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Judge Allows Challenge to Minnesota Wild Rice Protections

Duluth News Tribune
May 12, 2011

A judge is allowing a lawsuit to go forward that challenges Minnesota's water quality standards for protecting wild rice.

Ramsey County District Judge Gregg Johnson today denied an environmental group's motion to dismiss the lawsuit, which was filed by the Minnesota Chamber of Commerce. He says WaterLegacy failed to meet the legal thresholds required to get the case dismissed.

Chamber attorney Thaddeus Lightfoot says the ruling means their challenge can go forward.

The Chamber contends the state is improperly applying the wild rice rule, which limits sulfate discharges into waters where wild rice grows. It's an issue as plans advance for copper mining in northeastern Minnesota.

WaterLegacy attorney Paula Maccabee says she'll still have ample opportunities to argue the rule is valid and the state is appropriately enforcing it.

Royalties from School Trust Lands Help Every School and All Taxpayers

Duluth News Tribune
Opinion: Rep. Denise Dittrich
May 11, 2011

The news regarding opening bids for mineral leases across northern Minnesota ("Your land may be gold mine – for others," April 24) told only part of the story.

The article correctly mentioned the state collects "huge royalties for the state to pay for schools," but readers should know how this benefits them. The royalties and their allocation to schools are known as the School Trust Lands and Permanent School Trust Fund. Some of the mineral rights mentioned in the story will be invested in the trust fund. It is a living legacy for our students and of great benefit to Minnesota's taxpayers.

The founders of this grand country, in their great wisdom, recognized the importance of public education to the lives of citizens and to the success of a democratic society. Upon statehood, two sections of land in every township in Minnesota were set aside and constitutionally dedicated to schools. The state currently holds in trust more than 2.5 million acres of School Trust Lands. An additional 1 million acres of mineral rights land remains today. These lands are managed by the Department of Natural Resources, and the Permanent School Trust Fund receives the revenue from these resources. The State Board of Investment manages the revenue, which is constitutionally dedicated to be used for schools.

Unfortunately, poor oversight of this investment over the years has meant that revenue that should have been sent to schools was instead sent to the state's general fund where it was used to pay for everything from health care to roads. This was corrected in 2008 when my legislation enhancing oversight of the Permanent School Trust Fund contributed to additional permanent funding for every student in Minnesota. It is important to note this money is over and above the general education formula payment to schools.

The Permanent School Trust Fund held $720 million at the beginning of the year and made payments to school districts amounting to $28 per pupil this school year. Duluth schools received more than $300,000 this school year.

The Minnesota Legislature has been active this session with regard to the School Trust Lands issue. There are efforts seeking to maximize the value of the natural resources and the payments that go to Minnesota schools. As we have seen, strong oversight and prudent management of these resources ensure our students receive every possible dollar they are due.

Even with stronger oversight from trustees, the value of the School Trust Lands is under attack. The House K-12 education bill contains a provision that qualifies individual charter schools as unique school districts. This means per-pupil payments would decrease statewide.

The Minnesota Department of Natural Resources administration of the lands also is problematic. The agency has an inherent conflict of interest managing the lands. While one part of the DNR's mission is to preserve and protect Minnesota's natural resources, it also is charged with maximizing return on the lands. To solve this I have introduced two bills to replicate the Utah model in Minnesota, allowing a lands administrator to manage the School Trust Lands. The goal is to assure long-term productivity for economic benefit from the School Trust Lands.

This funding stream is a great deal for taxpayers. It provides consistent payments for every student in every public school, none of which come directly from Minnesota's taxpayers. Prudent trustee management of the resource and the investments will ensure its long-term benefit. Working together, we can keep careful watch of this living legacy.

 

Vermilion Community College

Mesabi Daily News
Angie Riebe
May 9, 2011

New mining projects in the works on the Iron Range along with ever-changing technology have prompted Vermilion Community College to launch a degree program to meet anticipated workforce needs.

Starting in fall 2011, the college will offer an associate in applied science degree program in chemical technology

The program helps to expand Vermilion's tradition of natural resources and liberal arts programs dating back to Ely Junior College's start in 1922 The program combines science and technology to provide the academic background necessary to begin a profession as an entry level lab analyst.

Chemical technology students will use the principles and theories of science and mathematics to solve problems in research and development and to help invent, improve and assess products and processes.

Technicians set up, operate and maintain laboratory instruments, monitor experiments and make observations, calculate and record results, manage data and often develop conclusions

"Chemical technology is an exciting new science-based program," said Teresa Neufelder, VCC program coordinator for chemical technology. "Students in this program will learn how to help answer two basic questions about materials: What is its composition and how much is there of each component?"

