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Why the Minnesota Court of Appeals’ PolyMet decision is so significant

Leftover structures from an old LTV Steel taconite facility
MinnPost photo by Walker Orenstein
Leftover structures from an old LTV Steel taconite facility that PolyMet hopes to refurbish and reuse for the copper-nickel mine it plans to build.

In March, PolyMet Mining announced it had all the permits it needed to build a copper-nickel mine near Hoyt Lakes. After 14 years of environmental review, the company’s biggest remaining hurdle was finding construction money for the $1 billion project — the first of its kind in Minnesota.

Now, 10 months later, PolyMet has yet to break ground on that mine, and the project is even further from opening than it was in March. Many of the company’s permits have been suspended as a sweep of lawsuits from environmental organizations and tribes make their way through Minnesota courts.

The most recent blow to the project came on Monday, when the Minnesota Court of Appeals reversed two dam safety permits and the project’s critical permit to mine, with judges ruling that criticisms of PolyMet had not been properly reviewed by a neutral administrative law judge.

And next week, state regulators will face a trial in district court over allegations they suppressed concerns from the Environmental Protection Agency about the strength of a key water permit needed for the project, and then destroyed records to cover their tracks.

Taken together, the lawsuits have delayed PolyMet and could force changes to the project. Or, if environmental groups win out, stop the mine altogether. 

PolyMet supporters said Monday’s court ruling was a needless delay for a project that has faced lengthy environmental review. Senate Majority Leader Paul Gazelka, a Republican from Nisswa, said Iron Range jobs are “again put on hold by liberal courts and radical environmentalists.”

Paula Maccabee, attorney for the environmental nonprofit WaterLegacy, said a neutral judge would put the state’s permits through more robust review than a typical public comment process. WaterLegacy sued over the dam safety permits and permit to mine.

“What the Court of Appeals has done is let the sun shine in so that the difficult decision that Minnesota has to make about sulfide mining can be made under impartial, open scrutiny,” Maccabee said.

What the court’s decision means

If built, PolyMet plans to extract copper, nickel, platinum, cobalt and other metals at an open-pit mine in northern Minnesota for 20 years. Its majority owner is Glencore, a massive Swiss company known for mining and trading commodities around the globe.

PolyMet’s leadership promises 360 direct jobs at the mine and another 600 or so spinoff jobs. But the project has faced fierce opposition from environmental nonprofits and a tribal government who argue the mine risks polluting the St. Louis River watershed — which drains into Lake Superior — with toxic byproducts and heavy metals.

Paula Maccabee
MinnPost photo by Walker Orenstein
Paula Maccabee, shown during a Monday press conference, said a neutral judge would put the state’s permits through more robust review than a typical public comment process.
PolyMet says that can be avoided, and plans to repurpose a tailings facility at a former LTV Steel taconite mine and build a system to capture and treat water tainted by mine waste. It has also agreed to a financial assurance package that aims to keep Minnesota taxpayers from being saddled with the cost for any necessary pollution clean up. After environmental reviews, the company eventually secured 18 state and federal permits and approvals.

Still, the Fond Du Luc Band of Lake Superior Chippewa, WaterLegacy the Minnesota Center for Environmental Advocacy (MCEA) and others have challenged many of those permits in court.

Their biggest win came on Monday, when three judges on the Court of Appeals unanimously rejected a trio of permits issued in 2018 by the state’s Department of Natural Resources. In the lawsuits, the PolyMet opponents argued the project’s tailings dam and closure plan would be unsafe; that Glencore should be named on state permits; and that the financial assurance package was insufficient.

In a written opinion for the court, Judge Edward J. Cleary did not take a side on those debates. But he said they were substantial questions that warranted what’s known as a “contested-case hearing.”

In such a hearing, an administrative law judge holds a trial-like proceeding on controversial issues and then offers an opinion on the facts. The DNR would then have to decide whether to alter, re-issue, or deny the permits.

Before the ruling, DNR had denied a contested-case hearing, saying in part it had closely examined concerns raised by the environmental groups and the Fond Du Lac Band during its own lengthy environmental review of PolyMet. But Cleary said the court found evidence of “probative, competent, conflicting evidence on material fact issues” that by law required DNR to hold what could be a new assessment of the project. Cleary went to far as to describe the DNR as seeking “unfettered discretion” to sidestep its legal duty to hold a contested-case hearing.

Kathryn Hoffman, CEO of the MCEA, said contested-case hearings typically last between six and 18 months, but can last longer in complex cases.

