Comments and Testimony by the Division 

Directory

• S.J.R. 2 Hearing concerning Designation of National Monuments, March 5, 2001 to Senate Natural Resources Committee by Alan R. Coyner, Administrator 
• S.J.R. 1 Hearing concerning R.S. 2477 Rights-of-Way, February 28, 2001 to Senate Natural Resources Committee by Alan R. Coyner, Administrator
• S.B. 106 Hearing concerning the State of Nevada Mapping R.S. 2477 Rights-of-Way, February 28, 2001 to Senate Natural Resources Committee by Alan R. Coyner, Administrator
• S. 2273, Black Rock Desert - High Rock Canyon Emigrant Trails, National Conservation Area Act of 2000, April 26, 2000 to U.S. Senate Committee on Energy and Natural Resources, Subcommittee on Forests And Public Land Management by Patrick Fagan, Geothermal Commissioner
• H.R. 2753, The Abandoned Mine Restoration Act of 1999, March 28, 2000 to U.S. House of Representatives Committee on Resources, Subcommittee on Energy & Mineral Resources by Alan R. Coyner, Administrator
• Status of the Nevada Division of Minerals and Its Programs, September 8, 1999 to Nevada's Legislative Committee on Public Lands by Alan R. Coyner, Administrator
• Proposed Revision of the Bureau of Land Management 3809 Regulations, May 3, 1999 to State of Nevada Clearinghouse by Alan R. Coyner, Administrator
• AB450 Hearing concerning Certain Fees Charged by the Division, April 26, 1999 to Senate Natural Resources Committee by Alan R. Coyner, Administrator
• AJR19 Hearing concerning Proposed Changes to the BLM 3809 Regulations, April 26, 1999 to Senate Natural Resources Committee by Alan R. Coyner, Administrator
• Hardrock Mining on Federal Lands, Reno Field Hearing, April 22, 1999 to National Research Council Committee on Geosciences, Environment, and Resources by Alan R. Coyner, Administrator
• AB103 Hearing concerning Changes to Organizational Structure of the Division and Certain Fees Charged by the Division, April 20, 1999 to Assembly Ways and Means Committee by Alan R. Coyner, Administrator

S.J.R. 2 Hearing
Senate Natural Resources Committee
March 5, 2001

Testimony of Alan R. Coyner, Administrator
Commission on Mineral Resources and Division of Minerals

The Commission on Mineral Resources and the Division of Minerals support S.J.R. 2 which expresses opposition to the designation of a national monument by the President of the United States without obtaining the approval of each state and local government in which the national monument is located.

Twenty one national monuments, totaling almost 6 million acres, were established or expanded during the Clinton administration through the use of the 1906 Antiquities Act. The president's power to designate monuments is not in the Constitution, but is delegated by Congress. In delegating that authority, Congress limited the scope of the Antiquities Act by its use of the terms "scientific," "historic," and "smallest area," and by its intent to protect objects of antiquity. Nevertheless, the use of the Antiquities Act by the Clinton administration stopped a coal mine (Escalante), prevented oil and gas development (Missouri Breaks), designated a wild and scenic river next to a nuclear facility (Hanford), set aside habitat for endangered species (Siskiyou), and ended mineral exploration and development (Ironwood). While some of these designations may have merit, they should not have been accomplished through the Antiquities Act.

Although Nevada was not directly impacted by the recent National Monument designations, the Commission and the Division continue to be concerned with the cumulative effect of public land designation and our ability to further the responsible development and production of the state's mineral resources to the benefit and welfare of the people of Nevada. Designations such as these, which may be politically motivated, are particularly disturbing in that the impacts to state and local governments are given little if any attention during the designation process. Nevada is not immune from this impact as exemplified by the recent controversy surrounding the creation of the Black Rock Desert National Conservation Area and its associated wilderness areas.

Given the large amount of federally managed land in Nevada, some 87% of our total land area, we should expect such controversies over public land designations to occur in the future. We support the efforts of the Nevada Legislature, to mitigate the controversy and build beneficial partnerships with the Federal government concerning the management of our public lands as envisioned in S.J.R. 2.

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S.J.R. No. 1 Hearing
Senate Natural Resources Committee
February 28, 2001

Testimony of Alan R. Coyner, Admininstrator
Commission on Mineral Resources
Division of Minerals

The Nevada Commission on Mineral Resources and the Division of Minerals support S.J.R.1 which seeks to amend the Federal Land Policy and Management Act of 1976 to require the identification, mapping and recognition of certain rights-of-way across land administered by the Federal Government. The Commission and the Division have provided input and voiced support for many different initiatives over the years concerning R.S.2477 rights-of-way. We were active participants in the proposed rule making by the Department of the Interior in 1994 and 1995 to revise the R.S.2477 statute. We supported the actions of Congress in 1996 and subsequent years that prohibited the Department from "developing, promulgating, and thereafter implementing a rule concerning rights-of-way under Section 2477 of the Revised Statutes" unless they were expressly authorized by an Act of Congress subsequent to 1996. We continue to be critical of the current position of the Department that continues to recognize the instructional memorandum issued by the Secretary in 1993 that "defers the processing of any R.S.2477 assertions except in cases where there is demonstrated, compelling, and immediate need to make such determinations."

We hope that S.J.R.1, which is nearly identical in scope and intent to S.J.R.2 passed by the Nevada Legislature in 1999, can be of help in breaking the R.S.2477 impasse. We particularly support the fact that these resolutions seek to have the federal land management agencies provide funding to each state to identify and map the R.S.2477 rights-of-way.

S.B.106 Hearing
Senate Natural Resources Committee
February 28, 2001

Testimony of Alan R. Coyner, Administrator
Commission on Mineral Resources
Division of Minerals

The Nevada Division of Minerals, a part of the Commission on Mineral Resources, is responsible for administering programs and activities to promote, advance, and protect mining and the development and production of petroleum and geothermal resources in Nevada. The Division's mission is to conduct activities to further the responsible development and production of the State's mineral resources to benefit and promote the welfare of the people of Nevada. The seven-member Commission on Mineral Resources is a public body appointed by the Governor and directs mineral-related policy for the Division and advises the Governor and Legislature on matters relating to mineral resources. The Division focuses its efforts on three main areas: Industry relations and public affairs; regulation of oil, gas, and geothermal drilling activities and well operations; and abandoned mine lands.

