A Modest Proposal for Frac Sand Mining

We're serious.  We hope he will take this proposal seriously.

October 21, 2013

Governor Scott Walker

115 East State Capitol

Madison, Wisconsin  53702

Sent by email:  govgeneral@wisconsin.gov

Dear Gov. Walker:

At a recent appearance at the Wisconsin Freight Rail Day in Madison, you thanked “God and the glaciers” for the rapidly expanding frac sand mining industry.

It is indeed a booming industry.  An industrial sand executive estimates there are about 2,000 jobs associated with frac sand mining in Wisconsin. 

As you no doubt know, the development of the industry has not been without controversy.  Dust, noise, truck traffic and other community and environmental concerns have surfaced all across western Wisconsin.  We note that you have added two positions at the Wisconsin Dept. of Natural Resources devoted to frac sand mining.  But it appears those positions are designed to expedite permit processing rather than to improve the scrutiny of permits for sand mines.  We do understand that the positions were not developed to monitor air and water quality and quantity impacts of the mines once they are operating. 

Long-term environmental damage from frac sand mining – in particular, air quality and groundwater depletion – may not be well understood yet.  What is well understood – and you acknowledged this in your Freight Rail Day comments – that Wisconsin sand is a very valuable and highly sought after product that is essential to the expansion of oil and natural gas production, both domestically and globally.

Given the high value of Wisconsin sand to the extremely lucrative oil and gas industry; and given that Wisconsin (and to a far lesser extent, Minnesota) are the premier locations for such sand; and given the quantifiable impacts (road damage, reclamation, local and state government environmental and zoning review) of developing sand mines, processing facilities and loading terminals, we believe it makes eminent sense for Wisconsin to develop a severance tax for frac sand.

Wisconsin already has a severance tax for oil and gas (WI Chapter 70.397), but it clearly doesn’t include sand for fracking.  (The state is very unlikely to generate much revenue from an oil and gas severance tax, with no known reserves here.)  We would not be alone in having a severance tax:  According to MineralWise.com, a total of 23 states have oil/gas severance taxes, among them conservative and business-friendly states such as Wyoming and Texas.  

More appropriate examples for Wisconsin include Alabama’s forest products and local solid minerals severance taxes, and there is Colorado’s severance tax, very applicable to Wisconsin, that applies to “non-renewable natural resources that are removed from the earth.”

Minds more creative than our own could develop ideas for how a severance tax could be used.  At a minimum, the revenues could be directed to the local communities most affected by sand mining.  But clearly more revenue could be generated, for the benefit of the entire state, than what would be required to provide for affected local communities.

According to a Wisconsin DNR fact sheet, a “conservative estimate” of the amount of sand mined in Wisconsin (in 2012) was 12 million tons.  Using that figure, a small 25-cent-per-ton severance tax would generate $3 million in revenues.  This would be an insignificant “hit” on the industry and would allow Wisconsin to capture a small part of the considerable wealth of this highly valuable product that the state is essentially giving away to the industry. 

We hope that as you continue to promote industrial sand mining in Wisconsin that you also consider how the state should seriously “get in the game” of the hydrocarbon extraction business.  We possess a product the oil and gas industry are very anxious to have, and it seems only right and sensible that Wisconsin capture a small part of the obvious value of this product.  We also urge you to take seriously the ongoing human health and resource depletion concerns arising from frac sand mining.  Our tax idea might be one way to support the expenses of necessary studies and monitoring of this billion-dollar industry.

We appreciate your consideration.

Sincerely,

Denny Caneff

Executive Director 

Political Back-Alley Surgery

Imagine if a doctor were just about to cut you open on the surgery table.  All is well:  the surgeon is ready to go, the support crew is scrubbed and attentive, and the anesthesiologist is managing your drip so you are blissfully unaware of what’s going on.  You trust all will be well.

Then imagine an insurance company hack sulking into the surgery suite and telling the surgeon, “Would you mind taking a few shortcuts to save us some money?"

We have the political equivalent of shady back-alley surgery going on in the State Capitol, dressed up as the business of the state biennial budget.  The surgical team is the members of the Joint Finance Committee.  

