[Federal Register Volume 83, Number 35 (Wednesday, February 21, 2018)]
[Rules and Regulations]
[Pages 7556-7588]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-26514]



[[Page 7555]]

Vol. 83

Wednesday,

No. 35

February 21, 2018

Part II





 Environmental Protection Agency





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40 CFR Part 320





Financial Responsibility Requirements Under CERCLA Section 108(b) for 
Classes of Facilities in the Hardrock Mining Industry; Final Rule

  Federal Register / Vol. 83 , No. 35 / Wednesday, February 21, 2018 / 
Rules and Regulations  

[[Page 7556]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 320

[EPA-HQ-SFUND-2015-0781; FRL-9971-50-OLEM]
RIN 2050-AG61


Financial Responsibility Requirements Under CERCLA Section 108(b) 
for Classes of Facilities in the Hardrock Mining Industry

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final action.

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SUMMARY: The Environmental Protection Agency (EPA or Agency) is 
announcing its decision to not issue final regulations on its proposed 
regulations for financial responsibility requirements applicable to 
hardrock mining facilities that were published on January 11, 2017.
    This decision is based on the record for this rulemaking. This 
final rulemaking is the Agency's final action on the proposed rule.

DATES: This final action is effective on March 23, 2018.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-HQ-SFUND-2015-0781. All documents in the docket are listed on 
the https://www.regulations.gov website. Although listed in the index, 
some information is not publicly available, e.g., Confidential Business 
Information (CBI) or other information whose disclosure is restricted 
by statute. Certain other material, such as copyrighted material, is 
not placed on the internet and will be publicly available only in hard 
copy form. Publicly available docket materials are available 
electronically through https://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Office of Resource Conservation and 
Recovery, Mail Code 5303P, Environmental Protection Agency, 1200 
Pennsylvania Avenue NW, Washington, DC 20460; Barbara Foster, (703) 
308-7057, [email protected]; or Michael Pease, (703) 308-0008, 
[email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Executive Summary
    A. Overview
    B. Purpose of the Regulatory Action
    C. Summary of the Major Provisions of the Regulatory Action
    D. Costs and Benefits of the Regulatory Action
II. Authority
III. Background Information
    A. Overview of Section 108(b) and Other CERCLA Provisions
    B. History of This Rulemaking
    C. Recent Litigation Under Section 108(b)
    D. Hardrock Mining Priority Notice
    E. Hardrock Mining Proposed Rule
IV. Statutory and Record Support for This Final Rulemaking
    A. Statutory Interpretation
    B. Evaluation of the Administrative Record
    1. Reports on Risk Posed by Hardrock Mining Facilities
    2. Federal and State Regulatory Requirements
    a. Federal Environmental Statutes
    b. Federal Reclamation Laws
    c. Other Existing Regulatory Requirements
    3. Risk of Payments From the Fund
    C. Comments Supporting a Final Rulemaking
    D. Comments Opposing a Final Rulemaking
    1. Comments Regarding Appropriateness of Information Used
    a. Use of Information Not Relevant to the Mines To Be Regulated 
Under the Rule
    b. Use of Data That Did Not Directly Demonstrate Risk at Current 
Hardrock Mining Operations
    2. Comments That EPA Failed To Consider Relevant Information
    a. Comments Providing Information on the Role of Federal and 
State Programs and Protective Mining Practices in Reducing Risks at 
Current Hardrock Mining Operations
    (1) Examples of Federal Programs
    (2) Examples of State Programs
    b. Comments Providing Information on Reduced Costs to the 
Taxpayer Resulting From Effective Hardrock Mining Programs and Owner 
or Operator Responses
    E. Evidence Rebutting EPA's Site Examples
    1. Example of Sites Now Not Relevant to the Mines To Be 
Regulated Under the Rule
    2. Example Reflecting Reassessment of Costs to the Taxpayers 
Based on Additional Information
    3. Example Where Program Requirements Were Subsequently Modified 
To Address the Problem
    F. Information Regarding Financial Responsibility Instrument 
Availability
V. Decision to Not Issue the General Facility Requirements of 
Subparts A Through C in This Final Rulemaking
VI. Obstacles to Developing and Implementing Section 108(b) 
Financial Responsibility Requirements for Hardrock Mining Facilities
    A. Potential Disruption of State, Tribal, or Local Mining 
Programs
    B. Challenges To Determine the Level of Financial Responsibility
    C. Concerns Regarding Costs and Economic Impacts of the Proposed 
Rule
    1. Overall Concerns Regarding Cost and Economic Impact
    2. Concerns Particular to Impacts on Small Entities/Businesses
    D. Concerns Regarding Financial Responsibility Instrument 
Availability
    E. Challenges To Identify the Facility
VII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Executive Order 13771: Reducing Regulation and Controlling 
Regulatory Costs
    C. Paperwork Reduction Act
    D. Regulatory Flexibility Act
    E. Unfunded Mandates Reform Act
    F. Executive Order 13132: Federalism
    G. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    H. Executive Order 13045: Protection of Children From 
Environmental Health and Safety Risks
    I. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    J. National Technology Transfer and Advancement Act
    K. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    L. Congressional Review Act

I. Executive Summary

A. Overview

    EPA is announcing its decision on its proposed regulations for 
financial responsibility requirements applicable to hardrock mining 
facilities that were published on January 11, 2017. EPA has decided not 
to issue final regulations because the Agency has determined that final 
regulations are not appropriate. This decision is based on EPA's 
interpretation of the statute and analysis of its record developed for 
this rulemaking. EPA has analyzed the need for financial responsibility 
based on risk of taxpayer funded cleanups at hardrock mining facilities 
operating under modern management practices and modern environmental 
regulations, i.e., the type of facilities to which financial 
responsibility regulations would apply. That risk is identified by 
examining the management of hazardous substances at such facilities, as 
well as by examining federal and state regulatory controls on that 
management and federal and state financial responsibility requirements. 
With that focus, the record demonstrates that, in the context of CERCLA 
section 108(b), the degree and duration of risk associated with the 
modern production, transportation, treatment, storage or disposal of 
hazardous substances by the hardrock mining industry does not present a 
level of risk of taxpayer funded response actions that warrant 
imposition of financial responsibility requirements for this sector. 
This determination reflects EPA's interpretation of the statute, EPA's 
evaluation of the record for the proposed rule, and the public comment 
received by EPA.

[[Page 7557]]

    The decision not to issue final regulations will address the 
concerns of those federal and state regulators and members of the 
regulated community who commented that the proposed requirements were 
unnecessary and would, therefore, impose an undue burden on the 
regulated community. This decision will provide assurance to state 
regulators who were concerned that the proposed requirements would be 
disruptive of state mining programs. This decision also will address 
the information provided by the insurance industry regarding the lack 
of availability of financial instruments that meet the requirements of 
section 108(c)(2). This decision is based on the record for this 
rulemaking, and does not affect the process for site-specific risk 
determinations, or determinations of the need for a particular CERCLA 
response, at individual sites, nor does this decision affect EPA's 
authority to take appropriate CERCLA response actions. Decisions on 
risk under other environmental statutes would continue under those 
statutes. This final rulemaking is the Agency's final action on the 
proposed rule.

B. Purpose of the Regulatory Action

    Section 108(b) of the Comprehensive Environmental Response, 
Compensation, and Liability Act (CERCLA), also known as Superfund, 
directs EPA to develop regulations that require classes of facilities 
to establish and maintain evidence of financial responsibility 
consistent with the degree and duration of risk associated with the 
production, transportation, treatment, storage, or disposal of 
hazardous substances. The statute further requires that the level of 
financial responsibility be established to protect against the level of 
risk the President, in his discretion, believes is appropriate, based 
on factors including the payment experience of the Fund. The 
President's authority under this section for non-transportation-related 
facilities has been delegated to the EPA Administrator.\1\
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    \1\ See E.O. 12580, 52 FR 2923 (January 23, 1987).
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    In a Federal Register notice dated July 28, 2009,\2\ EPA identified 
the classes of facilities within hardrock mining \3\ as the classes for 
which it would first develop financial responsibility requirements 
based on consideration of many factors, including factors unrelated to 
modern facilities, such as legacy contamination, and factors not 
demonstrating risk, in and of themselves, such as Toxic Release 
Inventory (TRI) reports under Superfund Amendments and Reauthorization 
Act of 1986 (SARA) section 313.
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    \2\ Identification of Priority Classes of Facilities for 
Development of CERCLA Section 108(b) Financial Responsibility 
Requirements, 74 FR 37213, July 28, 2009.
    \3\ For purposes of this final rulemaking, EPA includes within 
the term ``hardrock mining'' the facilities included in the 
definition of that term developed for purposes of the Priority 
Notice, that is, facilities that extract, beneficiate, or process 
metals (e.g., copper, gold, iron, lead, magnesium, molybdenum, 
silver, uranium, and zinc), and non-metallic non-fuel minerals 
(e.g., asbestos, gypsum, phosphate rock, and sulfur).
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    On January 11, 2017, the Agency published proposed financial 
responsibility requirements applicable to hardrock mining 
facilities.\4\ The proposal identified two goals for section 108(b) 
regulations--the goal of providing funds to address CERCLA liabilities 
at sites, and the goal of creating incentives for sound practices that 
will minimize the likelihood of need for a future CERCLA response. As 
discussed below, EPA now believes that these goals have been met for 
the hardrock mining classes of facilities.
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    \4\ Financial Responsibility Requirements Under CERCLA Section 
108(b) for Classes of Facilities in the Hardrock Mining Industry, 82 
FR 3388, January 11, 2017.
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    The proposal identified for public comment a range of options and 
supporting information, as described in the proposed rule preamble.\5\ 
The proposed rule set forth, in proposed 40 CFR part 320, subparts A 
through C, requirements for a comprehensive financial responsibility 
program under section 108(b) that would be applicable to hardrock 
mining facilities as well as to future industry sectors for which 
requirements under section 108(b) are later developed. In addition, the 
proposed rule set forth, in proposed part 320, subpart H, requirements 
specifically applicable to hardrock mining facilities.
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    \5\ See 82 FR 3388, January 11, 2017.
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    EPA provided information and analysis demonstrating releases and 
potential releases of hazardous substances at hardrock mining 
facilities. EPA also discussed the relationship of section 108(b) to 
other federal law and to state law.\6\ However, despite making a 
commitment to do so in the notice entitled ``Identification of Priority 
Classes of Facilities for Development of CERCLA Section 108(b) 
Financial Responsibility Requirements'' (2009 Priority Notice), 
published on July 28, 2009, in the development of the proposed rule the 
Agency did not consider other federal and state programs when 
determining the need for section 108(b) regulations.\7\ Instead, the 
proposed rule would have considered other programs only after financial 
responsibility requirements are imposed, as a means to reduce such 
requirements. EPA now believes that it is appropriate to consider such 
programs at the outset, when evaluating both the degree and duration of 
risk associated with the production, transportation, treatment, 
storage, or disposal of hazardous substances as well as when evaluating 
the risk of taxpayer financed response costs.
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    \6\ 82 FR 3402-03 (concluding that section 108(b) applies even 
when a facility is subject to financial responsibility requirements 
under federal law).
    \7\ 74 FR 37219 and n. 50.
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    EPA's final action on the proposed rule is a decision not to 
promulgate it.\8\ As explained below, EPA has reconsidered whether the 
rulemaking record supports the proposed rule in light of the Agency's 
interpretation of the statute, the Agency's evaluation of the record, 
and the information and data received through public comment. As a 
result of this reconsideration, EPA has determined that the rulemaking 
record it assembled does not support imposing financial responsibility 
requirements under section 108(b) on current hardrock mining 
operations. This determination is based on information in the record on 
the degree and duration of risk posed by modern production, 
transportation, treatment, storage or disposal of hazardous substances 
at mining sites operating under modern regulations that demonstrates 
that financial responsibility requirements are not necessary to address 
the risk of taxpayer financed response actions at hardrock mines. EPA 
has reconsidered its assessment of the risks posed by hardrock mining 
operations presented in the proposed rule, and determined that that 
assessment did not adequately consider the degree to which existing 
federal and state regulatory programs and improved mining practices at 
modern mines reduce the risk that there would be unfunded response 
liabilities at currently operating mines. Furthermore, EPA notes that 
even under the analysis in the proposed rule, the

[[Page 7558]]

projected level of risk of EPA-funded response actions was relatively 
low ($15 to $15.5 million per year), and was significantly less than 
the projected cost to industry of providing the additional financial 
responsibility that would have been required by the proposed rule 
($111-$171 million per year).
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    \8\ EPA has made editorial changes to this document from the 
prepublication version, including replacing various references to 
the action being a ``final rule,'' in accordance with the Office of 
the Federal Register's (OFR) interpretations of its implementing 
regulations (1 CFR 5.9 and parts 21 and 22), the Federal Register 
Act (44 U.S.C. chapter 15) and Document Drafting Handbook. OFR 
regulations, however, expressly disclaim a legal effect from these 
publication requirements. ``In prescribing regulations governing 
headings, preambles, effective dates, authority citations, and 
similar matters of form, the Administrative Committee does not 
intend to affect the validity of any document that is filed and 
published under law.'' 1 CFR 5.1(c). Accordingly, these editorial 
changes do not affect the legal status of the action as a final 
regulation under CERCLA.
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    The Agency's decision that a section 108(b) rule for the hardrock 
mining industry is not appropriate relies on the record developed for 
this rulemaking as well as information submitted by commenters on three 
key points, which in combination demonstrate significantly reduced risk 
at current hardrock mining operations: (1) The reduction in risks due 
to the requirements of existing federal and state mining programs and 
voluntary protective practices of current hardrock mining owners and 
operators, (2) the reduced costs to the taxpayer resulting from 
effective hardrock mining programs, enforcement actions, and owner or 
operator responses, including financial assurance requirements pursuant 
to these other programs, and (3) the resulting reduction in the risk of 
the need for federally financed response actions at hardrock mines. The 
record thus evaluated also supports EPA's determination that federal 
and state regulation and practices at modern facilities reduce the 
risks posed by operating facilities and, therefore, the imposition of 
section 108(b) financial responsibility requirements is not 
appropriate.
    This determination also addresses concerns regarding disruption and 
duplication of state and federal financial responsibility requirements, 
the difficulty in tailoring financial responsibility to a specific 
level of risk, as well as concerns raised by the financial industry 
regarding challenges in providing financial instruments that meet the 
requirements of the statute and the proposed rule. As discussed below, 
the proposed rule created the potential for the preemption of state 
financial responsibility requirements. In addition, EPA acknowledges 
that the formula through which EPA had proposed to determine the level 
of financial assurance relied on information unrelated to risks of 
taxpayer financed costs posed by the current facilities to which the 
proposed rule would apply. Finally, as discussed below, members of the 
financial industry commented that section 108(c)(2), which allows 
direct claims against a guarantor providing evidence of financial 
responsibility, is at odds with relevant commercial law and practice 
and would significantly deter the financial industry from providing 
such instruments and services.
    This final rulemaking does not affect, limit, or restrict EPA's 
authority to take a response action or enforcement action under CERCLA 
at any individual hardrock mining facility, including the currently 
operating facilities described elsewhere in this final rulemaking and 
in the Technical Support Document for this final rulemaking,\9\ and to 
include requirements for financial responsibility as part of such 
response action. The set of facts in the rulemaking record related to 
the individual facilities discussed in this final rulemaking support 
the Agency's decision not to issue financial responsibility 
requirements under section 108(b) for currently operating hardrock 
mining facilities as a class, but a different set of facts could 
demonstrate a need for a CERCLA response at those sites. This final 
rulemaking also does not affect the Agency's authority under other 
authorities that may apply at hardrock mining facilities, such as the 
Clean Water Act (CWA), the Resource Conservation and Recovery Act 
(RCRA), the Clean Air Act (CAA), and the National Environmental Policy 
Act (NEPA).
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    \9\ See: EPA, ``CERCLA Section 108(b) Hardrock Mining Final Rule 
Technical Support Document,'' December 1, 2017.
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C. Summary of the Major Provisions of the Regulatory Action

    EPA is not requiring evidence of financial responsibility under 
section 108(b) at hardrock mining facilities in this action. Thus, 
there are no regulatory provisions associated with this final action.

D. Costs and Benefits of the Regulatory Action

    The Regulatory Impact Analysis for the proposed rule demonstrated 
that the projected level of taxpayer liability that would have been 
avoided by the proposed rule was relatively small, and that the costs 
of meeting the proposed financial responsibility requirements were an 
order of magnitude greater than the costs avoided by the federal 
government as a result of such requirements. EPA is not requiring 
evidence of financial responsibility under section 108(b) at hardrock 
mining facilities in this action. EPA therefore has not conducted a 
Regulatory Impact Analysis for this action.

II. Authority

    This final rulemaking is issued under the authority of sections 
101, 104, 108 and 115 of the Comprehensive Environmental Response, 
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. 9601, 
9604, 9608 and 9615, and Executive Order 12580. 52 FR 2923, 3 CFR, 1987 
Comp., p. 193.

III. Background Information

A. Overview of Section 108(b) and Other CERCLA Provisions

    CERCLA, as amended by the Superfund Amendments and Reauthorization 
Act of 1986 (SARA), establishes a comprehensive environmental response 
and cleanup program. Generally, CERCLA authorizes EPA \10\ to undertake 
removal or remedial actions in response to any release or threatened 
release into the environment of ``hazardous substances'' or, in some 
circumstances, any other ``pollutant or contaminant.'' As defined in 
CERCLA section 101, removal actions include actions to ``prevent, 
minimize, or mitigate damage to the public health or welfare or to the 
environment,'' and remedial actions are ``actions consistent with [a] 
permanent remedy[.]'' Remedial and removal actions are jointly referred 
to as ``response actions.'' CERCLA section 111 authorizes the use of 
the Superfund Trust Fund (the Fund) established under title 26, United 
States Code, including financing response actions undertaken by EPA. In 
addition, CERCLA section 106 gives EPA \11\ authority to compel action 
by liable parties in response to a release or threatened release of a 
hazardous substance that may pose an ``imminent and substantial 
endangerment'' to public health or welfare or the environment.
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    \10\ Although Congress conferred the authority for administering 
CERCLA on the President, most of that authority has since been 
delegated to EPA. See Exec. Order No. 12580, 52 FR 2923 (Jan. 23, 
1987). The executive order also delegates to other federal agencies 
specified CERCLA response authorities at certain facilities under 
their ``jurisdiction, custody or control.'' This can include CERCLA 
authorities at mines located on federal lands under the jurisdiction 
of BLM and the Forest Service.
    \11\ CERCLA sections 106 and 122 authority is also delegated to 
other federal agencies in certain circumstances. See Exec. Order No. 
13016, 61 FR 45871 (Aug. 28, 1996).
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    CERCLA section 107 imposes liability for response costs on a 
variety of parties, including certain past owners and operators, 
current owners and operators, and certain transporters of hazardous 
substances. Such parties are liable for any costs of removal or 
remedial action incurred by the federal government, so long as the 
costs incurred are ``not inconsistent with the national contingency 
plan,'' (NCP).\12\ Section 107 also imposes liability for natural 
resource damages and health assessment costs.\13\ As has been the case 
since

[[Page 7559]]

CERCLA's enactment, these provisions of CERCLA are available according 
to their terms, to the federal government and other parties, regardless 
of whether an owner or operator has provided evidence of financial 
responsibility under section 108(b).
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    \12\ See CERCLA section 107 (a)(4)(A).
    \13\ See CERCLA section 107 (a)(4)(C)-(D).
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    In accordance with CERCLA, in 1990 EPA issued the current version 
of the NCP.\14\ These regulations provide the organizational structure 
and procedures for preparing for, and responding to, discharges of oil 
and releases of hazardous substances, pollutants, and contaminants. The 
NCP is codified at 40 CFR part 300. Among other provisions, the NCP 
provides procedures for hazardous substance response including site 
evaluation, removal actions, remedial investigation/feasibility studies 
(RI/FS), remedy selection, remedial design/remedial action (RD/RA), and 
operation and maintenance.\15\ The NCP also designates federal, state, 
and tribal trustees for natural resource damages, and identifies their 
responsibilities under the NCP.\16\ Under the NCP, EPA undertakes 
response actions that address or prevent risk to human health and the 
environment from the release of hazardous substances, pollutants or 
contaminants. A determination whether a release of hazardous 
substances, pollutants or contaminants presents a risk to be addressed 
under other sections of CERCLA or under other law is a separate 
determination from whether under section 108(b) risk associated with 
the management of hazardous substances at current hardrock mining 
operations warrants imposition of financial responsibility 
requirements. Nothing in this final action restricts EPA's other 
authorities. The Agency's decision not to issue final regulations under 
section 108(b) applicable to hardrock mining facilities does not change 
or substitute for EPA's procedures for site-specific evaluations of 
risk, and for determining the need for response, in accordance with the 
NCP.
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    \14\ See 55 FR 8666, March 8, 1990.
    \15\ See 40 CFR part 300, subpart E.
    \16\ See 40 CFR part 300, subpart G.
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    Section 108(b) establishes an authority to require owners and 
operators of classes of facilities to establish and maintain evidence 
of financial responsibility. Section 108(b)(1) directs EPA to develop 
regulations requiring owners and operators of facilities (in addition 
to those under Subtitle C of the Solid Waste Disposal Act and other 
federal law) to establish evidence of financial responsibility 
``consistent with the degree and duration of risk associated with the 
production, transportation, treatment, storage, or disposal of 
hazardous substances.'' In turn, section 108(b)(2) directs that the 
level of financial responsibility shall be initially established, and, 
when necessary, adjusted to protect against the level of risk that EPA 
in its discretion believes is appropriate based on the payment 
experience of the Fund, commercial insurers, courts settlements and 
judgments, and voluntary claims satisfaction. Section 108(b)(2) does 
not, however, preclude EPA from considering other factors in addition. 
The statute prohibited promulgation of such regulations before December 
1985.
    In addition, section 108(b)(1) provides for publication within 
three years of the date of enactment of CERCLA of a ``priority notice'' 
identifying the classes of facilities for which EPA would first develop 
financial responsibility requirements. It also directs that priority in 
the development of requirements shall be accorded to those classes of 
facilities, owners, and operators that present the highest level of 
risk of injury.

B. History of This Rulemaking

    In November 2003, EPA initiated a study of the Superfund program, 
commonly referred to as the ``120 Day Study.'' \17\ This ``120 Day 
Study'' resulted in more than 100 recommendations. In 2005, EPA 
initiated an Action Plan for implementing the recommendations of the 
120-Day Study of the Superfund Program. Under that plan, EPA conducted 
an analysis to determine whether action under section 108(b) was 
appropriate (Recommendation 12). This analysis resulted in two detailed 
studies specifically designed to help identify classes of facilities 
for priority consideration under section 108(b), carried out from 2006 
through 2008. The report of these studies, labeled ``draft'' and dated 
February 2009, are titled: ``CERCLA 108(b) Financial Responsibility, 
Phase 1: Preliminary Analysis'' (hereinafter Phase 1 Report) and 
``CERCLA 108(b) Financial Responsibility, Phase 2 Preliminary 
Analysis'' (hereinafter Phase 2 Report).\18\ Another analysis,\19\ 
referred to as the 40 TSD Study, also recommended by the 120-Day Study 
(Recommendations 10 and 11), on the sufficiency of financial assurance 
requirements imposed on hazardous waste treatment, storage, and 
disposal (TSD) facilities regulated under RCRA also provides relevant 
information.
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    \17\ See Superfund: Building on the Past, Looking to the Future 
(Washington DC: April 22, 2004), EPA-HQ-SFUND-2015-0781-0501.
    \18\ EPA-HQ-SFUND-2009-0265-0019 and EPA-HQ-SFUND-2009-0265-
0020.
    \19\ See ``Analysis of 40 Potential TSDs: Potential RCRA 
Treatment, Storage, and Disposal Facilities Proposed to the 
Superfund National Priority List after 1990,'' Office of Solid 
Waste, January 19, 2007.
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    In the Phase 1 and Phase 2 analyses, EPA interpreted the financial 
responsibility requirements of section 108(b) to apply to currently 
operating facilities and current or future risks. Accordingly, in the 
analyses performed from 2006 through 2008, the Agency attempted to 
exclude historic practices and legacy contamination resulting from such 
practices by using 1990 as a date to distinguish between modern and 
legacy practices. The Agency stated that it used 1990 because by that 
date most of the regulations under RCRA relating to management of 
hazardous waste had been promulgated. This approach was consistent with 
the 40 TSD study, which excluded facilities proposed to the National 
Priorities List (NPL) before 1990 to exclude facilities with legacy 
contamination that predated the RCRA hazardous waste regulatory 
program. However, because EPA determined in 1986 under section 
3001(b)(3)(C) of RCRA that solid waste from the extraction and 
beneficiation of ores and minerals do not present sufficient risk to 
warrant regulation under subtitle C of RCRA,\20\ 1990 is not a precise 
date for the advent of modern regulation of mining. As discussed below, 
commenters noted that state and federal mining regulations developed 
over a period of time. For mining regulated under state law, commenters 
suggest the mid-1990s represent the advent of modern mining 
regulation.\21\
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    \20\ 51 FR 24496 (July 3, 1986).
    \21\ State mining laws are discussed below.
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    In 2009, the Agency changed its interpretation of the statute. A 
July 2, 2009, memorandum attached to the Phase 1 and Phase 2 reports 
states that EPA decided that the reports were deficient because they 
excluded sites listed on the NPL before 1990. Accordingly, EPA did not 
finalize the reports and did not proceed to an analysis of the federal 
and state regulatory requirements and the modern practices of any 
specific industry sector.\22\ Instead, in a Federal Register notice 
dated July 28, 2009,\23\ EPA identified certain classes of facilities 
within the hardrock mining sector as the classes for which it would 
first develop financial responsibility requirements.

