Mining bill defeated in Senate, mining company drops project

The Wisconsin State Senate has voted down a compromise mining bill, effectively killing a proposed iron ore mine near Hurley, Wis. 

The final vote was 17 to 16, with one senator, Republican Dale Schultz, casting the lone dissenting GOP vote.

Senate action came about one month after the State Assembly passed a bill to streamline the state’s permitting process, and follows subsequent efforts by Schultz and Sen. Robert Jauch, and later the Joint Finance Committee, to pass a compromise.

Following the vote, Bill Williams, president of Gogebic Taconite, the company that would have operated the mine, pulled the plug on the project. The company had estimated that as many as 3,000 jobs would have been created during the development and operation of the mine, which was expected to operate for approximately 35 years.

With the exception of Schultz, the vote was along party lines, with all 16 Senate Democrats opposing the compromise bill despite the endorsement of the mining project by several labor groups. Earlier in the week, five Wisconsin labor organizations reached a Memorandum of Understanding with Gogebic Taconite in support of Assembly Bill 426, signaling their support of attempts to modify the permitting of iron mining in Wisconsin.

As part of the memorandum, Gogebic Taconite also agreed to use Wisconsin contractors for construction of the project, and hire Wisconsin workers to carry out operations, including mining, processing, and transportation.

Throughout the debate, mining interests argued the bill streamlined permitting – specifically eliminating lawsuits that would follow administrative review by the state DNR and the federal EPA – without weakening environmental standards. They also noted that iron mining has been conducted in neighboring states like Minnesota and Michigan without environmental damage.

Business groups like the Wisconsin Mining Association and Wisconsin Manufacturers & Commerce lobbied hard for its passage. WMC denounced the Schultz-Jauch compromise, arguing that it included delays and legal challenges that would worsen what it called the state’s already poor regulatory climate for mining, and impose a $25 million surtax during the first five years of an iron ore mining operating. The organization said no other industry in the state “faces this type of punitive tax burden.”

Environmentalists countered that iron ore mining threatened water quality in one of the state’s most environmentally pristine areas, and indigenous Native American communities expressed concerns about the mine’s potential impact.

The project would not only have created jobs in northern Wisconsin, but also southeastern Wisconsin, home to prominent mining equipment manufacturers like Bucyrus and Joy Global.