HomeMy WebLinkAbout2006-06-13 - AGENDA REPORTS - HR 5471 (2)Agenda Item:
CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR City Manager
Item to be presented by: Michael P. Murphy
DATE: June 13, 2006
SUBJECT: FEDERAL LEGISLATION: H.R. 5471
DEPARTMENT: City Manager's Office
RECOMMENDED ACTION
City Council adopt Resolution in support of H.R. 5471 and direct staff to transmit copies of the
resolution to Representative McKeon, Senator Boxer, Senator Feinstein, appropriate
congressional committees and administration officials.
BACKGROUND
On May 24, 2006, Representative Howard P. "Buck" McKeon introduced federal legislation,
H.R. 5471, regarding the Cemex mining proposal. The bill is designed to meet the City of Santa
Clarita's and the community's shared goal that mining at the Soledad Canyon site be restricted to
historical levels. Under existing federal law, the Bureau of Land Management can only cancel or
alter the terms of its leases with Cemex under action resulting from federal legislation.
The bill is written in a manner designed to provide for a fair exchange of values for Cemex;
allowing for their current leases and appropriate financial investment to be recognized and
exchanged at a fair and appropriate level for both Cemex and the Bureau of Land Management.
In short, the bill provides a favorable compromise for all parties. H.R. 5471 has been assigned to
the House Resources Committee for consideration, though no date for hearing has been set.
H. R. 5471 contains the following provisions:
1. Cancels the existing leases (CA -20139 and CA -22901) between the Bureau of Land
Management and Cemex.
2. Establishes a specific mechanism for the Secretary of the Interior to determine the economic
value of the existing leases.
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3. The economic value of the existing leases is an unspecified amount equal to the sum of:
A. The bonus bids or other prepayments to the federal government with respect to
the leases.
B. Interest on the amounts of the bonus bids or other prepayments at a rate to be
determined by the Secretary of the Interior.
C. Amounts expended by Cemex in obtaining the leases and attempting to bring
the mine into production, including reasonable costs relating to the engineering,
environmental studies, and legal costs.
4. Establishment of a 90 -day timeline from the date of enactment of the measure for Cemex to
submit their costs and supporting documentation to the Secretary of the Interior for an
exchange of values calculation.
5. Establishment of a 90 -day timeline after receipt of completed documentation from Cemex for
the Secretary of the Interior to review the costs and documentation to determine if the
expenses are reasonable and eligible for inclusion in the exchange of values calculation.
6. Identifies an arbitration mechanism should the Secretary of the Interior and Cemex disagree
on eligible components and amounts for inclusion in the exchange of values calculation.
7. Provides that financial and mineral production opportunities may be in the form of receipt by
Cemex of mineral estate in California available under the Mineral Leasing Act and/or surface
estate within the State of California under the administrative jurisdiction of the Secretary of
the Interior and available for disposal.
8. Provides a two year window for Cemex and the Secretary of the Interior to complete the
financial and mineral production opportunities agreement or the matter shall be referred to the
United States Court of Federal Claims for resolution.
9. Places limitations on aggregate mining at the Soledad Canyon site to historical levels, which
is defined in the bill as "300,000 tons of aggregate produced for sale per calendar year."
I O.Requires that the Bureau of Land Management consult with the City of Santa Clarita and
other parties prior to issuing any future mining leases at the Soledad Canyon site.
ALTERNATIVE ACTIONS
1. Not support H.R. 5471.
2. Other actions as directed by the City Council.
FISCAL IMPACT
Adoption of the recommended action will result in no additional financial resource allocation as
all activities can be accomplished using existing resources as provided in the adopted City of
Santa Clarita 2005/06 budget.