[[Page 7560]]

EPA based that identification on consideration of many factors, 
including factors unrelated to risk posed by the production, 
transportation, treatment, storage, and disposal of hazardous 
substances at facilities that would be regulated under the proposed 
rule, such as legacy contamination, and non-risk based information, 
such as Toxic Release Inventory reports under SARA section 313. This 
notice represented a substantial departure from previous EPA 
interpretation of the statute to exclude legacy activities when 
determining the need for financial responsibility requirements under 
section 108(b).\24\
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    \22\ EPA-HQ-SFUND-2009-0265-0019 and EPA-HQ-SFUND-0265-0020.
    \23\ Identification of Priority Classes of Facilities for 
Development of CERCLA Section 108(b) Financial Responsibility 
Requirements, 74 FR 37213, July 28, 2009.
    \24\ Compare EPA's Phase I and Phase II reports (EPA-HQ-SFUND-
2009-0265-0019 and EPA-HQ-SFUND-0265-0020) to 74 FR 37213.
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    In the 2009 Priority Notice, EPA identified hardrock mining 
facilities as a priority without considering the impacts of modern 
federal and state regulations. Instead, EPA stated: ``EPA will 
carefully examine specific activities, processes, and/or metals and 
minerals in order to determine what proposed financial responsibility 
requirements may be appropriate. As part of this process, EPA will 
conduct a close examination and review of existing Federal and State 
authorities, policies, and practices that currently focus on hardrock 
mining activities.'' \25\
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    \25\ 74 FR 37219.
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    On January 11, 2017, the Agency published proposed financial 
responsibility requirements applicable to hardrock mining 
facilities.\26\ The proposed rule adopted two goals for section 108(b) 
regulations--to provide funds to address CERCLA liabilities at sites, 
and to create incentives for sound practices that will minimize the 
likelihood of need for a future CERCLA response.
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    \26\ 82 FR 3388 (January 11, 2017).
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    The proposal identified for public comment a range of options and 
supporting information, as described in the proposed rule preamble. The 
proposed rule set forth, in proposed part 320, subparts A through C, 
requirements for a comprehensive financial responsibility program under 
section 108(b) that would be applicable to hardrock mining facilities, 
as well as to future industry sectors for which requirements under 
section 108(b) are later developed. In addition, the proposed rule set 
forth, in proposed part 320, subpart H, requirements specifically 
applicable to hardrock mining facilities.
    The proposed rule provided information and analyses on releases and 
potential releases of hazardous substances at hardrock mining 
facilities. The proposed rule identified several classes of hardrock 
mining facilities that were excluded from the financial responsibility 
requirements because they involved a lower risk, and sought comment on 
whether additional classes should be excluded from the scope of a final 
rule.\27\ The proposed rule also discussed the relationship of section 
108(b) to other federal law and to state law.\28\ However, contrary to 
the commitment made in the 2009 Priority Notice, the proposed rule did 
not consider reductions in risk as a result of such laws when 
determining the need for financial responsibility requirements. 
Instead, the proposed rule would have established such requirements at 
a level based on the activities already covered by reclamation bonds as 
well as the cost of cleaning up historic mining sites and then, based 
on information provided by the facility, would have allowed reductions 
in the amount of financial responsibility,\29\ or release from the 
requirement for financial responsibility entirely.\30\
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    \27\ 82 FR 3456-59; Hoffman Memo, ``Mining Classes Not Included 
in Identified Classes of Hardrock Mining,'' June 2009. See 82 FR 
3455 n. 145. See exclusions from the rule at proposed 40 CFR 
320.60(a)(2). EPA solicited comments on whether to identify 
additional exclusions based on a finding of minimal risk, citing 
iron ore, phosphates and uranium mines as examples. 82 FR 3456.
    \28\ 82 FR 3402-03.
    \29\ Proposed 40 CFR 320.63.
    \30\ Proposed 40 CFR 320.27.
---------------------------------------------------------------------------

    EPA received over 11,000 public comment submissions on the proposed 
rule. Other federal agencies, state agencies, and industry 
representatives overwhelmingly opposed financial responsibility 
requirements under section 108(b) for the hardrock mining industry. 
Environmental groups urged adoption of the proposed rule. EPA also 
received a large number of identical comments from individuals through 
multiple letter-writing campaigns, advocating both for and against 
adoption of the rule. Among other concerns, commenters objecting to the 
proposed rule expressed the view that the Agency's assessment of the 
information relating to risks posed by hardrock mining operations as 
presented in the proposed rule was deficient because the Agency: (1) 
Relied on inappropriate evidence, such as data that did not demonstrate 
risk, and evidence not relevant to the facilities to be regulated under 
the rule; and (2) failed to consider relevant evidence, such as the 
role of federal and state mining programs and voluntary protective 
mining practices in reducing risks at current \31\ hardrock mining 
operations, and the reduced costs to the taxpayer resulting from 
effective hardrock mining programs, including existing financial 
responsibility requirements, and owner or operator responses.
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    \31\ A discussion of which mining operations are considered 
``current'' or ``modern'' can be found in section IV.D.1. of this 
final rulemaking.
---------------------------------------------------------------------------

    EPA has considerable discretion under the statute and, as explained 
below, has reconsidered whether the rulemaking record supports the 
proposed rule in light of EPA's interpretation of the statute, review 
of the record, and the information and data received through public 
comment. As a result, EPA has determined that the assessment of the 
information relating to risks posed by hardrock mining operations as 
presented in the proposed rule was not supported by the record. This 
reassessment relies on the information in the record on three key 
points: (1) The reduction in risks due to the requirements of existing 
federal and state mining programs and protective practices of current 
hardrock mining owners and operators, (2) the reduced costs to the 
taxpayer resulting from effective hardrock mining programs, including 
existing financial responsibility requirements, and owner or operator 
responses, and (3) the resulting reduction in the risk of the need for 
federally financed response actions at hardrock mines.

C. Recent Litigation Under Section 108(b)

    On March 11, 2008, Sierra Club, Great Basin Resource Watch, Amigos 
Bravos, and Idaho Conservation League filed a suit against then EPA 
Administrator Steven Johnson and then Secretary of the U.S. Department 
of Transportation Mary E. Peters, in the U.S. District Court for the 
Northern District of California. Sierra Club, et al. v. Johnson, No. 
08-01409 (N.D. Cal.). On February 25, 2009, that court ordered EPA to 
publish the Priority Notice required by section 108(b)(1) later that 
year. The court later dismissed the remaining claims.\32\
---------------------------------------------------------------------------

    \32\ See Sierra Club v. Johnson, 2009 U.S. Dist. LEXIS 68436 
(N.D. Cal. Aug. 5, 2009).
---------------------------------------------------------------------------

    EPA continued to work on a proposed rule for the next several 
years. However, developing a regulation that meets the statutory 
requirements presented a significant challenge.\33\ Dissatisfied with 
the pace of EPA's progress, in August 2014, the Idaho Conservation 
League, Earthworks, Sierra Club, Amigos Bravos,

[[Page 7561]]

Great Basin Resource Watch, and Communities for a Better Environment 
filed a new lawsuit in the U.S. Court of Appeals for the District of 
Columbia Circuit, seeking a writ of mandamus requiring issuance of 
section 108(b) financial responsibility rules for the hardrock mining 
industry and for three other industries--chemical manufacturing; 
petroleum and coal products manufacturing; and electric power 
generation, transmission, and distribution.\34\ Companies and 
organizations representing business interests in the hardrock mining 
and other sectors also sought to intervene in the case.
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    \33\ See the discussion regarding instrument availability in 
section IV., and the discussions in section VII of some of the 
obstacles to developing a rule under section 108(b).
    \34\ In re: Idaho Conservation League, et al., No. 14-1149.
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    Following oral argument, the court issued an Order in May 2015 
requiring the parties to submit, among other things, supplemental 
submissions addressing a schedule for further administrative 
proceedings under section 108(b). The Court's May 19, 2015 Order 
encouraged the parties to confer regarding a schedule and, if possible, 
to submit a jointly agreed upon proposal. Petitioners and EPA agreed to 
a schedule calling for the Agency to sign for publication in the 
Federal Register a proposed rule for the hardrock mining industry by 
December 1, 2016, and a notice of its final action on the proposal by 
December 1, 2017. The parties submitted this schedule to the court, and 
on January 29, 2016, the court granted the parties' joint motion and 
issued an order that mirrored the submitted schedule in substance.\35\ 
With this action the Agency has now satisfied both of these 
obligations.
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    \35\ In re Idaho Conservation League, 811 F.3d 502.
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D. Hardrock Mining Priority Notice

    As described above, section 108(b)(1) requires the President to 
identify those classes of facilities for which requirements will be 
first developed and to publish notice of such identification in the 
Federal Register. On July 28, 2009, EPA issued a ``Priority Notice'' 
entitled ``Identification of Priority Classes of Facilities for 
Development of Section 108(b) Financial Responsibility Requirements.'' 
\36\ In the 2009 Priority Notice, EPA explained how it then chose to 
evaluate indicators of risk and its related effects, to inform its 
decision on the classes of facilities for which it would first develop 
requirements.\37\ The 2009 Priority Notice pointed to eight factors 
that EPA considered,\38\ and stated that its review of those factors 
and the associated information in the docket led the Agency to conclude 
that hardrock mining facilities present the type of risk that, in light 
of its evaluation, justified them being the first for which EPA would 
develop section 108(b) requirements.\39\ The 2009 Priority Notice 
satisfied the notice requirement in section 108(b)(1).
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    \36\ See 74 FR 37213 (July 28, 2009).
    \37\ See Id. at 37214.
    \38\ These eight factors were: (1) Annual amounts of hazardous 
substances released to the environment; (2) the number of facilities 
in active operation and production; (3) the physical size of the 
operation; (4) the extent of environmental contamination; (5) the 
number of sites on the CERCLA site inventory (including both NPL 
sites and non-NPL sites); (6) government expenditures; (7) projected 
cleanup expenditures; and (8) corporate structure and bankruptcy 
potential (74 FR 37214, July 28, 2009).
    \39\ Id.
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E. Hardrock Mining Proposed Rule

    On January 11, 2017, EPA proposed requirements in a new 40 CFR part 
320 that owners and operators of hardrock mining facilities subject to 
the rule demonstrate and maintain financial responsibility as specified 
in the proposed rule.
    The proposed rule identified two goals for section 108(b) 
regulations--the goal of providing funds to address CERCLA liabilities 
at sites, and the goal of creating incentives for sound practices that 
will minimize the likelihood of need for a future CERCLA response. The 
proposed rule explained that first, when releases of hazardous 
substances occur, or when a threat of release of hazardous substances 
must be averted, a Superfund response action may be necessary. 
Therefore, the costs of such response actions can fall to the taxpayer 
if parties responsible for the release or potential release of 
hazardous substances are unable to assume the costs.\40\ Second, the 
likelihood of a CERCLA response action being needed, as well as the 
costs of such a response action, are likely to be higher where 
protective management practices were not utilized during facility 
operations.\41\
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    \40\ The proposed rule discussion acknowledged the existence of 
federal and state financial responsibility requirements but took the 
position that they do not duplicate CERCLA financial responsibility 
requirements. 83 FR 3402. For example, the proposed rule claimed 
that state regulations include but are not limited to hazardous 
substance releases. 83 FR 3403.
    \41\ As discussed below, the Agency now believes that protective 
management practices must be considered when determining the need 
for financial responsibility requirements.
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    The proposed rule discussed information assembled by EPA in the 
record for the action, which, as discussed below, included information 
on legacy practices and legacy contamination, as well as information 
not related to risk. Based on that record, EPA had proposed to presume 
that hardrock mining facilities as a class present the type of risks 
that section 108(b) addresses. The proposed rule then proceeded to 
establish a methodology to determine a level of financial 
responsibility in accordance with a proposed formula. The formula then 
allowed adjustments to the level of those requirements if a facility 
could demonstrate site specific conditions that rebut the presumption 
that the hardrock mining facilities that would be regulated under the 
rule pose a risk.\42\
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    \42\ See proposed 40 CFR 320.63.
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    EPA proposed limiting the applicability of the rule to owners and 
operators of facilities that are authorized to operate or should be 
authorized to operate on the effective date of the rule (hereinafter 
referred to as ``current hardrock mining operations'').\43\ EPA 
explained its interpretation of the statute on this issue.\44\ The 
proposed rule also relied, in part, on the grounds that these owners 
and operators are more likely to further the regulatory goals of 
section 108(b) requirements than are owners and operators of facilities 
that are closed or abandoned. EPA also proposed limiting the 
applicability of the rule to current hardrock mining operations because 
those facilities are readily identifiable and, since they are ongoing 
concerns, they are more likely to be able to obtain the kind of 
financial responsibility necessary under the regulation.\45\ EPA 
continues to believe that this focus upon current hardrock mining 
operations is appropriate.
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    \43\ See proposed 40 CFR 320.2.
    \44\ 82 FR 3404-05.
    \45\ The proposed rule also excluded 55 specific substances (see 
footnote 25 infra).
---------------------------------------------------------------------------

IV. Statutory and Record Support for This Final Rulemaking

A. Statutory Interpretation

    Section 108(b) provides EPA only general instructions in paragraphs 
(b)(1) and (b)(2), on how to determine what financial responsibility 
requirements to impose for a particular class of facility. Section 
108(b)(1) directs EPA to develop regulations requiring owners and 
operators of facilities to establish evidence of financial 
responsibility ``consistent with the degree and duration of risk 
associated with the production, transportation, treatment, storage, or 
disposal of hazardous substances. Section 108(b)(2) directs that the 
level of financial responsibility shall be initially established, and, 
when necessary, adjusted to protect against the level of risk that EPA 
in its discretion believes is appropriate based on the payment 
experience of the Fund, commercial insurers, courts settlements

[[Page 7562]]

and judgments, and voluntary claims satisfaction. Section 108(b)(2) 
does not indicate that this list of factors is exclusive. Read 
together, it is clear that the statutory language on determining the 
degree and duration of risk presented by a class, and in setting the 
level of financial responsibility as it determines is appropriate, 
confers a significant amount of discretion upon the Agency. EPA 
discusses these key phrases in turn below.
    Section 108(b)(1) directs EPA to develop regulations requiring 
owners and operators of classes of facilities that EPA identifies, to 
establish evidence of financial responsibility ``consistent with the 
degree and duration of risk associated with the production, 
transportation, treatment, storage, or disposal of hazardous 
substances.'' Thus, the statute indicates that EPA is to evaluate risk 
from a selected class. However, EPA does not interpret this direction 
to require a precise calculation of risk associated with the selected 
classes of facilities. Standard dictionary definitions of the term 
``consistent'' include merely ``being in agreement'' or ``compatible.'' 
\46\ Moreover, section 108(b) requirements are necessarily imposed in 
the absence of any response action, although it is through such 
response actions that the precise level of risk associated with a 
particular site is ascertained. The statute thus confers upon EPA wide 
latitude to determine, for purposes of a section 108(b) rulemaking 
proceeding, what the degree and duration of risk presented by the 
identified class is. Section 108(b)(2) in turn directs that the level 
of financial responsibility shall be initially established, and, when 
necessary, adjusted to protect against the level of risk that EPA in 
its discretion believes is appropriate based on the payment experience 
of the Fund, commercial insurers, courts settlements and judgments, and 
voluntary claims satisfaction. This statutory direction does not 
specify a particular methodology for the evaluation, indicating simply 
that the level of financial responsibility be established to protect 
against the level of risk that EPA ``in [its] discretion believes is 
appropriate.'' Thus, this decision is committed to the discretion of 
the Administrator. While the statute does provide a list of information 
sources in section 108(b)(2) on which EPA is to base its decision--the 
payment experience of the Superfund, courts settlements and judgments, 
and voluntary claims satisfaction--that list is not exclusive, nor does 
the statute specify how the information from these sources is to be 
used, for example, by indicating how the categories are to be weighted 
relative to one another. As discussed elsewhere in this final 
rulemaking and in the Technical Support Document, the record and 
comments received by EPA, provide details about the payment history of 
the Fund, experience with enforcement actions and court settlements 
resulting in operational changes, and voluntary actions by companies to 
reduce risks at specific sites that were used by the Administrator in 
his judgement to evaluate the risks from current hardrock mining 
operations. EPA has, therefore, taken multiple considerations into 
account, including information in these categories which, taken 
together, inform the exercise of its statutory discretion.
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    \46\ 301 Webster's II New Riverside University Dictionary 
(1988).
---------------------------------------------------------------------------

    Among the types of information the statute authorizes EPA to 
consider are the existence of federal and state regulations and 
financial responsibility requirements. Section 108(b)(1) directs EPA to 
promulgate financial responsibility requirements ``for facilities in 
addition to those under subtitle C of the Solid Waste Disposal Act and 
other Federal law.'' According to the 1980 Senate Report on legislation 
that was later enacted as CERCLA, Congress felt it was appropriate for 
EPA to examine those additional requirements when evaluating the degree 
and duration of risk:

    The bill requires also that facilities maintain evidence of 
financial responsibility consistent with the degree and duration of 
risks associated with the production, transportation, treatment, 
storage, and disposal of hazardous substances. These requirements 
are in addition to the financial responsibility requirements 
promulgated under the authority of section 3004(6) of the Solid 
Waste Disposal Act. It is not the intention of the Committee that 
operators of facilities covered by section 3004(6) of that Act be 
subject to two financial responsibility requirements for the same 
dangers.\47\

    \47\ S. Rept. 96-848 (2d Sess, 96th Cong.), at 92.
---------------------------------------------------------------------------

    While the report language addresses section 3004(6) of RCRA 
specifically, EPA believes that it is consistent with Congressional 
intent for EPA to consider other potentially duplicative Federal 
financial responsibility requirements when examining the ``degree and 
duration of risk'' or the ``level of risk'' when determining whether 
and what financial responsibility requirements are appropriate. EPA 
also believes that it is consistent with Congressional intent for EPA 
to consider state laws before imposing federal financial responsibility 
requirements on facilities. Consideration of state laws before 
developing financial responsibility regulations is consistent with 
section 114(d) of CERCLA, which prevents states from imposing financial 
responsibility requirements for liability for releases of the same 
hazardous substances after a facility is regulated under section 108 of 
CERCLA. Just as Congress clearly intended to prevent states from 
imposing duplicative financial assurance requirements after EPA had 
acted to impose such requirements under Section 108, EPA believes it 
reasonable to also conclude that Congress did not mean for EPA to 
disrupt existing state programs that are already successfully 
regulating industrial operations to minimize risk, including the risk 
of taxpayer liability for response actions under CERCLA, and that 
specifically include appropriate financial assurance requirements under 
State law. Both reviews (of state and other Federal programs) help to 
identify whether and at what level there is current risk that is 
appropriate to address under section 108 of CERCLA.
    EPA also believes that, when evaluating whether and at what level 
it is appropriate to require evidence of financial responsibility, EPA 
should examine information from hardrock mining facilities operating 
under modern conditions. These modern conditions include state and 
federal regulatory requirements and financial responsibility 
requirements that currently apply to operating facilities.
    This reading of section 108(b) is consistent with statements in the 
legislative history of the statute. The 1980 Senate Report states that 
the legislative language that became section 108(b) ``requires those 
engaged in businesses involving hazardous substances to maintain 
evidence of financial responsibility commensurate with the risk which 
they present.'' \48\ This reading of section 108(b) is also supported 
by testimony given by EPA before Congress during consideration of 
legislation that led to CERCLA. In 1979, Thomas C. Jorling, the EPA 
Assistant Administrator for Water and Waste Management, testified 
before a Senate subcommittee that new financial responsibility 
requirements in a hazardous substance liability law would be important 
to increase ``standards of care'' with respect to management of such 
substances. Mr. Jorling testified that this goal is not ``relevant'' to 
sites where ``it is already too late; emergency assistance and 
containment are

[[Page 7563]]

required.'' \49\ EPA notes that nothing in Mr. Jorling's testimony 
suggests that there are not other potential mechanisms, such as 
successful regulatory programs under state and other Federal laws, that 
can ensure appropriate ``standards of care.''
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    \48\ S. Rept. 96-848 (2d Sess, 96th Cong.), at 92.
    \49\ See Statement of Thomas C. Jorling, Assistant Administrator 
for Water and Waste Management, USEPA regarding S.1341/S.1480 (Sen. 
Comm. on Env't and Public Works, Subcommittees on Resource 
Protection and Environmental Pollution, June 20, 1979).
---------------------------------------------------------------------------

    This statutory interpretation was also reflected in the proposed 
rule. The proposed rule would have applied to currently operating 
facilities.\50\ As explained in the preamble to the proposal, EPA 
sought to document the extent to which hardrock mining facilities as a 
class continued to present risk associated with hazardous substance 
management.\51\ Moreover, this direction to identify requirements 
``consistent with'' the risks found also led EPA to recognize that 
imposition of financial responsibility requirements under section 
108(b) would not be necessary for facilities that present minimal 
current risks \52\ and to seek comment on whether other classes of 
facilities should be excluded.\53\
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    \50\ See proposed 40 CFR 320.2 and 82 FR 3404-05.
    \51\ See 82 FR 3470-80.
    \52\ See exclusions from the rule at proposed 40 CFR 
320.60(a)(2), as well as the opportunity to obtain a release from 
financial responsibility requirements at proposed 40 CFR 320.27. 
Both were proposed based on an evaluation of the level of risk posed 
by the facilities. 82 FR 3455-59.
    \53\ 82 FR 3456.
---------------------------------------------------------------------------

    Despite its focus on currently operating facilities, the proposed 
rule relied on a record of releases of hazardous substances from 
facilities and payments to respond to such releases that does not 
present the same risk profile as the modern facilities to which the 
rule would apply.\54\ As a result, EPA has determined that the analysis 
of risk presented in the proposed rule is inconsistent with the scope 
of the proposed rule and EPA's intended approach under the statute.
---------------------------------------------------------------------------

    \54\ 82 FR 3460-61.
---------------------------------------------------------------------------

    The final rulemaking does not seek to rely on historical practices, 
many of which would be illegal under current environmental laws and 
regulations,\55\ to identify the degree and duration of risk posed by 
the facilities that would be subject to financial responsibility 
requirements. Instead, in this final rulemaking EPA has considered 
modern federal and state regulation of hazardous substance production, 
transportation, treatment, storage, or disposal at hardrock mining 
facilities. As discussed below, the record does not document 
significant risks associated with such facilities. Further, this final 
rulemaking does not rely on the cost of responding to historic mining 
activities and instead reflects the reduction in the risk of federally 
financed response actions at modern hardrock mining facilities that 
result from modern practices and modern regulation. With a few 
exceptions, discussed below, EPA has made minimal expenditures for 
modern hardrock mining operations. In addition, EPA engaged in 
significant discussions with, and received significant comments from, 
commercial insurers and other financial instrument providers. These 
providers have submitted information indicating that the availability 
of financial responsibility instruments would likely be limited for 
regulated entities, should EPA require companies to obtain them. Thus, 
to the extent that risks remain at current hardrock mining operations, 
the information provided by commenters has further convinced EPA that 
it is not appropriate to establish financial responsibility 
requirements on this class of facilities.
---------------------------------------------------------------------------

    \55\ See, for example, Clean Water Act effluent limitations 
applicable to mining, discussed below.
---------------------------------------------------------------------------

    Nor does EPA believe that issuing final financial responsibility 
requirements is necessary to achieve the stated goals of the proposed 
section 108(b) rules for hardrock mining, namely, the goal to increase 
the likelihood that regulated entities will provide funds necessary to 
address CERCLA liabilities if and when they arise, and the goal to 
create an incentive for sound practices. EPA's economic analysis 
showing that the proposed rule would avoid governmental costs of only 
$15-$15.5 million a year supports this conclusion. Based on these 
estimates, commenters objected that the projected annualized costs to 
industry ($111-$171 million) are an order of magnitude higher than the 
avoided costs to the government ($15-15.5 million) sought by the rule. 
Further, given the fact that federal and state laws, including 
potential liability under CERCLA, have already created an incentive for 
sound practices, promulgating financial responsibility regulations for 
hardrock mining facilities under section 108(b) also is not necessary 
to advance that goal.
    This final rulemaking is based on the record assembled for this 
action. This decision does not substitute for any site-specific 
determinations of risk made in the context of individual CERCLA site 
responses. Those decisions will continue to be made in accordance with 
preexisting procedures. EPA has reached these conclusions on the record 
for this rulemaking, including public comments.
    The major concerns raised by commenters are described below in 
Sections C and D. Section E below, and the Technical Support Document 
for this final rulemaking, discuss case examples in EPA's record that 
correspond to these major concerns. It should be noted that much of the 
public comment received on the proposed rule addressed specific 
provisions of the proposal. Because EPA has decided not to issue 
regulatory text under section 108(b) for hardrock mining facilities, or 
the general provisions in proposed subparts A through C, comments on 
specific regulatory provisions are outside the scope of this final 
rulemaking.

B. Evaluation of the Administrative Record

    EPA has reevaluated the administrative record for this rulemaking 
regarding risk at current hardrock mining operations in light of its 
interpretation of the statute discussed above, and has determined that 
that record does not support the proposed rule and supports, instead, a 
final Agency action of no rule. This determination is based on an 
evaluation of the three primary reports that the proposed rule relied 
on to identify risk to be addressed by section 108(b): Evidence of 
CERCLA Hazardous Substances and Potential Exposures at Section 108(b) 
Mining and Mineral Processing Sites (hereinafter referred to as the 
``Evidence Report''); Releases from Hardrock Mining Facilities 
(hereinafter referred to as the ``Releases Report''); and Comprehensive 
Report: An Overview of Practices at Hardrock Mining and Mineral 
Processing Facilities and Related Releases of CERCLA Hazardous 
Substances (hereinafter referred to as the ``Practices Report'').\56\ 
This determination also is based on EPA's consideration of the 
reduction of risk as a result of federal and state regulatory and 
financial assurance requirements. Finally, this determination is based 
on the record of payments from the Superfund Trust Fund to address 
hazardous substance releases from modern mining facilities.
---------------------------------------------------------------------------

    \56\ See Releases from Hardrock Mining Facilities, EPA-HQ-SFUND-
2015-0781-0497; Comprehensive Report: An Overview of Practices at 
Hardrock Mining and Mineral Processing Facilities and Related 
Releases of CERCLA Hazardous Substances, EPA-HQ-SFUND-2015-0781-
0144; and Evidence of CERCLA Hazardous Substances and Potential 
Exposures at Section 108(b) Mining and Mineral Processing Sites, 
EPA-HQ-SFUND-2015-0781-0505.