One such case involved Enbridge’s controversial Line 3 oil pipeline, which had two separate reviews by administrative law judges. One judge held 16 public hearings and took extensive testimony before concluding the new pipeline project should be built. (The Public Utilities Commission approved the pipeline, but ignored specific routing advice because of tribal opposition.)

In a written statement, the DNR said it was still reviewing the PolyMet order, but noted the court did not make any conclusions on the scientific work that led to the agency’s decision to grant the mining permits. “We remain confident in the solid foundation of our technical work,” the statement says.

Kathryn Hoffman, CEO of the MCEA
MinnPost photo by Walker Orenstein
Kathryn Hoffman, CEO of the MCEA, said contested-case hearings typically last between six and 18 months, but can last longer in complex cases.
In a separate statement, PolyMet said it was “exploring all of our options,” including asking for a review by the Minnesota Supreme Court. Both the company and the DNR have 30 days to appeal the decision.

“We obviously are disappointed in the court’s decision,” the PolyMet statement says. “We are confident that we can produce these high-demand metals responsibly, with Minnesota workers, and in compliance with all applicable regulations.”

While the appeals court did not decide many of the key issues that will come before the administrative law judge, it did weigh in on two questions.

First, the court said the DNR could legally transfer a permit from LTV Steel to PolyMet tied to its tailings basin. But the court also ruled the DNR could not award PolyMet an indefinite permit. While the DNR expects mining to last 20 years and estimated closing and restoring the mine area would be completed in 2072, its permit also says it lasts until “long term maintenance and active water treatment” is no longer needed.

Cleary wrote that modeling showed active “mechanical” water treatment could be necessary for at least 200 years at the mine site, and 500 years at the plant site.

A rare trial ahead

Recapturing the DNR permits is not the only obstacle ahead for PolyMet.

Another lawsuit brought by WaterLegacy, the MCEA and the Fond Du Lac Band argues PolyMet was granted a “sham” air pollution permit for a smaller mine when the company actually intends to greatly expand the mine and evade regulations. PolyMet denies this.

And next week, a water permit granted in 2018 by the Minnesota Pollution Control Agency will be the subject of an unusual district court trial. 

Earlier this year, the EPA released written comments that showed concerns a draft of the permit, known as a National Pollutant Discharge Elimination System Permit (NPDES), would violate the Clean Water Act. But those comments were initially read over the phone to MPCA officials and did not appear in the public record that determines the agency’s decisions. Hand-written notes of the phone call were destroyed.

Still, the MPCA has said there was no cover up. Current and former staff maintain the exchange was one brief part of a lengthy collaboration between the state and federal government over the permits, and that they had already considered complaints from others during the public comment process that had raised similar questions. And in the end, the EPA did not veto the final permit.

Still, the Court of Appeals in June said WaterLegacy had raised “substantial evidence of procedural irregularities” and asked the Ramsey County District Court to look into the issue. WaterLegacy’s Maccabee said she didn’t think such a trial has ever happened in the Minnesota.

Since that order, the court ordered a forensic search of MPCA computers, and the two sides have drummed up witness lists for questioning at the hearings. One is former MPCA commissioner John Linc Stine, who declined to comment on the litigation. 

The NPDES water permit has been suspended while the court proceedings advance. In the meantime, PolyMet backers on Monday urged the mining company to persevere amid what they hope is only a delay. “We encourage PolyMet to pursue all avenues to move this project forward and will stand strong with our members and allies,” said Nancy Norr, chairwoman of the labor and business coalition Jobs for Minnesotans.

Jubilant leaders from environmental nonprofits and the Fond Du Lac Band gathered in St. Paul and Duluth on Monday to celebrate the DNR permits being reversed. “PolyMet will never operate in the state of Minnesota,” said Chris Knopf, executive director of the Friends of the Boundary Waters Wilderness.

Comments (17)

  1. Submitted by Phyllis Kahn on 01/14/2020 - 12:21 pm.

    I have continually questioned the financial assurances for PolyMet and called for a bond from a reputable bonding company to cover clean up. Too many cases of the financial assurance company going belly up at the same time as the project.

  2. Submitted by Julie Stroeve on 01/14/2020 - 12:24 pm.

    great reporting, Mr. Orenstein! lay people like me need more detail and sunlight — not less — on this process. remember when Gazelka’s party promised us that sunlight on political contributions would be the result of Citizens United? well, how did that go for you? not so well. real transparency at every turn in the process is a good thing. music to my ears.

