HOUSE OF REPRESENTATIVES |
H.B. NO. |
2057 |
TWENTY-EIGHTH LEGISLATURE, 2016 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to mineral resources.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 182, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§182- Penalties, fees, and costs collected. All penalties, fees, and costs established and collected by the department pursuant to this chapter shall be deposited in the special land and development fund established under section 171‑19; provided that:
(1) Fees shall be charged in accordance with a schedule approved by the board;
(2) The proposed fee schedule shall be posted on the department's website at least forty-five days prior to the board meeting at which adoption will be considered;
(3) The board shall consider and adopt the fee schedule at a regular meeting after taking public testimony; and
(4) Setting of fees shall not be subject to chapter 91."
SECTION 2. Section 171-95, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:
"(c) For the purposes of this section, "renewable energy producer" means:
(1) Any producer or developer of electrical or thermal energy produced by wind, solar energy, hydropower, geothermal resources, landfill gas, waste-to-energy, ocean thermal energy conversion, cold seawater, wave energy, biomass, including municipal solid waste, biofuels or fuels derived from organic sources, hydrogen fuels derived primarily from renewable energy, or fuel cells where the fuel is derived primarily from renewable sources that sell all of the net power produced from the demised premises to an electric utility company regulated under chapter 269 or that sells all of the thermal energy it produces to customers of district cooling systems; provided that up to twenty-five per cent of the power produced by a renewable energy producer and sold to the utility or to district cooling system customers may be derived from fossil fuels; or
(2) Any grower or producer of plant or animal materials used primarily for the production of biofuels or other fuels; provided that nothing herein is intended to prevent the waste product or byproduct of the plant or animal material grown or produced for the production of biofuel, other fuels, electrical energy, or thermal energy, from being used for other useful purposes."
SECTION 3. Section 182-1, Hawaii Revised Statutes, is amended as follows:
1. By adding a new definition to be appropriately inserted and to read:
""Department" means the department of land and natural resources."
2. By amending the definitions of "geothermal resources", "geothermal resources exploration", and "mining lease" to read:
""Geothermal
resources"
means the natural heat of the earth, the energy, in whatever form, below the
surface of the earth present in, resulting from, or created by, or which may be
extracted from, such natural heat, and all minerals in solution or other
products obtained from naturally heated fluids, brines, associated gases, and
steam, in whatever form, found below the surface of the earth, but excluding
oil, hydrocarbon gas, other hydrocarbon substances, and any water, mineral in
solution, or other product obtained from naturally heated fluids, brines,
associated gases, and steam, in whatever form, found below the surface of the
earth, [having a temperature of 150
degrees Fahrenheit or less,]
and not used for
electrical power generation.
"Geothermal resources exploration" means either of the following:
(1) Conducting non-invasive geophysical operations, including geochemical operations, remote sensing, and other similar techniques; or
(2) Drilling exploration wells for purposes including, but not limited to, the extraction and removal of minerals of types and quantities;
that are reasonably required for testing and analysis to provide ground truth or determine the economic viability of geothermal resources. The term does not include "geothermal resources development".
"Mining lease" means a lease of
the right to conduct mining operations, including geothermal resource
exploration or development, on state lands and [on lands sold or leased by
the State or its predecessors in interest with a reservation of mineral rights
to the State.] reserved lands."
SECTION 4. Section 182-2, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) All minerals in, on, or under state lands or reserved lands [which hereafter become state
lands] are reserved to the State; provided that the board [of land and
natural resources] may release, cancel, or waive the reservation whenever
it deems the land use, other than mining, is of greater benefit to the State as
provided for in section 182-4.
[Such] The minerals are reserved from sale or
lease except as provided in this chapter. A purchaser or lessee of [any
such] the lands shall acquire no right,
title, or interest in or to the minerals. The right of the purchaser or lessee
shall be subject to the reservation of all the minerals and to the conditions
and limitations prescribed by law providing for the State and persons
authorized by it to prospect for, mine, and remove the minerals, and to occupy
and use so much of the surface of the land as may be required for all purposes
reasonably extending to the mining and removal of the minerals therefrom by any
means whatsoever."