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[[Page 7564]]

1. Reports on Risks Posed by Hardrock Mining Facilities
Evidence Report
    As described in the preamble to the proposed rule, the Evidence 
Report documents EPA's preliminary efforts from 2009-2012 to examine 
CERCLA site-specific documents for estimated exposures of human and 
ecological receptors to CERCLA hazardous substances from mining and 
mineral processing sites cleaned up under Superfund in the past. This 
report also collected available information on potential exposures of 
human and ecological receptors to CERCLA hazardous substances from 
mining and mineral processing sites that were operational in 2009 (the 
most current available data at the time the evaluation took place). The 
proposed rule relied on the following conclusions from the Evidence 
Report:

    Overall, the compiled information demonstrates that sites 
requiring cleanup under Superfund in the past, and sites operational 
in 2009 share characteristics related to the potential release of 
CERCLA hazardous substances and the exposure of human and ecological 
receptors, and illustrated the applicability of EPA's CERCLA 
experience to evaluating currently operating mines and 
processors.\57\

    \57\ 82 FR 3475.
---------------------------------------------------------------------------

    Upon review, EPA has now determined that those conclusions are not 
supported by the information provided in the Evidence Report. Further, 
these conclusions are not a primary factor in determining the ``degree 
and duration of risk'' presented by currently operating mines under 
modern environmental regulations. As a result, the Evidence Report does 
not support a rulemaking under section 108(b).
    First, the Evidence Report compares releases of hazardous 
substances at 24 facilities on the NPL that continued to operate after 
1980 (called post-1980 historical sites) to facilities operating in 
2009. It does not specify whether or not 1980 can be considered a date 
by which mining facilities could be considered modern facilities 
subject to modern regulations. The report does not identify or consider 
whether the releases from the historical sites were due to pre-1980 
activities and practices or whether the releases were caused by 
practices that are no longer typical of current mines. Instead, the 
report conflates risks posed by the historical facilities to risks 
posed by the 2009 facilities by comparing mining practices and 
contaminants of concern released at the facilities.
    When comparing mining practices, the report does not take into 
account the fact that by 2009, practices at mining facilities were 
already heavily regulated. For example, the effluent limitation for 
processes that use cyanide to extract gold or silver is zero 
discharge.\58\
---------------------------------------------------------------------------

    \58\ See 40 CFR 440.100(d).
---------------------------------------------------------------------------

    When comparing contaminants of concern, the Evidence Report 
identifies contaminants of concern at the historic sites through CERCLA 
response action documentation.\59\ In contrast, at the 2009 operating 
sites, contaminants of concern are identified through reports of TRI 
releases and through discharge monitoring reports submitted pursuant to 
Clean Water Act permits.\60\ The report fails to acknowledge that the 
evidence presented regarding releases of hazardous substances from 
facilities operating in 2009 is not evidence of risk. ``TRI data do not 
reveal whether or to what degree the public is exposed to listed 
chemicals.'' \61\ Further, releases reported under Clean Water Act 
permits are regulated releases. The fact that the same hazardous 
substances may be present at historic modern hardrock mining facilities 
is simply a consequence of the type of ores and processes used at 
hardrock mines. The mere presence of hazardous substances is not 
equivalent to risk. Similarly, the existence of common environmental 
receptors at historic and modern mines is not determinative of risk. 
The presence of a receptor does not indicate that there are releases of 
hazardous substances at levels that cause risk. Rather, the primary 
determinant of risk is how current operations at the mine are 
conducted, including the current regulatory regime under which they 
operate. As documented in this final action, it is in this respect that 
most of the historic examples discussed in the proposed rule differ 
from the modern mines that would actually be subject to its 
requirements.
---------------------------------------------------------------------------

    \59\ Evidence Report, at 9.
    \60\ Evidence Report, at 17.
    \61\ See https://www.epa.gov/sites/production/files/2015-06/documents/factors_to_consider_6.15.15_final.pdf.
---------------------------------------------------------------------------

    Finally, the Evidence Report admits that the releases identified as 
a cause of past fund expenditures are now regulated under the Clean Air 
Act and RCRA.\62\
---------------------------------------------------------------------------

    \62\ Evidence Report, at 55-56.
---------------------------------------------------------------------------

    As a result of these limitations, the Evidence Report fails to 
identify substantial risks associated with modern hardrock mining 
facilities and therefore does not support a rule that would impose 
financial responsibility requirements on the current hardrock mining 
sector.
Releases Report and Practices Report
    Implicitly recognizing the limitations of the Evidence Report, as 
well as the inability to rely on reports that are decades old,\63\ EPA 
developed two additional reports to attempt to provide record support 
for a rule under section 108(b), the Releases Report and the Practices 
Report.
---------------------------------------------------------------------------

    \63\ See the 1992 and 1997 reports cited at 82 FR 3475.
---------------------------------------------------------------------------

    The Releases Report was intended to ``substantiate the ongoing 
existence of environmental risk from releases to the environment from 
hardrock mining and mineral processing operations in spite of improved 
regulation of and practices instituted by the hardrock mining and 
mineral processing industry.'' \64\ It purports to document releases 
from facilities ``that had no previous significant legacy mining 
issues.'' \65\
---------------------------------------------------------------------------

    \64\ Releases Report, at 1.
    \65\ 82 FR 3471.
---------------------------------------------------------------------------

    The report lists sites that required CERCLA, CERCLA-like, and 
potential CERCLA actions, and describes the release and response 
narratively. However, the limitations of this report prevent it from 
supporting a determination that requirements under section 108(b) for 
hardrock mining facilities are appropriate. As discussed in section E, 
below, and in the Technical Support Document for this final 
rulemaking,\66\ the Releases Report included facilities with 
significant mining activity that pre-dated modern regulation, creating 
legacy contamination. The report also fails to address whether or not 
the releases resulted in the expenditure of federal dollars or 
appropriately distinguish releases that predate modern regulation and 
are now prohibited by law or otherwise regulated.
---------------------------------------------------------------------------

    \66\ See: EPA, CERCLA Section 108(b) Hardrock Mining Final Rule: 
Technical Support Document, December 1, 2017.
---------------------------------------------------------------------------

    The Practices Report purports to present information on the 
potential for future releases at operating hardrock mining 
facilities.\67\ However, the Practices Report acknowledges that it 
cannot be used to draw conclusions about future releases, stating that: 
``Many sites and facilities within the non-operating and currently 
operating samples have been active for a century or longer. When a 
post-1980 release occurred at these facilities, it was difficult to 
determine if the equipment or practice responsible for the release was 
newly constructed or part of the site's past operations.'' \68\ The 
Practices Report acknowledges that ``a number of

[[Page 7565]]

factors limited the inferences that can be drawn from data about 
releases at currently operating facilities.'' \69\
---------------------------------------------------------------------------

    \67\ Practices Report, at 1.
    \68\ Id., at 5.
    \69\ Practices Report, at 9.
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    Both reports also lack important information on whether or not the 
releases resulted in the expenditure of federal dollars or whether the 
releases identified are now prohibited by law or otherwise regulated. 
As noted in section E, below, and the Technical Support Document for 
this final rulemaking, many of the releases discussed in those reports 
are being addressed by the responsible parties.
    Despite the limitations of the Releases Report and the Practices 
Report, the proposed rule claimed that they validated the conclusions 
of earlier reports stating that: ``EPA believes the results of this 
relatively recent effort to further document the state of current 
mining practices substantiates the findings from the other documents 
described herein [the Evidence Report and the reports from 1992 and 
1997] and further reinforces the Agency's belief that currently 
operating hardrock mining and mineral processing facilities subject to 
this proposal continue to present risks of release of hazardous 
substances.'' \70\
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    \70\ 82 FR 3475.
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    As discussed above, upon reexamination, EPA now believes that none 
of these reports provide an appropriate basis for identification of the 
risk of hazardous substance releases at the facilities that would be 
regulated under the proposed rule or the risk of federally financed 
response actions at such facilities. Additional relevant information on 
many of the sites discussed in these reports which helped inform EPA's 
conclusions in this final rulemaking is documented in section IV.E 
below and in the Technical Support Document.
2. Federal and State Regulatory Requirements
    EPA has determined that modern regulation of hardrock mining 
facilities, among other factors, reduces the risk of federally financed 
response actions to a low level such that no additional financial 
responsibility requirements for this industry are appropriate. This 
section summarizes the regulations that support that determination.
a. Federal Environmental Statutes
    The proposed rule proposed to regulate facilities that engage in 
the extraction, beneficiation, and processing of metals, (e.g., copper, 
gold, iron, lead, magnesium, molybdenum, silver, uranium, and zinc) and 
non-metallic, non-fuel minerals (e.g., asbestos, phosphate rock, and 
sulfur), other than placer mining, exploration only activities, and 
mines and processers disturbing less than five acres.\71\ This scope 
includes mines, processors, and smelters.
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    \71\ See Proposed 40 CFR 320.60.
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    While much mining and beneficiation is exempt from RCRA,\72\ these 
activities are regulated under the Clean Water Act and the Clean Air 
Act. In addition, some waste material from covered mineral processing 
facilities is regulated under RCRA. Finally, permissions to mine on 
federal land are subject to review under the National Environmental 
Policy Act and may require the preparation of an Environmental Impact 
Statement.
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    \72\ See 51 FR 24496.
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Clean Water Act
    The Clean Water Act (CWA) prohibits discharges to waters of the 
United States, unless in compliance with another portion of the 
Act.\73\ Principal among those other provisions is the permitting 
program established under section 402 of the Act, the National 
Pollution Discharge Elimination System (NPDES).\74\ Existing 
dischargers of toxic and nonconventional pollutants are required to 
install best available control technology that is economically 
achievable.\75\ New dischargers must meet new source performance 
standards, based on the best available demonstrated control technology. 
If these technology-based standards do not fully protect water quality, 
then a facility must adopt additional controls to meet applicable water 
quality standards (water quality-based effluent limitations).\76\
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    \73\ 33 U.S.C. 1311.
    \74\ 33 U.S.C. 1342.
    \75\ 33 U.S.C. 1311.
    \76\ 33 U.S.C. 1311(b)(1)(C).
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    Technology-based effluent limitations for hardrock mining are found 
at 40 CFR part 440. The Ore Mining and Dressing Effluent Guidelines 
apply to facilities in twelve subcategories as follows:

Iron Ore
Aluminum Ore
Uranium, Radium and Vanadium Ores
Mercury Ore
Titanium Ore
Tungsten Ore
Nickel Ore
Vanadium Ore (Mined Alone and Not as a Byproduct)
Antimony Ore
Copper, Lead, Zinc, Gold, Silver, and Molybdenum Ores
Platinum Ores
Gold Placer Mining

    The Background Document for the proposed financial responsibility 
formula states: ``Nearly three-quarters of the 354 currently operating 
facilities report mining five commodities (gold, iron, copper, 
phosphate, and uranium), with gold mines alone making up nearly half of 
the universe.'' \77\ Accordingly, subpart J, the Copper, Lead, Zinc, 
Gold, Silver, and Molybdenum Ores Subcategory, is of particular 
relevance. Last amended in 1982 (effective January 1983), this subpart 
applies to:
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    \77\ EPA-HQ-2015-0781-0500 at 3-11.
---------------------------------------------------------------------------

    (1) Mines that produce copper, lead, zinc, gold, silver, or 
molybdenum bearing ores, or any combination of these ores from open-pit 
or underground operations other than placer deposits;
    (2) Mills that use the froth-flotation process alone or in 
conjunction with other processes, for the beneficiation of copper, 
lead, zinc, gold, silver, or molybdenum ores, or any combination of 
these ores;
    (3) Mines and mills that use dump, heap, in-situ leach, or vat-
leach processes to extract copper from ores or ore waste materials; and
    (4) Mills that use the cyanidation process to extract gold or 
silver.\78\
---------------------------------------------------------------------------

    \78\ 40 CFR 440.100.
---------------------------------------------------------------------------

    Under this subpart, the following activities must meet an effluent 
limitation of zero discharge:
    (1) Mine areas and mills processes and areas that use dump, heap, 
in situ leach or vat-leach processes to extract copper from ores or ore 
waste materials (40 CFR 440.103(c)); and
    (2) Mills that use the cyanidation process to extract gold or 
silver (40 CFR 440.103(d)).
    In addition, drainage from all mines in this subcategory and 
discharges from mills in this category that use a froth-flotation 
process must meet limitations for copper, zinc, lead, mercury, and 
cadmium.
    Discharges to water from mineral mining and processing facilities 
are regulated under 40 CFR part 436. Last amended in 1979, these 
regulations require best practicable control technology for wastewater 
discharges from mine drainage, mineral processing operations and 
stormwater runoff. This part includes subpart R, which applies to the 
mining and the processing of phosphate bearing rock, ore or earth for 
the phosphate content. These regulations regulate the pH of discharges 
from phosphate mines and limit discharges of total suspended solids 
from such mines to a daily maximum concentration of 60 mg/l.
    The Clean Water Act regulates discharges of pollutants from 
smelters under 40 CFR part 421 (Nonferrous Metals Manufacturing 
Category). Last

[[Page 7566]]

amended in 1984, these regulations limit pH and the concentration of 
metals in discharges.
Clean Air Act
    The Clean Air Act regulates air emissions from industrial processes 
like mining and mineral processing. These include National Emissions 
Standards for Hazardous Air Pollutants (NESHAPs) as well as New Source 
Performance Standards (NSPS).
    The 2011 NESHAP for gold ore processing and production facilities 
controls mercury air emissions from these facilities. 40 CFR part 63, 
subpart EEEEEEE.
    On June 12, 2002, EPA promulgated final air toxics standards for 
the Primary Copper Smelting major sources 40 CFR part 63, subpart QQQ. 
These regulations control emissions of arsenic, beryllium, cadmium, 
chromium, lead, manganese and nickel. On June 4, 1999, EPA promulgated 
a NESHAP for primary lead smelting (40 CFR part 63, subpart TTT) that 
controls emissions of lead. In 2007, EPA promulgated a NESHAP for zinc, 
cadmium and beryllium smelters (40 CFR part 63, subpart GGGGGG), and 
those regulations established a particulate matter standard. Under 
section 111 of the CAA, New Source Performance Standards (NSPS) 
applicable to metallic mineral-processing plants have been established 
(40 CFR part 60, subpart LL control emissions of particulate matter). 
EPA's 1976 NSPS for primary lead smelting (40 CFR part 60, subpart R) 
controls emissions of particulate matter.
RCRA
    While most hardrock mining and beneficiation waste is exempt from 
RCRA subtitle C,\79\ mineral processing waste (other than twenty 
``special wastes'') are not.\80\ Thus, mineral processing facilities 
may be regulated under RCRA Subtitle C. The management of hazardous 
wastes is generally subject to strict minimum technology 
requirements.\81\ Land disposal of hazardous wastes is prohibited 
unless treatment standards are met.\82\
---------------------------------------------------------------------------

    \79\ 51 FR 24496 (July 3, 1986).
    \80\ See the list at https://www.epa.gov/hw/special-wastes#mining.
    \81\ 42 U.S.C. 6924(o).
    \82\ 42 U.S.C. 6924(d)-(g).
---------------------------------------------------------------------------

National Environmental Policy Act
    The National Environmental Policy Act (NEPA) requires an 
environmental review of major federal actions significantly affecting 
the quality of the human environment.\83\ Major federal actions include 
the issuance of federal permits or permission to use federal lands.\84\ 
Mining activities on federal lands are generally subject to NEPA. 
Accordingly, the potential environmental impacts of those activities 
are considered and publicly disclosed before they occur. These reviews 
include consideration of impacts to surface water, ground water, air, 
soils, ecosystems, wetlands, endangered species, and flood plains.
---------------------------------------------------------------------------

    \83\ 42 U.S.C. 4332.
    \84\ 40 CFR 1508.18.
---------------------------------------------------------------------------

b. Federal Land Management Laws
    The Bureau of Land Management (BLM) and the Forest Service (herein 
referred to at the Federal Land Management Agencies (FLMAs), have both 
promulgated regulations that apply to hardrock mining operations on 
land they manage.
    BLM has promulgated regulations under the Federal Land Policy and 
Management Act (43 U.S.C. 1701 et seq.) that apply to hardrock mining 
operations on BLM land. These regulations include a requirement to 
develop a plan for reclamation of disturbed areas and a financial 
guarantee sufficient to fund completion of the reclamation plan.\85\
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    \85\ 43 CFR part 3800, subpart 3809.
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    In order to obtain a permit to mine on public lands, the operator 
must submit a plan of operations that includes plans for water 
management, rock characterization and handling, spill contingency, and 
reclamation.\86\ The plan of operations for the mine cannot be approved 
until thirty days after a final environmental impact statement has been 
prepared and filed with EPA.\87\ The required reclamation plan must 
detail stabilization of land disturbed for mining, reclaiming and 
reshaping the land, wildlife rehabilitation, controlling potentially 
hazardous materials, and post-closure management.\88\
---------------------------------------------------------------------------

    \86\ 43 CFR 3809.1-6.
    \87\ 43 CFR 3809.1-6.
    \88\ 43 CFR 3809.1-3(d).
---------------------------------------------------------------------------

    Like BLM, the Forest Service also requires a plan of operation that 
includes a plan for reclamation of mining disturbances on Forest 
Service lands.\89\ The requirements for environmental protection are 
set forth in 36 CFR 228.8 and include compliance with all air quality, 
water quality, and solid waste standards; protection of scenic values; 
and reclamation to control erosion and water runoff, isolate, remove or 
control toxic materials, reshape and revegetate disturbed areas, and 
rehabilitate fisheries and wildlife habitat. The Forest Service 
requires a bond to cover the cost of stabilizing, rehabilitating, and 
reclaiming the area of operations.\90\ Like a BLM plan of operations, 
approval of a Forest Service plan of operations also is subject to 
NEPA.
---------------------------------------------------------------------------

    \89\ 36 CFR part 228.
    \90\ 36 CFR 228.13.
---------------------------------------------------------------------------

    The Forest Service regulations allow the Forest Service to require 
a modification to the Plan of Operations and reclamation plan (36 CFR 
228.4(e)) and adjust the bond to cover the modified plan (36 CFR 
228.13(c)).
    EPA's conclusion that BLM and Forest Service regulations address 
risks at hardrock mining facilities is further supported by the 
comments submitted by these agencies, discussed below.
c. Other Existing Regulatory Requirements
    The proposed rule stated that addressing CERCLA liabilities is 
different from the mine reclamation bonding requirements required by 
BLM, the Forest Service, or state requirements that seek to ensure 
compliance with technical engineering requirements imposed through a 
permit, or to ensure proper closure or reclamation of an operating 
mine.\91\ This discussion in the proposed rule was intended to 
highlight legal distinctions between the section 108(b) requirements 
and the requirements of other federal and state programs. However, even 
when developing the proposed rule, EPA acknowledged the overlap between 
the risks to be addressed by section 108(b) and existing federal and 
state regulations. EPA now recognizes that the existence of these other 
programs, whatever legal differences there may be in their intent and 
implementation, are critical to understanding ``the degree and duration 
of risk associated with the production, transportation, treatment, 
storage, or disposal of hazardous substances'' as well as the risk to 
taxpayers of being required to fund response activities under CERCLA, 
which are the primary factors relevant to EPA's determination of the 
need for and appropriate level of financial responsibility requirements 
under section 108(b).
---------------------------------------------------------------------------

    \91\ 82 FR 3403.
---------------------------------------------------------------------------

    For example, 16 of the 27 sites discussed in the Releases Report 
are called ``CERCLA-like'' releases. Thus, according to the Releases 
Report, these sites present the same type of risk that is to be 
addressed under section 108(b). However, as discussed below and in the 
Technical Support Document for this final rulemaking, we have 
documented no expenditure of funds by EPA for those ``CERCLA-like'' 
releases, which,

[[Page 7567]]

as is explained in the Releases Report, are being addressed under other 
state and Federal programs, demonstrating that modern regulation 
adequately addresses the risk of Fund financed response action posed by 
these sites.\92\
---------------------------------------------------------------------------

    \92\ The limited number of sites referenced in the Releases 
Report for which there were CERCLA actions and EPA expenditures are 
discussed below.
---------------------------------------------------------------------------

    Even the methodology used in the proposed rule to develop the 
proposed financial responsibility requirements shows that the actual 
physical risks addressed by modern regulations are essentially the same 
as the risks to be addressed by section 108(b). The Background Document 
for the financial responsibility formula demonstrates that the costs of 
existing federal and state reclamation and closure requirements were 
used to develop costs for the categories of response activities that 
are the building blocks of financial responsibility requirements under 
the proposed rule.\93\ Thus, the proposed financial responsibility 
requirements largely address the same risks that are addressed by 
existing regulatory requirements.
---------------------------------------------------------------------------

    \93\ See CERCLA 108(b) Financial Responsibility Formula For 
Hardrock Mining Facilities, Background Document, Sept. 19, 2016 
(EPA-HQ-2015-0781-0500), at 2-17, Table 2.2. See also 82 FR 3462 
(``EPA found that such engineering cost data was readily available 
from cost estimates developed for state and Federal mining 
reclamation and closure plans, and associated documents.'').
---------------------------------------------------------------------------

    This conclusion is further supported by comments submitted by the 
Forest Service, and a number of states opposing the proposed rule. The 
Forest Service demonstrated in their comments how their regulations 
address the same physical risks that are captured in the response 
categories that are the building blocks of the proposed section 108(b) 
financial responsibility formula.\94\ The states of Alaska, Nevada, New 
Mexico, and South Dakota each provided a similar analysis for their 
state, and the Interstate Mining Compact Commission provided analyses 
for Arizona, South Dakota, and Utah.\95\ The National Mining 
Association (NMA) also compiled similar information for 15 states.\96\
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    \94\ See comment from the Forest Service, EPA-HQ-SFUND-2015-
0781-2400, at page 2.
    \95\ Alaska (Attachment 5/Attachment D to EPA-HQ-SFUND-2015-
0781-2785); Nevada (Appendix to EPA-HQ-SFUND-2015-0781-2651); New 
Mexico (Attachment A at p. 17 of EPA-HQ-SFUND-2015-0781-2676); South 
Dakota (Attachment to EPA-HQ-SFUND-2015-0781-2419); IMCC (showing 
results for Arizona, South Dakota, and Utah at EPA-HQ-SFUND-2015-
0781-2758 & EPA-HQ-SFUND-2015-0781-2757).
    \96\ EPA-HQ-SFUND-2015-0781-2794 at Appendix A.
---------------------------------------------------------------------------

    In conclusion, EPA is convinced by the arguments made by state and 
Federal commenters that the risks sought to be addressed by the 
proposed rule are already addressed by existing state and Federal 
programs. The proposed rule would have considered the risk reduction of 
existing regulations only as a means to reduce the amount of otherwise 
required financial responsibility and sought comment on several aspects 
of this approach. EPA is now convinced that those regulations obviate 
the need for additional financial responsibility requirements under 
section 108(b) on the hardrock mining sector. As stated by the Forest 
Service:

    [T]he fact that EPA refers to existing regulations as a 
rationalization for building the requirements of a particular 
reduction [in financial responsibility] serves to underline that 
these existing regulations serve the purpose that EPA hopes is 
served by the proposed rule: To reduce the risk of a release of a 
hazardous or toxic substance. Therefore, the specific requirements 
in the reductions are unnecessary, because other programs with more 
site-specific presence than EPA has, are already requiring these 
actions, using site-specific conditions as criteria for design of 
the mitigations in question. Thus, the outcome is that EPA is 
attempting to regulate that which is already regulated.\97\
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    \97\ See comment EPA-HQ-SFUND-2015-0781-2400, at page 11.
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3. Risk of Payments From the Fund
    According to the preamble of the proposed rule, EPA estimated that 
the historical costs of responding to releases from 243 hardrock mining 
and minerals processing facilities totaled $12.9 billion, of which 
approximately $4 billion was paid for through EPA's Superfund program. 
EPA relied on this estimate to conclude that: ``Such significant 
cleanup costs may be considered as an indication of the relative risks 
present at these sites, and the potential magnitude of environmental 
liabilities associated with this industry overall.'' \98\
---------------------------------------------------------------------------

    \98\ 82 FR 3479.
---------------------------------------------------------------------------

    As discussed above, EPA has now determined that as a result of 
modern regulations, the degree and duration of risk associated with the 
modern production, transportation, treatment, storage or disposal of 
hazardous substances by the hardrock mining industry does not present a 
level of risk of taxpayer funded response actions that warrant 
imposition of financial responsibility requirements for this sector.
    EPA acknowledges that the Agency has incurred response costs at 
mining sites. However, as many commenters have noted, the vast majority 
of those costs have been to address legacy practices. EPA also 
acknowledges that there are a handful of examples of sites where EPA 
has incurred response costs, notwithstanding regulation under the Clean 
Water Act, or other state and federal law. However, the Agency does not 
believe that these few examples are an appropriate basis for regulation 
under CERCLA section 108(b).
    The record for the proposed rule includes background information on 
response costs, expenditures, and settlements at 185 NPL sites and 134 
non-NPL sites to inform the proposed financial responsibility 
formula.\99\ To develop this information, EPA collected and reviewed 
data available in the Comprehensive Environmental Response, 
Compensation, and Liability Information System (CERCLIS), the 
Integrated Financial Management System (IFMS), and the Office of 
Enforcement and Compliance Assurance (OECA) settlements database, as 
well as a 2004 report of the EPA Inspector General, and a 2010 report 
from the Government Accountability Office.\100\ As part of this 
analysis, EPA combined data from CERCLIS and IFMS into a Microsoft 
Access file to summarize Fund expenditures incurred at each hardrock 
mining facility for which EPA had data (as of 2011).\101\ A link to an 
FTP site containing these files was provided in the docket.\102\
---------------------------------------------------------------------------

    \99\ CERCLA 108(b) Financial Responsibility Formula For Hardrock 
Mining Facilities, Background Document, Sept. 19, 2016 (EPA-HQ-2015-
0781-0500), at sections 2.1 and 2.2, and Appendix B. The formula 
also includes estimated costs for natural resources damages and 
public health assessments. However, both are a function of a release 
that requires a response action. In the formula, health assessment 
costs are simply a fixed cost of $550,000 and the natural resource 
damages are assumed based on a percentage of the response costs. Id. 
at section 5 and page 6-2.
    \100\ Id. at 2-1. EPA was able to obtain cost information for 
319 hardrock mining facilities.
    \101\ Id. at 2-2. If EPA itself had incurred expenditures at a 
hardrock mining facility, those expenditures would have been 
included in the data pulled from these databases.
    \102\ It also is available here: ftp://newftp.epa.gov/CERCLA108B.
---------------------------------------------------------------------------

    While the purpose of this data collection was to support the 
development of the financial responsibility formula, it also can be 
used to examine Fund expenditures at specific sites. For example, the 
results of a query of the Microsoft Access file on site expenditures 
results in a table that has data for only eight of the 27 sites 
identified in the Releases Report.\103\ The

[[Page 7568]]

discussion of why the releases at these sites do not support the 
proposed rule is discussed in the Technical Support Document 
accompanying this final rulemaking.\104\ Of the eight, seven are gold 
or gold and silver mines. Of the seven, six were operational after the 
effective date of Clean Water Act effluent limitations applicable to 
cyanide heap leach mining processes. Thus, regulation does not always 
prevent releases. In fact, the release at the Summitville Mine in 
Colorado was significant and the response was very costly. As discussed 
in the Technical Support Document accompanying this final rulemaking, 
the costs of response at that site included costs of addressing acid 
mine drainage from legacy (since 1890) operations, unrelated to the 
releases from cyanide heap leach process. Further, Colorado has since 
changed its regulation to prevent a repeat of the releases that 
occurred from the heap leach process at Summitville. Thus, Summitville 
mine is not an example of current risk. However, it also is important 
to understand that, according to a 1996 retrospective review of 
Summitville prepared by an EPA Region 8 employee and the Colorado 
Department of Natural Resources, the Colorado-issued Clean Water Act 
permit, which assumed no discharge from the heap leach process, was 
based on an erroneous water balance calculation for the site. The 
permit assumed that evaporation would be greater than 
precipitation.\105\ EPA's financial responsibility formula similarly 
relies on water balance data, and could be subject to the same type of 
error, demonstrating that neither regulation nor financial 
responsibility requirements are infallible.\106\
---------------------------------------------------------------------------

