FUNDING SOURCES

How are the county and local reclamation programs funded?

The law requires that county and local ordinances establish annual fees so the reclamation program is fully funded by those fees. County or municipal government may recover all reasonable costs that they incur in administering the program. A portion of the fees is forwarded to the DNR to cover costs associated with technical support and program audits.

The Department has published a document titled Fees to Support the Nonmetallic Mining Reclamation Program, which is located under "Publications" and "Mining".

How can operators be assured that fees assessed by county and local government will not be too high?

The statute provides county or local government with the ability to collect fees to fund the administration of their program. These fees must equal, as closely as possible, the actual costs of program administration. The fee amounts specified in Chapter NR 135 (specifically Tables 1, 2, 3 and 4) serve as a "reality check" on county or local fees. The rule indicates that there must be specific justification if county or local annual fees exceed those referenced in Tables 2, 3 and 4.

It is important to note that a regulatory authority may not assess a fee in excess of what is required for administrative costs. One of the areas reviewed by the Department during the mandatory audits of county or local programs is the relationship between fees collected and actual administrative costs incurred.

Is the operator able to select the form of financial assurance that must be posted?

The rule language provides for a choice on the part of the operator as to the form of financial assurance to be provided to the regulatory authority. However, depending on the financial assurance option selected by the operator, there are varying degrees of discretion and judgment that may be exercised by the regulatory authority in making final financial assurance decisions.

Is there flexibility in determining and posting financial assurance?

Yes, Chapter NR 135 provides several alternative means of satisfying the financial assurance requirements. The amount of financial assurance required is generally dictated by the work items described in the reclamation plan and the cost of performing those activities. Some flexibility is lost in order to ensure that the regulatory authority has access to the funds necessary to perform site reclamation in the event of default on the part of the operator.

It is important to understand the relationship between the approved reclamation plan and the financial assurance requirement. This is an area where the operator can, through good planning, minimize the costs of financial assurance. The plan should keep the number of unreclaimed acres to a minimum, at any point in time. This can be accomplished by delaying affecting areas until necessary and by promptly reclaiming areas no longer necessary for the operation. The less acreage affected by mining the less financial assurance is required.