SECTION 5. Section 182-4, Hawaii Revised Statutes, is amended to read as follows:
"§182-4 Mining leases on
state lands. (a) If any mineral is discovered or known to
exist on state lands, any interested person may notify the board [of land
and natural resources] of the person's desire to apply for a mining lease. The notice shall be accompanied by [a
fee of $100] the required fees as established by the board, together with a description of the land desired
to be leased [and], the
minerals involved, and any information and maps that the board by rule
may prescribe. As soon as practicable
thereafter, the board shall cause a public notice to be given in the county
where the lands are located, at least once in each of three successive weeks,
setting forth the description of the land, and the minerals desired to be
leased. The board may hold the public
auction of the mining lease within six months from the date of the first notice
or any further time that may be reasonably necessary. Whether or not the state
land sought to be auctioned is then being utilized or put to some productive
use, the board, after due notice of public hearing to all parties in interest,
within six weeks from the date of the first notice or any further time that may
be reasonably necessary, shall determine whether the proposed mining operation
or the existing or reasonably foreseeable future use of the land would be of
greater benefit to the State. If
the board determines that the existing or reasonably foreseeable future use
would be of greater benefit to the State than the proposed mining use of the
land, it shall disapprove the application for a mining lease of the land
without putting the land to auction. The
board shall determine the area to be offered for lease and, after due notice of
public hearing to all parties in interest, may modify the boundaries of the
land areas. At least thirty days prior to the holding of any public auction,
the board shall cause a public notice to be given in the State at least once in
each of three successive weeks, setting forth the description of the land, the
minerals to be leased, and the time and place of the auction. Bidders at the public auction may be
required to bid on the amount of annual rental to be paid for the term of the
mining lease based on an upset price fixed by the board, a royalty based on the
gross proceeds or net profits, cash bonus, or any combination or other basis
and under any terms and conditions that may be set by the board.
(b) Any provisions to the contrary
notwithstanding, if the person who discovers the mineral discovers it as a
result of exploration permitted under section 182-6, and if that person bids at
the public auction on the mining lease for the right to mine the discovered
mineral and is unsuccessful in obtaining such lease, that person shall be
reimbursed by the person submitting the highest successful bid at public auction for the direct or
indirect costs incurred in the exploration of the land, excluding salaries, [attorneys] attorney's fees, and legal expenses. The
department [shall have the authority to] may review
and approve all expenses and costs that may be reimbursed.
(c) Any proposed mining operations to be undertaken by a renewable energy producer, as defined in section 171-95(c), shall require an application to the board for a mining lease on state lands. Any provisions to the contrary notwithstanding, the application for a mining lease on state lands pursuant to this subsection may be granted by the board in accordance with this section, or the board, by the vote of two-thirds of the members to which the board is entitled, may grant a mining lease to the renewable energy producer without public auction."
SECTION 6. Section 182-5, Hawaii Revised Statutes, is amended to read as follows:
"§182-5 Mining leases on
reserved lands. If
any mineral is discovered or known to exist on reserved lands, any interested
person may notify the board [of land and natural resources] of the
person's desire to apply for a mining lease. The notice shall be accompanied by [a
fee of $100] the required fees, as
established by the board, together with a description of the land
desired to be leased and the minerals involved and [such] information
and maps as the board may by [regulation] rule prescribe. The
board may grant a mining lease on reserved lands in accordance with section
182-4, or the board may, by the vote of two-thirds of [its] the members to which the board is entitled,
without public auction, grant
a mining lease on reserved lands to the occupier thereof. [Such a] A
mining lease may be granted to a person other than the occupier if the occupier
has assigned the occupier's rights to apply for a mining lease to another
person, in which case only [such] an assignee may be granted a mining
lease. Any provisions to the
contrary notwithstanding, if the board decides that it is appropriate to grant
a geothermal mining lease on the reserved lands, the surface owner or the
owner's assignee shall have the first right of refusal for a mining lease. If the occupier or the occupier's
assignee of the right to obtain a mining lease should fail to apply for a
mining lease within six months from the date of notice from the board of a
finding by the board that it is in the public interest that the minerals on the
reserved lands be mined, a mining lease shall be granted under section 182-4;
provided that bidders at the public auction shall bid on an amount to be paid
to the State for a mining lease granting to the lessee the right to exploit
minerals reserved to the State."
