The Mining Action Group is a volunteer, grassroots effort to defend the clean water and wild places of Michigan’s Upper Peninsula from the dangers of sulfide mining – previously known as Save the Wild U.P.
MARQUETTE — On Thursday, a nonprofit corporation set up by Michigan Department of Environmental Quality (MDEQ) regulators and mining industry executives, the Northern Michigan Geologic Repository Association (NMGRA), will appear in Circuit Court in Marquette claiming that it is not a public body and therefore is not subject to public scrutiny under the Freedom of Information Act in response to requests for financial information.
In 2008 high-ranking State officials directly charged with enforcing mining safety and environmental regulations formed the Northern Michigan Geologic Repository Association as a ‘non-profit’ corporation while Rio Tinto was in the process of planning and constructing Eagle Mine. The NMGRA Board of Directors features Rio Tinto and Bitterroot Resources mining executives in addition to DEQ officials.
The Northern Michigan Geologic Repository Association is intended to fund and operate a “core shed” — a warehouse dedicated to storing mineral core samples which is a function of the Office of Geologic Survey according to Michigan law. As a nonprofit 501(c)3 organization, the contributions the Northern Michigan Geologic Repository received from individuals and corporations, including over $32,000 from Rio Tinto in 2012, are fully tax-deductible.
While Rio Tinto executives assisted in the formation of the NMGRA with state regulators, Rio Tinto constructed a 10 megawatt substation — 400% the power previously existing in Big Bay — to electrify a core shed adjacent to the Eagle Mine site. Once the power infrastructure had been installed, the core shed was removed, and Eagle Mine permit was granted a minor modification without due process or public participation.
Jana Mathieu, the attorney suing NMGRA to disclose their financial information said: “The murky facts surrounding the Northern Michigan Geologic Repository Association exemplify the need for the Freedom of Information Act and the purpose for which it was enacted: to shine a light on the actions of government officials which directly impact the citizens whom they purport to represent.”
Local attorney Michelle Halley, who challenged the Eagle Mine’s permits in court, says the public deserves to better understand the NMGRA’s funding. “The MDEQ’s partnership with corporations demonstrates its inappropriate relationship with the mining industry. The MDEQ’s motto of ‘the industry is our customer and we trust them’ is plain wrong. MDEQ’s job is to regulate the industry, not form partnerships with them — they’ve got it wrong, again,” said Halley.
“It can’t be overstressed how valuable these rock core samples are — to both the mining industry and the State of Michigan. The cores are key to understanding the safety of the proposed mine, the valuation of the proposed mine, and the toxic cocktail of heavy metals that will soon be raining down on Marquette County, when the mine’s exhaust vent stack begins spewing unfiltered mining dust into our clean air. Further, as the TWS is currently permitted, Eagle Mine will discharge over 500,000 gallons of water that will flow into the East Branch of the Salmon Trout River. That’s why, from the beginning, public access to information has been denied, and the core samples have been kept from scrutiny,” said Kathleen Heideman, Save the Wild U.P. vice president.
“The collaboration with mining executives for the creation of a non-profit in order to accomplish state mandates by a high level state of Michigan manager is classic regulatory capture: when an agency is captured to operate for the benefit of a private entity and no longer functions in the state’s best interests. We must end this regulatory fiasco,” said Jeffery Loman, former federal oil regulator and Keweenaw Bay Indian Community tribal member.
“I find it interesting that NMGRA would bring in the same high-powered downstate law firm on a simple Freedom of Information Act issue that Rio Tinto hired to run interference for the MDEQ in the Concerned Citizens of Big Bay’s administrative law case over the permitting of electric lines for Eagle Mine. It almost makes you think they have something to hide,” said Gene Champagne of Concerned Citizens of Big Bay, a grassroots group which has been active in monitoring regulatory oversight of Part 632, the legislation governing non-ferrous mining in Michigan.
“It’s in the best interests of Michigan taxpayers and workers that state regulators are doing their jobs of watching the mining industry, not holding hands with its executives. That is why we are also calling for a federal investigation of this so-called nonprofit,” said Margaret Comfort, president of Save the Wild U.P.