    \103\ See the site expenditure table from the D Site Exp.accdb 
file on the FTP site. These sites are Barite Hill, a gold and silver 
mine in South Carolina ($6.3 million), Brewer Gold, a gold and 
silver mine in South Carolina ($12.3 million), Cimarron Mine, a gold 
mine in New Mexico ($3.5 million), Formosa Mine, a copper and zinc 
mine in Oregon ($3.1 million), Gilt Edge mine, a gold and silver 
mine in South Dakota ($75 million), Grouse Creek mine, a gold mine 
in Idaho ($314,000), Silver Mountain, a gold and silver mine in 
Washington ($1.4 million), and Summitville, a gold and silver mine 
in Colorado ($226 million). These numbers are presented in nominal 
dollars and are current as of 2011. The Microsoft Access file on 
settlements available at the same FTP site shows past cost 
settlements totaling $12.7 million at Gilt Edge, response work and 
past cost settlements totaling over $9 million at Grouse Creek, and 
past cost and future cost settlements at Summitville totaling 
approximately $49 million. See the settlements table from the 
cerclis_historical_sites_41612.accdb file on the FTP site.
    \104\ The Technical Support Document addresses all but two of 
the eight sites discussed in the Releases Report for which there is 
a record of Fund expenditures. Silver Mountain is a gold and silver 
mine that operated beginning in 1928 and that used a cyanide heap 
leach process before the promulgation of strict Clean Water Act 
regulations for those processes. See Releases Report, at 7. Grouse 
Creek was operated by Hecla Mining Company and the Microsoft Access 
files on the FTP site show only $314,000 in EPA expenditures and a 
greater amount in cost recoveries. Thus, these sites are not 
evidence of risk of Fund-financed response actions at currently 
operating sites.
    \105\ The Mining History and Environmental Clean-up at the 
Summitville Mine. Colorado Geological Society Open File Report 96-4. 
Available at http://2fdpn7hy0ht206jws2e9og41.wpengine.netdna-cdn.com/wp-content/uploads/2013/08/38.pdf.
    \106\ EPA-HQ-2015-0781-0500, at section 3.4.
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    Issues with the financial responsibility formula in the proposed 
rule are also discussed in, January 19, 2017 comments submitted by the 
Small Business Administration (SBA) Office of Advocacy. SBA used data 
in the record to compare the results of the proposed financial 
responsibility formula against actual site costs at six mining sites. 
The formula both underestimated, and in some cases greatly 
overestimated the costs of response. For example, at one mine the 
actual costs to address an open pit were $77,000, while the formula 
would have required financial responsibility in the amount of 
$197,900,000 for this response activity.\107\ At another site, the 
formula would have required evidence of financial responsibility to 
cover interim operation and maintenance at a level of $69 million while 
the actual costs reported by the site operator who is paying for the 
response action pursuant to its reclamation plan were over $96 
million.\108\ EPA acknowledges that any formula with limited site 
specific information is necessarily a very imprecise means of 
determining potential response costs, and may significantly over or 
underestimate actual costs, as documented in the SBA comments. As noted 
by several commenters, financial assurance amounts established by state 
and other Federal regulatory programs are usually informed by site-
specific assessments by on-the-ground regulators and are thus likely to 
better reflect actual response costs.
---------------------------------------------------------------------------

    \107\ EPA-HQ-SFUND-2015-0781-1406, at 18.
    \108\ Id. (discussing Hycroft Resources, an active gold mine in 
Nevada). See also discussions of Hycroft in the Background Document 
for the financial capability formula. EPA-HQ-SFUND-2015-0781-0500.
---------------------------------------------------------------------------

    The conclusion that modern regulation has greatly reduced the risk 
of taxpayer financed response actions also is supported by the 
experience of other federal agencies. For example, in letters sent to 
Senator Murkowski, BLM and the Forest Service stated that no modern 
mines permitted since 1990 by either BLM or the Forest Service have 
been added to the NPL. When asked how many mining plans of operation 
BLM and Forest Service have approved since 1990, and how many of the 
corresponding sites have been placed on the NPL, BLM responded that it 
had approved 659 plans since 1990 and none had been added to the NPL 
and the Forest Service reported approval of 2,685 plans since 1990 with 
no sites being placed on the NPL.\109\ These data support a conclusion 
that federal financial responsibility programs (and related mining 
engineering and permitting requirements) have been effective at 
lowering risk, reducing taxpayer liability, and contrasts strongly with 
the historical record involving legacy mines.
---------------------------------------------------------------------------

    \109\ Letter dated June 21, 2011 from BLM Director Robert Abbey 
to Senator Lisa Murkowski, dated June 21, 2011; Letter dated July 
20, 2011 from USDA Secretary Thomas Vilsack to Senator Lisa 
Murkowski, dated July 20, 2011. The letters were written in response 
to several questions posed by Senator Murkowski relating to hardrock 
mining programs on BLM and Forest Service lands.
---------------------------------------------------------------------------

    States have had similar experience with their own programs. The 
state of Nevada, which has roughly one fourth of hardrock mines in the 
potentially regulated universe of mines developed by EPA for purposes 
of analysis in the proposed rule, has not had a case involving taxpayer 
funded response action since 1991, when the state's new rules were put 
in place.\110\
---------------------------------------------------------------------------

    \110\ Nevada comments, at Appendix 3 (EPA-HQ-SFUND-2015-0781-
2651).
---------------------------------------------------------------------------

    EPA considered these examples of the limited payment experience of 
the Fund, as well as the record relating to payments covered by federal 
and state financial responsibility instruments required under other 
federal and state law, and payments made pursuant to settlements and 
voluntary response actions \111\ to further support EPA's determination 
that the degree and duration of risk associated with the modern 
production, transportation, treatment, storage or disposal of hazardous 
substances by the hardrock mining industry does not present a level of 
risk of taxpayer funded response actions that warrant imposition of 
financial responsibility requirements for this sector.
---------------------------------------------------------------------------

    \111\ EPA considers this information to be encompassed by the 
categories of information set forth in section 108(b)(2) (``payment 
experience of the Fund, commercial insurers, courts settlements and 
judgments, and voluntary claims satisfaction'').
---------------------------------------------------------------------------

C. Comments Supporting a Final Rulemaking

    EPA received many comments on the proposed rule that expressed 
support for promulgation of financial responsibility requirements under 
section 108(b). Sixty comments from individual private citizens 
encouraged EPA to issue final requirements, as did four mass mailing 
letter campaigns sponsored by the Idaho Conservation League, Water 
Legacy, Friends of the Boundary Waters Wilderness, and Earthworks. The 
main comment in support of the rule came

[[Page 7569]]

from Earthworks, representing 35 different environmental groups.\112\
---------------------------------------------------------------------------

    \112\ Earthworks submitted comments on the proposed rule 
representing: Inform, Western Organization Resource Councils, 
Minnesota Center for Environmental Advocacy, Upper Peninsula 
Environmental Coalition, Natural Resources Council of Maine, Montana 
Environmental Information Center, Greater Yellowstone Coalition, 
Conservation Law Foundation, Northeastern Minnesotans for 
Wilderness, Friends of The Boundary Waters Wilderness, Northern 
Alaska Environmental Center, Save Our Sky Blue Waters, Gila 
Resources Information Project, Brooks Range Council, The Lands 
Council, Campaign to Save the Boundary Waters, Friends of The 
Clearwater, Rock Creek Alliance, Save Our Cabinets, Patagonia Area 
Resources Council, Friends of the Kalmiopsis, Clean Water Alliance, 
Water Legacy, Park County Environmental Council, Great Basin 
Resource Watch, Wisconsin Resources Protection Council, Rivers 
Without Borders, Spokane Riverkeepers, Western Watersheds Project, 
Okanagan Highlands Alliance, Boise Chapter Great Old Broads for 
Wilderness, Copper Country Alliance, Nunamta Aulukestai, and Idaho 
Conservation League.
---------------------------------------------------------------------------

    Earthworks, et al. commented that CERCLA financial assurance 
regulations are necessary to ensure enough funds are available to 
complete cleanup actions without shifting the burden to the general 
public. They also stated in their comments that the proposed 
regulations did not duplicate existing state rules, which they argued 
do not cover pipeline spills, tailings spills, tailings impoundment 
failures and other releases of hazardous materials which commonly occur 
at hardrock mines, and can result in substantial liabilities.\113\ In a 
separate comment on the proposed rule, the Idaho Conservation League 
stated that the state of Idaho's financial assurance requirements do 
not authorize bonding for groundwater contamination and water treatment 
in perpetuity and that a section 108(b) rule is necessary to close that 
gap.\114\
---------------------------------------------------------------------------

    \113\ See comment from Earthworks, et al., EPA-HQ-SFUND-2015-
0781-2739, at page 2.
    \114\ See comment from Idaho Conservation League, EPA-HQ-SFUND-
2015-0781-2700, at page 1.
---------------------------------------------------------------------------

    In their comments on the proposed rule, Earthworks stated that: 
``Strong CERCLA 108(b) regulations are necessary to protect taxpayers 
from incurring the cost of mine clean-up, and to ensure that clean-up 
of hazardous materials at mine sites occur in a timely manner.'' To 
support their conclusion, they specifically mentioned a 2005 report by 
the Government Accountability Office (GAO) that concluded that EPA 
should ``fully use its existing authorities to better ensure that those 
businesses that cause pollution also pay to have their contaminated 
sites cleaned up.'' \115\ They also pointed to a 2004 report by EPA's 
Office of Inspector General (IG) that identified 29 specific sites 
where, according to the IG, cleanup work was delayed or scaled back in 
ways harmful to human health and the environment because of funding 
shortfalls.\116\ In addition to this report, Earthworks identified in 
their comments other examples of cleanup efforts at mines that they 
stated remain uncompleted due to insufficient funds being available, or 
that took an inordinate amount of time to complete, exposing the public 
to dangerous substances. As discussed in the specific case studies and 
the accompanying Technical Support Document, a number of the examples 
cited by the IG and Earthworks are not representative of the risk posed 
by currently operating hardrock mining facilities.
---------------------------------------------------------------------------

    \115\ Earthworks, et al., EPA-HQ-SFUND-2015-0781-2739, page 5.
    \116\ Ibid. page 5, 6.
---------------------------------------------------------------------------

    EPA appreciates Earthworks' concern that insufficient funds leads 
to incomplete or slow cleanup and restoration of mine sites. Earthworks 
acknowledges that the universe of entities that EPA proposed to 
regulate under the proposed rule excluded mines that are no longer 
operating. They recommended that the universe be expanded to cover mine 
operations that are no longer active but still retain a responsible 
party. They state that, ``Many past hardrock mining facilities are 
already and/or will be the site of CERCLA liabilities and necessary 
response actions. The CERCLA 108(b) regulations should apply to these 
operations.'' \117\ EPA disagrees with this comment, and notes that the 
Agency has determined the goals of a section 108(b) rule as described 
in the proposal have already been satisfied.
---------------------------------------------------------------------------

    \117\ Ibid., page 11.
---------------------------------------------------------------------------

    Earthworks also commented that ``CERCLA 108(b) regulations are 
essential because they address risks and liabilities that aren't 
addressed in most other State or federal land management financial 
assurance programs, including spills, accidental releases, and tailings 
failures.'' \118\ To support this conclusion, they point to several 
instances in ongoing mining operations where there are impacts to 
natural resources and/or groundwater due to ongoing mining operations 
which other federal or state rules fail to regulate. Earthworks also 
submitted comment claiming the need for financial responsibility for 
long-term water treatment. EPA recognizes that some historical mining 
operations have resulted in the need for long-term water 
treatment.\119\ However, modern regulation of both process discharges 
and runoff, as well as reclamation requirements to control sources of 
contamination, significantly address those risks. Additionally, as 
discussed above, while EPA acknowledges that the risk of a release is 
never totally eliminated by the requirements of other programs, this 
residual risk is to be evaluated in light of EPA's discretion under the 
statute on whether to set section 108(b) requirements, and in light of 
the other information in the record for this action discussed elsewhere 
in this final rulemaking. Viewed in this manner, such residual risk 
does not change EPA's conclusion that it is not appropriate to issue 
final section 108(b) requirements for current hardrock mining 
operations.
---------------------------------------------------------------------------

    \118\ Ibid., page 12.
    \119\ Ibid., page 2.
---------------------------------------------------------------------------

    Water Legacy and Friends of the Boundary Waters Wilderness 
submitted separate comments expressing concern that Minnesota's 
financial assurance laws, for instance, are not adequate to cover mine 
pit seepage, waste rock pile seepage, tailings dam seepage and/or 
catastrophic dam failures.\120\ However, as is discussed in the site 
examples elsewhere in this final rulemaking and accompanying Technical 
Support Document, commenters submitted information to demonstrate that 
most releases at currently operating facilities are being addressed by 
owners and operators, and that the costs of these incidents at modern 
operations are generally not falling to the taxpayer.
---------------------------------------------------------------------------

    \120\ See comment from Water Legacy, EPA-HQ-SFUND-2015-0781-
2649, at page 3.
---------------------------------------------------------------------------

    EPA received comments from three federally-recognized tribes and 
from three Alaska Native Claims Settlement Act (ANCSA) resource 
managers regarding section 108(b) financial responsibility. Tribal 
comments were generally in support of the proposed rule, and cited some 
concerns about the potential negative impacts of hardrock mining on 
commercial enterprises and on subsistence living, along with the need 
to more fully identify the benefits of the rule. A primary ANCSA 
concern was that the section 108(b) financial responsibility 
requirements would duplicate existing federal and state requirements, 
resulting in a negative impact on Alaska Natives and states, that 
receive royalties through the Regional and Village Corporations. These 
comments are discussed in section VIII.G.

[[Page 7570]]

D. Comments Opposing a Final Rulemaking

1. Comments Regarding Appropriateness of Information Used
a. Use of Information Not Relevant to the Mines To Be Regulated Under 
the Rule
    Many commenters on the proposed rule, including mining companies, 
trade associations, as well as state and federal agencies, commented 
that EPA's record incorrectly characterized the on-going environmental 
risk at operating hardrock mining facilities by relying on information 
related to mines that were constructed and operated before current 
regulatory requirements were in place, rather than on information 
specific to current hardrock mining activities, which are highly 
regulated. Commenters argued that since the rule would not apply to 
inactive, non-operating sites, EPA should not rely on information 
related to such sites as part of its rulemaking record to justify the 
need for financial responsibility requirements for current hardrock 
mining operations. Several commenters disagreed with EPA's assertion in 
the proposed rule that the $4 billion spent by EPA through the 
Superfund for cleanup costs at historical hardrock mining facilities is 
an indication of the relative risk present at the facilities covered by 
the proposed rule. Commenters argued that the 2009 Priority Notice and 
the proposed rule did not differentiate between costs associated with 
the highly-regulated mining practices of today and pre-regulation 
practices in developing that number.
    EPA agrees with commenters that information about facilities that 
present a level of risk similar to those proposed to be regulated is 
the most appropriate focus for the Agency's record for this action. EPA 
also agrees with commenters that because mining practices have changed 
significantly over the past several decades, information related to 
risk presented by mines that operated before those changes occurred may 
not reflect the level of risk presented by currently operating 
facilities that include controls such as surface water containment 
structures, engineered storage facilities, water treatment, impermeable 
liners, and leak detection and recovery systems. Finally, EPA agrees 
with commenters that the cost of addressing releases from mines that 
operated without the controls in place today should not be assumed to 
be comparable to the cost of addressing releases from current 
operations, where controls such as monitoring assure early detection.
    Commenters objected to the use of 1980 in the Practices 
Report,\121\ (CERCLA was enacted in December 1980) as the point when 
``historic'' mining practices changed over to ``modern'' ones. They 
felt this ignored the evolution of mining practices that took place 
since 1980, in response to other environmental laws, as well as state 
mining regulations which were still in their infancy in 1980. Some 
commenters seemed to agree that EPA should consider ``modern'' mining 
practices to have begun post-1990, and some suggested that the mid-
1990s was the true beginning of modern hardrock mining practices.
---------------------------------------------------------------------------

    \121\ EPA relied on this date numerous times in the Practices 
Report (e.g., pages 7, 8, 72, 119, 126, 127, 133, 145).
---------------------------------------------------------------------------

    In evaluating the record for this rulemaking, EPA considered the 
issue of when mining operations became ``modern'' or ``current.'' EPA 
recognizes that there are not nationally-applicable federal standards 
governing the operation of mines,\122\ and that the current regulatory 
scheme of federal and state mining programs has evolved over time. 
Thus, the requirements of individual hardrock mining programs developed 
at different paces and sequences. One commenter provided a table 
demonstrating the evolution of hardrock mining programs over time, 
extending from 1972 to 2014, and including the adoption of regulations 
in Alaska, Arizona, Arkansas, Montana, New Mexico, Nevada, and Utah 
during that period of time.\123\ EPA has therefore concluded that no 
particular date in the past reliably distinguishes between ``historic'' 
or ``legacy'' and ``current'' or ``modern'' mines nationwide, and that 
a better approach is to consider operations taking place under the 
current applicable regulatory scheme as ``current'' operations, and 
mine operations that took place before the enactment of the currently 
applicable and relevant requirements as ``historic'' or ``legacy.''
---------------------------------------------------------------------------

    \122\ In 1986 EPA made a determination under section 
3001(b)(3)(C) of RCRA that wastes from the extraction of ores did 
not pose a significant enough risk to warrant regulation under 
Subtitle C of RCRA. 51 FR 24496.
    \123\ See comment from Freeport-McMoRan, EPA-HQ-SFUND-2015-0781-
2793, Attachment B.
---------------------------------------------------------------------------

b. Use of Data That Did Not Directly Demonstrate Risk at Current 
Hardrock Mining Operations
    Some commenters who opposed the rule objected to EPA's analysis of 
the information presented in the 2009 Priority Notice relating to 
hardrock mining risk. Commenters objected that EPA relied on 
inappropriate information to demonstrate risk at current hardrock 
mining operations, by focusing on data that does not address potential 
exposure to CERCLA hazardous substances, or the possibility that a 
CERCLA response action may occur in the future, that is--Toxics Release 
Inventory (TRI), and data from the Hazardous Waste Biennial Report 
(BR).\124\ Commenters argued that EPA's approach to identifying 
hardrock mining did not evaluate actual or potential risk.
---------------------------------------------------------------------------

    \124\ See, for example, comment from Comstock Mining, Inc., EPA-
HQ-SFUND-2015-0781-2735, at page 31.
---------------------------------------------------------------------------

    EPA agrees with commenters that information regarding releases from 
hardrock mining facilities does not, in and of itself, demonstrate 
risk. For example, as noted in EPA's ``Factors to Consider When Using 
Toxics Release Inventory Data'' (2015), ``TRI data do not reveal 
whether or to what degree the public is exposed to listed chemicals.'' 
\125\ In fact, TRI data generally encompass releases that are permitted 
under the Clean Air Act (CAA), the Clean Water Act (CWA), or the Safe 
Drinking Water Act, as well as the lawful disposal of hazardous 
substances. Accordingly, EPA agrees that TRI data cannot help predict 
the risk associated with potential mismanagement and therefore cannot 
be used to support any determination under CERCLA section 108(b) that 
imposing financial responsibility requirements on a sector is 
appropriate. Similarly, EPA agrees that BRS data and National Response 
System (previously referred to as the Emergency Response Notification 
System (ERNS) data do not provide information on the risk, if any, 
posed by the management of hazardous substances at hardrock mines.
---------------------------------------------------------------------------

    \125\ See https://www.epa.gov/sites/production/files/2015-06/documents/factors_to_consider_6.15.15_final.pdf.
---------------------------------------------------------------------------

    Another commenter stated that EPA's methodology for assessing risk 
was simply to describe some of the major mining practices that 
contributed to past CERCLA releases and simplistically conclude that 
similar practices are used today. The commenter argued that this 
approach is not accurate because it fails to account for the major 
changes in mining practices and regulatory requirements that are 
applied to modern mines. EPA agrees that it is important to consider 
modern mining practices and current regulatory regimes and has adopted 
that approach in this final action.
2. Comments That EPA Failed To Consider Relevant Information
    Commenters on the 2009 Priority Notice and the proposed rule 
objected

[[Page 7571]]

that EPA failed to consider relevant information in the 2009 Priority 
Notice and the proposed rule, specifically on the role of federal and 
state regulatory programs and protective practices in reducing risks at 
current hardrock mining operations, and on information on reduced costs 
to the taxpayer from regulatory programs and cleanup by owners and 
operators. For example, the American Exploration and Mining Association 
(AEMA) commented that the Federal Land Management Agencies and the 
states have significantly evolved their financial assurance programs 
with specific emphasis on post-closure care and maintenance, thereby 
minimizing the long-term potential for releases of hazardous substances 
and un-bonded agency liability. AEMA further commented that existing 
financial responsibility programs are working at modern mines and there 
is no need for a costly EPA program.\126\
---------------------------------------------------------------------------

    \126\ See comments from American Exploration and Mining 
Association at Docket ID Number EPA-HQ-SFUND-2015-0781-2657, page 2.
---------------------------------------------------------------------------

a. Comments Providing Information on the Role of Federal and State 
Programs and Protective Mining Practices in Reducing Risks at Current 
Hardrock Mining Operations
    Many commenters who opposed the rule objected that EPA's analysis 
failed to consider the technical or engineering requirements specified 
by other regulatory programs or the requirements that financial 
assurance be established to ensure that required measures will be 
funded when needed. The commenters stated that both types of 
requirements significantly decrease the risks posed by modern mines, 
including both risks to the environment and risks that potential future 
liabilities will not be funded by mining companies.\127\ EPA agrees 
that due to the increased regulation of hardrock mining practices over 
the past several decades, mining operations are conducted in a manner 
that does not present the same level of risk as practices of the past.
---------------------------------------------------------------------------

    \127\ Freeport-McMoRan Inc; Fertilizer Institute; 
MiningMinnesota; New Mexico Environment Department and New Mexico 
Energy, Minerals, and Natural Resources Department; Colorado 
Department of Natural Resources, Division of Reclamation, Mining and 
Safety; National Mining Association.
---------------------------------------------------------------------------

    Commenters provided extensive information regarding the 
requirements of those programs including design standards, engineering 
controls, and environmental monitoring. Commenters argued that 
engineering controls and best practices reduce the degree and duration 
of risk associated with the modern production, transportation, 
treatment, storage, and disposal of hazardous substances to minimal 
levels and that no additional financial responsibility requirements are 
necessary to protect the taxpayer or the Superfund. Some of these 
federal and state programs are discussed below.
(1) Examples of Federal Programs
    The regulations of the Bureau of Land Management (BLM) and the 
Forest Service, applicable to hardrock mining facilities, are described 
below.
Bureau of Land Management
    BLM's surface management regulations at 43 CFR part 3800, subpart 
3809, govern the majority of the hardrock mining operations on the 
public lands that would be subject to the proposed rule. These 
regulations were first promulgated in 1980 pursuant to the agency's 
authority under the Mining Law of 1872,\128\ and its mandate under 
section 302(b) of the Federal Land Policy and Management Act of 1976 to 
take any action to prevent ``unnecessary or undue degradation'' of the 
public lands.\129\ BLM also regulates the development of solid minerals 
subject to other mineral disposal authorities, such as phosphate, 
through the issuance of permits and leases under 43 CFR part 3500. 
BLM's regulatory programs provide cradle-to-grave oversight of mining 
operations on the public lands. For example, BLM's subpart 3809 
regulations require operators to obtain authorization from BLM to 
conduct any surface disturbance greater than casual use.\130\ All 
operations under subpart 3809 must comply with the general and specific 
performance standards set forth in the regulations which govern, among 
other things, disposal of mining wastes and handling of acid-forming, 
toxic, or other deleterious materials.\131\ In addition, subpart 3809 
requires all operations to comply with applicable federal and state 
laws and regulations, including laws related to air and water 
quality.\132\ For extractive mining operations and some exploration, 
operators under subpart 3809 must submit and obtain BLM approval of a 
plan of operations that includes plans for baseline data collection, 
water management, rock characterization and handling, spill 
contingency, and reclamation.\133\ BLM's subpart 3809 regulations 
impose also requirements for design, operation, closure, and 
reclamation to ensure productive use of the land after mining. The 
required reclamation plan must detail stabilization of land disturbed 
for mining, reclaiming and reshaping the land, wildlife rehabilitation, 
controlling potentially hazardous materials, and post-closure 
management.
---------------------------------------------------------------------------

    \128\ 30 U.S.C. 22-54, as amended.
    \129\ 43 U.S.C. 1732(b).
    \130\ 43 CFR 3809.10, 3809.11.
    \131\ See 43 CFR 3809.420.
    \132\ See 43 CFR 3809.5, 3890.420(b)(4), (b)(5).
    \133\ 43 CFR 3809.401.
---------------------------------------------------------------------------

    BLM's regulations also require operators to provide a financial 
guarantee before they can begin all hardrock mining operations.\134\ 
Moreover, financial guarantees for mining operations must remain in 
effect until BLM determines that reclamation has been completed in 
accordance with the authorized operations and the agency releases the 
financial guarantee.\135\ BLM's regulations also allow the agency to 
initiate forfeiture of the financial guarantee in the event the 
operator refuses or is unable to conduct reclamation.\136\
---------------------------------------------------------------------------

    \134\ See 43 CFR 3504.50, 3809.4500.
    \135\ 43 CFR 3504.71, 3809.590.
    \136\ 43 CFR 3504.65, 3809.595.
---------------------------------------------------------------------------

Forest Service
    The U.S. Department of Agriculture (USDA) Forest Service 
regulations governing mining under the Mining Law of 1872 were 
promulgated in 1974 \137\ and can be found at 36 CFR part 228, subpart 
A. Disposal of minerals such as phosphates, sodium, potassium, and 
hardrock minerals on acquired National Forest System lands are subject 
to the mineral leasing laws and are regulated by BLM under 43 CFR part 
3500.
---------------------------------------------------------------------------

    \137\ See comment from United States Forest Service, Docket ID: 
EPA-HQ-SFUND-2015-0781-2400 at page 10; comment from National Mining 
Association, EPA-HQ-SFUND-2015-0781-2794 at page 29.
---------------------------------------------------------------------------

    Under the Forest Service regulations at 36 CFR part 228, subpart A, 
operators must submit and obtain approval of a plan of operations 
before conducting any operations that might cause significant 
disturbance of surface resources.\138\ The regulations are designed to 
minimize adverse environmental impacts both during and after mining 
operations. The regulations prohibit releases of hazardous substances, 
and require financial guarantee that is calculated to reasonably insure 
that operations and reclamation are conducted to avoid releases, and to 
respond to releases that may occur.\139\ USDA highlighted in its 
comments how well developed Plans of Operations, site inspections, and 
monitoring reduce environmental risks before, during, and after mine 
closure. Specifically, USDA stated that an operator complies with 
Forest Service

[[Page 7572]]

regulations by developing a Plan of Operations, which requires that the 
operator submit enough detail that the agency can analyze various risks 
associated with the proposed operation and, through the NEPA process, 
identify proper mitigation measures to reduce or eliminate those 
risks.\140\ The regulations also require that, ``all operations be 
conducted so as, where feasible, to minimize adverse environmental 
impacts on National Forest surface resources'' (36 CFR 228.8). This 
allows the Agency to be very site-specific in its analysis of risk and 
mitigation.\141\ A Plan of Operations must also include detailed 
reclamation and closure plans, which are reviewed and approved to 
minimize the potential future risk to the environment based on 
predicted outcomes.\142\ USDA further stated that Plans of Operation 
must include hazardous materials inventory and handling procedures, 
spill prevention plans, and transportation mitigation measures.\143\ 
USDA stated a Plan of Operations for a hardrock mining operation cannot 
be approved unless hazardous substances are managed so that the threat 
of present or future release is minimized.\144\ During the mine 
permitting process, the Forest Service actively engages in memorandums 
of understanding and agreements with other State and Federal Agencies 
to ensure that all parties' permits are approved and implemented. 
Currently this can involve over forty separate permits and 
authorizations.
---------------------------------------------------------------------------

