Federal Land Management:

The Mining Law of 1872 Needs Revision

RCED-89-72: Published: Mar 10, 1989. Publicly Released: Mar 10, 1989.

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In response to a congressional request, GAO reviewed various aspects of the Mining Law of 1872, focusing on the: (1) law's patent provision; (2) law's requirement that unpatented claim holders annually perform a minimal amount of work to develop their mineral claims; and (3) amendments needed to bring the law's provisions more in line with existing national natural resource policies.

GAO found that: (1) the work requirement no longer promoted mineral development, was difficult to enforce, and occasionally resulted in land damage; (2) much of the work was difficult to verify because there was often little or no physical evidence of the work performed and the work performed did little to bring the claims closer to development; (3) some claim holders needlessly scarred the land to make it appear that they complied with the annual work requirement; and (4) replacing the annual work requirement with an annual holding fee would reduce damage to federal lands, eliminate difficult annual work requirement certification and enforcement, and result in clearance of more inactive, invalid, or abandoned claims. GAO also found that: (1) the government received less than $4,500 for 20 patents issued since 1970 that had an estimated worth of between $13.8 million and $47.9 million; (2) as of October 1987, 265 patent applications were pending for more than 80,000 acres of public land; (3) if the government patented all of the land in the 12 sites reviewed, it would receive about $16,000 for land appraised at between $14.4 million and $47.1 million; (4) although the Land Policy and Management Act requires that the government receive fair market value for disposable public lands, about 157,000 acres of public lands have passed into private ownership for the nominal mining law patent fee since 1978; and (5) the federal government has never collected revenues from the sale of hardrock minerals, as it does for fuel and common minerals, and loses the opportunity to do so when public lands pass into private ownership.

Matters for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: The 1993 Interior appropriations bill requires a holding fee for 1993 and 1994. Further, the President's fiscal year 1994 budget extends the holding fee through 1998.

    Matter: Congress should amend the Mining Law of 1872 to require claim holders to pay the federal government an annual holding fee in place of the existing annual work requirement. In considering such an amendment, Congress should bear in mind the relationship of the annual work requirement to the patent provision of the Mining Law of 1872.

  2. Status: Closed - Not Implemented

    Comments: Bills have been introduced in the Senate (S. 257) and the House (H.R. 322) that will end patenting the land and minerals. On June 29, 1994, the conference began considering these bills. The conference did not report out a bill.

    Matter: Congress should amend the Mining Law of 1872 to eliminate the patenting of both hardrock minerals and the land required to mine them. This change would not only permit the land to remain under federal ownership, it would also provide the government the opportunity in the future to collect revenues for the hardrock minerals extracted.

  3. Status: Closed - Not Implemented

    Comments: Bills have been introduced in the House (H.R. 322) that propose to end patenting and in the Senate (S. 775) that would allow patenting only the mineral, after payment of fair market value. A conference began considering these bills in June 1994. The conference did not report out a bill.

    Matter: If Congress decides not to eliminate the patenting provision, it should either: (1) permit claim holders to patent only the minerals, thereby retaining the land in federal ownership; or (2) require that the federal government obtain fair-market value for the lands patented. Under either option, the claim holder still should be required to pay an annual holding fee.

 

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