The program was developed after college representatives from the Northeast Higher Education District met with a group of Iron Range industry leaders concerning the growing need for skilled workers in industrial settings. One of the major recommendations from the committee was to offer relevant, hands-on training in the area of industrial processes.

Industry leaders cited everything from the mining industry's need for laboratory technicians responsible for testing the quality control during the ore production process to the needs of regional testing facilities for entry-level laboratory positions

"Minnesota Power recognizes the need for new educational pathways leading to a highly skilled workforce for regional industry sectors such as mining, manufacturing, environmental compliance and construction, to name a few," said Thomas Hendrickson, lab manager for Minnesota Power. "With continued growth of industry in northeastern Minnesota as well as the anticipated retirements within the existing workforce, I fully support the need for new programming within the region."

After completing the two-year, 68-credit program, graduates are ready for work in a variety of industries.

"While we are attempting to meet the local demand for laboratory technicians, we also wanted to develop a very flexible and mobile degree," said VCC Provost Shawn Bina. "Students will discover they will have a wide range of career opportunities in Minnesota and around the nation."

There is an increasing need for laboratory and industrial analysts for a host of industrial processes including natural resources, ores and mining, construction, pharmaceuticals, plastics, foods, and environmental compliance. Other crucial services require analysts such as forensics, chemical treatment plant and environmental compliance laboratories.

The program aligns with existing natural resources curriculum at VCC, including courses such as biology, chemistry, environmental compliance, and solids and hydrology.

The curriculum also includes new course offering developed by Neufelder such as Instrumental Analysis I and II, industrial process, and chemical laboratory management skills.

A chemical technology degree leads students to a profession as an entry-level lab technician.

According to the Department of Labor Statistics, the employment rate for all types of chemical lab technician positions is expected to stay steady, and the rate for environmental lab technicians is expected to increase by 13 percent as demand for environmental compliance continues.

PolyMet Cuts Costs, Revamps Financial Reporting System

Business North
May 9, 2011

PolyMet Mining Corp. (NYSE Amex:PLM) lost $7.3 million for its fiscal year ending Jan. 31, although the company remains in the development stage and isn't yet deriving revenue from its body of copper, nickel and precious metals. A year ago, the company lost $9 million for the 12-month period.

PolyMet, which controls 100 percent of the NorthMet ore-body and the nearby Erie Plant Hoyt Lakes, reported several highlights for the year, effective Jan. 31 and reported in U.S. dollars:

• It had cash and cash equivalents of $10.4 million compared with $21.3 million a year earlier.

• Glencore AG has committed to purchase an additional 10 million shares of PolyMet common stock at $2 per share for gross anticipated net proceeds of $20 million.

• PolyMet last year repaid $2 million in notes payable to Cliffs Natural Resources, Inc. related to the acquisition of the Erie Plant.

• General and administrative expenses were $4.7 million compared with $9.2 million for the prior year period. Excluding non-cash items, general and administrative expense was $2.6 million compared with $2.9 million for the prior period, reflecting cost-cutting efforts.

• PolyMet invested $16.5 million into its NorthMet project during the year, compared with $17.7 million in the prior year.

• As of Jan. 31, PolyMet had spent approximately $32 million on environmental review and permitting.

After announcing two delays in reporting quarterly results, management identified a material weakness in its internal control over financial reporting. The underlying cause, PolyMet said, was the implementation of a new accounting and financial reporting system during the third fiscal quarter. Steps have been taken to address the weakness, and PolyMet said it is implementing further changes to its internal controls to improve reporting timeliness.

Antofagasta Donates $25,000 to NRRI Program

Business North
May 9, 2011

Antofagasta Minerals, a partner in the joint venture Nokomis project development, donated $25,000 on May 6 to the Precambrian Research Center, a collaborative effort between UMD's Natural Resources Research Institute and its Department of Geological Sciences.

Antofagasta President and CEO Marcelo Awad said the Chilean company is successful due to its strong team of geologists, and is proud to support the Duluth-based geology program.

"We're very pleased to be here. You are very open and very supportive of our company," he told a gathering of graduate and undergraduate geology students and executives of Duluth Metals, majority developer of their joint Twin Metals nonferrous minerals project.

The Precambrian Research Center was established in 2007 to train geoscientists in geological mapping. It offers professional workshops, field camps, graduate student advising and mapping courses.