    \138\ 36 CFR 228.4(a).
    \139\ See comment from United States Forest Service, Docket ID: 
EPA-HQ-SFUND-2015-0781-2400 at page 2.
    \140\ Ibid.
    \141\ Ibid.
    \142\ Ibid., page 5.
    \143\ Ibid., page 4.
    \144\ Ibid., page 4.
---------------------------------------------------------------------------

    The Forest Service requires that mine operators provide a financial 
guarantee to assure complete reclamation and compliance with 
environmental laws under the following authorities: 16 U.S.C. 551; 30 
U.S.C. 612; 36 CFR 228.8, 228.13.\145\ USDA stated that regulatory 
requirements (36 CFR 228.13) require operators to provide a bond 
sufficient to insure stabilization, rehabilitation, and reclamation of 
the area of operations.\146\ Environmental protection measures 
described in under 36 CFR 228.8 also include certification of 
compliance with all other applicable environmental standards.\147\ 
Forest Service regulations at 36 CFR 228.4(e) allow the agency to 
require a modification to the Plan of Operations to allow for bond 
adjustments to address unforeseen environmental effects.\148\ In its 
comments on the proposed rule the USDA stressed that financial 
guarantee requirements further reduce financial risk to the public. The 
operator must provide a financial guarantee that must be of a 
sufficient amount to ensure that, upon closure, the operation no longer 
presents long-term risks to the environment and a liability to the 
Forest Service and the public.\149\ USDA further noted that any ongoing 
obligation to continue the protection of the environment is also 
provided for in a long-term financial assurance instrument required by 
the Forest Service.\150\
---------------------------------------------------------------------------

    \145\ Ibid., page 1.
    \146\ Ibid., page 3.
    \147\ Ibid., page 3.
    \148\ Ibid., page 5.
    \149\ Ibid., page 5.
    \150\ Ibid., page 5.
---------------------------------------------------------------------------

    Commenters also noted the role the NEPA plays in identifying risks 
at mining operations. NMA stated that a federal plan of operation is 
also scrutinized under NEPA, usually requiring the preparation of an 
environmental impact statement, which evaluates potential environmental 
impacts of the mining operation, assesses alternatives, and requires 
the identification of mitigation measures to reduce potentially 
significant environmental impacts.\151\ The Forest Service also offered 
several examples of the ways in which the NEPA process mitigates risk 
for mines which require the preparation of an environmental impact 
statement. Specifically, the Forest Service noted that it identifies 
closure requirements as part of the NEPA process after in-depth studies 
using site-specific data.\152\ Moreover, Forest Service noted that 
proposed reclamation requirements and potential for releases at mines 
on NFS lands are examined and disclosed in NEPA documents prepared for 
Forest Service approval of the plan of operations, which are reviewed 
by EPA.\153\ The Forest Service also noted that EPA reviews all NEPA 
documents, and comments on the adequacy of mitigation measures and 
reclamation plans in general. Once an operator incorporates source 
controls and mitigation measures into their plan, the Forest Service 
approves that plan, based on the expected outcomes and not the 
individual engineering standards used.\154\ EPA notes that the NEPA 
process applies to all federal agencies and thus is not limited to only 
mines on NFS lands.
---------------------------------------------------------------------------

    \151\ See comment from National Mining Association, EPA-HQ-
SFUND-2015-0781-2794 at page 30.
    \152\ See comment from United States Forest Service, Docket ID: 
EPA-HQ-SFUND-2015-0781-2400 at page 3.
    \153\ Ibid., page 5.
    \154\ Ibid., page 7.
---------------------------------------------------------------------------

(2) Examples of State Programs
    A discussion of the mining programs of five states--Nevada, New 
Mexico, Alaska, Colorado, and Montana--is provided below. Of the 184 
\155\ mining sites in the potentially regulated universe of mines 
developed by EPA for purposes of analysis in the proposed rule, roughly 
one fourth are located in Nevada, and roughly one tenth are located in 
New Mexico, Alaska, Colorado, and Montana combined. In addition to the 
examples discussed below, the record includes detailed information on 
the protectiveness of mining programs in Arizona, Utah, South Dakota, 
and Idaho that were provided by those states and state 
organizations.\156\ Additional information on state programs also was 
provided by other commenters.\157\
---------------------------------------------------------------------------

    \155\ This number does not include the stand-alone mineral 
processors in the potentially regulated universe of 221 hardrock 
mining facilities developed by EPA for purposes of analysis in the 
proposed rule.
    \156\ See comment and attachments from Beth A. Botsis, Deputy 
Executive Director, Interstate Mining Compact Commission, comment 
number EPA-HQ-SFUND-2015-0781-2759; EPA-HQ-SFUND-2015-0781-2758; 
EPA-HQ-SFUND-2015-0781-2757), discussing the protectiveness of 
mining programs in Arizona, Utah, and South Dakota. Together, 
Arizona and Utah have 35 potentially regulated mines. See also, 
comment from Governor Butch Otter, noting that that most of the 
mines in Idaho are on federally managed land and thus would be 
subject to Forest Service or BLM regulations, comment number EPA-HQ-
SFUND-2015-0781-2682. Idaho has nine potentially regulated mines.
    \157\ See the discussion of comments on state mining programs in 
below.
---------------------------------------------------------------------------

Nevada
    The Bureau of Mining, Regulation, and Reclamation of Nevada 
requires closure and reclamation for hardrock mines under the Nevada 
Revised Statutes (NRS) 519A.010--NRS 519A.280 and the Nevada 
Administrative Code (NAC) 519A.010--NAC 519A.415.\158\ Nevada's 
regulatory program was enacted in 1989-1990 and includes the authority 
for the Nevada Division of Environmental Protection (NDEP) to require 
financial assurance for long-term management of mine-impacted 
waters.\159\ Commenters reported that Nevada's stringent regulations 
``impose extensive permitting, design, operation, monitoring, 
corrective action, closure, reclamation, and financial assurance 
requirements on hardrock mining

[[Page 7573]]

operations in the State.\160\ In addition, because many mines in Nevada 
operate on federal lands, Nevada and BLM and Forest Service have 
entered into Memoranda of Understanding to ensure coordination of 
financial assurance requirements across private and public lands.\161\ 
Mines in Nevada estimate the amounts of their required financial 
assurance through use of Nevada's Standardized Reclamation Cost 
Estimator (SRCE).\162\ The SRCE is well-regarded amongst mining 
reclamation programs and is used by several other states and Federal 
agencies.\163\
---------------------------------------------------------------------------

    \158\ See comment from Nevada Lithium Corp, Comment Number: EPA-
HQ-SFUND-2015-0781-2681 at page 4.
    \159\ See comment from Nevada Division of Environmental 
Protection, comment number EPA-HQ-SFUND-2015-0781-2651 at page 1.
    \160\ See comment from Newmont Mining Corporation, comment 
number EPA-HQ-SFUND-2015-0781-2712 at page 46-47.
    \161\ See comment from Nevada Division of Environmental 
Protection, comment number EPA-HQ-SFUND-2015-0781-2651, at page 2, 
and Attachment.
    \162\ See comment from Nevada Lithium Corp, Comment Number: EPA-
HQ-SFUND-2015-0781-2681, Page 4.
    \163\ See comments from Women's Mining Coalition, Comment number 
EPA-HQ-SFUND-2015-0781-2705 at page 5, Pershing Gold Corporation, 
Comment number EPA-HQ-SFUND-2015-0781-2688 at page 6, Hecla Mining 
Company, Comment number EPA-HQ-SFUND-2015-0781-2688 at page 21, 
Mining and Metallurgical Society of America, comment number EPA-HQ-
SFUND-2015-0781-2734 at page 3.
---------------------------------------------------------------------------

    Nevada's hardrock mining regulatory programs, including its 
reclamation surety program administered by NDEP, include stringent 
design standards, including standards in liner systems, dam safety, and 
tailings impoundments that are intended to manage and contain process 
wastes.\164\ The regulations also specify treatment of spent ore heaps 
at closure to ensure surface and groundwater impacts are 
prevented.\165\ NDEP provided comment that no modern mines that 
commenced operation after the promulgation of the Nevada mine 
reclamation financial assurance regulations have required public 
funding for proper closure or reclamation as evidence of the strength 
of Nevada's program.\166\
---------------------------------------------------------------------------

    \164\ See comment from Newmont Mining Corporation, comment 
number EPA-HQ-SFUND-2015-0781-2712 at page 48.
    \165\ Ibid., page 49.
    \166\ See comment from Nevada Division of Environmental 
Protection, comment number EPA-HQ-SFUND-2015-0781-2651 at page 2.
---------------------------------------------------------------------------

New Mexico
    The New Mexico Mining Act (``Mining Act'') was adopted in 1993 with 
the purposes of ``promoting responsible utilization and reclamation of 
lands affected by exploration, mining or the extraction of minerals.'' 
\167\ The Mining Act broadly defines ``mining'' and ``minerals'' to 
cover the extraction and processing of hardrock minerals.\168\
---------------------------------------------------------------------------

    \167\ See comments from New Mexico Environment Department and 
the New Mexico Energy, Minerals, and Natural Resources Department, 
Docket ID Number EPA-HQ-SFUND-2015-0781-2676-2 at page 4.
    \168\ Ibid. page 4.
---------------------------------------------------------------------------

    Mining operations in New Mexico, both ``existing'' and ``new,'' 
\169\ are required to obtain permits which include closeout, or 
reclamation, plans.\170\ These plans, which are developed in 
coordination with closure plans required under the Water Quality Act, 
address the areas disturbed by mining including impacts from any of the 
thirteen site features identified by EPA as the sources of releases or 
threatened releases at hardrock mining sites.\171\ The reclamation and 
remediation of these site features, which include tailings, waste rock, 
leach piles and open pits, are addressed in the permits issued under 
the Mining Act and the Water Quality Act.
---------------------------------------------------------------------------

    \169\ ``existing mining operations'' were producing minerals 
prior to June 18, 1993, and ``new mining operations'' began 
producing minerals after that date. Section 69-36-3(E) and (I).
    \170\ See comments from New Mexico Environment Department and 
the New Mexico Energy, Minerals, and Natural Resources Department, 
Docket ID Number EPA-HQ-SFUND-2015-0781-2676-2 at page 5.
    \171\ 82 FR 3461, fn. 171.
---------------------------------------------------------------------------

    Mining operations in New Mexico are subject to significant 
compliance and enforcement provisions. The Mining Act mandates a 
specific set of minimum inspections for each class of facility 
including one inspection a month when a mine is conducting significant 
reclamation activities.\172\ If the agency determines that a facility 
is in violation of the Act, regulations or the permit or is creating an 
imminent danger to public health or safety or is causing significant 
environmental harm, the agency can order a cessation of mining or 
undertake administrative or judicial enforcement proceedings.\173\ 
Violations can result in civil penalties of up to $10,000 a day, and 
knowing or willful violations can bring criminal penalties.\174\
---------------------------------------------------------------------------

    \172\ See comments from New Mexico Environment Department and 
the New Mexico Energy, Minerals, and Natural Resources Department, 
Docket ID Number EPA-HQ-SFUND-2015-0781-2676-2 at page 5.
    \173\ Ibid., page 5.
    \174\ Ibid., page 5.
---------------------------------------------------------------------------

    Financial assurance is an integral and inseparable part of New 
Mexico's regulation of hardrock mining and attendant reclamation 
requirements. Before a permit can be issued under the Mining Act, 
financial assurance must be filed with the agency. ``The amount of the 
financial assurance shall be sufficient to assure the completion of the 
performance requirements of the permit, including closure and 
reclamation, if the work has to be performed by the director or a 
third-party contractor.'' \175\ The financial assurance amount is based 
on a detailed engineering cost estimate to complete the approved 
reclamation plan and must be based on what it would cost the State, or 
the State's contractor, to complete the reclamation plan. Financial 
assurance must include costs for: Contract administration; 
mobilization; demobilization; engineering redesign; profit and 
overhead; procurement costs; reclamation or closeout plan management; 
and contingencies.\176\
---------------------------------------------------------------------------

    \175\ Ibid., page 5.
    \176\ Ibid., page 5.
---------------------------------------------------------------------------

    The New Mexico Environment Department (NMED) regulates mining 
operations under the New Mexico Water Quality Act (``Water Quality 
Act'').\177\ Enacted in 1967, the Water Quality Act requires the New 
Mexico Water Quality Control Commission (``WQCC'' or ``Commission'') to 
adopt regulations to protect surface water and groundwater quality. The 
Commission must ``adopt water quality standards for surface and ground 
waters of the state,'' \178\ and must also adopt regulations requiring 
a permit for ``the discharge of any water contaminant.'' \179\ The 
Commission authorizes NMED to place conditions on discharge permits to 
protect groundwater, and must deny a discharge permit if the discharge 
would cause or contribute to contaminant levels in excess of water 
quality standards at any place of present or potential future use.\180\ 
The WQCC must adopt procedures for providing notice to interested 
persons and the opportunity for a public hearing, and must also adopt 
regulations ``for the operation and maintenance of the permitted 
facility, including requirements, as may be necessary or desirable, 
that relate to the continuity of operation, personnel training and 
financial responsibility.'' \181\ Finally, the Water Quality Act was 
amended in 2009 to direct the WQCC to adopt regulations for the copper 
industry, resulting in a comprehensive and prescriptive set of copper 
mine regulations,\182\ and in accordance with the directives of the 
Water Quality Act, the Commission has adopted a body of implementing 
regulations codified in Title 20, Chapter 6 of the New Mexico 
Administrative Code.
---------------------------------------------------------------------------

    \177\ Ibid., page 6.
    \178\ Ibid., page 6.
    \179\ Ibid., page 6.
    \180\ Ibid., page 6.
    \181\ Ibid., page 6-7.
    \182\ Ibid., page 6.
---------------------------------------------------------------------------

    The stated purpose of the Ground and Surface Water Protection 
Regulations is

[[Page 7574]]

``to protect all ground water of the state of New Mexico which has an 
existing concentration of 10,000 [milligrams per liter] or less [total 
dissolved solids], for present and potential future use as domestic and 
agricultural water supply.'' \183\ The regulations include three 
categories of groundwater quality standards: (1) Maximum numerical 
standards for thirty-three contaminants for protection of human health; 
(2) maximum numerical standards for nine contaminants and a range for 
pH for protection of domestic water supplies; and (3) maximum numerical 
standards for five contaminants for protection of water for irrigation 
use.\184\
---------------------------------------------------------------------------

    \183\ Ibid., page 6-7.
    \184\ Ibid., page 6-7.
---------------------------------------------------------------------------

    The regulations also address discharge permits,\185\ prohibiting 
any person from causing or allowing a water contaminant to ``discharge 
so that it may move directly or indirectly into groundwater'' unless 
that person is discharging pursuant to a discharge permit issued by 
NMED.\186\ The regulations provide for notice to the public of a 
proposed discharge permit, and the opportunity to request a public 
hearing on the permit.\187\ The regulations further provide that a 
discharge permit may include a closure plan to protect ground water 
after the cessation of the operations causing the discharge. The 
closure plan must include ``a description of closure measures, 
maintenance and monitoring plans, post-closure maintenance and 
monitoring plans, financial assurance, and other measures necessary to 
prevent and/or abate . . . contamination.'' \188\
---------------------------------------------------------------------------

    \185\ Ibid., page 6-7.
    \186\ Ibid., page 6-7.
    \187\ Ibid., page 6-7.
    \188\ Ibid., page 6-7.
---------------------------------------------------------------------------

    The Copper Mine Rule \189\ was promulgated in 2013 and the state 
indicated that it is the most prescriptive rule governing copper mining 
operations in the United States. The Copper Mine Rule establishes 
specific operational, monitoring, contingency, closure, and post-
closure requirements for copper mines to ensure protection of water 
quality and prevent the release of contaminants into the environment 
during operations and following closure. The Copper Mine Rule is 
supplemental to the general discharge permit regulations, and is 
implemented through the issuance of ground water discharge permits.
---------------------------------------------------------------------------

    \189\ Ibid., page 7.
---------------------------------------------------------------------------

    The Copper Mine Rule covers all aspects of mine operation and 
closure. The permit application requirements for copper mine facilities 
result in a comprehensive document that identifies all mine units at 
the facility including: Impoundments; pipelines; tanks; leach 
stockpiles; waste rock stockpiles; crushing, milling, concentrating, 
smelting and tailing impoundments; open pits; underground mines; and, 
truck and equipment washing units.\190\ Each of these respective mine 
units is subject to prescriptive engineering design criteria to control 
and prevent the release of contaminants.\191\
---------------------------------------------------------------------------

    \190\ Ibid., page 8.
    \191\ Ibid., page 8.
---------------------------------------------------------------------------

    Existing mine units in operation prior to promulgation of the 
Copper Mine Rule have extensive groundwater monitoring to determine 
their effectiveness in preventing the release of contaminants to the 
environment.\192\ Discharge permit requirements for existing mine units 
include operation of groundwater interceptor systems, as well as 
seepage and surface runoff capture systems to ensure impacts are 
contained as close as is practicable.\193\ The Copper Mine Rule 
requires development and implementation of a site-wide water management 
plan describing in detail how impacted storm water and groundwater at 
the site is contained and managed.\194\ Construction and operation of 
new mine units or expansion of existing mine units is subject to 
detailed engineering design requirements that include lined leach 
stockpiles, double lined process water impoundments, leak detection 
systems, flow metering, and extensive groundwater monitoring.\195\
---------------------------------------------------------------------------

    \192\ Ibid., page 8.
    \193\ Ibid., page 8.
    \194\ Ibid., page 8.
    \195\ Ibid., page 8.
---------------------------------------------------------------------------

    Proposals for new mine units such as waste rock stockpiles and 
tailing impoundments are required to include an aquifer evaluation to 
determine the nature and extent of any impacts to groundwater that may 
occur if these mine units are proposed to be unlined.\196\ Based on the 
aquifer evaluation, the Copper Mine Rule requires a design report for 
proposed interceptor systems to ensure containment of groundwater 
impacted by the stockpile or tailing impoundment such that applicable 
standards will not be exceeded at monitoring well locations.\197\ As 
previously stated, monitoring wells must be located as close as 
practicable to the various mine units being monitored.\198\ Impacted 
water collected at a mine site typically is used in the process water 
system, offsetting use of potable water. Any impacted water in excess 
of process water requirements must be treated prior to release.\199\ In 
the event a demonstration of containment cannot be satisfactorily made, 
a liner system placed beneath waste rock or tailing impoundments may be 
required.\200\
---------------------------------------------------------------------------

    \196\ Ibid., page 8.
    \197\ Ibid., page 8.
    \198\ Ibid., page 8.
    \199\ Ibid., page 8.
    \200\ Ibid., page 8.
---------------------------------------------------------------------------

    The Copper Mine Rule also contains prescriptive requirements for 
closure of mine units that have the potential to impact water quality 
\201\ including requirements for process solution reduction plans \202\ 
and closure water management and water treatment plans.\203\ There are 
prescriptive engineering design requirements for surface re-grading and 
cover design to ensure storm water is routed off and away from 
encapsulated mine waste, and that infiltration into mine waste is 
minimized.\204\ It should be noted that the prescriptive closure design 
criteria are based on designs that have been implemented successfully 
not only at copper mines in New Mexico, but mimic successful closure 
design that has been consistently required and applied at other mine 
sites in New Mexico.
---------------------------------------------------------------------------

    \201\ Ibid., page 9.
    \202\ Ibid., page 9.
    \203\ Ibid., page 9.
    \204\ Ibid., page 9.
---------------------------------------------------------------------------

    Under these regulations, any hardrock mine that has the potential 
to impact groundwater must obtain a permit from NMED. The Water Quality 
Act provides numerous enforcement mechanisms for violations of the 
provisions of the Act, the regulations, a water quality standard 
adopted pursuant to the Act, or a condition of a permit issued pursuant 
to the Act.\205\ These include injunctive relief ordered by a district 
court; suspension or termination of a permit allegedly violated; \206\ 
civil penalties of up to $15,000 per day of noncompliance for a 
violation of the Water Quality Act permit provisions at NMSA 1978, 
Section 74-6-5, including regulations adopted or a permit issued 
pursuant to that section; \207\ up to $10,000 per day for each 
violation of the Water Quality Act or regulations other than Section 
74-6-5; up to $25,000 per day for each day of continued noncompliance 
with a compliance order; and criminal penalties.\208\
---------------------------------------------------------------------------

    \205\ Ibid., page 6-7.
    \206\ Ibid., page 6-7.
    \207\ Ibid., page 6-7.
    \208\ Ibid., page 6-7.
---------------------------------------------------------------------------

    The New Mexico state commenters indicated that NMED and the New 
Mexico Energy, Minerals, and Natural Resources Department work closely 
together pursuant to a Joint Powers

[[Page 7575]]

Agreement in drafting and issuing permits for hardrock mining 
facilities to ensure that financial assurance and other permit 
requirements are consistent, integrated, and complementary. These 
agencies allow permitted facilities to submit a single financial 
assurance instrument, or set of instruments, that are jointly held by 
the agencies, meeting the financial assurance requirements of both 
statutes. They also have Memoranda of Understanding with BLM and the 
Forest Service to avoid duplication where federal land is involved. 
Through mining permits issued under the Mining Act, and groundwater 
discharge permits issued under the Water Quality Act, the Agencies have 
jointly required permittees to establish financial assurance for all 
operating hardrock mines in New Mexico, as well as many that are no 
longer operating.
    Freeport McMoRan Inc. commented that there are existing, state-
imposed financial assurance requirements, often amounting to hundreds 
of millions of dollars per mine, that might be sufficient to protect 
against risks,\209\ and offered the example that EPA itself has adopted 
state reclamation requirements specified in New Mexico law, as the 
CERCLA remedy for the Questa mine site.
---------------------------------------------------------------------------

    \209\ See comments from Freeport McMoRan, Inc., EPA-HQ-SFUND-
2015-0781-2402 at page 9.
---------------------------------------------------------------------------

Alaska
    The Alaska Department of Environmental Conservation requires 
financial assurance to prevent releases from mines to water.\210\ 
Financial assurance for reclamation at mines on state, private, 
municipal, and federal land is managed by the Alaska Department of 
Natural Resources under authority granted by the Alaska Mine 
Reclamation Act.\211\ The act describes a general reclamation standard 
which ``prevents unnecessary or undue degradation of land and water 
resources'' \212\ Under the mine permitting process undertaken for most 
large mines in Alaska, coordination with federal, state, and local 
governments is employed to review mine plans.\213\ As evidence of the 
stringency of Alaska's requirements, AEMA offered comment that large 
mines in Alaska are required to undergo a comprehensive third-party 
environmental audit every five years.\214\
---------------------------------------------------------------------------

    \210\ See comment from NOVAGOLD, comment number EPA-HQ-SFUND-
2015-0781-2720 at page 2.
    \211\ See comment from Alaska Department of Environmental 
Conservation, comment number EPA-HQ-SFUND-2015-0781-2785 at page 9.
    \212\ See comment from Alaska Department of Environmental 
Conservation, comment number EPA-HQ-SFUND-2015-0781-2785 at page 9.
    \213\ Ibid., page 10-11.
    \214\ See comment from AEMA, comment number EPA-HQ-SFUND-2015-
0781-2657 at page 10.
---------------------------------------------------------------------------

    Alaska requires further safeguards for mines where the plan 
includes a dam. These requirements include operation and maintenance 
plans and contingencies in an emergency action plan.\215\ Alaska made 
the ``Guidelines for Cooperation with the Alaska Dam Safety Program'' 
guidance available which outlines regulatory requirements applying to 
dams, including design standards, methods of analysis, [. . .] 
performance requirements and risk profile of the facility, operation, 
maintenance and monitoring requirements, emergency action planning and 
incident reporting, periodic safety inspections'' as well as financial 
assurance.\216\
---------------------------------------------------------------------------

    \215\ See comment from Alaska Department of Environmental 
Conservation, comment number EPA-HQ-SFUND-2015-0781-2785 at page 10.
    \216\ Ibid., page 19.
---------------------------------------------------------------------------

Colorado
    In 1976, the Colorado state legislature passed the Mined Land 
Reclamation Act \217\ (MLRA) establishing a Mined Land Reclamation 
Board (``Board'').\218\ The MLRA provided far more structure for 
permitting mine sites and, importantly, oversight of reclaiming these 
sites. The MLRA's legislative declaration stated:
---------------------------------------------------------------------------

    \217\ C.R.S. section 34-32-101 et seq.
    \218\ See comments from Colorado Division of Reclamation, Mining 
and Safety at Docket ID number EPA-HQ-SFUND-2015-0781-2774, page 3.

    It is the declared policy of this state that the extraction of 
minerals and the reclamation of land affected by such extraction are 
both necessary and proper activities. It is further declared to be 
policy of this state that both such activities should be and are 
compatible. It is the intent of the general assembly by enactment of 
this article to foster and encourage the development of an 
economically sound and stable mining and minerals industry and to 
encourage the orderly development of the state's natural resources 
while requiring those persons involved in mining operations to 
reclaim land affected by such operations so that the affected land 
may be put to a use beneficial to the people of this state. It is 
the further intent of the general assembly by the enactment of this 
article to conserve natural resources, to aid in the protection of 
wildlife and aquatic resources, to establish agricultural, 
recreational, residential, and industrial sites, and to protect and 
promote the health, safety, and general welfare of the people of 
this state. \219\
---------------------------------------------------------------------------

    \219\ Ibid., page 4.