The insurance industry equivalent from Rat’s little illustration above are the special interests, insisting on their own surgical procedures for the patient -- the state budget.  This Legislature's surgical team is all too willing to entertain diversions from normal operations of the budget. 

Sure, the budgeting process is rife with politics, but there were two surgical intrusions which caught Rat’s eye lately.  These intrusions are small, but not unlike how a little bacterium can cause a nasty infection, these intrusions are pernicious.

One would force local communities to go to the lowest common denominator – state standards – for controlling storm water runoff.  This one is a classic product of the home builders and construction industry, which doesn’t want to be bothered with how much dirt and mess their building practices, and their finished products, send to rivers and lakes.  Milwaukee or Mauston would not be free to manage their water; they'd be forced to go with weaker state standards, which of course the home builders will write for the DNR.

The other – clearly the handiwork of dairy industry defenders of factory farms -- would  make a mess or regulating big wells.   All the wells in an area affect all the water in that area.  Big Dairy interests inserted into the budget by the Joint Finance Committee a policy that would block anyone from calling the question with the DNR:  "Will this new well, along with all the others in the neighborhood, dry up the river there?"  It would essentially
give license to anyone drilling big wells pumping over 100,000 gallons a day to pump with impunity, never mind the impact on nearby lakes and creeks or other wells.

This gambit also attempts to kneecap lawsuits currently in the pipeline that call out DNR’s failure to consider so-called “cumulative impacts” of big wells.  

Just be glad you won’t go to the Joint Finance Committee to fix your gall bladder. They’d take your bile duct too, put in a spare part from someone else, and charge you an arm and a leg for it.

A River Runs Through the Manure

There's much to read in between the lines of this recent Wisconsin Dept. of Natural Resources press release:

http://dnr.wi.gov/news/Weekly/Article_Lookup.asp?id=2499

Its headline reads:  "Bumper Bass Crop One More Reason to Land Spread Manure Carefully."  (Showing real new media savvy, the DNR released this to "agricultural media" first.)

The agency crows about the "bumper" small mouth bass crop in 2012, which they attribute to "hot and dry years."  Rat is a rodent expert, not a fisheries expert, but I'm not sure it's just "hot and dry" that helped out the baby bass last year.  DNR's tying that good news with a warning about manure spreading is a little hint.

Translation: the bass probably did well in a "hot and dry" year like 2012 because we had a drought. The lack of snow and rain meant no manure was flushed into the rivers via water running off the land.

Why is DNR talking about this now?  T'is the season for manure to run off the fields and to the rivers, where it will kill the baby bass.  Farmers spread manure like there's no tomorrow this time of year.  The ground is still frozen and supports the heavy weights of tractors and spreaders. Farmers with storage pits that have been filling up over the winter empty them now, fast.  Those who don't have pits have already been spreading, all winter long.

That manure is just sitting on top of the frozen ground. When the snow melts or it rains at this time of year, when the ground is still frozen, that manure ends up in the rivers. 

Above-freezing temps are predicted for the coming days.  So is rain.  We rats wish you well this spring, baby bass. 

Rat Riffs on "What if?"

Your Ratly correspondent does get out of her rat hole on occasion to see the sights of this lovely state.
This weekend I passed two very different and unrelated places in Wisconsin, but that got me to thinking.

One place, draped in fresh snow, was the Penokee Hills, the site of a proposed iron mine in Ashland County.   I also passed by a couple of paper mills -- homely and hulking, towering over their home communities (in this case, of Port Edwards and Rothschild), and steaming away in the cold air. 

Let me explain how an iron mine site pertains to a paper mill.

Photo courtesy Domtar Corp. (Nekoosa plant)

Despite its past glory, there is not much of a mining industry in Wisconsin, and no iron mining to speak of.  There's a good reason there's no iron mining -- what little low-grade ore exists is very hard to extract without considerable environmental disruption.  No infrastructure exists: the related ore processing would all have to be built from scratch. 