On June 8th, Save the Wild U.P. joined with Concerned Citizens of Big Bay and others calling for a federal corruption investigation of the mining industry and Michigan Department of Environmental Quality. Save the Wild U.P. is a grassroots environmental organization dedicated to the preservation of the Upper Peninsula of Michigan’s unique cultural and environmental resources.
MARQUETTE — Local residents, including KBIC tribal members, Concerned Citizens of Big Bay, and Save the Wild U.P., rallied at a joint press conference on Saturday, June 8, 2013, calling for a corruption investigation related to activities of an unusual “non-profit” corporation, the Northern Michigan Geologic Repository Association (NMGRA), based in Marquette County.
Nearly two dozen citizens spent that Saturday afternoon in the Department of Environmental Quality (DEQ) Upper Peninsula office parking lot in Gwinn, holding hand-lettered signs that outlined corruption concerns, speaking with locals driving by, participating in a question-and-answer session, and reviewing what they call “the murky facts surrounding NMGRA.”
Signs like this one at the June 8 demonstration refer to NMGRA’s refusal to disclose financial information requested through the Freedom of Information Act (FOIA). Pictured here are, from left, Rich Sloat of Iron River (Mich.); Gene Champagne of Concerned Citizens of Big Bay; Kathleen Heideman, Save the Wild U.P. Board vice president; and Alexandra Thebert, Save the Wild U.P. executive director.
In 2008, while Rio Tinto was in the process of planning and constructing the mine at Eagle Rock, high-ranking state officials directly charged with enforcing mining safety and environmental regulations formed the Northern Michigan Geologic Repository Association as a “non-profit” corporation, whose Board of Directors featured Rio Tinto and Bitterroot Resources mining executives alongside DEQ and DNR officials. At the same time, according to Save the Wild U.P. and other environmental groups, these state officials were failing to enforce environmental and safety regulations enacted to protect the health and well-being of U.P. citizens.
Jeffery Loman, Keweenaw Bay Indian Community (KBIC) tribal member and former federal oil regulator, led the group on a walking tour of a large cinder block warehouse building located nearby, identified by signage as a “State Warehouse.” The property is actually leased from the Marquette County Economic Development Corporation by the nonprofit Northern Michigan Geologic Repository Association — and serves as its core shed, housing valuable core samples. Local workers report seeing only Rio Tinto vehicles accessing the warehouse.
This “State Warehouse” building at the former K.I. Sawyer Air Force Base, near the Upper Peninsula DEQ office outside Marquette, serves as a core shed for the Northern Michigan Geologic Repository Association (NMGRA).
According to Gene Champagne of Concerned Citizens of Big Bay, the warehouse building is a great place for hiding something.
“It looks totally neglected. Here’s this big building covered with peeling paint, surrounded by invasive knapweed and erosion gullies — anyone driving by would assume it was a giant meth lab, not a top-secret core shed set up by mining executives and controlled by the Michigan DEQ,” Champagne noted. “Peeking in the windows, you can see an emergency list of contact people that includes not only police agencies and hospitals, but Kennecott/Rio Tinto employees, and DEQ officials.”
Near the Upper Peninsula District Office of the Department of Environmental Quality (DEQ) in Gwinn, this map taped to the wall of a large warehouse labels the facility a “State Warehouse.” Core samples are stored within, but the DEQ claims no further association with NMGRA, the non-profit that has leased the warehouse and is attempting to raise money to make it a state geologic repository.
Champagne says citizens can FOIA information on this for a reason.
“We need to be the watchdog of government to ensure that our business is conducted in the light of day and in the best interest of the people, not special interest,” he explains. “Our elected local, state, and federal representatives and officials who all decry this type of secrecy in government need to demand action and ask questions of the DEQ.”*
DEQ: State not part of NMGRA but new repository needed
Despite the “State Warehouse” sign, though, the warehouse is not (yet) an official state repository, according to at least one DEQ official.
