The Montana Department of Environmental Quality has asked a district court judge to dismiss a case that would have labeled the CEO of an Idaho-based mining company a “bad actor,” preventing the company from opening two copper and silver mines in northwest Montana.
DEQ’s decision to drop its case against Hecla Mining Company and CEO Phillips S. Baker came as little surprise to opponents and supporters of the Rock Creek and Montanore projects following the election of Gov. Greg Gianforte. Last year, Gianforte spoke favorably of the two projects in Lincoln and Sanders counties and held a campaign event at Hecla’s offices in Libby. In its motion to dismiss, attorneys representing DEQ said Gianforte’s election and the appointment of a new director prompted the agency to reevaluate the case, which was originally filed during the Bullock administration.
In a press release announcing its motion to dismiss, officials said they believed there were problems with the case, and that those hurdles might have impacts on future attempts to use the law. In court documents, the agency also said it appears that Hecla is in compliance with state law at all three of its sites in Montana: Rock Creek, Montanore and the Troy Mine, which permanently closed in 2015 and is now in remediation.
The Montanore and Rock Creek projects were first proposed by different companies in the early 1980s. Mining officials have said that together the two mines beneath the Cabinet Mountain Wilderness could produce more than 500 million ounces of silver and 4 billion pounds of copper, making them one of the largest untapped deposits of either mineral in the world. Both projects have been bogged down in the state and federal permitting process for decades, shepherded by two small mining companies, including one that ran the now-shuttered Troy Mine. In 2015, Coeur d’Alene-based Hecla purchased both projects. Hecla was founded in 1891 and currently operates mines in Idaho, Alaska and Quebec.
Locals who have long said the mines are key to Lincoln County’s economic prosperity were excited about the arrival of Hecla, believing that the company could open the mines. But another wrench was thrown into the mix in 2018, when DEQ sued the company in an effort to label its CEO a “bad actor” due to his former involvement with Pegasus Gold Corp. That mining company went bankrupt in 1998 and left the state on the hook for a $32 million reclamation effort at three sites in the Little Rocky Mountains south of the Fort Belknap Reservation.
Montana’s “bad actor” law was passed in the 1980s and is designed to hold companies that fail to clean up polluted mine sites responsible. Baker and Hecla officials have described the bad-actor lawsuit against them as misguided, saying Baker had left Pegasus before the failed cleanup. There have also been questions about whether the law can be applied to out-of-state actors. In May, Lewis and Clark County District Court Judge Mike Menahan determined that the state could apply the label to Baker, but did not rule on the merits of the case, which seeks reimbursement of the Pegasus cleanup costs.
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Despite that ruling, DEQ officials now say there are “procedural hurdles” that complicate their case, leading to the decision to drop it.
“At this time, it seems highly unlikely the case would result in reimbursement,” said DEQ Director Chris Dorrington. “In choosing to dismiss this case, I want Montanans to know that DEQ is not stepping away from continuing to seek reimbursement of these costs and we are not backing down from our commitment to holding bad actors accountable for their actions.”
DEQ officials did note that the May ruling that the law can be applied to out-of-state actors was a win for the agency, and that they hope to have that formally incorporated into the law.
“Changing the law is the best way to ensure it is clearer and easier to go after bad actors in the future,” Dorrington said. “Legislation not only provides opportunity for public input, but would also apply to all parties operating throughout the state, rather than one company. DEQ has a track record of gaining bipartisan support on laws that strengthen protections.”
Asked for other specifics about what the agency would change about the current law, DEQ spokesperson Moira Davin said the agency would like to see more specificity about which company principals and executives are responsible for failed remediation efforts. Davin declined to speculate whether the agency would have been successful in labelling Baker a “bad actor” had the law been different.
“We cannot speak to the possible outcome of this case. However, under our ideal version of the law, its application would be clear and bad actors would be held accountable,” Davin wrote.
Hecla spokesperson Luke Russell said the company and its CEO felt vindicated by DEQ’s decision to drop the case, which allows the company to move forward with the permitting process. Though state and federal agencies have issued permits for the mines in the past, those permits have faced multiple court challenges from environmental groups opposed to mining beneath a wilderness area.
Russell also said the company appreciates Gianforte’s “pro-business, pro-resource-development stance” and thinks that stance will help bring more jobs to Montana.
Environmental groups that have opposed the mines are not surprised at DEQ dropping the case, said Mary Costello, executive director of the Rock Creek Alliance. She said attorneys for her group and other environmental groups are still reviewing the decision, but that they will continue to fight the mines regardless.
“These projects would have severe and long-lasting impacts on the wilderness,” Costello said. “I don’t know what it will take for these companies to realize that this is not a good place for a mine. But we’re not giving up. We’re in this fight for the long haul.”
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