    In 1984, the Colorado Division of Reclamation, Mining, and Safety 
(DRMS) permitted the Summitville mine.\220\ This was a high elevation 
mine located in the historic mining district of Summitville in 
Southwest Colorado. Errors were made in the permitting review and 
initial build out of this mine site. The financial assurance at 
Summitville was not site-specific but based on a formulaic approach, 
and ultimately proved to be far short of the actual reclamation 
cost.\221\ The large cyanide heap leach operation almost immediately 
encountered problems with construction and water treatment.\222\ 
Ultimately, the operator walked away from the site after a significant 
environmental release leaving the state with an insufficient financial 
assurance.
---------------------------------------------------------------------------

    \220\ Ibid.
    \221\ Ibid.
    \222\ Ibid.
---------------------------------------------------------------------------

    The state indicated that it learned from the errors at Summitville, 
and the state legislature subsequently passed major programmatic 
revisions to the MLRA in 1993, strengthening permitting and enforcement 
provisions.\223\ Most importantly, the MLRA was specifically amended to 
create a new class of mining sites now known as Designated Mining 
Operations (DMOs) and to clearly require financial assurance for all 
sites based on site specific, not formulaic, criteria.\224\
---------------------------------------------------------------------------

    \223\ Ibid.
    \224\ Ibid.
---------------------------------------------------------------------------

    The DMO amendment is the backbone of Colorado's hardrock regulatory 
program and requires operators to submit an Environmental Protection 
Plan with numerous technical elements that were previously not required 
in light of lessons learned from Summitville.\225\ A DMO's 
Environmental Protection Plan now describes how the operator assures 
protection of all areas that have the potential to be affected by 
designated chemicals, toxic or acid forming materials, or acid mine 
drainage.\226\ The plan must include an Emergency Response Plan and 
must implement any measures required by Colorado Parks and Wildlife for 
the protection of wildlife or Colorado Water Quality Control Division 
for the protection of water quality.\227\ Other aspects of the DMO 
amendment required submission of information to evaluate the potential 
for adverse impacts associated with acid mine drainage or acid or toxic 
producing materials to leach facilities, heap leach pads, tailing 
storage or disposal areas, impoundments, waste rock piles, stockpiles 
(temporary or

[[Page 7576]]

permanent), land application sites and in-situ or conventional uranium 
mining operations.\228\
---------------------------------------------------------------------------

    \225\ Ibid., page 5.
    \226\ Ibid.
    \227\ Ibid.
    \228\ Ibid.
---------------------------------------------------------------------------

    Further Environmental Protection Plans must include designated 
chemicals and materials handling plans, facilities evaluation, 
groundwater evaluation and protection measures, surface water control 
and containment facilities information, surface water quality data, 
hydrologic monitoring plans, detailed climate data to assist in 
facilities design, geotechnical and geochemical data and analysis, 
construction schedules including quality assurance and quality control 
measures, plant and soils analysis, tailings and sludge disposal 
plans.\229\
---------------------------------------------------------------------------

    \229\ Ibid.
---------------------------------------------------------------------------

    The financial assurance amendment required all hardrock mine 
facilities in Colorado, including prospecting operations, to post a 
financial assurance equal to the amount necessary for the state to 
reclaim a site if permit revocation and forfeiture were to occur.\230\ 
The financial assurance amount is calculated during the permitting 
phase of a mine and updated throughout the life of the mine to account 
for any changes to the mining or reclamation plans or changes in 
reclamation costs.\231\ As discussed above, DRMS did not calculate 
site-specific financial assurance prior to the 1993 amendments. As part 
of the 1993 amendments, language was removed that had allowed sites to 
be permitted for an established amount (depending on permit type) and 
language was inserted to mandate that DRMS require, on a site-specific 
calculation, the total amount of financial assurance necessary for the 
state to complete reclamation. DRMS now calculates financial assurance 
amounts during permitting and periodically (at a minimum every four 
years) through the life of the mine.\232\
---------------------------------------------------------------------------

    \230\ Ibid.
    \231\ Ibid.
    \232\ Ibid.
---------------------------------------------------------------------------

    The MLRA minimizes the adverse impacts of hardrock mining in 
Colorado by requiring every operator to obtain a permit and adhere to 
rigorous reclamation standards, both during and after mining.\233\ Many 
of the MLRA's reclamation standards are designed to prevent the release 
of hazardous substances into the environment.\234\ Pursuant to the 
MLRA, DRMS regulates mining in Colorado to protect the health, safety 
and welfare of the people of Colorado and to ensure that affected lands 
are appropriately reclaimed by those operating mines and mills.\235\ 
See Section 34-32-102, C.R.S. Under Section 34-32-109, C.R.S., any 
operator of a mine or mill must obtain and maintain a reclamation 
permit.\236\ To ensure that reclamation obligations are performed, 
Section 34-32-117(1), C.R.S., provides that no mining and reclamation 
permit may be issued until the Board receives performance and financial 
warranties.\237\ Pursuant to Section 34-32-117(3)(a), C.R.S., a 
financial warranty consists of a written promise to the Board to be 
responsible for reclamation costs together with proof of financial 
capability.\238\ Each operator must submit a financial warranty 
sufficient to assure compliance with applicable reclamation standards, 
as incorporated in the operation's reclamation permit.\239\ See Section 
34-32-117, C.R.S. During the life of a mine, DRMS requires financial 
assurance for water quality treatment, as well.\240\
---------------------------------------------------------------------------

    \233\ Ibid., page 6.
    \234\ Ibid.
    \235\ Ibid.
    \236\ Ibid.
    \237\ Ibid.
    \238\ Ibid.
    \239\ Ibid.
    \240\ Ibid.
---------------------------------------------------------------------------

    Under the MLRA, reclamation must be conducted, both during and 
after the mining operation, in accordance with a reclamation plan that 
meets certain performance standards.\241\ Many of the reclamation 
standards are designed to prevent releases of hazardous substances and 
prevent adverse impacts on surrounding properties.\242\ See Section 34-
32-116, C.R.S. (requiring measures to minimize disturbance to the 
hydrologic balance, protect outside areas from damage, and control 
erosion and attendant air and water pollution).\243\ MLRA's financial 
assurances ensure that DRMS can complete reclamation according to those 
standards if the operator is unwilling or unable.\244\ Regulatory 
financial assurances require enormous expertise, and must be 
established by fact-intensive case-by-case review.\245\ DRMS calculates 
the financial assurance amount by developing and aggregating task-by-
task cost estimates using current reference materials as well as the 
regional expertise of its staff.\246\ Applicants may submit initial 
estimates; however, DRMS rigorously reviews those estimates. DRMS is 
also charged with continuously reviewing the adequacy of financial 
warranties and uses the same methods.\247\
---------------------------------------------------------------------------

    \241\ Ibid.
    \242\ Ibid.
    \243\ Ibid.
    \244\ Ibid.
    \245\ Ibid.
    \246\ Ibid.
    \247\ Ibid.
---------------------------------------------------------------------------

    DRMS and the Board have promulgated a robust set of rules and 
regulations specific to the oversight of the hardrock mining industry 
that implement the MLRA.\248\ The rules contain specific performance 
requirements for hardrock mining to protect, for example, both surface 
and groundwater, impacts to wildlife, and offsite impacts including 
erosion controls.\249\ The rules are evidence of how DRMS minimizes the 
risk associated with the potential for releases from hardrock mine 
facilities.\250\
---------------------------------------------------------------------------

    \248\ Ibid., page 7.
    \249\ Ibid.
    \250\ Ibid.
---------------------------------------------------------------------------

    Colorado's regulatory program is predicated on three essential 
independent but interrelated elements; permitting, inspection and 
enforcement \251\ that allow DRMS to carefully plan for mining and 
reclamation through the permitting process which is anchored by a 
thorough financial warranty calculation.\252\ It also allows DRMS to 
periodically review sites through inspections to determine compliance 
with their permits and, if necessary, take enforcement action to remedy 
non-compliance.\253\
---------------------------------------------------------------------------

    \251\ Ibid.
    \252\ Ibid.
    \253\ Ibid.
---------------------------------------------------------------------------

    The permitting process requires prospective operators to, among 
other things, assess baseline conditions for hydrology, soils, 
vegetation, land use, climate, geology, and plan for a number of other 
factors such as chemical and toxic materials handling plans, as they 
develop their mining and reclamation plans.\254\ Many of these plans 
are required to be certified by a registered professional engineer to 
ensure design integrity and performance, particularly with respect to 
any environmental protection facility.\255\ A financial warranty is 
then calculated utilizing the specific factors associated with these 
plans, including cost details associated with construction of 
environmental protection facilities and costs associated with 
demolition and removal of some of these same facilities and 
structures.\256\ Other aspects included in these calculations address 
volumes of topsoil to be removed and replaced, volumes of overburden to 
be moved and regraded, waste piles and tailings impoundments to be 
constructed, capped and reclaimed

[[Page 7577]]

and types and amounts of vegetation to be reestablished.\257\
---------------------------------------------------------------------------

    \254\ Ibid.
    \255\ Ibid.
    \256\ Ibid.
    \257\ Ibid.
---------------------------------------------------------------------------

    Once an application is approved and the financial and performance 
warranties are posted, a permit is issued.\258\ Upon permit issuance, 
the site inspection frequency is determined and the site is inspected 
at an appropriate frequency throughout its mining and reclamation 
life.\259\ If a violation occurs at a permitted site, this matter is 
presented to the Board for adjudication which includes finding a 
violation, possibly issuing a cease and desist order, assessing civil 
penalties and requiring corrective actions to remedy the 
violation.\260\ Failure by an operator to remedy a violation could lead 
to permit revocation and, ultimately, financial warranty 
forfeiture.\261\
---------------------------------------------------------------------------

    \258\ Ibid.
    \259\ Ibid.
    \260\ Ibid., page 8.
    \261\ Ibid.
---------------------------------------------------------------------------

Montana
    In the state of Montana, hardrock mining is regulated by the 
Montana Department of Environmental Quality pursuant to the Montana 
Metal Mine Reclamation Act (MMR Act).\262\ The intent of the 
legislation is to ``provide adequate remedies for the protection of the 
environmental life support system from degradation and provide adequate 
remedies to prevent unreasonable depletion and degradation of natural 
resources'' \263\ and the ``proper reclamation of mined land and former 
exploration areas not brought to mining stage is necessary to prevent 
undesirable land and surface water conditions detrimental to the 
general welfare, health, safety, ecology, and property rights of the 
citizens of the state.'' \264\
---------------------------------------------------------------------------

    \262\ Montana Code Annotated section 82-4-301 et seq.; available 
at: http://leg.mt.gov/bills/mca/title_0820/chapter_0040/part_0030/sections_index.html.
    \263\ Montana Code Annotated, section 82-4-301(2)(a).
    \264\ Montana Code Annotated, section 82-4-301(3).
---------------------------------------------------------------------------

    The state legislature has amended the MMR Act several times over 
the years, including reforms to address bankruptcies of mining 
companies. For example, in the 1999 legislative session following the 
bankruptcy of the Pegasus Gold Corp. the previous year, section 82-4-
390 was added to the MMR Act to prohibit open pit mining for gold and 
silver using the heap leach or vat leach with cyanide ore-processing 
agents except for certain mines that were already in operation as of 
November 3, 1998. In another example, section 82-4-338 concerning 
performance bonding requirements was substantially amended in the 2007 
legislative session and now authorizes the Department of Environmental 
Quality to take action, including accessing the financial assurance 
bond and suspending the permit, to abate an imminent danger to public 
health, public safety or the environment caused by violation of this 
law.\265\
---------------------------------------------------------------------------

    \265\ Montana Code Annotated, section 82-3-338(10).
---------------------------------------------------------------------------

    Montana has also enacted state laws to protect water \266\ and air 
\267\ quality, to regulate hazardous and solid waste disposal,\268\ and 
to assess environmental impacts.\269\ The Department of Environmental 
Quality has developed regulations implementing the MMR Act that require 
compliance with the environmental laws contained in Title 75 of the 
Montana Code. For example, reclamation activities must assure long-term 
compliance with the air and water quality laws \270\ and that operating 
permits must prevent acid mine drainage through the construction of 
earth dams or other devises to control water drainage.\271\ In another 
example, permit modifications require an assessment of environmental 
impacts pursuant to the state equivalent of NEPA.\272\
---------------------------------------------------------------------------

    \266\ Montana Code Annotated, Title 75, Chapter 5.
    \267\ Montana Code Annotated, Title 75, Chapter 2.
    \268\ Montana Code Annotated, Title 75, Chapter 10.
    \269\ Montana Code Annotated, Title 75, Chapter 1.
    \270\ Montana Administrative Rules, 17.24.102(13)(f).
    \271\ Montana Administrative Rules, 17.24.115(1)(d).
    \272\ Montana Administrative Rules, 17.24.119.
---------------------------------------------------------------------------

    In its comments on the proposed rule, the Montana Department of 
Environmental Quality stated that the proposed rule was unnecessary 
because the state's environmental laws and the MMR Act sufficiently 
regulate environmental and financial risks posed by current mining 
operations in the state.\273\
---------------------------------------------------------------------------

    \273\ See comments of Montana Department of Environmental 
Quality at EPA-HQ-SFUND-2015-0781-2742.
---------------------------------------------------------------------------

Comments on State Mining Programs
    Freeport-McMoRan Inc. commented that state regulatory programs are 
comprehensive, staffed by experienced professionals, and effective. In 
evaluating the risks of hardrock mining EPA did not take into account 
common elements of current mining regulation, including the detailed, 
mandatory closure and reclamation requirements designed to restore 
large land areas disturbed by mining to an appropriate post-mining land 
uses, the long-term water management requirements designed to protect 
and, if needed, remediate both groundwater and surface water resources, 
and operational requirements designed to prevent environmental problems 
in the first place.\274\
---------------------------------------------------------------------------

    \274\ See comments from Freeport McMoRan Inc, EPA-HQ-SFUND-2015-
0781-2793, pages 23-24.
---------------------------------------------------------------------------

    In its comments, the Fertilizer Institute (TFI) stated that, by 
applying the CERCLA program to facilities covered by existing federal 
and state reclamation and bonding programs, EPA is duplicating such 
programs.\275\
---------------------------------------------------------------------------

    \275\ See comments from The Fertilizer Institute, EPA-HQ-SFUND-
2015-0781-2633-34, page 63.
---------------------------------------------------------------------------

    Newmont Mining, in its comments, noted that, given the 
administrative record compiled by the Agency and the excellent job that 
the FLMAs and States such as Nevada and Colorado already are doing in 
regulating the risk of unfunded CERCLA releases at hardrock mining 
facilities, the Agency must conclude that there is no need for another, 
expensive, duplicative, and preemptive rule to be layered on top of 
existing regulations.\276\
---------------------------------------------------------------------------

    \276\ See comments from Newmont Mining Corporation, EPA-HQ-
SFUND-2015-0781-2712-207, page 195.
---------------------------------------------------------------------------

    NMA commented that mining is comprehensively regulated by a vast 
range of federal, state, and local environmental laws and regulations, 
and that these laws and regulations provide ``cradle to grave'' 
coverage of virtually every aspect of mining from exploration to 
operations through mine reclamation and closure/post-closure.\277\
---------------------------------------------------------------------------

    \277\ See comments from National Mining Association, EPA-HQ-
SFUND-2015-0781-2794, page 28.
---------------------------------------------------------------------------

    EPA generally agrees with these commenters that in the proposed 
rule it did not adequately consider the protectiveness and financial 
assurance requirements of current state regulatory programs in 
assessing the ``degree and duration of risk associated with the 
production, transportation, treatment, storage, or disposal of 
hazardous substances'' and the risk that taxpayers will be forced to 
fund CERCLA response actions, and has based this final action in part 
upon its more comprehensive consideration of those existing programs.
Protective Mining Practices
    Commenters further argued that new facilities are specifically 
designed, constructed, operated, and closed in a manner to prevent 
environmental degradation and to avoid the types of problems that were 
caused by past practices. The information provided to EPA by commenters 
emphasized that an assessment of risks of damages to the

[[Page 7578]]

environment should not focus on mines of an earlier era, and that the 
targeted regulated universe--currently operating mines using 
contemporary mining practices--pose comparatively minimal risks of 
releases.
    NMA noted that new facilities are specifically designed, 
constructed, operated, and closed in a manner to prevent environmental 
degradation and avoid the types of problems that were caused by past 
practices.\278\ NMA pointed out that historical operating practices 
that led to the need for largescale CERCLA type responses in the past 
(e.g., direct disposal of tailings into streams, uncontrolled 
infiltration/discharge of mine impacted water, discharge of mine waste 
into dumps or impoundments without mitigating potential release 
mechanisms, etc.) are no longer utilized by the modern mining industry 
or compliant with current state and federal regulatory requirements. 
Rather, NMA notes that the mining industry routinely designs modern 
mining operations using detailed scientific and engineering 
investigations such as groundwater and surface water modeling, 
environmental risk assessments, and stability analyses which contribute 
to sound design and operating practices intended to protect human 
health and the environment.
---------------------------------------------------------------------------

    \278\ See comment from National Mining Association, EPA-HQ-
SFUND-2015-0781-2794.
---------------------------------------------------------------------------

    NMA further stated that risks are further reduced at currently 
operating hardrock mining sites using technologies such secondary 
containment systems, seepage collection systems, surface water 
management systems, liners, and active monitoring systems to reduce or 
eliminate the risk of a release. In the event that a release or 
potential release is identified through installed monitoring systems, 
remedial actions are immediately implemented as required by regulatory 
programs using technologies such as interceptor wells, cutoff walls, 
and hydraulic capture zones.\279\
---------------------------------------------------------------------------

    \279\ Ibid., Appendix B.
---------------------------------------------------------------------------

    NMA stated that as federal and state mining programs and 
groundwater protections have matured, monitoring, reporting, and 
corrective action have become core components of hardrock mining 
programs and permits, citing, for example, BLM's current regulations, 
promulgated in 2001, which require operators to submit a comprehensive 
monitoring plan that demonstrates compliance with BLM's surface 
management regulations and other Federal and State environmental laws 
and regulations, provides early detection of potential problems, and 
supplies information that will assist in directing corrective actions 
should they become necessary.\280\
---------------------------------------------------------------------------

    \280\ See 43 CFR 3809.401(b)(4).
---------------------------------------------------------------------------

    Numerous other commenters, including MiningMinnesota, AEMA, Energy 
Fuels Resources, and General Moly, Inc. supported NMA's views, noting 
that advances in engineering controls, technology, mining industry best 
practices, and FLMA and state regulatory programs have lowered the 
``degree and duration of risk'' to a point that CERCLA 108(b) financial 
responsibility requirements are not required.\281\ These commenters 
further elaborated that the FLMA and state mine regulatory and 
financial assurance programs coupled with engineering controls and best 
practices reduce the degree and duration of risk associated the 
production, transportation, treatment, storage, or disposal of 
hazardous substances and that these FLMA and state reclamation and 
closure requirements require more than simply reshaping land and 
revegetation--by requiring a mine to be designed, built, operated and 
closed to prevent the release of hazardous substances and ensure no 
adverse environmental impacts through the entire mine life cycle, 
including closure and post-closure. As such, the commenters believe no 
additional financial responsibility requirements are necessary to 
protect the taxpayers or the Superfund Trust Fund.
---------------------------------------------------------------------------

    \281\ See comments from MiningMinnesota, EPA-HQ-SFUND-2015-0781-
2655 and from American Exploration and Mining Association (AEMA), 
EPA-HQ-SFUND-2015-0781-2657, and General Moly, Inc., EPA-HQ-SFUND-
2015-0781-2715.
---------------------------------------------------------------------------

    The Idaho Mining Association (IMA) echoed the same message, noting 
that modern mining techniques and best practices in the mining industry 
use technology and appropriate controls in combination with FLMA and 
state programs to lower risk of release such that EPA's proposed rule 
is not necessary.\282\
---------------------------------------------------------------------------

    \282\ See comment from the Idaho Mining Association, EPA-HQ-
SFUND-2015-0781-2772.
---------------------------------------------------------------------------

    For the planned Donlin Gold project in Alaska, Calista Corporation 
noted in its comments that one of the primary goals has been to avoid 
environmental and human health risks both from planned operations and 
potential unanticipated releases of hazardous substances such as 
tailings, acid rock drainage, mercury, cyanide, and fuel oil. For 
example, the Donlin Gold tailings storage facility design is state-of-
the-art and includes: (1) Downstream, rock fill dam construction keyed 
into bedrock, (2) a geo-synthetic liner, and (3) dry closure to 
minimize long-term water management needs.\283\
---------------------------------------------------------------------------

    \283\ See comment from Calista Corporation, EPA-HQ-SFUND-2015-
0781-2644.
---------------------------------------------------------------------------

    Freeport-McMoRan provided numerous specific examples of how the 
hardrock mining industry has improved its management of environmental 
impacts:
     In the area of managing the acidic content of waste rock, 
the industry employs a far more sophisticated and technology-driven 
approach that includes a thorough geochemical analysis of the ore 
reserve body being mined. Using up-to-date information, trucks equipped 
with GPS systems are routed to specific designated disposal locations 
based on the acidic potential of the waste rock. These locations in 
turn are selected based on geochemical modeling that can project out 
far into the future. Potentially acid-generating material is disposed 
of in engineered facilities designed to minimize the potential for acid 
generation by encapsulation or neutralization and thereby reducing the 
potential for acid rock drainage and seepage.
     The changes to the design and operation of tailings ponds 
over the last 25 years are also quite extensive. At the operational 
level, qualified internal tailings-dedicated engineers and onsite 
leaders manage tailings stability. Sites with tailings dams follow 
established operations, maintenance and communication protocols. In 
this process, items regularly inspected and monitored are: Phreatic 
level trends, deposition plans and adherence to good operational 
construction practices, water management controls (including pool sizes 
and location relative to dam faces), seepage management, decant systems 
and other stability components.
     Prior to the revisions to state mining programs during the 
late 1980s and into the early 1990s, it was not uncommon for waste rock 
stockpiles, tailings impoundments, leach pads and ponds to be built 
with limited or no engineering and design review, limited quality 
control and questionable operational practices. For example, some leach 
pads were built on somewhat compacted sub-grade overlain with solvent 
welded poly-vinyl chloride (PVC) plastic sheeting, many times installed 
by mine site employees without specific expertise in the construction 
of these systems. These pads usually had ditches lined with Hypalon 
sheeting due to this material's superior ultraviolet light resistance 
compared to PVC. Many of these sites have been decommissioned, closed, 
and

[[Page 7579]]

replaced by more environmentally robust options.
     Modern tailings disposal facilities are engineered and 
constructed utilizing environmental protection controls. These 
facilities are constructed utilizing geologic containment or engineered 
liners to contain the fluid portion of the tailings. As time passes 
following deposition, the solid fraction of the tailings consolidates, 
reducing the interstitial pore space and thereby decreasing the 
hydraulic permeability to a value that is often less than the liner 
material used during construction. These facilities are often equipped 
with controls, such as barge pump back systems and containment/
collection wells at the toes of the units, to capture any seepage and 
allow for the recycling of captured water. Upon closure, these 
facilities take measures to minimize net infiltration into the 
tailings, such as by utilizing stormwater controls and ensuring that 
there is positive drainage during storm events. Tailings facilities are 
also covered and revegetated to produce a passive evapotranspiration 
mechanism which further reduces net infiltration. These tailings 
disposal facilities are operated following Tailings Management Plans 
which are included in the application for environmental protection 
permits issued by state regulating agencies.
     Prior to the placement of waste rock, the proposed site is 
evaluated for environmental risks including upstream stormwater run-on, 
seeps and springs upwelling from beneath the proposed facility, 
proximity to streams and rivers and other site specific exposures. The 
waste rock facility must be designed and built in accordance with 
engineering and construction details required by a mine's state-issued 
permit, which must be based on geotechnical stability analyses. 
Stormwater management measures, such as diversion features to intercept 
water and direct it around the waste rock facility, and facility 
management plans that govern the placement of potentially-reactive 
material are also employed to limit contact with potentially acid-
producing materials. Other management strategies that may be employed 
to limit contact with potentially acid-generating material may include 
blending with neutralizing rock, segregation in cells that are set back 
a prescribed distance from the base and edges of the facility and are 
covered or encapsulated in neutralizing material, and landform design 
to minimize stormwater ponding. Concurrent reclamation is also often 
incorporated to further reduce the potential for net infiltration into 
the waste rock facility and return the area to a productive post-mining 
land use. Waste rock facility inspections by the operator and 
regulatory inspectors are also performed on schedules based upon 
regulatory requirements imposed by laws, regulations and permit 
stipulations. These inspections include looking for seepage from the 
facility, slope stability, stormwater ponding and other prescribed 
conditions. Any issues observed must be corrected per the regulatory 
and permit requirements imposed. These inspections are conducted during 
operation and continue through the closure period following reclamation 
of the facility.
    Several commenters also commented on the usefulness of 
environmental management systems (EMSs) and best management practices 
(BMPs). For example, NMA commented that the introduction of EMSs in the 
1990s was another key development for improved environmental 
performance--a framework that helps an organization meet its regulatory 
compliance requirements and otherwise achieve its environmental goals 
through consistent review, evaluation, and improvement of its 
environmental performance.\284\ This consistent review and evaluation 
are intended to identify opportunities for continuous improvement in 
the environmental performance of the organization. NMA states that many 
HRM facilities have implemented EMS programs, noting that at EPA's 
request, it, in association with the Society for Mining, Metallurgy, 
and Exploration (``SME''), developed a model EMS guide to address the 
agency's concerns about the ability of smaller and medium size mining 
companies to develop and implement EMS programs. The objective of the 
EMS guide is to assist companies in achieving reliable regulatory 
compliance, reducing adverse impacts to the environment, improving 
environmental stewardship, and continually improving environmental 
performance. NMA notes the most commonly used framework for an EMS is 
the one developed by the International Organization for Standardization 
(``ISO'') for the ISO 14001 standard. Established in 1996, this 
framework is the official international standard for an EMS and 
includes an optional third-party certification component, meaning an 
independent certification body audits an organization's practices 
against the requirements of the standard. Many HRM facilities have 
taken this extra certification step. The ISO 14001, first published in 
1996, underwent significant revisions in both 2004 and 2015.
---------------------------------------------------------------------------

    \284\ See comment from National Mining Association, EPA-HQ-
SFUND-2015-0781-2794.
---------------------------------------------------------------------------

    Freeport-McMoRan similarly commented that EPA did not consider the 
implementation of EMSs--under standards developed by reputable third-
party organizations, such as the International Standards Organization 
and the International Council on Mining and Metals.\285\ The commenter 
noted that such standards commit participants to continuing process 
improvement above and beyond minimum legal requirements. Likewise, 
standards for sustainability, such as ICMM's, require third party 
assurance and verification programs. Freeport-McMoRan stated these 
private initiatives supplement state programs, adding an additional 
layer of best practices and external review above and beyond what is 
legally required. The Arizona Department of Environmental Quality 
(ADEQ) supported this approach, noting the usefulness of its Voluntary 
Environmental Stewardship Program (VESP) and Voluntary Remediation 
Program (VRP) that are innovative systems not based on enforceable 
commitments required for reductions.\286\ ADEQ also stated the 
usefulness of EMSs, ISO certification, third party inspection programs, 
or similar types of state and federal programs for reducing risk from 
mining operations and specifically noted that Freeport-McMoRan, with 
mines in Arizona, employs industry best practices of an ISO14000 
environmental management system.
---------------------------------------------------------------------------

    \285\ See comment from Freeport-McMoRan, EPA-HQ-SFUND-2015-0781-
2793.
    \286\ See comment from the Arizona Department of Environmental 
Quality (ADEQ), EPA-HQ-SFUND-2015-0781-2714.
---------------------------------------------------------------------------

