New mining commission gathers input at first meeting

A new state commission cleared its throat on Tuesday, but it remains to be seen what it will have to say about taxing and regulating the Silver State's namesake industry.

The Mining Oversight and Accountability Commission took care of some housekeeping business, listened to background briefings and gathered public input during its first-ever meeting, which was conducted by video link from Carson City, Las Vegas, Elko and Winnemucca.

Commission members are expected to oversee all state regulation of mining, including taxation, worker safety and environmental rules.

The seven-member panel was created by lawmakers earlier this year after it was revealed that state taxation officials had not conducted field audits at Nevada mines for at least two years and lacked trained staff to do so.

In one of the first reports to the commission, Chris Nielsen, deputy director of the Nevada Department of Taxation, said work is under way to get the auditing program back on track.

Every mine operator in the state has been notified to expect a field audit in the coming months, with the first wave aimed at the state's largest operator, Toronto-based Barrick Gold Corp.

Newmont Mining Corp., based in Denver, is the state's second-largest operator and will be next in line for financial review.

Nielsen said results of those field audits are expected by mid-2012.

Based on public input at Tuesday's inaugural meeting, some expect the commission to provide more than oversight.

Several people called on commission members to use the new platform to push for tighter restrictions and higher taxes on the industry.

One audience member said Nevada's century-old mining laws now serve to protect the profits of international corporations that "rape" the state's resources and give too little in return.

Another audience member encouraged the commission to consider a Nevada version of the Alaska Permanent Fund, which collects proceeds from oil and mineral production and distributes dividends to residents of that state.

Arguably the commission's best-known member is also one of its most outspoken critics of the mining industry.

State Sen. Steven Horsford, a Las Vegas Democrat and candidate for Nevada's 4th Congressional District, said he nominated himself for the new panel because of his experience in the Legislature and his work to close tax loopholes exploited by mining companies.

In an interview shortly after Gov. Brian Sandoval officially named him to the commission, Horsford said this year's legislative session opened his eyes to all the perks and protections mining enjoys in Nevada.

"After I started peeling back the onion, it made me want to cry, but it also stunk up the place," he said.

This year's session in Carson City proved to be one of the most punishing for the mining industry in decades.

Lawmakers took away several of the industry's historic tax deductions and struck down an 1875 law that gave mining companies the power to condemn private property.

They also gave preliminary approval to a measure that would write the mining industry out of the Nevada Constitution, ending what some lawmakers consider outdated protections that make it impossible to get more tax revenue from mines now booming because of record gold prices.

The measure, known as Senate Joint Resolution 15, will be taken up again by the Legislature in 2013. If it passes a second time, it will be up to voters to decide whether to strike the constitutional limit on mining tax rates.

The Associated Press contributed to this report. Contact reporter Henry Brean at hbrean@reviewjournal.com or 702-383-0350.