Nathan Sass

Does the WI State Senate Mining Bill Contain Poison Pills?

In Politics, Scott Walker, Tax Policy, Vicki McKenna, WI DNR on February 14, 2012 at 6:32 PM

The buzz today in Wisconsin among the conservative media relates to the Senate version of proposed legislation related to mining regulation in Wisconsin.

WISN (AM 1130) hosts Mr. Mark Belling and Ms. Vicki McKenna, both of whom I have tremendous respect for, have pointed out 3 troubling provisions in the Senate version that differ from the already passed Assembly version.

They are 1) Unlimited 30 day extensions to the proposed 360 time limit to grant or deny a permit; 2) the inclusion of a new additional tax on ferrous mining based on the gross tonnage recovered from the mine; and 3) the continued ability for any person or group to bring “contested case” proceedings against mining companies.

With all due respect to Ms. McKenna and Mr. Belling, I only see 1 actual poison pill in the Senate version.

The easiest one to confirm or deny is the new tax.

It is there, just as described by McKenna and Belling.

Worse yet, this tax is in addition to already existing mining taxes on the books in Wisconsin.  As a conservative, there is no justification for this blatant grab at private money to support continued state overspending.

But in my review of the draft legislation, I also found a section related to those tax dollars that may be very important:

SECTION 32. 70.395 (1e) of the statutes is amended to read:

70.395 (1e) DISTRIBUTION. Fifteen days after the collection of the tax under ss. 70.38 to 70.39, the department of administration, upon certification of the department of revenue, shall transfer the amount collected in respect to mines not in operation on November 28, 1981, to the investment and local impact fund, except that the department of administration shall transfer 60 percent of the amount collected under s. 70.375 (2) from each person extracting ferrous metallic minerals to the investment and local impact fund and the department of revenue shall deposit 40 percent of the amount collected under s. 70.375 (2) from any such person into the general fund. In addition, the department of administration shall transfer 70 percent of the amount collected from each person under s. 70.375 (7) to the investment and local impact fund and the department of revenue shall deposit 30 percent of the amount collected from each person under s. 70.375 (7) into the general fund.

The above text is an appropriation of state funds.

So what?“, you might say.

Well, the Wisconsin Constitution and Wisconsin State Supreme Court precedent clearly state (in a nutshell) that the governor has the ability to veto any part of any bill with appropriations contained within it.

In this case, any provision in the final bill passed by both chambers would be subject to a line item veto from Governor Walker, provided the above appropriation language is in the version sent to his desk.

This is the solution to the Senate tax increase language.  It can and will be vetoed, and the veto will not be overruled.

Therefore, the tax increase – as far as the actual final signed law is concerned – is a dead issue.

Also included in the Senate version was a “30 day extension” clause.

The Assembly version established a strict 360 day limit to grant or deny a permit to a mining company after complete applications are received.  According to Belling and McKenna, the Senate language added the ability to extend the deadline 30 days at a time, indefinitely.

That is a literal truth, and they are correct regarding the unlimited nature of the extensions.

But there is one bit they may have overlooked.  The language in the Senate version is as follows (emphasis added):

(7) DEADLINE FOR ACTING ON MINING PERMIT APPLICATION. (a) No more than 360 days after the day on which the application for a mining permit is administratively complete under sub. (2), the department shall approve the application, and issue a mining permit, or deny the application, in accordance with s. 295.58, unless the department and the applicant agree to extend the deadline. The department and the applicant may enter into more than one agreement to extend the deadline, but may not provide for an extension of more than 30 days in any one agreement.

In order for the 30 day extension to come into play the applicant and the DNR must both agree to it.

It makes some logical sense to allow for extensions, in this mutual agreement manner, given that some reviews may take longer than 360 days to complete.  If the DNR is simply dragging their heels, the applicant will not agree to the extension and the 360 limit remains in force.

Furthermore, the Senate added language to allow for refunded permit fees in the event of a denial, so the exposure of the mining firms to indefinite delays in approvals is minimal.  This is an actual improvement over the Assembly version.

As before, this entire issue can be rendered moot if the Governor uses his line item veto power to strike it in part or totally.

Things left out of the bill, however, will not be so easy to deal with.

This is the case regarding the issue of “contested case” proceedings.  (Contested case proceedings are essentially suits brought against the mining company by a member of the public in front of a state agency, in this case the DNR.)

The assembly version prohibits such actions specifically.  Current state law allows for such actions in almost all cases, and the broad nature of this law (WI Statute 227 if you care) makes it extremely unfriendly to business.  The Assembly was correct to limit the broad nature of these suits and create a more business friendly environment.

The Senate version leaves out this change completely, leaving existing state law unchanged.

Governor Walker cannot line item veto something back into a bill, so the lack of the Assembly language in the Senate version on this issue may truly be considered a poison pill provision.

It seems reasonable to me to allow the DNR to bring suit against a mine operator for violations of environmental regulations.  Also allowing for citizens to bring similar suits is excessive.  Environmental groups utilize this ability to simply litigate businesses to death, with no intention of a good faith use of their ability to bring suit.

If the bill goes to conference committee, the Assembly would be wise to insist that their “contested case” language be reinserted into the bill.  Anything less than that will see Wisconsin continue to be the regulatory hell businesses avoid like the plague.

All in all, given the ability for Governor Walker to use the line item veto to remove objectionable provisions that were inserted to placate RINO’s like Dale Shultz, the Senate version is not as horrible as it may appear on the surface.

The fact that RINO’s like Shultz are allowed to continue to exist in the GOP, however, is a horrible thing.  With Republicans like Shultz, who needs Democrats?

And after all this screwing around to stroke Dale Shultz’s over-inflated ego, maybe we can actually get some jobs to the people of the North Woods who so desperately need them.


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