    With respect to BMPs, the Forest Service commented that EPA 
acknowledges that ``[t]oday, BMPs have been developed that can mitigate 
potential impacts from mining to meet EPA's goal `. . . that the 
engineering requirements will result in a minimum degree and duration 
of risk associated with the production, transportation, treatment, 
storage, or disposal, as applicable, of all hazardous substances 
present at that site feature.\287\ However, comments submitted by 
Earthworks, et al. raise concern about the use of BMPs, noting that no 
data was provided to demonstrate that these rules have reduced, or 
prevented, releases of hazardous materials. Earthworks further noted 
that numerous reports document substantial impacts at modern hardrock 
mines, particularly those associated

[[Page 7580]]

with the release of hazardous materials.\288\
---------------------------------------------------------------------------

    \287\ See comment from USDA Forest Service, EPA-HQ-SFUND-2015-
0781-2400.
    \288\ See comment from Earthworks et al., EPA-HQ-SFUND-2015-
0781-2739.
---------------------------------------------------------------------------

    EPA recognizes that substantial advances have been made in the 
development of mining practices and the implementation of federal and 
state regulatory programs to address releases at hardrock mining 
facilities. While the risk of a release is never totally eliminated, 
commenters provided information regarding state regulation of hardrock 
mining facilities, including detailed information on controls those 
programs require to prevent releases. This information indicates that 
state and voluntary programs improve in response to incidents. Barrick 
Gold commented that EPA cited some releases including at the 
Summitville and Zortman-Landusky mines, which the commenter stated 
cannot occur again because federal land management agencies and state 
regulators have strengthened requirements and practices to prevent the 
issues that occurred previously. Specifically, they stated that 
regulations and policy were modified to more carefully identify risks 
of acid rock drainage or other water contamination, to control 
potential sources though mine design and to assure those measures are 
implemented through permit and monitoring obligations. The Colorado 
Department of Natural Resources, Division of Reclamation, Mining, and 
Safety's comments support Barrick's statements, stating that ``the 
state learned from the errors at Summitville, and the state legislature 
passed major programmatic revisions to the Mined Land Reclamation Act 
(MLRA)'' that ``strengthened permitting and enforcement provisions. 
Most importantly, the MLRA was specifically amended [. . .] to clearly 
require financial assurance for all sites based on site specific, not 
formulaic, criteria.'' \289\
---------------------------------------------------------------------------

    \289\ See comment from Colorado Department of Natural Resources, 
EPA-HQ-SFUND-2015-0781-2774, page 3.
---------------------------------------------------------------------------

    The Nevada Mining Association's comments reference Nevada's 
continual improvement of its regulatory programs to ensure 
effectiveness and efficiency. This comment argues that state programs 
are not static and rather make constant improvements.\290\ Comments 
from the Small Business Administration Office of Advocacy explained 
that the bonding requirements of the Nevada program have been more 
recently upgraded, in part, because of the experience gained from 
administering mines through bankruptcies in the early 1990s \291\ NMA 
notes improvements to federal and state programs made in response to 
bankruptcies in the mining industry experienced in the 1990s and early 
2000s \292\ One coordinated improvement of Federal Land Management 
Agencies and Nevada cited is the development of the SRCE mentioned 
above.
---------------------------------------------------------------------------

    \290\ See comment from the Nevada Mining Association, EPA-HQ-
SFUND-2015-0781-2684, page 7.
    \291\ See comment from the Small Business Administration, EPA-
HQ-SFUND-2015-0781-1406, page 4.
    \292\ See comment from the National Mining Association, EPA-HQ-
SFUND-2015-0781-2794, page 64.
---------------------------------------------------------------------------

    Additionally, a commenter operating in several states stated that 
EPA's evaluation of risk failed to consider important aspects of modern 
mining, including the deployment of voluntary industry programs (e.g., 
the International Council on Mining and Metals (ICMM) Sustainable 
Development Framework) and robust environmental management systems with 
third-party certification.\293\ A commenter also noted the 
International Cyanide Management Code for the Manufacture, 
Transportation, and Use of Cyanide in the Production of Gold, which was 
developed under the guidance of the United Nations Environment Program. 
The code ``focuses exclusively on the safe management of cyanide and 
cyanidation mill tailings and leach solutions. Companies that adopt the 
Cyanide Code must have their mining and processing operations that use 
cyanide to recover gold and/or silver audited by an independent third 
party to determine the status of Cyanide Code implementation.'' The 
requirements under the code include storage and mixing location and 
containment, secondary containment, lining for leach ponds, and spill 
prevention and containment.\294\ Similarly, another commenter stated 
that EPA failed to adequately recognize the impacts of the development 
and adoption of industry BMPs, other voluntary programs, and 
environmental management systems.\295\
---------------------------------------------------------------------------

    \293\ See comment from Freeport-McMoRan Inc., EPA-HQ-SFUND-2015-
0781-2402.
    \294\ See Id., Appendix D page at 8.
    \295\ See comment from National Mining Association, EPA-HQ-
SFUND-2015-0781-2794.
---------------------------------------------------------------------------

    EPA acknowledges that the requirements of current federal and state 
programs can reduce risk at hardrock mining facilities, and that when 
determining the need for section 108(b) requirements for hardrock 
mining facilities at proposal, EPA did not adequately consider their 
impact. EPA agrees with commenters opposing the proposed rule that 
those reductions in risk should be considered in determining the need 
for final requirements under section 108(b) for current hardrock mining 
operations.\296\ The Agency is thus convinced by those commenters and 
its own further investigations that the rulemaking record supporting 
requirements under section 108(b) for currently operating facilities 
was incomplete in not adequately considering the risk reductions 
currently obtained by other Federal and state regulatory programs. 
While EPA also acknowledges that the risk of a release is never totally 
eliminated by the requirements of other programs, this residual risk is 
to be evaluated in light of EPA's discretion under the statute on 
whether to set section 108(b) requirements, and in light of the other 
information in the record for today's action discussed elsewhere in 
this final rulemaking. Viewed in this manner, such residual risk does 
not change EPA's conclusion that it is not appropriate to issue final 
section 108(b) requirements for current hardrock mining operations.
---------------------------------------------------------------------------

    \296\ As discussed above, this determination applies only to 
EPA's authority under section 108(b) and does not affect EPA's 
authority to take action under other sections of CERCLA or under 
other federal law at any facility, including at a facility discussed 
in this preamble.
---------------------------------------------------------------------------

    Finally, it should be noted that in addition to the federal and 
state mining programs that regulate mine operation and closure, 
hardrock mining facilities are regulated under a number of other 
federal programs, discussed above, which contribute to reduction in 
risk at these facilities. For example, mines are generally required 
under the Clean Water Act regulations to obtain NPDES permits, and to 
meet federal water quality standards for point-source discharges to 
water sources from industrial operations. Requirements of the Safe 
Drinking Water Act include permitting and technical standards for 
underground injection wells that might be used in mineral extraction. 
And, requirements under the CAA apply National Emission Standards for 
Hazardous Air Pollutants to hazardous air releases from mining and 
processing operation sources.
b. Comments Providing Information on Reduced Costs to the Taxpayer 
Resulting From Effective Hardrock Mining Programs and Owner or Operator 
Responses
    Commenters also argued that the reduced risk at modern hardrock 
mining facilities is evidenced by the fact that there are very few 
cases where modern hardrock mining facilities have been addressed by 
Superfund and/or at taxpayer expense.

[[Page 7581]]

    Several commenters disagreed with EPA's assertion in the proposal 
that the estimated $4 billion spent by EPA through the Superfund for 
cleanup costs at historical hardrock mining facilities is an indication 
of the relative risk present at the facilities covered by the proposed 
rule. Commenters stated that EPA did not differentiate between costs 
associated with the highly-regulated mining practices of today and pre-
regulation practices in developing that number. EPA agrees that the 
analysis discussed in the preamble to the proposed rule \297\ did not 
adequately distinguish between legacy and current mines.
---------------------------------------------------------------------------

    \297\ See 82 FR 3479, January 11, 2017.
---------------------------------------------------------------------------

    Commenters argued that such analyses would further demonstrate that 
any risks from modern operations entail much less costly responses, and 
that the bulk of the observed historical response costs are 
attributable to pre-regulation practices.
    In addition, many commenters stated that the risk that there will 
be inadequate funding to cover CERCLA liabilities at hardrock mining 
facilities in the future is adequately addressed by existing federal 
and state financial assurance programs. Commenters provided numerous 
examples of existing trust, bonds, and letters of credit (LOCs) 
available to pay for necessary actions at these sites.\298\ Commenters 
also provided examples of facilities where the response costs have been 
paid for by owners and operators at no cost to taxpayers.\299\
---------------------------------------------------------------------------

    \298\ See a discussion of this issue in the Technical Support 
Document for this final rulemaking: EPA, CERCLA Section 108(b) 
Hardrock Mining Final Rule: Technical Support Document, December 1, 
2017.
    \299\ See a discussion of this issue in the Technical Support 
Document for this final rulemaking, Ibid.
---------------------------------------------------------------------------

    Since a goal of section 108(b) requirements is to provide funds to 
address CERCLA liabilities at sites, evidence of such privately-funded 
responses contributes to support for the decision that financial 
responsibility requirements under section 108(b) for current hardrock 
mining operations are not appropriate.

E. Evidence Rebutting EPA's Site Examples

    In developing the 2009 Priority Notice and the proposed rule, EPA 
cited examples of hardrock mining facilities where releases of 
hazardous substances have occurred, and in some cases where CERCLA or 
CERCLA-like actions were necessary, as evidence of risk associated with 
hardrock mining operations.\300\ The examples fell into three 
categories: (1) Examples now not relevant to the mines to be regulated 
under the rule, (2) examples reflecting a reassessment of costs to the 
taxpayers based on new information, and (3) examples where program 
requirements were subsequently modified to address the problem.
---------------------------------------------------------------------------

    \300\ See the Releases Report, the Practices Report, and the 
Evidence Report. NMA comments included a detailed critique of the 
Practices Report prepared by the Society for Mining Metallurgy and 
Exploration, Inc., as Appendix D to its comments.
---------------------------------------------------------------------------

    Commenters on the proposed rule provided information to rebut the 
facts associated with the case studies and their significance in 
support of the 2009 Priority Notice and the proposed rule, by pointing 
out that response actions were due to legacy contamination, were 
privately funded, were covered by financial assurance under other law, 
or were the result of situations that have been subsequently addressed 
by state law.\301\ The information provided by these case studies 
formed a significant portion of the record on which the 2009 Priority 
Notice and the proposed rule were based. This additional information 
provided by commenters has caused EPA to reevaluate its conclusions in 
the proposed rule regarding the level of potential taxpayer liability 
from modern mines operating under currently existing regulatory 
programs.
---------------------------------------------------------------------------

    \301\ In fact, comments submitted by NMA included a lengthy 
Appendix addressing the individual facilities cited by EPA. See 
comment EPA-HQ-SFUND-2015-0781-2794, Appendices C-1, C-2, and C-3.
---------------------------------------------------------------------------

    One example in each of the three categories is discussed below. A 
full discussion of the case studies and the evidence provided in 
rebuttal can be found in a support document entitled ``CERCLA Section 
108(b) Hardrock Mining Final Rule: Technical Support Document,'' which 
is available in the docket for this rulemaking.
1. Example of Sites Now Not Relevant to the Mines To Be Regulated Under 
the Rule
    Commenters provided information demonstrating that several of the 
site examples relied upon in the proposed rule are not relevant to an 
evaluation of the risk at current hardrock mining operations because 
they relate to historic mining activities that do not reflect current 
mining practices or regulatory regimes at the state or federal level. 
EPA agrees that the historical mining practices, and environmental 
contamination that may have occurred as a result of such practices, are 
not an accurate representation of the risks associated with current 
hardrock mining operations. Many of the sites referenced in the 
proposed rule, the 2009 Priority Notice, and record of support, are not 
relevant to EPA's assessment of risk posed by current hardrock mining 
operations that are already subject to applicable federal and state 
regulatory regimes. Rio Tinto Kennecott Bingham Canyon Site in Utah is 
an example of a site that was now not relevant to current hardrock 
mining operations.
    This mine was included in the preamble of the proposed rule as an 
example of the impacts that can occur from large-scale operations.\302\ 
For example, the discussion of this mine references the large-scale 
disturbance of land, accumulation of waste rock, and leaching of 
hazardous substances and acid rock drainage, but it does not provide 
details about the history of the mine or context about whether certain 
activities are best characterized as legacy mining activities or ones 
that reflect current mining practices and regulatory regimes.
---------------------------------------------------------------------------

    \302\ 82 FR 3388, 3472; see also, Comment submitted by 
Earthworks (EPA-HQ-SFUND-2015-0781-1072). The four-page report 
characterizes the mine as the ``second most polluting mine in the US 
by toxic releases'' based on TRI data; however, as noted in the 
preamble to the final rulemaking, TRI data are not an accurate 
representation of risk at a particular site. As the Earthworks 
comment notes, EPA and the state have reached an agreement to not 
finalize the proposal to list the site on the NPL and there have 
been several state and federal regulatory and enforcement actions at 
the site, which required the company to take steps to mitigate risks 
to human health, water, and other natural resources.
---------------------------------------------------------------------------

    According to Rio Tinto's comments and EPA's record for the site, 
there has been active mining in the canyon since the 1860s and that the 
historic mining activities ``based on a less sophisticated 
understanding of environmental sciences and substantially less 
regulation by emerging environmental protection laws inarguably left 
their mark.'' \303\ According to the record for this action, EPA has 
secured more than $270 million to pay for response actions for this 
site through enforcement orders and consent decrees. Rio Tinto in its 
comments acknowledges that accidents do happen and that reporting, 
inspections, and enforcement can help prevent and address problems that 
do occur. In its comments, NMA stated that the cooperation between the 
mining company, EPA, and the state is a model for addressing legacy 
environmental contamination at mining sites.\304\ EPA has touted the 
cooperative effort to clean up the site as a ``major accomplishment of 
the Superfund program and law.'' \305\ Further

[[Page 7582]]

discussion of this mine can be found in the Technical Support Document 
for this final rulemaking.\306\ EPA agrees that this mine, which has an 
expansive footprint but whose current operations are subject to 
considerable oversight by regulatory authorities, is not a relevant 
example on which to base a rule under section 108(b).
---------------------------------------------------------------------------

    \303\ EPA-HQ-SFUND-2015-0781-2747; see also, EPA-HQ-SFUND-2015-
0781-0186.
    \304\ EPA-HQ-SFUND-2015-0781-2794, table C.
    \305\ See comment from the National Mining Association, EPA-HQ-
SFUND-2015-0781-2747, Appendix F.
    \306\ See: EPA, CERCLA Section 108(b) Hardrock Mining Final 
Rule: Technical Support Document, December 1, 2017.
---------------------------------------------------------------------------

2. Example Reflecting Reassessment of Costs to the Taxpayers Based on 
Additional Information
    As discussed above, a goal of regulations under section 108(b) is 
to increase the likelihood that owners and operators will provide funds 
necessary to address the CERCLA liabilities at their facilities. In 
doing so, section 108(b) requirements assure that owners and operators, 
rather than the taxpayers, bear the costs associated with necessary 
responses to releases and potential releases of hazardous substances at 
their sites. Commenters on the proposed rule objected that EPA did not 
properly consider whether a release resulted in expenditure of taxpayer 
funds to determine the need for a rule under section 108(b). EPA's 
reconsideration of these case studies supports the determination that 
section 108(b) financial responsibility requirements at hardrock mining 
facilities are not necessary to provide funds to address CERCLA 
liabilities at sites. Many of the sites referenced in the proposed 
rule, the 2009 Priority Notice, and record of support, are not relevant 
to EPA's assessment of risk posed to the taxpayer because cleanup is 
being paid for by private parties. Golden Sunlight Mine in Montana is 
an example of such a site.
    The Releases Report presented this mine as an example of a current 
mine with releases to the environment where a response action was 
necessary. NMA and Barrick Gold both commented that the releases from 
the tailings facility detected in 1993 were discovered by monitoring 
implemented at the behest of state mining permits at the site and 
corrective action was taken by the operator.\307\ In the proposed rule, 
the agency described the actions by the owner/operator to immediately 
repair the bentonite cut-off wall to control seepage from the tailings 
impoundments. The facility has also installed an extensive system of 
monitoring wells and several hydrogeologic investigations have been 
undertaken to continue to monitor, evaluate, and control leakage from 
the tailings impoundment.
---------------------------------------------------------------------------

    \307\ National Mining Association comments on proposed rule 
appendix table C-2 pg 6; Barrick Gold July 11, 2017 comments on 
proposed rule page 20.
---------------------------------------------------------------------------

    As discussed in the Technical Support Document and elsewhere in the 
preamble, Montana substantially reformed its mining laws over the past 
couple of decades. Montana Department of Environmental Quality 
commented on the proposed rule that Montana State Law ``requires Hard 
Rock operators to submit to Montana Department of Environmental Quality 
a bond in an amount no less than the estimated cost to the state to 
ensure compliance with Montana's Air Quality Act, Montana's Water 
Quality Act, the Metal Mine Reclamation Act, and the permit issued by 
DEQ under the Metal Mine Reclamation Act (MMRA). The site is also 
subject to Montana's Environmental Policy Act (MEPA) which is patterned 
after NEPA). The mine has been the subject of several environmental 
assessments and one environmental impact statement for amendments to 
its operating permit. In addition, and at a minimum, Montana Department 
of Environmental Quality is required to perform a comprehensive bond 
review every five years for each Hard Rock operation to ensure that the 
bonding level is appropriate.'' \308\
---------------------------------------------------------------------------

    \308\ EPA-HQ-SFUND-2015-0781-2742.
---------------------------------------------------------------------------

    The Agency researched Montana's requirement to perform a 
comprehensive bond review every five years as it applies to the Golden 
Sunlight Mine. The agency found a final bond determination for Golden 
Sunlight Mine dated July 28, 2017 in which Montana DEQ determined that 
the current bonding level of $112,153,980 did not represent the present 
cost of compliance with the MMRA, the administrative rules, and 
Operating Permit No. 00065. After negotiations between Montana 
Department of Environmental Quality, the Bureau of Land Management, and 
the mine owner, and a 30-day comment period, the bond amount was 
increased to $146,564,163. The next comprehensive bond review will be 
in 2020.\309\ Further discussion of this mine can be found in the 
Technical Support Document for this final rulemaking.\310\
---------------------------------------------------------------------------

    \309\ See: EPA, CERCLA Section 108(b) Hardrock Mining Final 
Rule: Technical Support Document, December 1, 2017. http://deq.mt.gov/Portals/112/Land/Hardrock/Active%20Amendments/Golden%20Sunlight%20016/00065_GSM_2017_07_28_Final_Bond.pdf.
    \310\ See: EPA, CERCLA Section 108(b) Hardrock Mining Final 
Rule: Technical Support Document, December 1, 2017.
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3. Example Where Program Requirements Were Subsequently Modified To 
Address the Problem
    Commenters provided information to demonstrate that when problems 
have arisen at hardrock mining facilities, states have responded by 
improving their programs to prevent similar problems in the future and 
that there is, therefore, no need for financial responsibility 
requirements under section 108(b). Commenters provided examples of such 
state program modifications to rebut evidence provided in the record 
supporting the proposed rule. Barite Hill/Nevada Goldfields Facility in 
South Carolina is an example of a situation where program modifications 
reduced future risk.
    As was discussed in the proposed rule, the Barite Hill/Nevada 
Goldfields was a gold and silver surface mine located in McCormick, 
South Carolina that was operated by Nevada Goldfields.\311\ The mine 
operated an open pit cyanide heap leach operation on the property from 
1989 to 1994. Nevada Goldfields conducted mine reclamation activities 
from 1995 to 1999, when it filed for bankruptcy and abandoned the site, 
turning over control to the South Carolina Department of Health and 
Environmental Control.\312\
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    \311\ 82 FR at 3473.
    \312\ ATSDR 2011 PHA Barite Hill EPA-HQ-SFUND-2015-0781.
---------------------------------------------------------------------------

    NMA commented that EPA's description of the mine in the proposed 
rule included mischaracterizations and omissions, including that 
significant changes were made to South Carolina Mining Act in 1990 that 
specified reclamation requirements and provided enforcement tools. NMA 
also stated that the most recent facility that had been permitted in 
the state had a waste rock management plan to prevent acid mine 
drainage.\313\ EPA has confirmed that South Carolina finalized 
regulations implementing this new authority in 1992, including 
requirements that a mine obtain a reclamation bond as a condition for 
receiving a mining permit, and that the recently permitted gold mine is 
subject to stricter environmental and financial assurance 
requirements.\314\ These regulations were not completed in time to 
significantly reduce risks at Nevada Goldfields, which ceased active 
mining in 1994, but EPA believes that similar mines operating in South 
Carolina today under

[[Page 7583]]

the current regulations would have significantly reduced risks of 
unpermitted releases and taxpayer liability. Further discussion of this 
mine can be found in the Technical Support Document for this final 
rulemaking.
---------------------------------------------------------------------------

    \313\ NMA EPA-HQ-SFUND-2015-0781-2794 Attachment #109 pdf p. 81/
119; Attachment #110 pdf p. 330, 346, and 387/440.
    \314\ S.C. State Register, Vol. 16, Issue 4 (April 24, 1992); 
available at: http://digital.tcl.sc.edu/cdm/compoundobject/collection/scsreg/id/31138/rec/5.
---------------------------------------------------------------------------

F. Information Regarding Financial Responsibility Instrument 
Availability

    During the public comment period for the proposed rule, commenters 
representing or participating in the insurance, surety and banking 
industries identified several concerns with EPA's proposed instrument 
terms, and expressed concern that those terms could impact the 
availability of instruments. Similarly, entities in the mining industry 
expressed concerns that instruments may not be available for the 
amounts proposed in the forms specified. Information provided by 
commenters on likely lack of available instruments to satisfy section 
108(b) requirements provides further support for EPA's determination 
that the proposed financial responsibility requirements are not 
appropriate.
    EPA considered the capacity of the financial market to provide 
instruments as part of the development of the proposed rule. The 
Conference Committee Report for the Consolidated Appropriations Act 
(2016) instructed EPA to conduct a study of the market capacity 
regarding the necessary instruments for meeting any new section 108(b) 
financial responsibility requirements. EPA accordingly developed a 
study,\315\ which suggested significant uncertainty exists around the 
ultimate availability of instruments.
---------------------------------------------------------------------------

    \315\ Doc. ID EPA-HQ-SFUND-2015-0781-0496; Letter from USEPA, 
Chief Financial Officer, to members of Senate and House 
Subcommittees on Interior, Environment, and Related Agencies, dated 
Sept. 1, 2016, along with attached submission of EPA study titled, 
``CERCLA 108(b) Hardrock Mining and Mineral Processing Evaluation of 
Markets for Financial Responsibility Instruments, and the 
Relationship of CERCLA 108(b) to Financial Responsibility Programs 
of Other Federal Agencies'', August 25, 2016.
---------------------------------------------------------------------------

    Many commenters expressed concerns regarding the uncertainty 
inherent in the study as well and expressed concerns that financial 
responsibility instruments may not be universally available and 
affordable.\316\ The concerns raised by commenters regarding the terms 
and conditions of the proposed instruments as well as the comments on 
the market capacity study have contributed to uncertainty regarding the 
availability of instruments to owners and operators seeking to comply 
with the proposed section 108(b) requirements. If instruments were not 
available, owners and operators would be unable to comply with section 
108(b) requirements, and the goal of the rule to provide funds to 
address CERCLA liabilities at sites would not be achieved.
---------------------------------------------------------------------------

    \316\ See, for example, Freeport McMoran comments on the 
proposed rule Docket ID: EPA-HQ-SFUND-2015-0781-2793 pg 89-91; 
American Exploration and Mining Association comments on the proposed 
rule Docket ID: EPA-HQ-SFUND-2015-0781-2795 pg 30-32; National 
Mining Association comments on the proposed rule Docket ID: EPA-HQ-
SFUND-2015-0781-2794 pages 81-82.
---------------------------------------------------------------------------

    The issue of availability of instruments is discussed in more 
detail in section VII.D. of this final rulemaking.

V. Decision to Not Issue the General Facility Requirements of Subparts 
A Through C in This Final Rulemaking

    The Agency also has decided not to issue as final any provisions of 
the proposed rule, including the general financial responsibility 
requirements in subparts A through C. EPA would include general 
facilities requirements, such as these, in the first of any subsequent 
rulemaking proposals under section 108(b), rather than issue final 
requirements under those subparts at this time.
    EPA decided on this approach because there is no need to issue 
final requirements in subparts A through C at this time as they would 
not be applicable to any classes of facilities until such time as final 
section 108(b) regulations applicable to classes of facilities are 
issued.
    In addition, the Agency received significant comment on the general 
financial responsibility provisions of the proposed rule, many of which 
identified significant issues with those portions of the proposal. 
These included, for example, the financial industry's concerns 
regarding certain provisions included with the language of the 
instruments, as described in detail below. By issuing a new proposed 
set of general requirements for any subsequent industry class, EPA 
would to be able to gather additional information as appropriate. 
Accordingly, EPA would be able to present a new set of general facility 
requirements in any subsequent proposal, with an additional opportunity 
for public comment, rather than having to create a proposal to modify 
existing requirements, thus avoiding potential confusion to commenters.

VI. Obstacles To Developing and Implementing Section 108(b) Financial 
Responsibility Requirements for Hardrock Mining Facilities

    EPA decided not to issue final requirements under section 108(b) 
for hardrock mining facilities because the Agency believes that final 
requirements are not appropriate. Furthermore, the Agency encountered a 
set of challenges that validate the decision not to issue final 
regulations. First, challenges remain regarding the potential 
disruption of state, tribal, and local mining programs by section 
108(b) requirements. Second, section 108(b) continues to present 
particular challenges regarding the determination of a financial 
responsibility amount. Third, the Agency's evaluation of the economic 
impacts of the proposed rule does not support the need for a rule. 
Fourth, concerns regarding the availability of instruments remain. 
Finally, section 108(b) continues to present challenges in identifying 
the facility for purposes of the rule. These concerns were raised by 
commenters, and are discussed in detail below.