The agency is involved in a wide array of activities relating to mineral development. Staff compiles annual data on all active mines in Nevada and maintains the State's mine registry. Information concerning mining operations and production is made available to the public through this yearly publication. Educational documents and materials concerning many aspects of the minerals industry are also produced. The Division participates in governmental activities affecting policies and laws concerning the minerals industry and resource development. The Division administers the State's reclamation bond pool.

The Division is responsible for permitting, inspecting, and monitoring all oil, gas, and geothermal drilling activities on both public and private lands in Nevada. Staff also monitors production of oil, gas, and geothermal resources to insure proper management and conservation. The Administrator is the Governor's Official Representative to the Interstate Oil and Gas Compact Commission.

The Division's abandoned mine lands program provides for public safety by identifying and ranking dangerous conditions at mines that are no longer operating, and by securing dangerous orphaned mine openings. The program continually urges the public to recognize and avoid hazardous abandoned mines.

The Division receives no state general fund money and operates entirely on fees collected from the mineral industry and a small amount of grant money. The fees collected by the agency are set by regulation by the Commission on Mineral Resources.

The Commission and the Division have provided input and voiced support for many different initiatives over the years concerning R.S.2477 rights-of-way. In the 1999 legislative session, we supported S.J.R.2 which sought to amend the Federal Land Policy and Management Act of 1976 to require the identification, mapping and recognition of certain rights-of-way across land administered by the Federal Government. Similarly, the Commission and the Division support S.J.R.1 of this legislative session which is nearly identical in scope and intent to the 1999 joint resolution. Of particular importance is that these resolutions seek to have the federal land management agencies provide funding to each state to identify and map the R.S.2477 rights-of-way.

S.B.106 proposes a new initiative for the R.S.2477 validation process in Nevada, led by the Division of Minerals with an appropriation from the state general fund. The bill also allows grants and donations to be applied for and used. This initiative parallels similar efforts currently underway in the states of Alaska and Utah. The Commission and the Division are keenly aware of the cumulative impact new land withdrawals, resource management plan restrictions, and land management regulations are having on the ability to access public lands in Nevada. We are also aware that this loss of access extends beyond the core mineral industry mission of the Division to include such activities as agriculture, ranching, timber harvesting, and recreation. Validating R.S.2477 rights-of-way provides an opportunity to mitigate some of the impacts of these federal actions.

While the Commission and Division support S.B.106 in principle, we must raise several concerns of a practical nature:

1) The bill contains an appropriation not included in the Executive Budget.

2) The bill will place new duties on the Division beyond its current scope of activities. Staff workload is of special concern due to an anticipated workforce reduction of one full time employee from ten to nine under the proposed FY02/FY03 budget.

3) Because of workload concerns, should the bill be enacted the Division intends to contract as necessary to accomplish the bill's objectives.

Statement of
Patrick Fagan
Geothermal Commissioner, Nevada Commission on Mineral Resources

before the
U.S. SENATE COMMITTEE ON ENERGY AND NATURAL RESOURCES
SUBCOMMITTEE ON FORESTS AND PUBLIC LAND MANAGEMENT
APRIL 26, 2000

concerning
S.2273
BLACK ROCK DESERT - HIGH ROCK CANYON EMIGRANT TRAILS
NATIONAL CONSERVATION AREA ACT OF 2000

Good morning, ladies and gentlemen, Mister chairman and members of the Subcommittee on Forests and Public Land Management of the U.S. Senate Committee on Energy and Natural Resources.

My name is Patrick Fagan and I am a member of the Nevada Commission on Mineral Resources representing geothermal resources. The Commission is a seven-member public body appointed by the Governor to direct mineral-related policy for the State Division of Minerals and advise the Governor and the Legislature on matters relating to mineral resources. Through the Division of Minerals, the Commission conducts activities to further the responsible development and production of the state’s mineral resources to benefit and promote the welfare of the people of Nevada. A significant component of that mission is facilitating industry relations and public affairs for the geothermal industry and regulation of geothermal drilling activities and well operations in the state.

Thank you for providing me the opportunity to appear before you today concerning Senate Bill S.2273, the Black Rock Desert - High Rock Canyon Emigrant Trails National Conservation Area Act of 2000. The Commission on Mineral Resources has formally adopted a position of opposition to the bill as currently proposed. The reason the Commission opposes the creation of the National Conservation Area (NCA) is that the proposed legislation withdraws 690,000 acres of public land from the operation of the geothermal leasing laws and the mining law. These same lands contained within the NCA have been repeatedly identified by government agencies and private industry to contain significant potential for the development of clean, renewable geothermal energy.

Nevada is the second largest producer of geothermal power in the nation. Currently, there are 14 plants at 10 locations producing 1.63 million net megawatt hours of electricity annually using geothermal resources. Geothermal power plants currently supply northern Nevada with approximately 10% of its total power demand, enough power to serve 100,000 homes. In 1999, this electrical production had a sales value in excess of $100 million dollars, provided over $4 million dollars in royalty payments, and paid significant property and other taxes.

Furthermore, Nevada is widely recognized as the state having the highest potential to add significant geothermal production capacity in the future. Secretary of Energy Bill Richardson and Nevada’s Senator Harry Reid recently announced a new Department of Energy initiative known as GeoPowering the West. The goal of this initiative is to provide ten percent of the electricity needs of the Western states by 2020 from geothermal energy through identification and development of new sites and existing reservoirs. As part of the initiative, the DOE is awarding $5 million in initial grants to provide technical assistance to support the design and testing of new geothermal technology. Nevada is expected to be a major beneficiary of this program.

In a DOE press release concerning GeoPowering the West Senator Reid said, "Nevada is on the cutting edge of geothermal research and technology and the Department of Energy’s multi-year campaign to increase the use of geothermal energy in western states will help Nevada reach its full potential as the nation’s foremost producer of geothermal energy." Senator Reid’s own press release stated, "This modest investment by the federal government has the potential to stimulate billions of dollars in investment and tens of thousands of new jobs and in turn help make Nevada the Saudi Arabia of geothermal energy."

Senators, the land withdrawals and prohibition of geothermal leasing proposed in S.2273 run entirely counter to the initiatives proposed in GeoPowering the West.

In the late 1970's the United States Geological Survey investigated the geothermal occurrences in the western United States. Using technology available at the time, the Survey classified areas having resources with the potential for electrical production as "Known Geothermal Resource Areas" or KGRA’s. Twentyone KGRA’s were identified in Nevada, and development has occurred in nine areas. Of the remaining twelve KGRA’s, eight are threatened by the establishment of the NCA proposed in S.2273.