“It’s not officially part of the state at all,” said Melanie Humphrey, geological technician in the Michigan DEQ Office of Oil, Gas and Minerals, Upper Peninsula District. “NMGRA is hoping to make it a geological repository for core, rock samples and records that have geological information.”
Humphrey is the contact person for anyone who wishes to visit the existing geologic repository in Harvey, near Marquette. That facility is full to capacity — thus the need for a larger storage area such as the warehouse in Gwinn. At present the repository in Harvey receives visits from the U.S. Geological Survey, graduate students, archaeologists and other persons interested in studying the core and rock samples. The repository serves as a library. Anyone can come and visit the facility in Harvey by making an appointment with Humphrey, who will open it for visitors.**
“I think it would be very nice to have a research center up here,” Humphrey said.
The Geologic Repository (there is a second one in Kalamazoo) is needed because of a law that requires industries (oil, gas and mining) to give the state core samples or related documents left over from exploration on state land or land with state mineral rights, Humphrey explained. If the drilling is on private property the company is not required to do this.
“It could be valuable information,” Humphrey noted.
While NMGRA was formerly associated with the DNR, which leases surface state land, and the DEQ, which regulates it, apparently the non-profit organization is now separate from the state but trying to raise money to pay for the warehouse in Gwinn with the idea of making it a new state repository. Humphrey described it as “a group of people that see the value of having this repository for the state to preserve geological information.”
“We wouldn’t get core from an active mine, but once the mine closes the leftover core could be donated to the repository,” Humphrey added. “The core that we have at our repository in Harvey is all open-record.”
Hal Fitch, state geologist and chief of the DEQ Office of Oil, Gas, and Minerals in Lansing, explained that the repository fulfills a function required by Part 601 of NREPA (Natural Resources Environmental Protection Act 451), which states, “The Michigan geological survey shall provide for the collection and conservation of cores, samples, and specimens for the illustration of every division of the geology and mineralogy of this state, to the extent that facilities and funds are available to do so.”***
Fitch was a member of the NMGRA board of directors when the non-profit was established in 2008 but is no longer associated with it, he said.
Fitch told Keweenaw Now he is aware of the community group’s intention to request a Department of Justice investigation of NMGRA.
“I would say go right ahead because there’s nothing improper (about the non-profit), and at the time we (the DEQ and the DNR, Department of Natural Resources) were involved there was nothing improper about our involvement,” Fitch said.
Because of the Part 601 requirement and the fact that he was unable to secure state funding for a suitable repository to continue to collect and preserve core samples and related data, Fitch was involved in establishing NMGRA in order to provide for the future support of a repository, he explained.
“We were looking for people who utilized the core repository to support the concept,” he said. “We didn’t get to the point where we were soliciting funding while we were members.”
Geologic repositories are a function of the Geological Survey. In 2008 Fitch’s department, the Office of Geological Survey, was the Geological Survey established by Part 601. In 2011 Part 601 was revised, and the Geological Survey was established within Western Michigan University. While that is a state university, the Geological Survey is no longer part of the DEQ, Fitch explained.
Fitch was unable to say exactly when he and the DNR representative on the NMGRA board, Milton A. Gere, Jr., who is now retired, left NMGRA; but it was before 2011, he noted.
“I never contemplated seeking funding from an outside source, such as industry, for the state of Michigan or for the association (NMGRA) during the time I was a member of it,” Fitch added. “The association would be a separate entity that would receive funding later. That was the concept.”
Fitch noted he just wanted to get the association established. He said he believed industry, academia or grant sources might fund NMGRA later, when he would not be a part of it.
He also said there was no connection between NMGRA and the issuing of mining permits.
“No mining company or outside source offered any money to NMGRA while I was on the board of it,” Fitch said.
An Oct. 28, 2008, article in the Lake Superior Mining News, states that Hal Fitch (at that time director of the DEQ’s Office of Geological Survey, or OGS) formed a 501(c)(3) non-profit corporation with Kennecott and Bitterroot Resources, “registering the non-profit under the DEQ’s address with himself as the primary contact.”
