U.S. Steel fights new environmental standards for MN mine

U.S. Steel lobbyists
Chris Masciantonio, general manager of state government affairs at U.S. Steel Corp. (right), and U.S. Steel lobbyist Peder Larson speak to the Minnesota House Mining and Outdoor Recreation Policy Committee on Feb. 4, 2015 in St. Paul, Minn.
Tom Scheck / MPR News

U.S. Steel is trying to stop state officials from enforcing tough new environmental standards that affect taconite facilities in northeastern Minnesota, and a bipartisan group of state lawmakers is ready to act on the company's behalf.

The Minnesota Pollution Control Agency is set to propose the new standards when it releases a draft environmental permit for U.S. Steel's Minntac Facility in Mountain Iron. The company has launched an aggressive fight against the new regulations even before they've been released to the public.

In letters to the Pollution Control Agency, U.S. Steel executives warn that the draft environmental permit would create a "significant hardship." Lobbyists for the company have also been busy at the State Capitol — meeting privately with Gov. Mark Dayton and legislative leaders.

For example, U.S. Steel lobbyist Chris Masciantonio told the House Mining and Outdoor Recreation Policy Committee last week that the state's environmental standards are too stringent. In particular, he said, the clean water standard aimed at protecting water where wild rice grows is too strong.

"This '10 standard' is going to be a big problem for Minnesota if it isn't corrected," Masciantano said.

The "10 standard" is shorthand for 10 milligrams of sulfates per liter. State law prevents companies from discharging sulfates into wild rice water at levels higher than that.

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U.S. Steel contends that the sulfate standard is too low, and Masciantano suggested that could hurt the company in Minnesota, where it employs 1,900 people at an annual payroll of $142 million.

"There are a number of important decisions that are going to be made this year by the Legislature that I think could have a profound impact on the future of mining here in Minnesota," he said.

For 23 years, the company has operated its Minntac facility without renewing its environmental permits. Since then, the company has fallen out of compliance with several clean water standards, said Ann Foss, metallic mining director for the MPCA, which has the job of writing the rules for companies such as U.S. Steel.

"When we look at surface water in the area," Foss said, "some of the water quality standards are currently being exceeded and that is clearly as a result of the tailings basin."

The tailings basin is an artificial lake where the company discharges what's left over from the process of extracting iron ore from taconite. In two lakes east of that 8,000 acre tailings basin, Foss said the sulfate standards are too high for water that produces wild rice.

If the standards are enforced, U.S. Steel officials say they would have to spend hundreds of millions of dollars to ensure the water is clean. They also said they do not think the standard could be applied to any water that is not designated as a wild rice water.

Several lawmakers representing Iron Range communities want to help the company. State Sen. David Tomassoni, DFL-Chisholm, said people in his district are worried.

"It's huge because it's all about people's jobs," Tomassoni said. "It could shut down the entire industry if it doesn't get resolved. We absolutely need to resolve it and resolve it in a positive way."

Tomassoni said at a minimum he wants to prevent the MPCA from issuing any sulfate regulations until a study is complete and the agency specifically identifies waters that produce wild rice.

Meanwhile the federal Environmental Protection Agency officials want the sulfate standard to be enforced.

Environmental groups agree with the EPA. Kathryn Hoffman, an attorney for the Minnesota Center for Environmental Advocacy, said the sulfate standard has been state law since 1973.

If U.S. Steel is allowed to keep new rules from going into effect, she said, that could set a bad precedent for how copper and nickel mining will be regulated.

MPCA officials say the draft permit for U.S. Steel is only the first step in a long process. They say the agency will make changes to the permit once the public has an opportunity to weigh in. The MPCA's Citizen Advisory Board will have final say on permit unless the Legislature acts first.

Hoffman worries that copper-nickel mining has the potential to release more pollution into northern lakes.

"If people are looking at U.S. Steel to see how Minnesota regulators will handle sulfide mining, they should be concerned because right now our taconite mines are not complying with our water quality standards," Hoffman said. "How do we know that sulfide mines will be held to the law?"