The geothermal industry in this country, and especially Nevada, is in its infancy. The first geothermal power plant in Nevada was commissioned only 16 years ago in 1984. Further geologic resource evaluations using current methodologies need to be done to increase our level of understanding of geothermal systems. New technologies are just now becoming available which will allow the use of lower temperature waters for power production. Secondary and tertiary utilization opportunities such as vegetable drying and fish farming have become economically viable only in the past few years.

My service to the Nevada Public Utilities Commission has given me a great deal of personal experience concerning the development of Nevada’s geothermal electrical production in a regulated utility environment. As Nevada approaches the deregulation of its power industry, for the first time independent power producers and entrepreneurs will have the ability to capture the true promise of geothermal’s clean renewable energy. In a deregulated marketplace, I believe many consumers will be willing to pay a slight premium for electrons produced from green sources such as geothermal, solar, and wind power generation.

In conclusion, the land withdrawals and prohibition of geothermal leasing proposed in the Black Rock Desert - High Rock Canyon Emigrant Trails National Conservation Area Act cuts the Nevada geothermal industry off at the knees. The Nevada Commission on Mineral Resources is deeply concerned about the cumulative impacts of major land withdrawals such as this on, not only the geothermal industry, but also the ability of the mineral industry to explore for and develop additional mineral resources in Nevada.

Geothermal energy and mineral production continue to be major factors in the economy of Nevada, especially in its rural areas. Nevada needs a much higher level of understanding about the geothermal and mineral potential of the Black Rock Desert area before it can support legislation of the scope and magnitude of U.S. Senate Bill S.2273.

Thank you and I would be happy to answer any questions you might have.

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Statement of
ALAN R. COYNER
Administrator, Nevada Division of Minerals

before the
U.S. HOUSE OF REPRESENTATIVES COMMITTEE ON RESOURCES,
SUBCOMMITTEE ON ENERGY & MINERAL RESOURCES
MARCH 28, 2000

concerning
H.R.2753, THE ABANDONED MINE RESTORATION ACT OF 1999

Good morning, ladies and gentlemen, Madam chairman and members of the Subcommittee on Energy and Mineral Resources of the U.S. House of Representatives Committee on Resources.

My name is Alan Coyner and I am the administrator of the Division of Minerals for the State of Nevada. The mission of the Division is to conduct activities to further the responsible development and production of the state’s mineral resources to benefit and promote the welfare of the people of Nevada. The Division reports directly to the Governor and the Legislature through the Commission on Mineral Resources. The Division focuses its efforts in three main areas: industry relations and public affairs; regulation of oil, gas, and geothermal drilling activities and well operations; and abandoned mine lands.

Thank you for providing me the opportunity to appear before you today in support of H.R.2753, the "Abandoned Mine Restoration Act of 1999" sponsored by Congressman Jim Gibbons of Nevada. This act would establish an important new program and authorize the Secretary of the Army to assist Federal and State agencies to address the serious environmental and water quality problems caused by drainage and related impacts from abandoned and inactive hardrock (non-coal) mines in Nevada and throughout the western United States.

What is the problem?

The geology which underlies the western United States is highly permissive for the occurrence of hardrock minerals such as gold, silver, copper, lead, zinc, and many others. For over 150 years the mines and mills of the West have provided minerals and economic wealth to this nation.

In contrast to today’s high-tech mining industry, the vast majority of what we consider abandoned and inactive hardrock mine sites were constructed before current mining methods and modern environmental regulations. This lack of safeguards has resulted in adverse effects to the environment from such things as acid rock drainage and heavy metal contamination. Since many of the sites are historic, some dating back to the 1800's, in most cases the individuals or companies responsible for the problem are no longer present to help with the remediation and reclamation of the site.

The adverse water quality impacts from abandoned or inactive mine sites can be extremely complex and require highly site-specific solutions. Even with best engineering practices, the level of specific improvement at any given site cannot be predicted in advance. Cleanup must proceed on a "best effort" basis, since desired water quality standards may not be attained and complete restoration is impractical.

How big is the problem?

Nevada is located in one of the most highly mineralized regions of the earth’s crust. We are the nation’s largest producer of gold, silver, and barite. The state’s nickname, the Silver State, derives from the fabulous Comstock Lode discovered in 1859 near Virginia City. The riches from this single deposit facilitated the admission of Nevada into statehood in 1864 and helped the Union finance the Civil War.

The Nevada Bureau of Mines and Geology has documented 526 mining districts in the state which have had significant mining and milling activities. Within each district there are numerous individual mine sites. While the whole universe of sites in Nevada is quite large, the sites that pose a potential threat to the environment is believed to be a much smaller subset, probably on the order of one to two hundred sites.

Are we doing anything about the problem?

Progress towards the remediation and reclamation of abandoned and inactive hard rock mine sites has been seriously impeded by two issues -- lack of funding and concerns about liability. Several western states, notably Colorado, Montana, Wyoming, and Utah have been able to initiate abandoned mine land reclamation programs with the help of funds obtained from the Surface Mining and Reclamation Act of 1977, which places a per ton assessment fee on coal production.

Other states with significant past and current hardrock mineral production including Nevada, California, Arizona, Idaho, and Alaska have made only very limited progress. In Nevada, for example, I am aware of only three sites that have received funding for on-the-ground environmental remediation and reclamation activities. Meanwhile, these same states account for the bulk of the approximately $30 million dollars derived from the $100 dollar annual maintenance fee on hardrock mining claims. This fee, which has been widely viewed as a potential source of funding for abandoned mine lands cleanup, is currently allocated by Congress to the Department of the Interior for administration of the mining law.

Liability concerns continue to be a disincentive to the cleanup of abandoned mine sites. The Clean Water Act and the Comprehensive Environmental Response, Compensation and Liability Act, as currently written, are major stumbling blocks to progress on this issue. Due to questions of liability, many "Good Samaritan" efforts involving voluntary cleanups or remining by industry have been impeded.

