Otter Stupidity

By Beacon Staff

On Jan. 10, state District Judge Joe J. Hegel told environmentalists they could proceed with litigation against the preliminary leasing of the so-called Otter Creek tracts to Arch Coal.

That the Greens are pursuing this case strikes me as otter stupidity. But first, some history and numbers:

Otter Creek came into Montana’s trust portfolio in the mid 1990s as a result of the successful environmentalist effort to block the Crown Butte gold mine northeast of Cooke City. The New York Times scored a Pulitzer, but as usual, American taxpayers got the shaft, paying $73 million to forever extinguish mining rights and eliminate all private property in the New World mining district.

Because the mine would have created lots of jobs and tax revenues over its life, the Clinton Administration offered an insulting $10 million in compensation to Montana.

Then-Congressman Rick Hill, R-Mont., convinced Congress to instead transfer 7,623 acres of coal ground at Otter Creek (south of Ashland) from BLM, containing about a half-billion tons of mineable coal, to Montana’s common schools trust in 1996.

Environmentalists and a small cadre of populist ranchers have since fought to block mining at Otter Creek, but after 14 years the Montana State Land Board finally moved to offer Otter Creek up for lease.

The first round in December 2009, the Land Board set a stiff $145 million minimum bid. No takers. In February, the board lowered the minimum and got one offer, from Arch Coal. On March 18, 2010, the board finally voted 3-2 to award the lease to Arch for $86 million. Five “Rising Tide” protesters from Missoula (where else) disrupted the meeting and were arrested for disorderly conduct.

Gov. Brian Schweitzer, Auditor Monica Lindeen, and Secretary of State Linda McCulloch voted for. Attorney General Steve Bullock voted no because he felt the minimum bid was too low.

Despite the fact that Otter Creek would fund “common schools,” Superintendent of Public Instruction Denise Juneau hypocritically voted no.

Arch Coal basically bought a first right to propose a mine that must still be approved. A railroad as well as three or four mine loadouts must be built. Royalties and taxes for Montana should be $250 million per year totaling $5 billion. Arch has also leased 730 million tons (at 10 cents a ton) of Great Northern Properties private coal mixed in with the state coal. Along with pre-existing state trust holdings, we’re looking at 1.4 billion usable tons.

Plaintiffs Northern Plains Resource Council, National Wildlife Federation, Sierra Club and Montana Environmental Information Center (represented by Earthjustice) claim that under the Montana Environmental Policy Act (MEPA), a full Environmental Impact Statement (EIS) of all impacts of future mining must be conducted before the leases can go up for bid.

Judge Hegel ruled that the Greens’ case could go forward, because the lease “would allow the Land Board to convert public property rights to private property rights, stripping away its special protections before even considering possible environmental consequences.”

Greens believe they’ve scored a victory. Have they? Arch has anted up the lease loot, and Montana is spending it. If Judge Hegel rules for an EIS, then the fight moves to the state Supreme Court, taking another two years. Then, with the EIS, that will result in more court delay upon completion. And yep, at the end, Arch might lose.

Now, if Arch Coal just tossed away $86 million for nothing, what’s the message for businesses wanting to invest here?

Further, if a legal scenario unfolds in which Arch Coal sues Montana to get its money back and wins, what happens to Montana’s already-tight budget? Kaboom.

So, if existing law allows such otter foolishness, it otter be changed, eh? Last I looked, our state legislature has 17 introduced bills and 105 drafts lined up in the hopper that deal with “environmental protection” – including at least three from coal-county state Sen. Alan Olson, at least one outright MEPA repeal bill, and at least one bill for a constitutional referendum revising the “clean and healthful environment” to “clean, healthful and economically productive environment.”

Some of those will pass. Seeing which ones Schweitzer signs otter be interesting.

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