated creation of the Hardrock Abandoned Mine Reclamation Fund–applicable to private and federal, state, and tribal lands–would generate $500 million in savings over the next 10 years.

The Bureau of Land Management would distribute the funds through a competitive grant program to reclaim the highest priority hardrock abandoned sites on federal, state, tribal and private lands.

Salazar also intends to reform Coal Abandoned Mine Land Reclamation by terminating the unrestricted payments to states and tribes that have been certified for completing their coal reclamation work. Currently the money has been dispersed to states based on how much coal they produce.

However, a proposed new Abandoned Mine Lands Advisory Council to be created under the Office of Surface Mining would review and rank abandoned coal mine lands sites, so OSM could distribute grants to reclaim the highest priority coal sites each year. It is estimated the reforms would save taxpayers $1.1 billion over the next 10 years.

Although Obama’s proposed Fiscal Year 2012 five percent gross royalty for the mining of hardrock minerals on public lands failed to get the approval of Congress, the President has again called for instituting the royalty in the Fiscal 2013 federal budget. The administration believes it will generate $74.5 million in revenue over the next decade. It would be instituted under a leasing program under the Mineral Leasing Act of 1920 for certain hardrock minerals, such as silver, gold and copper.

"Existing mining claims would be exempt from the chance to a leasing system, but would be subject to increases in the annual maintenance fees under the General Mining Law of 1872," said the Bureau of Land Management. "However, holders of existing mining claims for these minerals could voluntarily convert their claims to leases. The Office of Natural Resources Revenue will collect, account for, and disburse the hardrock royalty receipts."

The President’s proposed budget calls for the repeal of a slew of fossil-fuel credits that benefit oil and gas producers, generating nearly $40 billion in additional tax revenue through 2021. A new $4 per acre fee on energy companies that are currently not producing on federal land and water they have leased could generate $783 million over 10 years.

The loss in fossil fuel subsidies would increase federal assistance for renewable energy and conservation programs.

The proposed U.S. Department of the Interior Budget of $11.5 billion remained relatively level with the 2012 enacted budget of $11.43 billion.

The 2013 BLM budget request is $1.1 billion, essentially level with the 2012 enacted level and contains a reduction of 124 positions from 2012.  The budget for renewable energy includes a program increase of $7 million.

The BLM is requesting an increase of $15 million to "implement sage grouse conservation and restoration measures to help prevent the future listing of the species for protection under the Endangered Species Act." The agency wants $10 million to incorporate "the necessary regulatory mechanisms into the BLM’s land use plans to address conservation of the sage grouse. An additional $25 million will be used for on-the-ground restoration programs and improvement of key sage grouse habitat.

The proposed FY 2013 budget for the U.S. Geological Survey is $34.5 million above the 2012 enacted level for a total 2013 budget request of $1.1 billion. It provides $44 million for the Interior Secretary’s New Energy Frontier initiative. The budget includes $97.1 million for energy, minerals and environmental health, a $914,000 increase over this year’s budget. Nevertheless, it includes program reductions of $5.3 million in the Minerals Resource Program.

Instead, a program increase of $8.6 million is requested to improve rapid disaster response to natural disasters. Another $13 million will support hydraulic fracturing research and development efforts with the Department of Energy and the Environmental Protection Agency.

The proposed USGS budget includes an increase of $1 million to support research on rare earth elements.

The 2013 budget request for the Office of Surface Mining is $140.7 million, a $9.5 million drop in the 2012 enacted level. The OSM budget assumes the agency will collect the proposed AML fee on the production of hardrock minerals on uranium and metallic mines on both public and private lands.