In recognition of the environmental problems associated with abandoned and inactive mine sites, Nevada formed an Abandoned Mine Lands Environmental Task Force in 1999. The task force is comprised of six federal agencies and six state agencies with environmental responsibilities in the state. The agencies have entered into an memorandum of understanding describing the goals and objectives of the task force, and published an initial report which highlights the cleanup of two abandoned mine sites and describes 33 other sites being considered for remediation and reclamation. Three agencies appearing before you today, the United States Army Corps of Engineers, the University of Nevada Reno Mackay School of Mines Mine Life-Cycle Center, and the Division of Minerals, are members of the task force. We believe the task force approach will foster cooperation among the member agencies and will result in the most efficient use of available funds and the maximum amount of actual on-the-ground cleanup.

How will H.R.2753 help solve the problem?

The member agencies of the Nevada Abandoned Mine Lands Environmental Task Force have contributed the time and expertise of their employees to help prioritize known abandoned mine sites with environmental problems. Only the Bureau of Land Management, however, has been able to fund on-the-ground cleanup activities to date. Two sites were remediated and reclaimed in Fiscal Year 1999 with $200,000 in funding, and $300,000 for two more sites has been budgeted for Fiscal Year 2000. While this is a solid beginning, it clearly falls short of what is needed to make significant gains against the problem.

The Nevada Abandoned Mine Lands Environmental Task Force is the vehicle we have built in our state to address the environmental impacts from abandoned and inactive hardrock mines. H.R. 2753 will help provide the fuel to power our vehicle. The full authority of the Corps of Engineers Restoration of Abandoned Mines (RAMS) program will be a strong addition to our efforts and bring invaluable engineering expertise necessary to solve the abandoned mine lands problem. Participation in the task force will assure the projects funded by the Corps will improve the quality of the environment, are in the public interest, and most importantly, will be cost-effective.

The State of Nevada welcomes the assistance of the United States Army Corps of Engineers in the remediation of environmental problems caused by abandoned and inactive hardrock mine sites in the state and supports the expeditious passage of H.R.2753, the "Abandoned Mine Restoration Act of 1999."

Madam Chairman, this concludes my prepared remarks. Again, I want to thank the Committee for holding this hearing and drawing attention to this important piece of legislation. I will be happy to try and answer any questions that you might have at the appropriate time.

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Nevada’s Legislative Committee on Public Lands

Testimony of Alan R. Coyner, Administrator
Nevada Division of Minerals
September 8, 1999

Good morning Mr. Chairman and members of the Committee. My name is Alan Coyner and I am the administrator of the Nevada Division of Minerals.

This morning I would like to advise you on the status of the Division and its programs. First, I will update you concerning the change in our structure as a result of the 1999 legislative session; second, I will briefly describe some of the recent activities of the Division; and third, I will discuss some relatively disturbing, but not unanticipated, results from our annual mineral exploration survey.

In the 1999 legislative session, with the help of the members of this committee, AB103 and AB450 were successfully passed into law. This legislation removed the Division from the Department of Business and Industry and placed it in a direct reporting role to the Governor under the Commission on Mineral Resources. The seven-member Commission is a public body appointed by the Governor and directs mineral-related policy for the Division and advises the Governor and the Legislature on matters relating to mineral resources. The commissioners represent segments of industry; large scale mining, small scale mining, exploration and development, oil and gas, geothermal resources, and public-at-large. The change in our structure has proved highly successful and brought the mission of the Division even more closely in alignment with the goals and objectives of the Commission.

With the recognition that the Division receives no general fund money, the legislation also changed five administrative fees collected by the Division from statutory (set by the legislature) to regulatory (set by the Commission). The wisdom of this decision was tested in July when the Commission held five public workshops and made many contacts with industry, to receive input on proposed increases to four of the five fees. As you might expect, given the condition of the mineral industry, raising fees was not a popular idea. The changes were met with what I would categorize as "reluctant acceptance", however, what was truly gratifying was the testimony of many people who affirmed again and again the value of the Division’s programs. In large part this is due to the fine leadership of my predecessor at the Division, Russ Fields, and to him we owe a debt of gratitude. We are hopeful that the changes made by the Commission will stabilize the Division’s budget for the next biennium.

Let me move next to several of our recent activities. As you know, the mission of the Division can be divided into four areas: government affairs, which includes mineral education; abandoned mine lands; oil, gas, and geothermal regulation; and the reclamation bond pool.

In the area of government affairs, the Division again published the "Major Mines of Nevada 1998". This document is a summary of the annual mineral production and the economic impact of the mining industry on our state. Nevada led the nation in the production of gold, silver, and barite, as it has for several years. Gold production reached nearly 8.9 million ounces, a new state record and a 17% increase over the 7.8 million ounces mined in 1997. This is a truly remarkable feat and places Nevada third in the world behind only South Africa and Australia. Silver production fell slightly to 21.5 million ounces from a record 24.7 million ounces in 1997, but still left Nevada with an undisputed claim to being the "Silver State." Industrial minerals, especially gypsum for wallboard, experienced strong demand in part due the continued building expansion in southern Nevada. While production amounts set new records, the value of our mineral production remained steady at about $3.2 billion, due primarily to lower gold prices. This does not portend well for 1999, as the State is currently experiencing lower gold production levels and prices than in 1998.

Again this year, with the help of the Nevada Mining Association, the Nevada Bureau of Mines and Geology, and industry volunteers, the Division sponsored two very successful teacher’s workshops in Las Vegas and Winnemucca. These workshops supplement our nearly two hundred annual presentations we make in Nevada classrooms on the importance of mining and minerals to our State. We were delighted to host the National Minerals Education Conference this June in Elko, which drew the "who’s who" of mineral education from around the country. This state’s continued dedication to the idea that our citizens need to be aware of the importance of our natural resources and our mineral industry was recently rewarded by the naming of our mineral education program as the 1999 Trophy Winner in the Excellence in Mining Education Award by the National Mining Association.

The Division continues its work in the physical securing of orphaned abandoned mine sites on public lands, even with a workforce reduction of one full time position in this program. We obtained an additional grant this year from the BLM to accelerate our efforts in the Carson City - Reno Urban Interface. We also were awarded another grant from the BLM to initiate a major new program concerning the remediation and reclamation of abandoned mine sites adversely impacting Nevada’s watersheds. This effort is being spearheaded by a task force made up of representatives from eleven major federal and state agencies. With the possibility of a multi-million dollar budget in calendar year 2000, the task force has targeted 33 sites in the state, and hopes to make significant inroads into this long-standing environmental problem.