 

Streamlined Permitting Draws Mixed Reviews

Business North
Ron Brochu
May 2, 2011

The process through which companies prepare key environmental documents has changed in a way favored by Minnesota's business community, but there remains a great difference of opinion about the long term impact.

State lawmakers in February revised environmental regulations to allow project proposers, not regulators, hire private experts to draft environmental documents. Legislators also established time frames the Minnesota Pollution Control Agency and Department of Natural Resources must strive to meet. Both measures came in response to complaints that companies lacked control over the cost, speed and outcome of the process.

Not unexpectedly, the changes have proven divisive. Environmentalist say the legislation was rifled through the legislature with far too little public input and debate. There's even disagreement among area DFL lawmakers. The entire Iron Range delegation voted in favor of the changes, which were supported by Gov. Mark Dayton, while the Duluth delegation unanimously opposed them. The geographical split inspired sharp criticism in an editorial published by the Mesabi Daily News in Virginia. Contending the regulatory changes will help the mining industry, the editorial said Duluth lawmakers ignore mining's spinoff benefits for the city they represent.

"They need to take more time to thoroughly understand what they're voting for," Frank Ongaro, executive director of Mining Minnesota, said in reference to the Duluth delegation, which includes Reps. Kerry Gauthier, Thomas Huntley and Mary Murphy and Sen. Roger Reinert. "Nothing the state has changed will affect what federal regulators require," said Ongaro, whose group represents several companies that seek to mine for copper, nickel and precious metals in northeastern Minnesota.

PolyMet has served as a poster child for the debate over nonferrous minerals mining, which involves digging into sulfide formations. Exposing that rock to air and water poses potential environmental damage to ground and surface water in a geographical area that contains wetlands. The Vancouver-based firm was the first nonferrous mining company to prepare a mining plan and work with government regulators to assemble a draft EIS. That $100 million process, which began in 2006 and continues today, has been a magnet for criticism. The Sierra Club of Minnesota, for example, said PolyMet prepared a poor mining plan, while the Corps of Engineers and DNR "fell far short of the analysis needed to understand the effect of the proposed project on Minnesota's water, wetlands and public health, as required by federal law."

Recent legislative changes will hasten that process for PolyMet and other companies, said Tony Kwilis, environmental policy director for the Minnesota Chamber of Commerce.

"Until now, companies wrote the checks but all they could do is look in the window" as regulators wrote a draft EIS, he said. The revised process still allows a responsible governmental unit – like the MPCA or Department of Natural Resources- to review the plan and require any needed changes, Kwilis said.

The changes might actually take some burden off the MPCA, according to a representative of the agency.

"The law may save us some time because we're not writing (the environmental plan) but just reviewing it," said MPCA spokesman Jeff Smith. In addition, "it's very well likely the same experts will be hired as contractors" whether they're employed by public agencies or private companies.

Environmentalists, however, think it makes a difference who signs the check.

"Consultants by nature want to please their clients. If that client is a project proposer, the consultant will be under pressure to deliver a result that their client wants, which may not be in the public's best interest," said Margaret Levin, state director of the Sierra Club. "Certainly it is possible that the same consultant could deliver different results, based on who's paying them for the work."

Murphy said her opposition was justified.

"Gov.Dayton had already issued his executive order that included the most pressing issues that proponents said were needed," she said in an e-mail, referring to his Jan. 24 executive order, which directed the MPCA and DNR to "move at the speed of commerce."

Further, she said "The report of the Legislative Auditor on environmental review and permitting was going to be released in March. I thought we should wait until the report was received, reviewed and considered before we made major legislative changes."

That examination, however, was unable to determine whether state regulators were acting on a timely basis. It said "Both PCA and DNR had only partial information on the time required for different phases of environmental review or priority permitting. They did not record dates for all of the phases of these processes. For instance, DNR's database for water permits did not record dates either for applications received or permits issued."

It painted a bleak picture of the state's office technology.

"Certain available data were difficult to retrieve. At DNR, even the most basic information was in narrative documents rather than electronic databases. PCA's archaic databases made it difficult or impossible to consistently produce accurate and timely data," the auditor's report said.

Meanwhile, Republican legislators are calling for spending cuts to state agencies, which could challenge their ability to meet tighter deadlines.

The legislative changes, Smith said, will have limited impact on large projects that require joint state-federal review.

"The new law doesn't cut away from the federal process. One misconception is that this law will cut back on oversight, but that's not the case," he said, adding that everyone involved must prepare regulatory documents as a team.

But it will prevent the state from having requirements that are more stringent that federal standards, said Murphy, who objected to that provision.

No other members of the Duluth delegation responded to BusinessNorth's request for comment.