Mindless energy and attention has been given to this non-industry by legislators and business leaders.  It got me to thinking:  what if all the energy and resources devoted to a divisive and disruptive iron mine had been put instead to reviving Wisconsin's paper industry?

Bring Back Paper
We were the paper kings, after all, for more than a century.  Paper built this state.  We had the rivers and the trees and the workers and the knowhow.  Paper defined the Fox and Wisconsin river valleys.  But like an ill and elderly man, the industry is in decline.  In an excellent two-part story, the Milwaukee Journal Sentinel outlined the Wisconsin paper industry's history and the many forces undermining it.

  http://www.jsonline.com/business/bankrolled-and-bioengineered-china-supplants-wisconsins-paper-industry-183049221.html


Wisconsin has not consciously decided to give up on the paper industry, as far as this Rat knows. But have their been discussions at high levels -- the governor, legislators, business leaders, academics, regulators -- about what the state could do to make that industry competitive again?  Do we think there is no job strategy in paper making?  Have we really given over the industry to China?

Seems to me it would make a lot more sense to put our time and brain power into a well-known industry that has a presence in a dozen or more communities, still employs thousands of workers, has its environmental performance figured out, and -- despite the fact you are not reading this on a piece of paper anymore -- still makes a useful product.

The "experts" might say Wisconsin's paper industry is beyond salvation.  But Rat is certain that conversation has not happened, and The End has not been declared.   A concerted effort for paper, by the same people who insist we need an iron mine, just seems so much more sensible than trying to ram an iron mine down our throats. 

Forget paper, you say?  Okay, but think about other possibilities:  there's the biofuels industry, among other industries of the future, that has great promise for economic development. This first-class state could do so much better than trying to revive a Third World industry. 

Mining the Truth from Last Week’s Capitol Spectacle

This Rat’s perspective on last week’s Capitol hearing on mining was constrained.  It wasn't just the restrictions imposed on the humans in the room on cell phone and Ipad use, and even whispering and smiling.  A scurrilous Rat like yours truly must keep way low and watch the proceedings between chair legs, high heels, and microphone cords.  But my finely tuned Rat ears heard plenty.

I could hear the legislators parrying with the orange-hatted mining supporters – not dudes in suits, but real (appearing) working folks – about the jobs the mine would bring.  I could not tell if pro-mine legislators looked those folks in the eyes and, with a straight face, say, “You will see mining jobs.”

(Photo courtesy Michelle Stocker, The Capital Times)

What?  No Mine?  Really??

Maybe they couldn’t promise that because they know in their hearts there may never be a mine in the Penokees.   But in their political calculations, Republican mining proponents are pretty clever.  They have their bases covered, mine or no mine.

1.  They have said, “Here’s how high?” when their political contribution patrons demanded they all jump for mining.  If a mine doesn’t get built, they can say they tried mightily, without drying up that source of campaign cash. 

2.   If they try mightily and fail, they can blame the Republicans' favorite nemeses:  shrill and clueless Madison environmentalists and obstructionist Indians invoking their dreaded treaty rights. 

3.  But Republicans will reserve their greatest wrath for the faceless federal bureaucrats of the U.S. Army Corps of Engineers.  In what could be a rare instance of bureaucratic heroism (you don’t put those two words in a sentence about that agency very often), the Army Corps has told legislators that what the state won’t do to review a mining proposal, the Corps will. That could take 4 or more years.

4.  Back to the Indians, specifically the Bad River Band of Lake Superior Chippewa – they will fight this mine to the death, using their “treatment-as-a-state” status that gives them authority to regulate water quality on their lands.  The Penokee mine would essentially destroy the headwaters of the tribe’s lifeblood, the Bad River.  Tribal chairman Mike Wiggins did look legislators in the eye last week and declared, in no uncertain terms, they will fight the mine to the death.  Building a mine upstream from their homeland would be “genocide,” he said.