ATTACHMENTS
H.R. 5471
Resolution
I
109m CONGRESS H
2D SESSION • R• 5471
To provide to the Bureau of Land Management a mechanism to cancel
certain mining leases for lands in the leases CA -20139 and CA -22901
and provide new leasing opportunities in the Soledad Canyon adjacent
to the City of Santa Clarita, California, that reflect the historical mining
levels, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MAY 24, 2006
Mr. MCKEoN introduced the following bill; which was referred to the
Committee on Resources
A BILL
To provide to the Bureau of Land Management a mechanism
to cancel certain mining leases for lands in the leases
CA -20139 and CA -22901 and provide new leasing op-
portunities in the Soledad Canyon adjacent to the City
of Santa Clarita, California, that reflect the historical
mining levels, and for other purposes.
1 Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 SECTION 1. SHORT TITLE.
4 This Act may be cited as the "Soledad Canyon Mine
5 Leases Adjustment Act".
2
1 SEC. 2. FINDINGS AND PURPOSES.
2 (a) FINDINGS.—The Congress finds the following:
3 (1) Transit Mixed Concrete Corporation holds
4 two valid Federal leases for the extraction of sand
5 and gravel from the Federal mineral estate in lands
6 located in Soledad Canyon adjacent to the City of
7 Santa Clarita, California, numbered CA -20139 and
8 CA -22901. Such lands contain approximately 56
9 million tons of sand and gravel.
10 (2) Mining 56 million tons of sand and gravel
11 under the terms of the leases would produce harm
12 to the environment and cause major transportation
13 problems for the City of Santa Clarita, surrounding
14 areas, and other users of the transportation systems
15 in the vicinity.
16 (3) It is in the best interest of the citizens of
17 California and the Federal Government to cancel
18 those leases and make available new leases for those
19 resources that reflect the level of mining that has
20 historically occurred in the Soledad Canyon area of
21 California.
22 (4) TMC should be offered resources extraction
23 opportunities of similar economic value in other
24 areas of California that would not impact the envi-
25 ronment and transportation systems to the degree
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1 that they would have been impacted in the Soledad
2 Canyon.
3 (5) TMC should receive credit for reasonable
4 and customary costs associated with their efforts to
5 develop leases CA -20139 and CA -22901.
6 (6) A site-specific solution that is fair to TMC,
7 protects the environment, and has minimal impact
8 on local transportation system is in the best interest
9 of the Nation.
10 (7) Considerable sums of money have been ex -
11 pended by all parties trying to insure their interests
12 are protected with respect to leases CA -20139 and
13 CA -22901, with no conclusion foreseen at this time.
14 (b) PURPOSES.—The purposes of this Act are the fol -
15 lowing:
16 (1) To provide to the Bureau of Land Manage -
17 ment a mechanism that is not available under exist -
18 ing law to cancel leases CA -20139 and CA -22901
19 and provide new leasing opportunities in the Soledad
20 Canyon that reflect the historical production levels.
21 (2) To provide a means for TMC to recover and
22 transfer to other Federal resources the amounts ex -
23 pended trying to develop leases CA -20139 and CA -
24 22901.
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1 (3) To provide the Bureau of Land Manage -
2 ment tools to evaluate expenses incurred by TMC
3 and provide relief.
4 SEC. S. DEFINITIONS.
5 In this Act:
6 (1) SECRETARY.—The term "Secretary" means
7 the Secretary of the Interior.
8 (2) TMC.—The term "TMC" means the Tran -
9 sit Mixed Concrete Corporation.
10 (3) The term "historical production levels"
11 means production of 300,000 tons of aggregate pro -
12 duced for sale per calendar year.
13 SEC. 4. TMC LEASE CANCELLATIONS AND EXCHANGE OF
14 VALUES EXPENDED.
15 (a) LEASES CANCELLATIONS.—The Secretary shall
16 cancel Bureau of Land Management leases CA -20139 and
17 CA -22901 effective on the date of the enactment of this
18 Act.
19 (b) EXCHANGE FOR ECONOMIC VALUES. -
20 (1) IN GENERAL.—In exchange for the eco -
21 nomic value invested in trying to bring leases CA -
22 20139 and CA -22901 into commercial production
23 the Secretary shall provide to TMC other financial
24 and mineral production opportunities in accordance
25 with subsection (d).