The article also notes, “In an October 2007 e-mail, Fitch acknowledged ‘that there would be a problem with a state agency forming a corporation’ but ‘came up with an innovative way to address the problem: formation of a non-profit corporation that is not a part of any state agency, but in which OGS is a participating member.'”****
Electric infrastructure for Eagle Mine “core shed” installed without permit
In October 2008, Rio Tinto claimed it needed a 10-megawatt substation and miles of private power lines to electrify a core shed adjacent to the Eagle Mine site.
This was approved by Jim Sygo, DEQ deputy director, in a letter to Rio Tinto (Kennecott Eagle Minerals, or KEM) dated Nov. 7, 2008, in which he says,”The DEQ considers the planned core shed to be part of KEM continuing exploration program. It does not constitute nonferrous metallic mineral mining or reclamation and therefore is not subject to a mining permit under Part 632, Nonferrous Metallic Mineral Mining, of the Natural Resources and Environmental Protection Act, 1994 PA 451, as amended.”
This October 2010 photo shows power lines being run along the AAA Road leading to the Eagle Mine without a request from (Rio Tinto’s) Kennecott Eagle Minerals Co. (KEMC) for an amendment to their mining permit for this infrastructure. (File photo byKeweenaw Now)
However, once the power had been installed, the core shed was deemed unnecessary, and Eagle Mine was electrified instead — a bait-switch move that sidestepped permitting, due process, and public participation.
“This core shed symbolizes Rio Tinto’s end-run around Part 632, the legislation governing non-ferrous mining in Michigan,” said Loman.
Mining companies fund core shed for state
During recent Rio Tinto community forums in Marquette and in L’Anse, Loman asked Matt Johnson, Rio Tinto Eagle Mine government and community affairs manager, about funding for the NMGRA non-profit and questioned its report of an annual income of less than $25,000 (an amount that exempts them from reporting financial information) when it has signed a 5-year lease totaling $400,000 for the core shed in Gwinn. The non-profit receives tax-deductible donations but will not reveal information about the donors or amounts.*
During the May 15, 2013, Rio Tinto Community Forum in L’Anse, Michigan, Jeffery Loman, Keweenaw Bay Indian Community member and former regulator, asks Rio Tinto’s Matt Johnson questions concerning the non-profit (NMGRA), FOIA requests about it that were unanswered, and the 14th Amendment. (Videos by Keweenaw Now)
Johnson later commented on Loman’s questions. In the following video clip, Johnson says state officials are not members of the NMGRA non-profit:
Matt Johnson, Rio Tinto Eagle Mine government and community affairs manager, speaks about NMGRA, the non-profit Northern Michigan Geologic Repository Association, in response to questions from Jeffery Loman at the May 15, 2013, Rio Tinto community forum in L’Anse.
“Their continual denial of access to information about their core shed (warehouse near the DEQ office) is a violation of the 14th Amendment,” Loman said. “Something smells bad here. Why create a private non-profit to perform a function of the state of Michigan? The circumstances surrounding these dealings between state officials and mining companies look like a bad rash on this administration,” he added. “Sunshine is the best disinfectant. Hopefully Governor Snyder will agree.”
Mary Ellen Krieg, a resident of Big Bay, called the situation “a barrel of rotten apples.”
No response to FOIA requests for facts about NMGRA
Attorney Jana Mathieu, who represents the Sugar Law Center for Economic and Social Justice, has sent a FOIA (Freedom of Information Act) request for financial information to NMGRA’s registered agent, Ron Greenlee, a Marquette attorney; but Greenlee has repeatedly failed to respond. Mathieu eventually served him with a lawsuit for violation of the Freedom of Information Act, to which he also has refused to respond.
In her Feb. 11, 2013, FOIA request sent to Greenlee, Mathieu asked for any and all of the following: year-end reports on activities, full annual budgets and/or year-end financial statements, audits of finances, year-end reports on assets and liabilities, reports on equity ownership, statements regarding tax-exempt status, tax statements and filings, and lists of the board of directors and/or officers for three entities — the Northern Michigan Geologic Repository Association, the Northern Michigan Geology Data Library, and the Northern Michigan Geological Repository.