The Division is responsible for permitting, inspecting, and monitoring all oil, gas, and geothermal drilling activities on both public and private lands in the state. The Nevada oil industry continues to face uncertain times, with 1998 production at about 800,000 barrels, a twenty-year low. Geothermal operators have their own set of challenges with the ending of price subsidies and the unknown effects of power deregulation.

The continued pressure of the regulatory environment, coupled with lower commodity prices, have conspired to make the small miner nearly extinct. It is hard to believe that as recently as twenty years ago, Nevada was home to hundreds of small hard rock mining operations. Depending on your definition of small, we now estimate that number to be less than ten. The state reclamation bond pool is not immune from that decline, and has experienced the first ever termination of a participant. While the pool remains fiscally sound, we have been forced to take legal action to recover collateral associated with the bond. This comes at a time when the bond pool is strongly needed, due to the unwillingness of traditional bonding sources to be involved in mining-related operations.

My closing comments concern the level of mineral exploration activities in Nevada. Exploration is the future of mining in the state, because new deposits need to be found to replace those which we are mining today. The Division conducts an annual survey to determine who is doing exploration in the state, how much are they spending, and their opinion about doing work in the state. We have documented a disturbing trend in recent years. Although companies continue to believe Nevada has unlimited geological potential for additional ore deposits, they are taking their exploration dollars elsewhere. Expenditures in Nevada have fallen from $139 million in 1997, to $91 million in 1998, and are projected to decline further in 1999. Mining claims reflect the same trend, falling from a high of 425,000 in 1990 to about 135,000 in 1998. Our initial projection for 1999 is 110,000 claims. The impact of this decline is most strongly felt in rural Nevada, where most exploration dollars are spent.

In order to gauge the magnitude of this impact, the Division recently commissioned a study by the Natural Resources Industry Institute at the University of Nevada Reno. We have published the results as "Economic Impacts of Proposed Changes in U.S. Mining Laws and Public Lands Regulations on Nevada" and it will be reviewed for you today by one of its authors, Dr. John Dobra. His results will confirm what many of us already know – access to public land and a reasonable regulatory environment are paramount for a healthy mining industry. And a healthy mining industry is vital to the economic health of our rural counties, and indeed our state.

Thank you and I would be pleased to answer any questions. **

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Comments From the Division of Minerals
Concerning the Proposed Revision of the Bureau of Land Management 3809 Regulations

May 3, 1999

Heather Elliott
Nevada State Clearinghouse
Department of Administration
Budget and Planning Division
209 East Musser Street, Room 200
Carson City, NV 89701-4298

RE: Comments from the Division of Minerals concerning the Proposed Revision of the Bureau of Land Management 3809 Regulations

Dear Ms. Elliott,

The Division of Minerals supports Alternative 1, the "No Action" alternative, as described in the draft Environmental Impact Statement (DEIS) on Surface Management Regulations and Locatable Mineral Operations dated February 1999 and to maintain the existing 3809 Regulations without revision or modification.

The mission of the Division as promulgated by the Nevada Legislature is "to promote, advance, and protect mining and the development and production of petroleum and geothermal resources in Nevada." In light of that mission, the Division has great concern about the proposed revisions to Bureau of Land Management regulations contained in 43 CFR Part 3809 which govern mining operations involving metallic and other minerals on public lands, especially with regards to the projected negative impacts to the economy of the State of Nevada under the preferred alternative.

Hard rock mining is an integral part of Nevada history and the Nevada way-of-life. It is a truly unique phenomenon, paralleled but not equaled by any other state in the Union. Accordingly, Nevada has devoted a tremendous amount of time, energy, and money over the years to create and maintain a healthy, viable, and above all, responsible mineral industry.

An essential component of this phenomenon has been the relationship between Nevada and the federal agencies charged with the management of public land in the State. The "Nevada Model", as it is known in the mining industry, is testimony to the levels of effectiveness and efficiency reached by that cooperative relationship. That model is the product of the continuous and ongoing efforts of all the stakeholders, industry, government, and the public, to balance our global natural resource needs with our economic and environmental concerns. We are rightly and justly proud of it.

The Division, therefore, views with a sense of regret, the BLM initiative to revise the 3809 regulations in ways that many have characterized as onerous, burdensome, and duplicative. We believe Nevada mining is not only doing things right, but doing the right thing. Apparently there are those in the BLM who believe otherwise.

The economic impact to the State of Nevada due to decreased production of locatable minerals on public land by the implementation of the proposed action (Alternative 3) is estimated on page 214 of the BLM Draft Environmental Impact Statement (DEIS) to be $93 million dollars. Nevada's share of the reduced production value is more than half of the loss to the western region of the United States as a whole. When indirect economic effects are considered, the total impact could be in the hundreds of millions of dollars. Maximum protection (Alternative 4) is even more onerous to Nevada, with an estimated negative economic impact of $560 million annually, more than half of the annual nationwide impact of $1 billion (Table 3-33, page 219). Impacts of this magnitude to the well-being of the citizens of this State would be intolerable and unacceptable.

A significant portion of the mineral production value in the State of Nevada is derived from private land. Some of this production utilizes adjoining federal lands for facilities and infrastructure. A significant divergence by Federal regulation from State regulation could result in a dual regulatory structure for many Nevada mining properties. This divergence and any reduction in access to federal land due to implementation of the proposed regulations will result in an economic impact to mineral production from private land. The DEIS fails to account for that economic impact.

BLM records indicate there are about 7,300 claimants holding approximately 130,000 unpatented mining claims in the State of Nevada. This number far outdistances any other state. Fully 80 percent of those claimants hold 20 or fewer claims. It is this population we can justifiably term "the small miner." Although significant emphasis is given in the proposed regulations for the need to further regulate the future activities of this population, it is clear from recent experience, negligible impacts can be attributed to them from an overall environmental perspective. It is the Division's opinion, that this population would be significantly economically disenfranchised by the preferred alternative, yet the DEIS fails to take this circumstance into account.

Of great concern is the possible elimination of "casual use" and "notice-of-intent" level activities on public lands. "Casual use" and "notice level" activities are crucial to the initial steps of mineral exploration, whether it be for geological sampling, mapping, or exploration drilling. Proposals in the DEIS will add significant time delays and burdensome costs on small operators, as well as result in serious restrictions to the exploration activities conducted by larger companies. The result will be a drastic reduction in domestic exploration activity and long-term reductions in the development of mineral properties.

