Financial assurances

(a) In general Before beginning any mineral activities requiring an exploration or mining permit under this Act, an operator shall provide to the Secretary concerned evidence of a bond, surety, or other financial assurance approved by the Secretary concerned in an amount determined, after public notice and comment, by the Secretary concerned to be sufficient to ensure the completion of reclamation under section 306 and the restoration of any land or water adversely affected by the mineral activities if the work (including any interim stabilization and infrastructure maintenance activities) would be performed by the Secretary concerned (or a third party retained by the Secretary concerned) in the event of forfeiture. (b) Land and water covered The financial assurance shall cover— (1) all land within the initial permit area; (2) all affected water that may require restoration, treatment, or other management as a result of mineral activities; and (3) all land added and water affected pursuant to any permit modification. (c) Review Not later than 3 years after the date on which an operator provides financial assurance in an amount determined under subsection (a) and not later than every 3 years thereafter, the Secretary concerned shall— (1) review the financial assurance to determine if the amount of the financial assurance is adequate for purposes of this section; and (2) if the Secretary concerned determines that the amount of the financial assurance is not adequate, adjust the amount of the financial assurance in accordance with this section. (d) Reduction (1) In general The Secretary concerned may reduce the amount of the financial assurance required if the Secretary concerned determines that a portion of the reclamation is completed in accordance with section 306. (2) Notice Before reducing or releasing the amount of financial assurance pursuant to this subsection, the Secretary concerned shall provide public notice and a reasonable opportunity for public notice and comment in accordance with subsection (g). (e) Incremental financial assurance (1) In general The Secretary concerned may authorize amounts of financial assurance for incremental mineral activities if— (A) no mineral activities are allowed beyond the activities for which financial assurance is provided; (B) the financial assurance for an increment covers all reclamation costs within the permit area for the increment; and (C) the amount and terms of the financial assurance for each increment are reviewed annually. (2) Review Notwithstanding subsection (c), the Secretary concerned shall— (A) review at least on an annual basis the amount and terms of the financial assurance for any increment; and (B) adjust the financial assurance as appropriate. (f) Duration The financial assurance required under this section shall be held for the duration of the mineral activities and for an additional period to cover the responsibility of the operator for reclamation, long-term maintenance, and effluent treatment as specified in subsection (h). (g) Release Subject to subsections (h) and (i), the Secretary concerned may, after public notice and a reasonable opportunity for public comment and after inspection, release in whole or in part the financial assurance required under this section if the Secretary concerned determines that— (1) reclamation covered by the financial assurance has been accomplished as required by this Act and other applicable law; and (2) the terms and conditions of any other applicable Federal and State requirements have been fulfilled. (h) Release of financial assurance for water If the Secretary concerned does not require the establishment of a trust fund or other long-term funding mechanism under subsection (i), the portion of the financial assurance attributable to the estimated cost of treatment of any discharge or other water-related condition resulting from mineral activities shall not be released until the public has been provided notice and an opportunity to comment in accordance with subsection (g) and— (1) the discharge has ceased for a period of at least 5 years, as determined through ongoing monitoring and testing; or (2) if the discharge continues, the operator has met all applicable effluent limitations and water quality standards for a period of at least 5 years. (i) Long-Term financial assurances (1) In general Notwithstanding subsections (d) and (g), if any discharge or other water-related condition resulting from mineral activities requires treatment in order to meet the applicable effluent limitations and water quality standards, the financial assurance shall cover the estimated cost of maintaining the treatment for the period that will be needed after the cessation of mineral activities. (2) Long-term funding mechanisms (A) In general The Secretary concerned shall, if determined necessary by the Secretary concerned, require the operator to establish a trust fund or other funding mechanism to provide financial assurances to ensure the continuation of long-term treatment or other management to achieve water quality standards and for other long-term, post-mining maintenance or monitoring requirements. (B) Amount The amount of funding shall be adequate to provide for construction, long-term operation, maintenance, or replacement of any treatment facilities and infrastructure, for as long as the treatment and facilities are needed after mine closure. (C) Liability Nothing in this paragraph allows any person to transfer any liability arising from mineral activities to any other person. (j) Report (1) In general Not later than 3 years after the date of enactment of this Act, the Secretary, in consultation with the Secretary of Agriculture and the Administrator of the Environmental Protection Agency, shall conduct a review and submit to the Committee on Energy and Natural Resources of the Senate and the Committee on Natural Resources of the House of Representatives a report regarding the sufficiency of financial assurances for locatable minerals activities (including exploration and mining) on Federal land. (2) Topics The report shall address— (A) methods for establishing financial assurances levels; (B) the type, level, and adequacy of financial assurances required for exploration activities; (C) for each mine on Federal land— (i) the dates of approval of any plan of operation or mining permit; (ii) the acreage involved; (iii) the expected life of the mine; (iv) the type, level, and adequacy of financial assurance; and (v) whether the mine is expected to require long-term water treatment or maintenance after mine closure; (D) the effectiveness of various types of financial assurances; and (E) the availability of and costs associated with various types of financial assurances. (3) Recommendations The report shall include any recommendations for modifications to Federal law or applicable regulations to improve the effectiveness of financial assurances for locatable mineral activities described in paragraph (1).