Empowered by a recent court ruling, the Environmental Protection Agency is coopting arcane laws to inhibit economic development and kill thousands of jobs. In order for a mining operating to begin production, developers must apply for and receive a handful of permits. One such mandatory permit is the Section 404 permit required under the Clean Water Act. Production cannot begin without the Section 404 permit, effectively giving the EPA veto authority over any proposed mining project.
A few weeks ago, a federal appeals court upheld the EPA’s decision to retroactively revoke a 2007 Section 404 mining permit issued for the Spruce Mine in West Virginia.
Granting the EPA sweeping authority, Judge Karen LeCraft Henderson wrote that the Clean Water Act “empowers him [EPA Administrator] to prohibit, restrict or withdraw the specification 'whenever' he makes a determination that the statutory 'unacceptable adverse effect' will result."
Judge Henderson’s ruling may have granted the now blatantly partisan EPA the ability to kill any mining project “whenever” it sees fit. Given the EPA’s job killing regulations and attempts to scuttle the Keystone XL pipeline, it is easy to predict how the EPA will use its newly codified authority.
It is not surprising that President Obama’s EPA is pushing legal barriers to shut down a coal mine in West Virginia. What is surprising is that a federal judge endorsed such a move, especially after a district court argued that the EPA "exceeded its authority under section 404(c) of the Clean Water Act when it attempted to invalidate an existing permit by withdrawing the specification of certain areas as disposal sites."
Most mining projects require years of preparation. Before developers can even begin mining, they first must identify economically viable resources, either buy or lease land from the government or private individuals, and then apply for drilling permits from a handful of different agencies. Arch Coal received its first Spruce Mine permit in 1998 and received its Clean Water Act permit in 2007. All in all, this process requires millions of dollars, lawyers, and years of paperwork.
After the Spruce Mine ruling, job creators will have to go through this expensive, time-consuming process knowing that the EPA can pull the rug out from under them at any point during production.
Every mining investment just got a whole lot riskier.
But this is nothing new. With Congressional Republicans blocking Democrats’ anti-growth legislation, environmentalists have enlisted the EPA to inhibit domestic energy and mineral production.
Another example of the EPA’s abuse of the permitting process is evident in the agency’s consideration to preemptively kill the Pebble Mine project in Southwest Alaska. At the behest of many radical environmentalist organizations, the EPA has undertaken a “watershed assessment” of the Bristol Bay region. Unsurprisingly, the EPA’s watershed assessment warned against development of the region. This unprecedented action, which is an “extra regulatory” process, is especially odd given that the Pebble Partnership has yet to formally apply for any permits to construct a mine. Simply put, the EPA’s watershed assessment is an ecological risk analysis of a hypothetical mine that has no basis in reality.
Conservatives fear that the recent Spruce Mine decision will embolden the EPA to preemptively kill the Pebble Mine project before developers even apply for requisite permits. This exploitation of the permitting process would have real consequences. The Pebble Mine would be an economic boon for the region and:
· Create 16,175 high-paying jobs per year throughout construction process and an additional 14,715 high-paying jobs per year during production
· Contribute $1.6 billion to our nation’s GDP per year during the construction process and an additional $2.4 per year afterwards
The Pebble Partnership has invested over $150 million in developing a safe, environmentally responsible way to mine the enormous copper reserves in Southwest Alaska. Even if, and that’s a big if, construction of the Pebble Mine is allowed, the EPA can revoke the mine’s permit at any time.
Taken in combination with the Spruce Mine decision, it is impossible to see how the EPA’s new interpretation of old permitting laws will not chill investment. This is just once instance, of one agency, gunning for one industry. Extrapolated across every Obama-run agency, it is easy to understand why the U.S. unemployment rate remains stubbornly high.
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