Many of the proposed changes to the 3809 regulations address the adequacy of the tools available to the BLM to "prevent unnecessary or undue degradation of the public lands." While the concept of unnecessary or undue degradation is normally framed in an environmental context, it also applies to the mineral resource and to the economic benefits derived from that resource, and the question might well be asked, "Is the current regulatory framework causing unnecessary or undue degradation to the mineral resource?" One example is the proposal to make backfilling of open pits mandatory, barring a compelling reason to keep them open. In almost every case, backfilling would condemn unrecovered mineral resources, and seriously impair their possible extraction by future generations. The BLM has a congressional mandate to manage the nation's mineral resources. Requiring backfilling of open pits would deplete the national storehouse of minerals which may be extracted in the future, when technological advances and favorable economics make their recovery feasible.

While the focus of the DEIS is on the economic impacts to current mineral production, it is nearly silent on the economic impacts to mineral exploration. To quote the DEIS text, "Success of mining depends on the success of exploration. ... The lag time between the first discovery of a mineral occurrence and the opening of a mine may be 10 years or more." (page 81). The Division of Minerals conducts an annual exploration survey to determine the level of exploration activity in Nevada and to ascertain what factors are influencing this activity level. Responses are generally received from approximately 50 companies, all of which have exploration programs in the State. Data from companies conducting exploration in the state indicate a reduction of nearly 30 percent in spending in Nevada for 1998 over 1997. This reduction is part of an ongoing trend of exploration dollars leaving Nevada and the rest of the United States for Australia, South America, and elsewhere. The economic impacts to Nevada, especially in our rural counties, from this situation are real and amount to hundreds of millions of dollars. The magnitude of the resulting economic loss from undiscovered new mineral deposits is nearly incalculable. The implementation of the proposed regulations will only serve to accelerate this trend. Again, the DEIS fails to account for this impact.

The following data from the Division of Minerals exploration survey provides evidence of the linkage between the regulatory framework and mineral exploration activity in the State:

Chart #1 - Active Claims in Nevada

• An increase in claim activity in the 80's led to major increases in the "rate of discovery" as defined by the number of deposits and ounces of reserves, and record gold production in the 90's.
• The $100 per claim annual maintenance fee enacted in 1993 resulted in a 60% reduction in the number of claims held, a loss of $20 million dollars annually in exploration expenditures toward the discovery of new deposits, and a redirection of $15 million dollars annually from exploration to the federal treasury.

Chart #2 - Factors Influencing Exploration Activity in Nevada

• Uncertainty of permitting time frame and actual length of permitting time frame are major considerations influencing exploration activity in Nevada. The proposed revision of the 3809 regulations is a component of this uncertainty.

Chart #3 - Exploration Expenditures for Companies Active in Nevada (dollars expended)

• Annual exploration expenditures worldwide steadily increased until 1998 from $450 million to $1.1 billion despite static or declining commodity prices.
• Total dollars spent in Nevada during that same period declined from $154 million to $120 million with a further decline projected to $94 million in 1998.

Chart #4 - Exploration Expenditures for Companies Active in Nevada (budget percent)

• Reflects the same observations of dollars expended but is expressed as a percentage.
• Reduces or eliminates the influence of price and suggests the "cost of regulation", including 3809, has contributed to an "undue degradation" of the economy of Nevada.

In addition, the Division has the following specific comments on the DEIS:

Administrative Costs and Fee Structure

The BLM administrative costs for regulatory oversight of the proposed 3809 regulations would increase by 25-33% for Alternative 3 (page 46) and double (approximately 200%) under Alternative 4 (page 50). Coupled with a projected decrease of 5% and 30% respectively in mining under the two alternatives, revenues from fees imposed on mining would decrease proportionately. It is possible that fees would be increased significantly to meet the increased administrative costs. Also, the administrative penalties described under 3809.700 may be driven more by the need for revenues than for environmental protection. In either case, the higher costs exacted from the mining industry would further erode the possibility of companies operating profitably and hasten the exodus of capital, employment and tax dollars from the U.S..

Potential Permit Delays due to Cultural Resource Mitigation

The DEIS contains numerous scenarios under which the BLM can delay permitting or production. For example, under Alternative 4, the discovery of archaeological, paleontological or cave resources could allow the BLM to require a company to cease operations until data recovery was accomplished. The DEIS sets no time constraints on recovery of data, so a company could be subjected to an indefinite permit delay or operational shutdown causing loss of revenues, personnel and opportunity to mine the resource. The ability to deny the right to mine under several of the "suitability" scenarios proposed in the DEIS may conflict with the general mining laws and constitute a taking of real property.

Environmental Management by a "One Size Fits All" Requirement

Prescribing inflexible requirements so that all companies must conform to a "one size fits all" approach to environmental management is unrealistic. The nature of ore bodies is unique, as is the particular geologic, climatic and social setting in which they occur. Successful environmental management occurs where the federal, state and local agencies can work with industry to solve site-specific problems. Under Alternatives 3 and 4, district and state office BLM personnel will be limited in their ability to address the unique characteristics of each mine site. Mine personnel will be reluctant to try novel approaches to environmental management because of the more rigid standards imposed by the new regulations. Innovation will be stifled for the sake of uniformity.

The Division of Minerals joins with many others in expressing strong disapproval that the Secretary of the Interior is closing public comment on the revisions to the 3809 regulations prior to the completion of the National Academy of Sciences study of the environmental and reclamation requirements for mining on federal lands and the adequacy of those requirements to prevent undue degradation. The Division formally requests the public comment period be extended for a period of sixty days beyond the completion date of the NAS study.

In conclusion, the Division recognizes Congress has the authority and responsibility to manage public land. It also recognizes that through statute, Congress has delegated that authority to federal agencies such as the Bureau of Land Management. The State of Nevada has worked hard and long with the BLM to further not hinder that management authority. To reverse that relationship through ill-advised rule making would be unwise and counterproductive to the well-being of Nevada and our Nation.

The Division of Minerals and many other State commissions, boards, and agencies, is firmly convinced the current regulatory structure is more than adequate to prevent unnecessary or undue degradation of the public lands in the State of Nevada. We, therefore, support Alternative 1, the "No Action" alternative, as described in the DEIS.

Sincerely,

Alan R. Coyner
Administrator

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AB450 Hearing
Senate Natural Resources Committee
April 26, 1999

Testimony of Alan R. Coyner, Administrator, Division of Minerals
on behalf of the
Commission on Mineral Resources

The Commission on Mineral Resources (CMR) supports the passage of AB450 as amended.