A. Potential Disruption of State, Tribal, or Local Mining Programs

    In the proposed rule, EPA acknowledged the role that effective 
reclamation and closure requirements at hardrock mining facilities 
under federal and state programs can have in reducing the likelihood of 
releases or potential releases of hazardous substances to the 
environment. EPA also documented that federal and state mining 
regulatory programs require financial assurance to support 
implementation of reclamation and closure requirements.
    Numerous observers raised questions about the effects of an express 
preemption provision in CERCLA section 114(d) during EPA's development 
of the proposed rule. This provision states in part:

    Except as provided in this subchapter, no owner or operator of a 
. . . facility who establishes and maintains evidence of financial 
responsibility in accordance with this subchapter shall be required 
under any State or local law, rule or regulation to establish or 
maintain any other evidence of financial responsibility in 
connection with liability for the release of a hazardous substance 
from such . . . facility. Evidence of compliance with the financial 
responsibility requirements of this subchapter shall be accepted by 
a State in lieu of any other requirement of financial responsibility 
imposed by such State in connection with liability for the release 
of a hazardous substance from such . . . facility.\317\

    \317\ 42 U.S.C. 9614(d).
---------------------------------------------------------------------------

    EPA discussed its views on the preemption provision in the proposed 
rule. Specifically, EPA explained that it did not intend for its 
section 108(b) regulations to result in widespread displacement of 
state mine bonding programs under section 114(d), nor did

[[Page 7584]]

it believe that such preemption is intended by CERCLA, necessary, or 
appropriate. In support of this conclusion, EPA discussed the language 
of paragraph (d) and section 114 as a whole, and considered whether 
state bonding programs were ``in connection with liability for the 
release of a hazardous substance'' as that term is used in section 
114(d), and also took into account relevant policy considerations.\318\
---------------------------------------------------------------------------

    \318\ 82 FR 3403-04.
---------------------------------------------------------------------------

    Commenters on the proposal nevertheless continued to express 
concern that preemption would indeed occur if section 108(b) 
requirements were implemented at facilities, resulting in disruption of 
those programs not only from successful preemption challenges, but also 
from the mere need to defend against those challenges.\319\
---------------------------------------------------------------------------

    \319\ See, for example, Montana Dept. of Environmental Quality, 
Comment #: EPA-HQ-SFUND-2015-0781-2742; Arizona Dept. of 
Environmental Quality (ADEQ), Comment #: EPA-HQ-SFUND-2015-0781-
2714; and State of Alaska (Dept. of Natural Resources (ADNR), Dept. 
of Environmental Conservation (ADEC), and the Alaska Dept. of Law), 
Comment #: EPA-HQ-SFUND-2015-0781-2785.
---------------------------------------------------------------------------

    Although EPA discussed its views on the question in the proposed 
rule, it will be the courts, rather than EPA, that will decide the 
effect of section 114(d). Thus, EPA cannot ensure that preemption will 
not occur if financial responsibility under section 108(b) requirements 
is in place at a facility. EPA thus understands why states and local 
governments have concerns that they would have to defend preemption 
challenges, and concerns over the possibility that preemption could 
occur.
    EPA also recognizes that the potential impact of preemption of 
financial assurance requirements extends beyond the concerns relating 
to the financial impacts, as financial assurance is an integral part of 
state mining programs--that is, financial assurance can provide 
enforcement leverage to regulators, and can prevent delays in 
conducting closure and reclamation at a site should the owner or 
operator become unwilling or unable to do so, thus minimizing 
environmental harm.
    For all of these reasons, EPA believes that preemption of state 
financial assurance requirements, should it occur, would be an 
undesirable and damaging consequence of section 108(b) requirements. 
The Agency's decision not to issue final requirements under section 
108(b) for hardrock mining facilities avoids this undesirable outcome.

B. Challenges To Determine the Level of Financial Responsibility

    In developing the proposed rule, EPA considered four approaches to 
identify a financial responsibility amount for a facility--fixed 
amount, site-specific amount, parametric approach, and formulaic 
approach, and described three of those approaches in the proposed rule. 
EPA also identified some of the challenges of the three approaches 
described and sought comment on various aspects of these approaches.
    Under a fixed amount approach, the Agency would identify a standard 
cost for the class of regulated facilities. This method would not rely 
on site-specific factors but rather on historical costs associated with 
similar facilities to calculate an expected future amount. This 
approach is best applied where the costs at issue are fairly uniform, 
as the wider the variation, the lower the accuracy of the financial 
responsibility amount for that cost. If there is wide variation in the 
costs associated with the facilities within the class to which the 
fixed amount is applied, the result can be significant over-regulation 
at those facilities with lower levels of liabilities, and significant 
under-regulation of facilities with higher levels of liabilities. At 
the same time, this approach has advantages in that it requires a lower 
level of effort on the part of the regulated community and the Agency 
to implement because the rule does not require a site-specific 
calculation to be developed, submitted, or evaluated. EPA proposed the 
use of a fixed amount for the health assessment component of the 
financial responsibility amount from hardrock mining facilities.
    The second method considered by EPA was a site-specific approach. 
Under this approach, the owner or operator would calculate the cost of 
conducting known activities to address identified problems. This 
approach is the most precise of the three approaches considered by EPA. 
However, it is also the most resource intensive to implement. It 
requires gathering detailed information about the site, including an 
assessment of the site conditions, and is most easily implemented where 
a release has occurred, a response is necessary, and a remedy 
determination has been made. In fact, EPA already requires financial 
responsibility identified on a site-by-site basis when requiring 
parties to carry out response actions under CERCLA.\320\ EPA notes that 
state regulatory programs and the programs of BLM and the Forest 
Service generally do use a site-specific approach based on extensive 
knowledge of site conditions to establish financial responsibility 
amounts, and this is one of the strengths of existing programs relative 
to the formula based approach in the proposed rule. Having identified 
reasons that a fixed cost and a site-specific approach may not be 
appropriate to identify the level of financial responsibility under 
section 108(b) for response costs and natural resource damages for 
hardrock mining facilities, EPA sought to develop an approach that was 
more accurate than the fixed amount, yet could be implemented without 
conducting a full site investigation at the facility. The Agency's 
efforts resulted in development of a formula for facilities within the 
hardrock mining industry.
---------------------------------------------------------------------------

    \320\ See Guidance on Financial Assurance in Superfund 
Settlement Agreements and Unilateral Administrative Orders (April 
2015).
---------------------------------------------------------------------------

    The proposed formula identified categories of response action at 
hardrock mining facilities, based on past response actions to legacy 
contamination and estimated the costs of those actions based on 
reclamation activities under federal and state laws. Instead of taking 
other regulations or facility practices into account when identifying 
the risk to be addressed by financial responsibility requirements, the 
formula assumed the need for a CERCLA response, and then allowed 
reductions in the financial responsibility amount based on a 
demonstration of compliance with other regulatory requirements or other 
facility practices. As discussed above, EPA no longer believes that 
this approach would result in financial responsibility requirements 
``consistent with the degree and duration of risk associated with the 
production, transportation, treatment, storage, or disposal of 
hazardous substances.'' Thus, the formula does not reflect a level of 
financial responsibility that EPA in its discretion believes is 
appropriate.
    The financial responsibility formula proposed for hardrock mining 
was specific to that industry, and was not designed for use in future 
rulemakings under section 108(b). In future rulemakings under section 
108(b), EPA will evaluate how to determine financial responsibility 
amounts for each particular rule, and will propose an appropriate 
methodology on which it would seek additional public comment.

C. Concerns Regarding Costs and Economic Impacts of the Proposed Rule

1. Overall Concerns Regarding Cost and Economic Impact
    EPA received significant comments on the Regulatory Impact Analysis 
(RIA) for the proposed section 108(b) rule that

[[Page 7585]]

highlight detrimental economic outcomes of concern to commenters. In 
addition to numerous comments critical of various methodological and 
data limitations in the RIA, the leading criticism focuses on the 
disparity between projected industry costs in comparison with the 
rule's predicted transfer of liability costs from the government to the 
hardrock mining industry.
    Using a period of analysis from 2021 to 2055, and assuming a seven 
percent social discount rate, EPA estimated the annualized compliance 
costs for industry to procure third-party instruments would be 
approximately $111 to $171 million (the net present value (NPV) of 
which is $1.4 to 2.2 billion over 34 years). These values represent the 
proposed rule's estimated incremental costs to industry.\321\
---------------------------------------------------------------------------

    \321\ The majority of the industry costs represented a transfer 
from the regulated industry to the financial industry in association 
with the procurement of third party instruments, and hence the 
quantified annualized net social costs were estimated at $30 million 
to $44 million.
---------------------------------------------------------------------------

    EPA then also quantified the transfer of potential CERCLA-related 
costs from the government to private industry that the proposed rule 
would yield. Based on an assumed facility default rate of 7.5 percent, 
the rule was expected to transfer a burden of just $15 to 15.5 million 
in annual liability from the federal government to the regulated 
industry (or $511 to $527 million over 34 years).
    Based on these estimates, commenters objected that the projected 
annualized costs to industry ($111-$171 million) are a magnitude of 
order higher than the avoided costs to the government ($15-15.5 
million) sought by the rule. Estimates of government cost savings in 
the baseline, and industry compliance costs under the rule, occur under 
different regulatory scenarios and are therefore not readily 
comparable. However, these findings do reveal that the costs borne by 
industry far exceed the relative scale of cost savings gained by the 
government as a result of the rule. In the words of one owner/operator, 
``the proposed rules inflict grossly disproportionate burdens on the 
hardrock mining industry relative to the small benefit that it is 
intended to provide to the taxpayers.'' \322\
---------------------------------------------------------------------------

    \322\ See comments from Freeport McMoran, EPA-HQ-SFUND-2015-
0781-2793 page 3.
---------------------------------------------------------------------------

    Beyond these concerns, commenters also took significant issue with 
the broader economic impacts that the rule could have on the hardrock 
mining industry and the nation. A trade association noted that the cost 
of compliance relative to cash flow will be devastating to many 
companies.\323\ According to some, the high cost of compliance will 
result in existing mines closing, and new mines not being built. 
Another commenter stated that the high costs of the rule would force 
more companies into bankruptcy, which they suggested is an unacceptable 
environmental risk without any demonstrated benefits.\324\ That 
commenter stated that it takes much effort and expertise over several 
years to administer a bankruptcy, so it is important to keep operators 
in business to conduct their own reclamation responsibilities.\325\
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    \323\ EPA-HQ-SFUND-2015-0781-2666-20/Organization: ACC, AFPM, 
AISI, CKRC, IMA-NA, NAM, NMA, NAMC, PCA, SSP, TFI, and the Chamber.
    \324\ See comment from Scott Richey and Susan Elliott, USDA 
Forest Service Humboldt-Toiyabee National Forest EPA-HQ-SFUND-2015-
0781-2722 page 1.
    \325\ Ibid., page 1.
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    State mining associations also repeatedly commented on the 
importance of the hardrock mining sector in their individual 
states.\326\ States commented that they would be grievously harmed 
financially if facilities reduced operations, ceased planned 
expansions, or otherwise closed or went bankrupt. In states where 
mining is prevalent, those states count heavily upon the tax and 
permitting revenues, jobs, etc. that come from the industry.
---------------------------------------------------------------------------

    \326\ See comment from Arizona Mining Association Docket ID: 
EPA-HQ-SFUND-2015-0781-2744 at pages 2-3.
---------------------------------------------------------------------------

    According to AEMA the cash collateral required to obtain a section 
108(b) financial responsibility instrument could be significant and 
also very problematic, because this cash collateral requirement reduces 
the capital that companies have available to conduct reclamation 
activities, advance environmental improvement initiatives, and pursue 
development opportunities. Ultimately, AEMA commented that the drain on 
corporate capital from the section 108(b) financial responsibility 
program would reduce the domestic production of minerals, cost hardrock 
mining jobs, and economically devastate mining dependent rural 
communities.\327\
---------------------------------------------------------------------------

    \327\ See comment from American Exploration and Mining 
Association, Docket ID: EPA-HQ-SFUND-2015-0781-2657 page 35.
---------------------------------------------------------------------------

    In an effort to further emphasize the adverse economic impacts of 
the proposed rule, an analysis was independently conducted by Dr. 
Gordon Rausser of OnPoint Analytics, on behalf of Freeport McMoRan, and 
submitted for the record in this rulemaking.\328\ These industry 
supported analyses found that when all impacts are considered 
(including impacts on cash flow, production, and available resources), 
the proposed rule is estimated to cost the U.S. hardrock mining 
industry ten times the amount projected in the RIA--an amount reported 
to be between 23 percent and 66 percent of annual industry profits. The 
study also estimates that U.S. investment in the hardrock mining 
industry would drop by more than $5.6 billion, and that between 3,486 
to 10,110 jobs would be lost in the U.S. hardrock mining industry 
should the proposed rule have become final.\329\
---------------------------------------------------------------------------

    \328\ EPA-HQ-SFUND-2015-0781-2650-4/Organization: New Mexico 
Mining Association.
    \329\ EPA-HQ-SFUND-2015-0781-2712-135/Organization: Newmont 
Mining Corporation.
---------------------------------------------------------------------------

    Lastly, commenters note that while mining occurs at the local 
level, the mining sector is a global industry. A commenter stated that 
increased costs have implications at the state and local levels, but 
these same increased costs could place U.S. mining at a competitive 
disadvantage. The commenter further explained that those increases 
could be a disincentive to investment in domestic projects and an 
incentive to focus on operations and production outside of the 
U.S.\330\ The commenter continued to speculate that this could further 
result in a shortage of strategic metals at home. The commenter 
explained by way of an example that lithium is viewed as a strategic 
mineral currently in high demand globally as a lubricant, for use in 
steel and aluminum production, and in batteries and in electrolytes and 
electrodes.\331\ Finally, the commenter stated that lithium mining is 
an area of considerable expansion in the U.S., and implied that could 
be threated under the proposed rule.\332\
---------------------------------------------------------------------------

    \330\ See comment from Nevada Mining Association Docket ID: EPA-
HQ-SFUND-2015-0781-2684 pg 11.
    \331\ Ibid.
    \332\ Ibid.
---------------------------------------------------------------------------

    EPA's decision not to issue final requirements under section 108(b) 
for hardrock mining facilities will thus alleviate potential burden on 
owners and operators, and will help prevent any disruptions to markets 
in the U.S. and abroad. EPA further seeks to avoid negatively impacting 
facility resources that could otherwise have greater benefits to the 
economy. The state of Idaho, for example, commented that the proposed 
requirements may divert funds from uses such as the implementation of 
environmental protection and enhancement programs, reclamation 
projects, exploration and

[[Page 7586]]

development of new mineral deposits, etc.\333\
---------------------------------------------------------------------------

    \333\ See comment from State of Idaho Docket ID: EPA-HQ-SFUND-
2015-0781-2682 at page 7.
---------------------------------------------------------------------------

2. Concerns Particular to Impacts on Small Entities/Businesses
    Concerns raised by commenters also point to the burden that the 
proposed rule could impose on small entities. In the RIA of the 
proposed rule, EPA assessed the economic impacts on small entities. Of 
the 221 mines and mineral processing facilities in the potentially 
regulated universe, EPA identified approximately 53 facilities that 
were owned by 44 small businesses. Twelve additional mines have owners 
of unknown size (due to lack of available company data). For these 
small entities, EPA compared the estimated annualized compliance costs 
with their annual revenues in order to assess whether these small 
entities could be expected to incur costs that constitute a significant 
impact; and whether the number of those small entities estimated to 
incur a significant impact represent a substantial number of small 
entities. Results of the analysis showed that 80 percent to 87 percent 
of these small entities may face an average annual compliance cost that 
is greater than one percent of their revenues. Similarly, 57 percent to 
75 percent of these small entities may experience impacts upon revenues 
that exceed three percent. These impact estimates were found by EPA to 
surpass the significant impact thresholds as set forth by the 
Regulatory Flexibility Act.
    In line with these findings, many of the commenters likewise 
suggested that a major number of small entities under the proposed rule 
would face significant annualized costs which would either severely 
hinder their ability to operate, cause them to cease operations, or be 
a barrier to them being able to acquire financing to begin new 
operations. In light of the findings from the Agency's own small entity 
analyses, and the comments of concern raised by the regulated 
community, EPA agrees that the proposed financial responsibility 
requirements could prove particularly burdensome for small businesses. 
Such impacts will be avoided in the absence of such requirements under 
this final decision.

D. Concerns Regarding Financial Responsibility Instrument Availability

    As discussed above, during the public comment period for the 
section 108(b) hardrock mining rule, commenters representing or 
participating in the insurance, surety, and banking industries 
identified several concerns with EPA's proposed instrument terms, and 
expressed concern that those terms could impact the availability of 
instruments. Similarly, entities in the mining industry expressed 
concerns that instruments may not be available for the amounts proposed 
in the forms specified. EPA agrees with these concerns.
    Section 108(b) discusses particular instruments for EPA to consider 
in its regulations. Specifically, paragraph (b)(2) states that 
financial responsibility may be established by any one, or any 
combination, of the following: Insurance, guarantee, surety bond, 
letter of credit, or qualification as a self-insurer. Paragraph (b)(2) 
further authorizes the President to specify policy or other contractual 
terms, conditions, or defenses that are necessary, or that are 
unacceptable in establishing evidence of financial responsibility. 
Paragraph (b)(2) also requires EPA to cooperate with and seek the 
advice of the commercial insurance industry to the maximum extent 
practicable when developing financial responsibility requirements. 
Paragraph (b)(4) provides direction on how the section 108(b) 
instruments are to address multiple owners and operators at a single 
facility.
    Section 108(c) also includes a ``direct action'' provision, under 
which CERCLA claims can be brought directly against an insurer or other 
entity issuing an instrument pursuant to the section 108(b) 
regulations. Section 108(c)(2) provides that any claim authorized by 
section 107 or section 111 may be asserted directly against any 
guarantor providing evidence of financial responsibility under section 
108(b) if the person is liable under section 107 and: (1) Is in 
bankruptcy, reorganization, or arrangement pursuant to the Federal 
Bankruptcy Code, or (2) is likely to be solvent at the time of judgment 
but over whom jurisdiction in the federal courts cannot be reached with 
reasonable diligence.
    The areas of most significant concern identified by commenters are: 
(1) The specification that the instruments need pay to multiple 
claimants; (2) the direct action provisions in the instruments; and (3) 
the continuity of coverage provisions that subject providers to 
potential liability. These three features of the proposed section 
108(b) financial responsibility program and the comments received 
regarding each are discussed below.
The Specification That the Instruments Need Pay to Multiple Claimants
    EPA proposed that instruments would be payable to the full range of 
potential future CERCLA claimants, and not solely to a currently 
designated beneficiary specified in instruments.
    Financial industry representatives commenting on the proposed rule 
expressed concerns that the proposed financial mechanisms would not 
have a single designated beneficiary. Commenters argued that instrument 
providers would be required to undertake more due diligence and 
exercise more discretion while also potentially being subject to more 
liability themselves absent a specified designated beneficiary.
Direct Action Provision
    Commenters also expressed concern that providers of instruments may 
be subject to direct action suit. However, the CERCLA statute itself, 
at section 108(c)(2), includes a direct action provision that expressly 
authorizes, in specified circumstances, any claim under section 107 and 
section 111 be made directly against the guarantor providing evidence 
of financial responsibility. Commenters from the surety industry 
claimed that the direct action provision significantly increased their 
risk exposure and included too broad of a trigger (bankruptcy). Banking 
industry representatives asserted that the provision was at odds with 
relevant commercial law and practice and would significantly deter 
banks from providing such instruments and services. The insurance 
industry commented that direct action creates the potential for 
significant increase in defense costs and administrative costs 
associated with the management of multiple lawsuits.
Continuity of Coverage Provisions
    To address the risk that the facility would no longer have 
financial responsibility when necessary, EPA proposed that owners and 
operators using a letter of credit, surety bond or insurance to 
demonstrate financial responsibility also establish a standby trust. In 
the event the instrument issuer intended to cancel the instrument and 
the owner or operator failed to obtain alternate financial 
responsibility, EPA could draw on the instrument and fund the standby 
trust.
    Commenters from the surety and insurance industry suggested that 
the requirements for prescriptive cancellation provisions that include 
potential issuer liability would limit the interest on behalf of 
sureties and insurers in providing mechanisms.

[[Page 7587]]

Commenters also suggested that this proposed provision in combination 
with the difficult-to-predict date at which a facility may be released 
from the proposed financial responsibility requirements created 
unwelcome uncertainty around the duration of the provider's obligation.
    Based on the negative comments received, EPA believes there is 
uncertainty around the adequate availability of instruments were final 
regulations to be promulgated at this time. This uncertainty 
necessarily means it is also unclear whether regulated entities would 
be able to obtain the necessary instruments when faced with a 
regulatory obligation under section 108(b) to obtain an instrument. 
This information thus also indicates that issuance of section 108(b) 
requirements for current hardrock mining operations is not appropriate.

E. Challenges To Identify the Facility

    Many commenters on the rule raised concerns regarding the 
applicability of section 108(b) to historical mining areas at 
facilities. The question of what the relevant facility is for purposes 
of section 108(b) regulations arose in several contexts--developing 
requirements for applicability of the rule, determining a financial 
responsibility amount, and developing conditions for payment of funds 
from the instruments. This was another difficult challenge EPA 
encountered in developing the proposed rule.
    In a typical CERCLA response action, the definition of the facility 
relies on a site-by-site determination based on site-specific 
conditions, and the facility is defined by where contamination comes to 
be located, as understood by EPA at a particular point in time, and is 
typically formally delineated in a decision document identifying the 
response actions to be taken. The relevant facility may include areas 
owned and/or operated by several parties and the facility is defined 
without regard to ownership. In addition, particular parties' CERCLA 
liability is determined through settlements and/or litigation.
    For the reasons discussed in the proposed rule, for purposes of 
determining the proposed rule's applicability, and for determining the 
financial responsibility amount, EPA found it necessary to consider the 
relevant facility to be only the current operations of the current 
owner(s) and operator(s). Two effects of this approach were to not 
require a financial responsibility amount under the proposed rule based 
on conditions present at historic areas of the mine, or to require 
evidence of financial responsibility from parties other than the 
current owner(s) or operator(s).
    This approach--that EPA found necessary to implement section 
108(b)--has no effect on CERCLA liability for parties that may be 
involved at a CERCLA site, or on the definition of facility for 
purposes of a CERCLA response. Thus, in the context of a particular 
response action, the facility may be defined to include an area broader 
than the current operations, and CERCLA liability may attach to parties 
other than the current owner or operator. Thus, there is an 
inconsistency in these respects between what EPA believed was necessary 
for practical development of section 108(b) instruments, and the 
definition that would apply when the instruments are invoked.
    This difficulty was also identified by outside parties to EPA. 
Instrument providers, during pre-proposal outreach, cited the inability 
to distinguish between and establish separate amounts for historic 
releases and potential future releases as a factor that may increase 
the cost and difficulty of obtaining instruments. Specifically, 
representatives of insurance companies noted that combining two 
distinct types of coverage (e.g., coverage for cleanup of known 
existing releases and coverage for liabilities that may arise from 
future releases) will increase premiums. Another insurance 
representative commented that amounts of coverage may be limited by 
reinsurance treaties if the two types of coverage were combined.\334\ 
Relatedly, a representative from a surety also noted that separating 
out known pre-existing issues and releases from current operations that 
have not yet occurred into separate mechanisms would likely enhance 
availability.\335\ Yet it was the impossibility of predetermining the 
source of any contamination that would ultimately be the subject of a 
CERCLA claim, or where contamination would ultimately come to be 
located, that was a factor in EPA's decision to propose instruments 
that could pay for any CERCLA section 107 or section 111 claims against 
a current owner or operator, irrespective of whether the claim arose as 
a result of current or historical operations.
---------------------------------------------------------------------------

    \334\ See Notes and Attendees for CERCLA 108(b) Insurance 
Meeting December 8, 2015 Docket ID: EPA-HQ-SFUND-2015-0781-0447.
    \335\ See Notes and Attendees for CERCLA 108(b) Surety Meeting 
January 14, 2016 Docket ID: EPA-HQ-SFUND-2015-0781-0445.
---------------------------------------------------------------------------

    Commenters' concerns also highlight another source of uncertainty 
for instrument availability. Thus, this issue raises similar concerns 
as in section E. Above. Therefore, this information further supports 
EPA's determination that issuance of section 108(b) requirements for 
current hardrock mining operations is not appropriate.

VII. Statutory and Executive Order Reviews \336\
---------------------------------------------------------------------------

    \336\ Additional information about these statutes and Executive 
Orders can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.
---------------------------------------------------------------------------

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is a significant regulatory action that was submitted 
to the Office of Management and Budget (OMB) for review, because it may 
raise novel legal or policy issues [3(f)(4)], although it is not 
economically significant. Any changes made in response to OMB 
recommendations have been documented in the docket. EPA prepared an 
economic analysis for the proposed rule, but that analysis is not 
relevant for this final rulemaking because no regulatory provisions are 
being finalized.

B. Executive Order 13771: Reducing Regulation and Controlling 
Regulatory Costs

    This action is not an Executive Order 13771 regulatory or 
deregulatory action, because this action does not alter any regulatory 
requirements.

C. Paperwork Reduction Act (PRA)

    This action does not impose an information collection burden under 
the PRA, because this action does not impose any regulatory 
requirements.

D. Regulatory Flexibility Act (RFA)

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. This 
action will not impose any requirements on small entities.

E. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandate as described in 
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect 
small governments, because this action does not impose any regulatory 
requirements.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national

[[Page 7588]]

government and the states, or on the distribution of power and 
responsibilities among the various levels of government.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications as specified in 
Executive Order 13175, because this action imposes no regulatory 
requirements. Thus, Executive Order 13175 does not apply to this 
action. However, EPA consulted with tribes and Alaska Native 
Corporations and Alaska Native Villages during the rulemaking process.
    EPA received comments from three federally-recognized tribes and 
from three Alaska Native Claims Settlement Act (ANCSA) resource 
managers regarding section 108(b) financial responsibility. Tribal 
comments were generally in support of the proposed rule, and cited some 
concerns about the potential negative impacts of hardrock mining on 
commercial enterprises and on subsistence living, along with the need 
to more fully identify the benefits of the rule. A primary ANCSA 
concern was that the section 108(b) financial responsibility 
requirements would duplicate existing federal and state requirements, 
resulting in a negative impact on Alaska Natives and states, that 
receive royalties through the Regional and Village Corporations. Other 
ANCSA comments related primarily to the calculation of the financial 
responsibility amount, and requested that EPA consult with them early 
in the regulatory development process. EPA acknowledged the challenges 
in determining a financial responsibility amount, and provided the 
opportunity for federally-recognized tribes and ANCSA resource managers 
to consult with the Agency during the public comment period.

H. Executive Order 13045: Protection of Children From Environmental 
Health and Safety Risks

    This action is not subject to Executive Order 13045 because it is 
not economically significant as defined in Executive Order 12866, and 
because EPA does not believe the environmental health or safety risks 
addressed by this action present a disproportionate risk to children, 
since this action imposes no regulatory requirements.

I. Executive Order 13211: Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This action is not a ``significant energy action'' because it is 
not likely to have a significant adverse effect on the supply, 
distribution or use of energy.

J. National Technology Transfer and Advancement Act

    This rulemaking does not involve technical standards.

K. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    EPA believes that this action is not subject to Executive Order 
12898 (59 FR 7629, February 16, 1994) because it does not establish an 
environmental health or safety standard, since this action imposes no 
regulatory requirements.

L. Congressional Review Act (CRA)

    This action is subject to the CRA, and EPA will submit a rule 
report to each House of the Congress and to the Comptroller General of 
the United States. This action is not a ``major rule'' as defined by 5 
U.S.C. 804(2).

List of Subjects in 40 CFR Part 320

    Environmental protection, Financial responsibility, Hardrock 
mining, Hazardous substances.

    Dated: December 1, 2017.
E. Scott Pruitt,
Administrator.
[FR Doc. 2017-26514 Filed 2-20-18; 8:45 am]
BILLING CODE 6560-50-P


