REGIONAL— U.S. Steel is challenging the state’s Pollution Control Agency over the agency’s proposal to classify several lakes near the company’s Minntac tailings basin as “wild rice waters.” And the company is getting help in its fight against the stricter requirements from Iron Range legislators.

The PCA has proposed to enforce the so-called “wild rice standard” in a new Minntac discharge permit that the agency expects to issue in draft form later this month. The classification means discharges from the 8,000-acre tailings basin would be subject to Minnesota’s strict 10 mg/liter limit for sulfates, a regulation intended to protect wild rice, which is known to be sensitive to sulfate discharges under certain conditions. Water in Minntac’s tailings basin, which discharges through seeps into the Sandy and Dark river watersheds, is known to be high in sulfates.

Minntac officials are most concerned about the PCA’s proposal to classify Admiral Lake, Sand River, Little Sandy Lake and Sandy Lake as wild rice waters.

The company, in a Dec. 19, 2014, filing, asserts that the MPCA lacks the authority to designate new wild rice waters or enforce the sulfate limit until it has completed scientific studies ordered by the Legislature in 2011.

While the MPCA’s research, first announced in 2013, largely confirmed the validity of the regulation, business groups have challenged the findings and Iron Range legislators have pressured agency officials against issuing a final conclusion, arguing instead for more peer review. Without a final determination, opponents of the wild rice standard argue that the PCA can’t enforce the rule.

“The legislature made the order of events very clear,” wrote an attorney for U.S. Steel. “Only after the completion of the mandated scientific research on water quality and other environmental impacts on the growth of wild rice could MPCA seek to set wild rice water quality standards, designate the water bodies to which the standards would apply, and designate the times of year the standard would apply.”

U.S. Steel is further challenging the MPCA’s interpretation of the original legislation that established the strict sulfate limit back in the 1970s. The company contends that the law was never intended to apply to natural stands of wild rice, but only to waters used in the agricultural production of the crop. The company argues there’s no evidence that the lakes and river stretches near the tailings basin were ever used for the commercial production of wild rice.

The language in question is found in Minnesota Rule 7050.0224, and like most statutes, laws, or rules, is subject to differing interpretations. But the rule, as written, does not appear to limit the rule’s effect only to those waters where wild rice has been commercially grown.

U.S. Steel also contends that the MPCA is violating the company’s due process rights by requiring it to meet standards not required of other dischargers in the past. “Attempting to comply with these limits will result in substantial cost to U. S. Steel, with no guarantee that these expenditures will achieve compliance with the extremely low limits MPCA has proposed,” states the company in its filing.

Political efforts

Besides arguing its case in law, U.S. Steel officials have been working the halls of the State Capitol. Lobbyists for the company have been meeting privately with Gov. Mark Dayton and legislative leaders, as well as testifying in public sessions.

For example, U.S. Steel lobbyist Chris Masciantonio told the House Mining and Outdoor Recreation Policy Committee earlier this month 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.

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.

Meanwhile, Iron Range legislators have introduced new legislation that would require the PCA to publish a list of wild rice designated waters, which would be the only water bodies subject to the 10 mg/l sulfate standard.

“This bill will give local government and Minnesota industry predictability,” said Rep. Melin (DFL-Hibbing), a co-author of the bill. “Not knowing what standard applies to a particular body of water makes it impossible for municipalities and industry to properly plan at their treatment facilities. It should not be the responsibility of these groups to research if nearby waters once grew wild rice in the last 50 years.”

State rules do encompass a long list of lakes and rivers officially designated as wild rice waters, but it doesn’t currently include the lakes near the Minntac tailings basin that the PCA has proposed for designation.

Iron Range legislators say the PCA has been “erratic” in its enforcement and that’s why they’re seeking clarification now.

“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, and made clear their opposition to efforts to weaken the rule. “Here we go again,” said Steve Morse, executive director of the Minnesota Environmental Partnership in a statement issued Monday following the introduction of legislation in the state Senate. That bill, sponsored by Senators Tom Bakk, Tom Saxhaug, Tomassoni, and Republican Bill Ingebrigtsen, would prohibit the PCA from designating any additional wild rice waters until the agency has completed its scientific studies as well as a rulemaking process.

“This is yet another attack on our state’s water quality,” said Morse. “This is just the most recent attempt to undermine protections of wild rice.”

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 the 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,” she said, “our taconite mines are not complying with our water quality standards. How do we know that sulfide mines will be held to the law?”

Minnesota Public Radio’s Tom Scheck contributed to this report.