Finally, in a rather misleading take on mining and jobs, the Milwaukee Journal-Sentinel calls Sen. Chris Larson’s statement that the mine won’t create jobs for at least 7 years “mostly false” on its Politi-Fact page January 27. The hair the paper split was that even though there might not be actual rocks dug up for mining for at least 7 years, there might be “jobs created along the way.”  This article misses the bigger point that the promise of jobs in the numbers offered by mining proponents is an audacious act of smoke-blowing.  They have to know the Army Corps’ assessment process and the Bad River tribe’s legal battle, will stymie, for years and years, any meaningful job creation in Hurley and other nearby towns. 

But you see my point?  They get a mine, they cheer; in the likely event they don’t, they spray unmerciful blame like a weed killer, without reflecting how they could have done this right from the outset.  

Nice Ice, Chill Winds

Postcards from my muskrat cousins are pouring in.  They are relieved that there is ice this winter under which to hide from hungry eagles and other hawk-eyed birds (such as hawks).  Some muskrats tell me they even pop up onto the surface of the ice at night, through holes the ice fishermen make, and slip-slide around under the light of the moon.  

And I thought river rats had fun.

This River Rat is having no fun anticipating the chill winds blowing down from the state Capitol.  When it comes to conservation, it is nothing but ill chill winds.

The biggest gust of ill wind is mining legislation. (To paraphrase Dylan, we should call these idiot winds.)  Lawmakers, with the governor’s approval, are poised to pass a bill that would rip a hole in northern Wisconsin a quarter mile wide by up to 15 miles long and nearly 2,000 feet deep.  They’re also itching to blow up a “mining moratorium” law, in place since the mid 1990s, that has successfully prevented mining that would cause the dreaded acid mine drainage.

The governor wants an income tax decrease, which he will get.  If you reduce revenue to state coffers, you gotta reduce costs, and that likely means state employees will get whacked.  Legislators’ favorite target to starve is the state’s guardian of natural resources, the DNR.

Frac away

And you know all that valuable frac sand being mined and shipped out of state – an extremely valuable commodity without which the domestic natural gas and oil boom couldn’t be?  It leaves Wisconsin, free of charge, and the local communities that pay the price for the environmental and social disruption, get nothing.  Nor does the state.  Wisconsin is a now a player in the oil industry, but it’s dressed up like a bar-sponsored softball team playing Major League Baseball.

Hostility to conservation is not unique to the Legislature. It starts, and it prospers, at the top, with Governor Walker.  He gives his annual state of the state speech next week.  Here’s an opportunity for the Gov surprise us. Rat offers this simple language to be inserted into the speech.   This is not tree-hugging, blow-up-the-ship-to-save-the-whales rhetoric here; it’s pragmatic and common sense. 

Water cannot be afterthought.  There is no economy, there is no life, without clean and plentiful water. 

 

Hang around your radio the night of January 15 and see if the Gov works any of Rat’s fine prose into his speech. 

I know what you’re thinking – that’s as likely as muskrats enjoying ice in July. But it's worth a try.

 

  

The State of the State’s Waters

Wisconsin is defined by water – our borders, our name, our economy, our identity, are formed and shaped by water.

Water is essential to who we are and what we do – as manufacturers, utilities, farmers and service providers who depend on water to do their business, and as people who have fun in and by the water. 

It is essential that we protect our water – both its quality and its quantity – vigorously, systematically and with the seriousness it deserves.  Our economy, our quality of life, and our future as a state depend on it. 

It will be my (Gov. Scott Walker) administration’s policy to mobilize those state agencies and offices equipped to defend the public trust to protect our water.  

• ·         We will ensure that drinking water drawn from underground sources will not be depleted. 

• ·         We will also ensure that that same groundwater – the drinking water for 90% of Wisconsin residents – will be protected from contamination by pesticides, nitrates, bacteria, viruses and other pollutants. 

•          We will work to reduce to the greatest extent possible the pollution of our surface waters of algae-producing phosphorus and keep the soil that delivers that phosphorus on the land. 

•   ·         We will strive to limit, even eliminate, exotic plants and animals that wreak havoc on our waters and cause tens of millions of dollars of damage. 

• ·         We will follow the letter and the spirit of the Great Lakes Compact to protect our Great Lakes.