The effects of AB450 on the Division of Minerals are as follows:

Five of the six administrative fees collected by the Division would be changed from statutory set by the Legislature to regulatory set by the CMR. The sixth administrative fee, on geothermal production, is currently set through regulation by the CMR. This change would allow more flexibility in the timing of fee adjustments and provide for industry input through workshops and hearings. The fee-setting process is balanced both by the makeup of the CMR, with six industry representatives, and the appeals process through the Legislative Commission.

The CMR took a position of support at its November meeting to adjust fees, as necessary, to balance the FY00-FY01 budget proposed by the Division.

The accompanying table describes the five fees affected by AB103, including the proposed caps provided for in AB450.

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AJR19 Hearing
Senate Natural Resources Committee
April 26, 1999

Testimony of Alan R. Coyner, Administrator
Nevada Department of Business and Industry, Division of Minerals

The mission of the Division as promulgated by the Nevada Legislature is "to promote, advance, and protect mining and the development and production of petroleum and geothermal resources in Nevada." In light of that mission, the Division has great concern about the proposed revisions to Bureau of Land Management regulations contained in 43 CFR Part 3809 which govern mining operations involving metallic and other minerals on public lands, especially with regards to the potential impacts to the economy of the State of Nevada.

Hard rock mining is an integral part of Nevada history and the Nevada way-of-life. It is a truly unique phenomenon, paralleled but not equaled by any other state in the Union. Accordingly, Nevada has devoted a tremendous amount of time, energy, and money over the years to create and maintain a healthy, viable, and above all, responsible mineral industry.

An essential component of this phenomenon has been the relationship between Nevada and the federal agencies charged with the management of public land in the State. The "Nevada Model", as it is known in the mining industry, is witness to the levels of effectiveness and efficiency reached by that cooperative relationship. That model is the product of the continuous and ongoing efforts of all the stakeholders, industry, government, and the public, to balance our global natural resource needs with our economic and environmental concerns. We are rightly and justly proud of it.

The Division, therefore, views with a sense of regret, the BLM initiative to revise the 3809 regulations in ways that many have characterized as onerous, burdensome, and duplicative. We believe Nevada mining is not only doing things right, but doing the right thing. Apparently there are those in the BLM who believe otherwise.

The economic impact to the State of Nevada due to decreased production of locatable minerals on public land by the implementation of the proposed action is estimated on page 214 of the BLM Draft Environmental Impact Statement (DEIS) to be $93 million dollars. Nevada's share of the reduced production value is more than half of the loss to the western region of the United States as a whole. When indirect economic effects are considered, the total impact could be in the hundreds of millions of dollars. An impact of that magnitude to the well-being of the citizens of this State would be intolerable and unacceptable.

A significant portion of the mineral production value in the State of Nevada is derived from private land. Some of this production utilizes adjoining federal lands for facilities and infrastructure. A significant divergence by Federal regulation from State regulation could result in a dual regulatory structure for many Nevada mining properties. This divergence and any reduction in access to federal land due to implementation of the proposed regulations will result in an economic impact to mineral production from private land. The DEIS fails to account for that economic impact.

BLM records indicate there are about 7,300 claimants holding approximately 130,000 unpatented mining claims in the State of Nevada. This number far outdistances any other state. Fully 80 percent of those claimants hold 20 or fewer claims. It is this population we can justifiably term "the small miner." Although significant emphasis is given in the proposed regulations for the need to further regulate the future activities of this population, it is clear from recent experience, negligible impacts can be attributed to them from an overall environmental perspective. It is the Division's opinion, that this population would be significantly economically disenfranchised, yet the DEIS fails to take this circumstance into account.

While the focus of the DEIS is on the economic impacts to current mineral production, it is nearly silent on the economic impacts to mineral exploration. The Division of Minerals conducts an annual exploration survey to determine the level of exploration activity in Nevada and to ascertain what factors are influencing this activity level. Responses are generally received from approximately 50 companies, all of which have exploration programs in the State. Data from companies conducting exploration in the state indicate a reduction of nearly 30 percent in spending in Nevada for 1998 over 1997. This reduction is part of an ongoing trend of exploration dollars leaving Nevada and the rest of the United States for South America, Australia, and other countries. The economic impacts to Nevada from this situation are real and amount to hundreds of millions of dollars. The magnitude of the resulting economic loss from undiscovered new mineral deposits is nearly incalculable. The implementation of the proposed regulations will only serve to accelerate this trend. Again, the DEIS fails to account for this impact.

Many of the proposed changes to the 3809 regulations address the adequacy of the tools available to the BLM to "prevent unnecessary or undue degradation of the public lands." While the concept of unnecessary or undue degradation is normally framed in an environmental context, it also applies to the mineral resource and to the economic benefits derived from that resource, and the question might well be asked, "Is the current regulatory framework causing unnecessary or undue degradation to the mineral resource?" The following data from the Division of Minerals exploration survey provides evidence of the linkage between the regulatory framework and mineral exploration activity in the State.

Chart #1 - Active Claims in Nevada

• Increase in activity in the 80's led to major increases in the "rate of discovery" as defined by the number of deposits and ounces of reserves, and record production in the 90's

• The $100 per claim annual maintenance fee enacted in 1993 resulted in a 60% reduction in the number of claims held, a loss of $20 million dollars annually in exploration expenditures toward the discovery of new deposits, and a redirection of $15 million dollars annually from exploration to the federal treasury

Chart #2 - Factors Influencing Exploration Activity in Nevada

• Uncertainty of permitting time frame and actual length of permitting time frame are major considerations influencing exploration activity in Nevada

Chart #3 - Exploration Expenditures for Companies Active in Nevada (dollars expended)

• Annual exploration expenditures worldwide steadily increased until 1998 from $450 million to $1.1 billion despite static or declining commodity prices

• Total dollars spent in Nevada during that same period declined from $154 million to $120 million with a further decline projected to $94 million in 1998

Chart #4 - Exploration Expenditures for Companies Active in Nevada (budget percent)

• Reflects the same observations of dollars expended but is more easily seen as percentages

• Reduces or eliminates the influence of price and suggests the "cost of regulation", has contributed to an "undue degradation" of the economy of Nevada

The Division of Minerals joins with many others in expressing strong disapproval that the Secretary of the Interior is closing public comment on the revisions to the 3809 regulations prior to the completion of the study that the National Academy of Sciences was mandated to do by Congress.