  3. Submitted by Ray Schoch on 01/14/2020 - 12:26 pm.

    “Cleary wrote that modeling showed active “mechanical” water treatment could be necessary for at least 200 years at the mine site, and 500 years at the plant site.”

    Mathematical equations are a primary reason why I didn’t follow my Dad into mechanical engineering. That said, and for what it’s worth, my considered opinion is that about 1,000 jobs in northern Minnesota over a span of 20 years don’t’t come close to balancing (are not equal to) CENTURIES of pollution-control measures made necessary by sulfide mining, which could easily destroy much of the St. Louis River’s watershed and other areas nearby even with the best technology we currently have available – and that assumes there’s both the means and the social and political will to monitor and control any issues along those lines that develop for multiple generations to come.

    Mr. Gazelka professes to be “conservative,” but in virtually any other context, one of the mantras of conservative thought historically has been “Think of the consequences.” Thinking of consequences is one of those things we expect grownups to do. It’s more than a little curious, then, that in this circumstance, Gazelka and others who profess to be “conservative” favor plunging ahead, despite the fact – not opinion, but fact – that sulfide mining has never been done anywhere on this planet – never – without substantial environmental damage and degradation. Gazelka would trade the state’s singular natural resource legacy, much of its tourist industry and income, and the many thousands of jobs made possible by those natural resources to placate 300 miners who will be making it possible for a a few hundred of their neighbors in northern Minnesota to make money from Minnesota resources, while the profits largely go to a foreign company.

    “…PolyMet will never operate in the state of Minnesota,” said Chris Knopf, executive director of the Friends of the Boundary Waters Wilderness.”

    I don’t know that Mr. Knopf will be proven correct – money usually wins out over ethical and environmental concerns – but in the long run, Minnesota and its citizens will be better off if his statement turns out to be true.

  4. Submitted by Eric House on 01/14/2020 - 01:16 pm.

    Mr Gazelka- just think how easily this could have been done if Polymet and the MPCA had just followed the rules in good faith. Instead, with the connivance of your party they have tried to put their thumb on the scale every step of the way.

    My personal belief is that the obvious reason for the cheating is that the proposed mine will never pass review if the rules are actually followed- but if I’m wrong then so be it. Until then, quit your whining.

  5. Submitted by JUDITH MONSON on 01/14/2020 - 02:13 pm.

    If 3M or Target or Walmart promised 960 jobs, but for only 20 years, would we be jumping through hoops to accommodate them? Would Senator Gazelka still be calling these jobs that don’t yet exist “put on hold?” Last time I noticed, you can’t “put on hold” jobs that haven’t yet been born. Imagine trying to deliver a baby, one that has yet to be conceived.

    And, of course, that’s another part of the problem. When they closed the Studebaker plant in South Bend it wasn’t (after 20 years) just taking away several hundred jobs. It was taking away an entire city. Like Ely. Or Virginia. Or Embarrass. Think of Duluth Underwear. Why not build a truly diverse economy? Underwear for women and kids and dogs too? Why not Tonka Trucks for kids? Why not a “trolley factory” in Duluth? I think these hills could handle it.

    Why not a Superior Lakeshore blueberry pie factory? Will blueberries go out of style in 20 years? I don’t think so. Will blueberry bushes cease to exist in 20 years? Well, maybe with global warming, we might have to switch to white peach trees.

    Or what about filling in that abandoned ore mine and planting the whole thing with Christmas trees? Christmas trees are probably going to be here for over 20 years. We would probably need lots of extra truckers too. What’s the matter, that some people, including the Governor, insist on wearing blinders, such that iron, steel and taconite (“men’s work”) are the only options?

    Is it too “girl-y” to work in a pie factory, down-size to a smaller house and one car, wear your underwear for a week instead of one day, then of course have more time for camping and fishing, not to mention love-making?

    Twenty years. What about the next generation of children and grandchildren? What happens to them in 20 years? Are they supposed to move to California and pan for gold? I hope you notice the similarity of false logic and half-truths here. Promises! Promises! Or as “45” would say, “fake news!”

    • Submitted by Paul Udstrand on 01/14/2020 - 04:35 pm.

      Yeah, 300 jobs? You’re average Costco employs 200. There’s got to be another way to create that many job that doesn’t through the environment under the bus.

    • Submitted by Ted Fiskevold on 01/19/2020 - 07:34 am.