SECTION 7. Section 182-6, Hawaii Revised Statutes, is amended to read as follows:
"§182-6 Exploration. Any person wishing to
conduct exploration on state lands or reserved lands shall apply to the
board [of land and natural resources who], which shall issue exploration
permits upon terms and conditions as it shall by [regulation] rule prescribe. During and as a result of the
exploration, no minerals of [such] types and quantity beyond that
reasonably required for testing and analysis shall be extracted and removed
from [such] state lands[.] or reserved lands. Upon termination of the exploration
permit, all exploration data, including but not limited to the drill logs and the results of the
assays resulting from the
exploration, shall be turned over to the board and kept confidential by the
board. If the person shall not make application for a mining lease of the
lands within a period of six months from the date the information is turned
over to the board, the board in its discretion need not keep the information
confidential.
This section shall be construed as authorizing the board to issue an exploration permit for geothermal resources as well as minerals."
SECTION 8. Section 182-7, Hawaii Revised Statutes, is amended as follows:
1. By amending subsection (a) to read:
"(a) Prior to the public auction
contemplated in section 182-4 or 182-5, or the granting of mining lease without
public auction contemplated in section 182-4 or 182-5, the board [of
land and natural resources] shall cause a mining lease for the land in
question to be drawn. The lease shall describe the land and shall contain, in
addition to such other provisions [which] that the board may deem appropriate, specific
provisions as provided in this section."
2. By amending subsections (d) through (f) to read as follows:
"(d) The lessee shall covenant and agree that the lessee shall commence mining operations upon the leased lands within three years from the date of execution of the lease; provided that so long as the lessee is actively and on a substantial scale engaged in mining operations on at least one such lease on the same minerals, the covenant shall be suspended as to all other leases held by the lessee.
Any interested party may[, however,]
request that a mining lease contain a research period under which the lessees
shall be required to expend money in research and development to establish a
method to make economical the mining and processing of the [mineral deposits
contained] minerals identified in the lease. If the board
determines that the research period would be beneficial, it shall fix
the period of research and shall also fix a minimum expenditure for labor
performed or money spent by the lessee [in] on research and development and the method by
which the lessee shall establish that such expenditure in fact be made. In [such]
these leases, the obligation to commence mining operations within three
years shall not commence until the expiration of the research period.
(e) For the period of the lease, the lessee shall have the exclusive right
of possession of the minerals leased and the exclusive rights to mine and
remove the minerals by means [which] that shall be reasonable and satisfactory to
the board and to occupy and use so much of the surface of the land as may
reasonably be required, subject to the provisions of section 182-3. The
right to use the surface shall include the right to erect transportation
facilities thereon, construct plants for beneficiating, drying, and processing
the minerals for electric power generation and transmission and [such]
other uses as may be approved
by the board. The other uses may include but need not be limited to uses necessary or convenient to
the [winning and] processing of the minerals; provided that the lessee
shall comply with all water and air pollution control laws, and rules of the
State or its political subdivisions.
(f) The lessee may retain all minerals
separated from the land as a part of the process of mining the minerals specified
in the mining lease; provided that the lease may prescribe the accounting and
testing procedures by which the amount and quality of [such] the additional
materials shall be determined for the purpose of computing the excise tax
thereon[.]
and the applicable
royalty that may be set by the board for the use of the minerals."
