Reclamation fees and financial assurance
Nonmetallic mining reclamation fees and financial assurance ensure that county and local reclamation programs have enough money to cover administrative costs and to clean up and restore a nonmetallic mining site should the site operator or owner abandon the site.
It is important to understand the relationship between the approved reclamation plan and the number of fees and financial assurance required. A mine operator can, through good planning, minimize these costs. The plan should keep the number of un-reclaimed acres to a minimum; this can be accomplished by delaying affecting areas until necessary and by promptly reclaiming areas no longer necessary for the operation. Less acreage affected by mining means fewer acres included in fee assessments and less financial assurance required.
State law requires county and local regulatory authorities, or "RAs," to set and collect mine operation fees that reflect the reasonable and actual costs for administering reclamation programs. The RAs also forward a portion of the fees to the DNR to cover administrative costs for the statewide nonmetallic mining reclamation program. The fees may only be assessed on unreclaimed acres at an active mine site.
Fees must equal, as closely as possible, the actual costs of program administration. The fee amounts specified in ch. NR 135, Wis. Adm. Code (specifically tables 1, 2, 3 and 4), serve as a reality check on county or local fees. An RA must have a specific justification for fees to exceed those referenced in tables 2, 3 and 4.
Periodically, the DNR conducts a review of reclamation fees statewide to ensure they are reasonable and in line with reclamation program costs.
The objective of financial assurance is to ensure reclamation. A mine operator must provide a surety bond or other form of financial assurance to the RA to guarantee that the RA has the funds necessary to perform site reclamation in the event of a default. The amount of this financial assurance is based on the cost to implement the reclamation plan.
Options for financial assurance include:
- a surety bond;
- a certificate of deposit;
- an irrevocable letter of credit; and
- government securities.
NR 135 includes a special provision to make it more feasible for small operators, in particular, to provide financial assurance without jeopardizing the solvency of their businesses. An example of this would be an interest-earning account designed to grow to meet the needs of reclamation.
- Contact information
- For more information on nonmetallic mining, contact:
- Roberta Walls
DNR Office of Mining