“The citizens of Michigan have consistently been denied access to information with regard to this so-called non-profit,” Mathieu said. “Today we are pulling back the veil of secrecy.”
Demonstrating for access to information near the Upper Peninsula DEQ office on June 8 are, from left, Jana Mathieu, attorney; Jeffery Loman, KBIC member and former federal regulator, Kathleen Heideman, Save the Wild U.P. board vice president; and Gene Champagne of Concerned Citizens of Big Bay.
NMGRA is a public body under the Freedom of Information Act because the DEQ and Michigan Office of Geological Survey were key players in the formation of the non-profit, Mathieu explained.
The non-profit status of NMGRA allows mining companies to make tax-deductible donations to state (public) agencies, she noted.
“They’re donating this money to the state regulators who are responsible for regulating their mines and enforcing safety and environmental regulations against these mining companies,” Mathieu said.
Loman agreed: “I just think it’s an extremely bad way to do government business — to form a non-profit with mining companies that the state is supposed to regulate,” he added.
Mathieu noted the question becomes “What are these mining companies getting from this?”
“That’s why we’re calling for an investigation by the Department of Justice of this non-profit,” Mathieu said. “There’s a strong argument that it does violate the Michigan Ethics Act.”*****
Attorney Michelle Halley of Marquette said, “As things stand, there’s no plan for any independent review of the quantity, content and grade of the ore removed at Eagle Mine. Essentially, that means the state is allowing Rio Tinto to self-report its income which serves as the basis for the taxes due the state. The DEQ’s Hal Fitch will just take Rio Tinto’s word for it; and in turn, Hal Fitch wants every taxpayer in Michigan to take his word for it.”
For several years Halley represented the National Wildlife Federation in a contested case against the DEQ and Kennecott (Rio Tinto), challenging the mining permit for the Eagle Mine. The case is now at the Michigan Court of Appeals. Other parties challenging the permit in the case are the Keweenaw Bay Indian Community, the Yellow Dog Watershed Preserve and the Huron Mountain Club.
“It was through the contested case, for which I was one of the attorneys, that we found out about this non-profit organization,” Halley said. “I support citizens finding out the truth and state officials being accountable for accepting money from private industry, especially when it’s the same state officials who make the permitting recommendations for those same companies.”
“There are serious concerns about the connections between the mining industry and the regulatory role of the state,” agrees Alexandra Thebert, executive director of Save the Wild U.P. “In the best interest of all Michiganders, we are calling for the Department of Justice to investigate.”
Projected sale of Eagle Project to Lundin Mining Corporation would not alter plans for investigation
The news (released last week) about Rio Tinto’s plans to sell the Eagle Project to the Lundin Mining Corporation does not change the plans by Save the Wild U.P. and other groups to call for a Department of Justice (DOJ) investigation.
“No change here — same mine, same state permits and lousy state regulators,” says Jeffery Loman. “If Rio Tinto executives violated the law, selling Eagle Mine isn’t going to get them off the hook.”
Gene Champagne agreed: “As far as I am concerned, it does not change my call for a DOJ investigation. The NMGRA is going nowhere and neither is RT. They still have large landholdings and mineral leases in the UP. RT is just moving on to another deposit in the UP and leaving Lundin with the mess they started at Eagle.”
In response to a question from Keweenaw Now, Rio Tinto had little to say about the potential investigation.
“We are aware of the recent allegations made by a group of community members,” said Dan Blondeau, director of communications and media relations for Rio Tinto Eagle Mine.
Concerning Rio Tinto’s future plans in the region following the sale of the Eagle Project, Blondeau said, “The binding agreement between Rio Tinto and Lundin Mining Corporation is for Eagle Mine — which includes the mine, mill, and selected property adjacent to the mine. Rio Tinto controls roughly 400,000 acres of mineral rights in the UP and is assessing future plans with other exploration efforts.”
Notes:
* Click here for an overview of NMGRA’s non-profit status.