SECTION 9. Section 182-9, Hawaii Revised Statutes, is amended to read as follows:
"§182-9 Deposit; first
year's rental.
All bidders shall, prior to the date of public auction, post
with the board [of land and natural resources a deposit of $500.] the
required deposit, as established by the board, provided
that:
(1) The proposed deposit shall be posted on the department's website at least forty-five days prior to the board meeting at which adoption will be considered;
(2) The board shall consider and adopt the proposed deposit at a regular meeting after taking public testimony; and
(3) Setting of the deposit shall not be subject to chapter 91.
The board shall refund to unsuccessful bidders [such] the
amount within two days after the auction. All bidders, prior to the auction,
shall satisfy the board of their financial ability to conduct mining operations
and of their capability to develop a mine. The successful bidder shall pay to
the board the amount of the first year's rental within two days after the
acceptance of the bid by the board and the [$500] required
deposit, as established by the board, shall be credited against [such] the sum. If the deposit exceeds the first year's rental, the excess
shall be refunded. All rentals thereafter are payable in advance once a
year."
SECTION 10. Section 182-10, Hawaii Revised Statutes, is amended to read as follows:
"§182-10 Revocation of
mining leases.
A mining lease may be revoked if the lessee fails to pay rentals when due or
if any of the terms of the lease or of law are not complied with, or if the
lessee wholly ceases all mining operations for other than reasons of force
majeure or the uneconomic operation of the mining lease for a period of one
year without the written consent of the board [of land and natural resources];
provided that the board shall give the lessee notice of any default and the
lessee shall have six months or such other time limit as provided by the rules
[and regulations] from the date of the notice to remedy the
default."
SECTION 11. Section 182-14, Hawaii Revised Statutes, is amended to read as follows:
"§182-14 Rules [and regulations]. Subject to chapter 91, the
board [of land and natural resources] may [make, promulgate] adopt and amend [such] rules [and
regulations] as it deems necessary to carry out this chapter and to perform
its duties thereunder, all commensurate with and for the purpose of protecting
the public interest. All
[such] rules [and regulations] shall have the force and effect of
law."
SECTION 12. Section 182-17, Hawaii Revised Statutes, is amended to read as follows:
"[[]§182-17[]] Penalty for violation. (a) Any person who violates any provision of
this chapter, or any [regulation]
rule
adopted pursuant [hereto, shall be fined not more than $500 for each
offense.] to this chapter, shall be subject to a fine imposed by
the board; provided that the fine shall not exceed $5,000 per violation. If
any person after receiving written notice for a violation fails to cure [such]
the violation within [such]
the time and under [such] conditions as determined by [the
rules and regulations,
such] the board, the person shall be subject to a
citation for a new and separate violation. There shall be a fine of not more than [$500] $5,000 for each additional violation.
(b) No provision of this chapter shall bar the right of any injured person to seek other legal or equitable relief against a violator of this chapter.
(c) Except as otherwise provided by law, the board or its authorized representative by proper delegation may:
(1) Set, charge, and collect administrative fines or bring legal action to recover administrative fees and costs as documented by receipts or affidavit, including attorney's fees and costs; and
(2) Bring legal action to recover administrative fines, fees, and costs, including attorney's fees and costs, or payment for damages resulting from a violation of this chapter or any rule adopted pursuant to this chapter."
SECTION 13. Sections 182-3(a), 182-11, 182-13, and 182-15, Hawaii Revised Statutes, are amended by substituting the word "board" wherever the phrase "board of land and natural resources" appears, as the context requires.
SECTION 14. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 15. This Act shall take effect upon its approval.
INTRODUCED BY: |
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Report Title:
Board of Land and Natural Resources; Mineral Resources
Description:
Revises statutory provisions relating to the regulation of mineral resources under chapters 171 and 182, Hawaii Revised Statutes, to provide clarity and consistency.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.