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1 (2) VALUES ASSIGNED TO LEASES. -For pur-
2 poses of paragraph (1), the economic value invested
3 is an amount equal to the sum of the following:
4 (A) All amounts paid to the United States
5 with respect to the leases as bonus bids or other
6 prepayments.
7 (B) Interest on amounts referred to in
8 subparagraph (A), from the date of payment of
9 such amounts to the United States, at a rate
10 determined by the Secretary.
11 (C) Amounts expended by TMC in secur-
12 ing the leases and trying to bring them into
13 production, including -
14 (i) reasonable costs associated with
15 the engineering and environmental studies
16 associated with the leases; and
17 (ii) reasonable legal costs associated
18 with efforts to exercise the rights granted
19 in the leases.
20 (C) SUBMISSION OF EXPENSES INCURRED. -
21 (1) IN GENERAL. -To assist in the determina-
22 tion of the amounts expended referred to in sub -
23 section (b)(2)(C), TMC shall submit to the Secretary
24 within 90 days after the date of the enactment of
25 this Act an itemized list of such amounts, with
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1 enough detail and supporting documentation so the
2 Secretary can determine that the expenses are asso-
3 ciated with the leases and are reasonable.
4 (2) ARBITRATION.—The Secretary's determina-
5 tion of the amounts expended referred to in sub -
6 section (b)(2)(C) shall be issued within 90 days of
7 receipt of the itemized list required under paragraph
8 (1). If the Secretary disapproves such list, the Sec -
9 retary shall, upon request of TMC, determine the
10 economic value invested for purposes of subsection
11 (b)(2) through arbitration in accordance with sub -
12 chapter IV of chapter 5 of title 5, United States
13 Code.
14 (d) RETURN OF VALUE OPPORTUNITIES FOR
15 TMC.—Financial and mineral production opportunities
16 provided under subsection (b)(1) may be in the form of
17 one or a combination of any of the following that is mutu-
18 ally agreed to by the Secretary and TMC:
19 (1) Interests in the mineral estate in Federal
20 lands in the State of California that are available for
21 leasing under the Mineral Leasing Act (30 U.S.C.
22 181 et seq.).
23 (2) Interests in the surface estate in Federal
24 lands in the State of California that are under the
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1 administrative jurisdiction of the Secretary and that
2 are available for disposal.
3 (e) REFERRAL TO COURT OF CLAIMS. -
4 (1) REFERRAL.—If the Secretary and TMC do
5 not reach agreement under subsection (b) regarding
6 the financial and mineral production opportunities to
7 be provided by the Secretary under subsection (b)(1)
8 within 24 months after date of the enactment of this
9 Act, the Secretary shall refer the issue to the United
10 States Court of Federal Claims for resolution.
11 (2) RESOLUTION BY COURT. -In any referral
12 under this subsection, the court shall -
13 (A) determine the economic value invested
14 for purposes of subsection (b)(2); and
15 (B) determine and order the Secretary to
16 provide financial and mineral production oppor-
17 tunities for purposes of subsection (b)(1) and
18 subsection (d).
19 SEC. 5. LIMITATIONS ON FUTURE LEASING FOR SAND AND
20 GRAVEL IN SOLEDAD CANYON AREA OF CALI-
21 FORNIA.
22 (a) LIMITATION ON RATE OF MINING. -The Sec -
23 retary may not issue any lease for mining sand and gravel
24 in the Soledad Canyon area of California as described on
25 the map titled and dated on file with the
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1 Secretary of Interior that in aggregate exceeds the histor-
2 ical production level.
3 (b) CONSULTATION AND CONSIDERATIONS.—Before
4 issuing any lease authorizing the mining of sand or gravel
5 in the Soledad Canyon area of California, the Secretary
6 shall -
7 (1) consult with the City of Santa Clarita, Cali -
8 fornia, Los Angeles County, California, and surface
9 owners in that area; and
10 (2) take into consideration the environmental
11 and transportation concerns of such mining in that
12 area.
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