** Click here for the DEQ page on Michigan’s two geological repositories. The page gives contact information for Melanie Humphrey and links to information on the repositories.
*** SeePart 601, Section 324.60105: Michigan geological survey; collection and conservation of cores, samples, and specimens.
MARQUETTE — Local residents, including KBIC tribal members, Concerned Citizens of Big Bay, and Save the Wild U.P., rallied at a joint press conference on Saturday June 8th, calling for a corruption investigation related to activities of an unusual ‘non-profit’ corporation, the Northern Michigan Geologic Repository Association (NMGRA), based in Marquette County.Nearly two dozen citizens spent Saturday afternoon in the Michigan DEQ parking lot, holding hand-lettered signs that outlined corruption concerns, speaking with locals driving by, participating in a question-and-answer session, and reviewing the murky facts surrounding NMGRA.
While Rio Tinto was in the process of planning and constructing the mine at Eagle Rock, high-ranking State officials directly charged with enforcing mining safety and environmental regulations formed the Northern Michigan Geologic Repository Association as a ‘non-profit’ corporation. The NMGRA Board of Directors features Rio Tinto and Bitterroot Resources mining executives alongside DEQ officials. At the same time, these state officials were failing to enforce environmental and safety regulations enacted to protect the health and well-being of U.P. citizens.Rio Tinto claimed it needed a 10 megawatt substation and miles of private power lines to electrify the core shed adjacent to the Eagle Mine site. However, once the power had been installed, the core shed was deemed unnecessary, and Eagle Mine was electrified instead — a bait-switch move that sidestepped permitting, due process, and public participation.
“The citizens of Michigan have consistently been denied access to information with regard to this so-called non-profit. Today we are pulling back the veil of secrecy,” explained attorney Jana Mathieu, who filed requests for information related to NMGRA which went unanswered.
Jeffery Loman, KBIC tribal member and former federal oil regulator, led the group on a walking tour of a large cinder block warehouse building located nearby, identified by signage as a “State Warehouse.” The property is actually leased by the nonprofit Northern Michigan Geologic Repository Association, and serves as its core shed, housing valuable core samples. Local workers report seeing only Rio TInto vehicles accessing the warehouse.
“This core shed symbolizes Rio Tinto’s end-run around Part 632, the legislation governing non-ferrous mining in Michigan,” said Loman.
“Something smells bad here. Why create a private non-profit to perform a function of the State of Michigan? The circumstances surrounding these dealings between State officials and mining companies look like a bad rash on this administration,” said Loman. “Sunshine is the best disinfectant. Hopefully Governor Snyder will agree.”
“This is a barrel of rotten apples,” said Mary Ellen Krieg, resident of Big Bay.
“As things stand, there’s no plan for any independent review of the quantity, content and grade of the ore removed at Eagle Mine. Essentially, that means the State is allowing Rio Tinto to self-report its income which serves as the bases for the taxes due the State. The DEQ’s Hal Fitch will just take Rio Tinto’s word for it, and in turn, Hal Fitch wants every taxpayer in Michigan to take his word for it,” explained Michelle Halley, an attorney based in Marquette.
“Great place for hiding something. It looks totally neglected. Here’s this big building covered with peeling paint, surrounded by invasive knapweed and erosion gullies — anyone driving by would assume it was a giant meth lab, not a top-secret core shed set up by mining executives and controlled by the Michigan DEQ,” says Gene Champagne of Concerned Citizens of Big Bay, a grassroots group which has been active in monitoring regulatory oversight of Part 632, the legislation governing non-ferrous mining in Michigan. “The more you look into this, the more it looks like either incompetence or fraud or even both.”
“There are serious concerns about the connections between the mining industry and the regulatory role of the state,” agrees Alexandra Thebert, Executive Director of Save the Wild U.P. “In the best interest of all Michiganders, we are calling for the Department of Justice to investigate.”
Save the Wild U.P. is a grassroots environmental organization dedicated to the preservation of the Upper Peninsula’s unique cultural and natural resources.