      Some of what you say makes some sense, Judith. But, “…filling in that abandoned ore mine…” [with what, scraps from blueberry pie-in-the-sky crusts?) “…and planting the whole thing with Christmas trees is not sound economics.
      Trying to “fill in” the mine pits? [Again, with what? Over 100 years of iron ore and taconite is gone.] Your fill-in project would take about 100 years, about a thousand huge trucks and other massive equipment, would be akin to filling in the Judith Basin in Montana, and it would make for some mighty expensive Christmas trees for folks to pick up in their one little car or carry home on the trolley. It WOULD create a few thousand busy-work jobs for men and women for 100 years or so.
      Yes, women have actually been working in the mines for 50 years. And sometimes men make pies.

  6. Submitted by Scot Kindschi on 01/14/2020 - 04:21 pm.

    If they couldn’t find the money to build, then how on earth were they planning to pay for the “inevitable” and impossible cleanup? This was an asinine notion from day one.

  7. Submitted by Dennis Wagner on 01/14/2020 - 04:51 pm.

    Decisions, decisions; the past comes back to haunt the future. The behavior of our corporations in the past has not necessarily been spartan. Perhaps Mr. Gazelka is good with taking corporations at their word, but many of us are familiar with the pollution/health problems of yesteryear (we grew up in it) and are more than hesitant to believe what the corporations and many government officials dole out as truth. Here is a deal Mr. Gazelka, when we have cleaned up all the existing Super fund and other pollution sites and sources, perhaps then we can adventure into this endeavor. Last check we have quite a list.

    The last note, I wouldn’t say folks that want to protect their health and environment are “radical environmentalists”. Perhaps folks that don’t much care for the environment are radical pollutionists, Mr. Gazelka, is it fair to say you subscribe to that notion? .

  8. Submitted by Alan Muller on 01/14/2020 - 06:06 pm.

    None of the mining promoters seem to have supported requirements that would give increased confidence of safe, low-impact operation. Or if any have, it’s not been public.

    So far the executive and legislative branches of government have failed on this issue. It seems that to some extent, at least, the judicial branch is stepping up.

  9. Submitted by William Hunter Duncan on 01/14/2020 - 07:39 pm.

    Somebody want to call ahead to the folks living 100-500 years from now and ask them what they think about cleaning up our mess?

    Kudos to the appeals court for saying the obvious. That this project was not shut down a decade ago is insane. That there is still a possibility that it will open is far beyond hubres.

  10. Submitted by Mark Countryman on 01/19/2020 - 03:02 pm.

    I have read this article, as well as the previous article, from end to end, along with all of the posted comments, and there is one question here that seems not to have been raised. Perhaps it’s a dumb question, but I do ask it sincerely:

    If copper and nickel are such precious and high-demand metals, then why not simply take pennies, nickels and dimes out of currency, and make the quarter dollar the lowest denominator of U.S. currency? The value of the metals in those coins far exceed their currency value. A massive recall of all pennies, nickels and dimes could be made at bank branches across the country, where equivalent cash would be given for their face value (just like they do now), and Poly Net, or any other mining company, could be awarded a federal contract to extract those metals. Such a facility could be built anywhere, and no mining or environmental damage need be done.

    Or, is it the “other precious metals” (such as cobalt) not found in coins, that they’re really after? Did I just answer my own question?

    • Submitted by Pat Terry on 01/19/2020 - 11:30 pm.

      Today pennies are mostly made out of zinc, which is less valuable than copper. Dimes and nickels are actually now mostly copper. The value of the metal in pennies and nickels still exceeds their currency value (dimes, which are obviously smaller, are worth less than 10 cents in metal value) but not by enough to make it worthwhile to take them out of circulation. Someday, though, between inflation and demand for metals, that calculation may change and your idea may make sense.

  11. Submitted by Ronald Holch on 01/19/2020 - 07:45 pm.

    There are still concerns that continue to be suppressed.

    When it comes to this radically new mining process for MN up river from the largest single volume of fresh water in the world, one word needs to be said over and over, ROBOTS.

    This is not your grandfathers iron range. There will be few jobs There will be little effect on the economy for the area available in the very near future in mining. The lion’s share of the work will be done by ROBOTS 24/7/365.

    Do you think a ROBOT will care if it despoils the environment? Do you think the Company will have any human witness to this destruction?
    Anyone who has paddled in this wilderness knows what is at stake here.


    Google “robot mining” and see for yourself.

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