In conclusion, the Division recognizes Congress has the authority and responsibility to manage public land. It also recognizes that through statute, Congress has delegated that authority to federal agencies such as the Bureau of Land Management. The State of Nevada has worked hard and long with the BLM to further not hinder that management authority. To reverse that relationship through ill-advised rule making would be unwise and counterproductive to the well-being of Nevada and our Nation.

The Division of Minerals and many other State commissions, boards, and agencies, is firmly convinced the current regulatory structure is more than adequate to prevent unnecessary or undue degradation of the public lands in the State of Nevada. We, therefore, support Alternative 1, the "No Action" alternative, as described in the BLM draft EIS.

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National Research Council
Committee on Geosciences, Environment, and Resources
Hardrock Mining on Federal Lands
Reno Field Hearing - April 22, 1999

Comments by Alan R. Coyner
Administrator, Nevada Division of Minerals

My name is Alan R. Coyner and I am the Administrator of the Division of Minerals for the State of Nevada. My educational background includes undergraduate work at Michigan Technological University in Geological Engineering and graduate work at the University of Minnesota Duluth in Geology. I have a master's degree in Business Administration from the University of Nevada Reno.

I have worked as an exploration geologist and manager in the minerals industry for nearly 25 years. My experience includes the exploration for, and development of, uranium, base and precious metal deposits, as well as industrial minerals. During my career I have worked for large international mining companies and small family-owned mineral producers.

The mission of the Division of Minerals, as promulgated by the Nevada Legislature, is "to conduct activities to further the responsible development and production of the State's mineral resources to benefit and promote the welfare of the people of Nevada." In light of that mission, the Division has great concern about the proposed revisions to the Bureau of Land Management regulations contained in 43 CFR Part 3809 which govern mining operations involving metallic and other minerals on public lands.

Hard rock mining is an integral part of Nevada history and the Nevada way-of-life. It is a truly unique phenomenon, paralleled but not equaled by any other state in the Union. Accordingly, Nevada has devoted a tremendous amount of time, energy, and money over the years to create and maintain a healthy, viable, and above all, responsible mineral industry.

An essential component of this phenomenon has been the relationship between Nevada and the federal agencies charged with the management of public land in the state. The "Nevada Model", as it is known in the minerals industry, is witness to the levels of effectiveness and efficiency reached by that cooperative relationship. That model is the product of the continuous and ongoing efforts of all the stakeholders, industry, government, and the public, to balance our global natural resource needs with our economic and environmental concerns. We are rightly and justly proud of it.

The committee has been asked by Congress to "assess the adequacy of state and federal statutes and regulations affecting hardrock mining on 'federal' lands that are intended to prevent unnecessary or undue degradation of 'federal' lands." While the concept of "unnecessary or undue degradation" is normally framed in an environmental context, I would suggest that it also applies to the mineral resource and to the economic benefits derived from that resource, and the question might well be asked, "Is the current regulatory framework causing unnecessary or undue degradation to the mineral resource?" With that in mind, I would like to present the committee with a data set that may provide evidence of the linkage between the regulatory environment and mineral exploration activity in the State.

The Division of Minerals conducts an annual exploration survey to determine the level of exploration activity in Nevada and to ascertain what factors are influencing this activity level. Responses are generally received from approximately 50 companies, all of which have exploration programs in the State.

Chart #1 - Active Claims in Nevada

• Increase in activity in the 80's led to major increases in the "rate of discovery" as defined by number of deposits and ounces of reserves, and record production levels in the 90's

• The $100 per claim annual maintenance fee enacted in 1993 resulted in a 60% drop in the number of claims and a corresponding loss of money being expended for discovery

Chart #2 - Exploration Expenditures for Companies Active in Nevada (dollars expended)

• Annual exploration expenditures worldwide steadily increased until 1998 from $450 million to $1.1 billion despite static or declining commodity prices

• During that same period total dollars spent in Nevada declined from $154 million to $120 million and further to projected 1998 expenditure of $94 million

Chart #3 - Exploration Expenditures for Companies Active in Nevada (budget percent)

• Reflects same observations as above but more easily seen as percentages

• Reduces or eliminates the influence of price and suggests the cost of regulation, in part, has "unduly degraded" the economy of Nevada

Chart #4 - North American Precious Metal Producers' Exploration Expenditures (budget percent) from John Dobra, UNR, Natural Resource Industry Institute

• Corroborates the trend identified above

• Confirms that exploration dollars are extremely liquid and flow internationally

Chart #5 - Factors Influencing Exploration Activity in Nevada

• Uncertainty of permitting time frame and actual length of permitting time frame are a major considerations influencing exploration activity in Nevada.

The famous economist John Maynard Keynes once said "In the long run we are all dead." It can also be said with the same level of certainty "In the long run economics is king." Successful regulation strikes a reasonable balance between environmental concern and economic activity. The Division of Minerals, along with the Nevada Legislature and many other State commissions, boards, and agencies, is firmly convinced the current regulatory structure is more than adequate to prevent unnecessary or undue degradation of the public lands in the State of Nevada.

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AB103 Hearing
Assembly Ways and Means Committee
April 20, 1999

Testimony of Alan R. Coyner, Administrator, Division of Minerals
on behalf of the
Commission on Mineral Resources

The Commission on Mineral Resources (CMR) supports the passage of AB103 as amended.

The effects of AB103 on the Division of Minerals are as follows:

1. The agency would be withdrawn from the Department of Business and Industry and become a division of the CMR. No new programs or staff would be created by this change. Reporting responsibility for the agency would be to the CMR which has direct reporting responsibility to the Governor. The $11,794 annual cost allocation to B&I would be reallocated to existing programs of the division.

2. The administrator of the division would be appointed by the CMR.

3. The division would retain its position on the State Environmental Commission.

4. Five of the six administrative fees collected by the division would be changed from statutory set by the Legislature to regulatory set by the CMR. The sixth administrative fee, on geothermal production, is currently set through regulation by the CMR. This change would allow more flexibility in the timing of fee adjustments and provide for industry input through workshops and hearings. The fee-setting process is balanced both by the makeup of the CMR, with six industry representatives, and the appeals process through the Legislative Commission.

The accompanying table describes the five fees affected by AB103, including the proposed caps provided for in AB450.

The CMR took a position of support at its November meeting to adjust fees, as necessary, to balance the FY00-FY01 budget proposed by the Division.