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SB 166: "An Act amending requirements for qualifications to acquire or hold mining rights; amending rental rates for mining locations and leases; repealing annual labor requirements for mining locations; providing for waiver of a cure penalty for abandonment because of failure to properly record a statement of labor; and providing for an effective date."

00                             SENATE BILL NO. 166                                                                         
01 "An Act amending requirements for qualifications to acquire or hold mining rights;                                      
02 amending rental rates for mining locations and leases; repealing annual labor                                           
03 requirements for mining locations; providing for waiver of a cure penalty for                                           
04 abandonment because of failure to properly record a statement of labor; and providing                                   
05 for an effective date."                                                                                                 
06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
07    * Section 1.  AS 27.10.010 is amended to read:                                                                     
08            Sec. 27.10.010. Claims to be located as prescribed by law. A person who                                    
09       discovers upon the public domain in the state a lode or vein of rock in place, or a                               
10 placer deposit that is open to location under the mining laws of the United States, may                                 
11 locate a lode mining claim or placer mining claim by posting a notice of location and                                   
12 by marking the boundaries as provided in AS 27.10.030 - 27.10.070. An attempted                                         
13 location of a mining claim that does not comply with AS 27.10.030 - 27.10.070 [AND                                      
01       AS 27.10.150 - 27.10.190] is void.                                                                                
02    * Sec. 2. AS 38.05.190(a) is amended to read:                                                                    
03            (a)  The right to acquire exploration and mining rights under AS 38.05.185 -                                 
04       38.05.275 may be acquired or held only by bona fide miners who are                                            
05                 (1)  citizens of the United States at least 18 years of age;                                            
06                 (2)  legal guardians or trustees of citizens of the United States under 18                              
07       years of age on behalf of the citizens;                                                                           
08                 (3)  persons at least 18 years of age who have declared their intention to                              
09       become citizens of the United States;                                                                             
10 (4)  aliens at least 18 years of age if the laws of their country grant like                                            
11       privileges to citizens of the United States;                                                                      
12 (5)  corporations organized under the laws of the United States or of                                                   
13       any state or territory of the United States and qualified to do business in this state;                           
14                 (6)  associations of persons described in (1) - (5) of this subsection.                                 
15    * Sec. 3. AS 38.05.190 is amended by adding new subsections to read:                                               
16 (c)  An applicant or bidder for a mining lease must submit a notarized affidavit                                        
17 to the department verifying that the applicant or bidder is a bona fide miner under (a)                                 
18 of this section. The affidavit must be submitted with the application for a mining lease                                
19 or before a competitive lease disposal of a mining lease as required by the department                                  
20 for an applicant or bidder to be eligible for a mining lease. Upon request by the                                       
21 department, a holder of a mining claim, lease, or leasehold location or an authorized                                   
22 representative for the holder, shall submit a notarized affidavit stating that the holder                               
23 or lessee is a bona fide miner. The affidavit must be postmarked or received by the                                     
24 commissioner not later than 90 days after receipt of the request for the affidavit. An                                  
25 affidavit timely postmarked or received is prima facie evidence that the holder or                                      
26 lessee is a bona fide miner. If an affidavit stating that the holder or lessee is a bona                                
27 fide miner is not timely postmarked or received, the department may determine in                                        
28 writing that the holder or lessee is unqualified to acquire or hold exploration and                                     
29 mining rights. Any appeal or request for reconsideration of a determination under this                                  
30       subsection must be made under AS 44.37.011.                                                                       
31 (d)  In this section, "bona fide miner" means an entity or person who seeks to                                          
01       acquire, acquires, or holds exploration and mining rights under AS 38.05.185 -                                    
02       38.05.275 in good faith for purposes of mineral exploration and development and not                               
03       for the prevention of mineral exploration or development.                                                         
04    * Sec. 4. AS 38.05.195(d) is amended to read:                                                                      
05 (d)  Locations may be amended in the manner and with the effect prescribed in                                           
06 AS 38.05.200. [ANNUAL LABOR SHALL BE PERFORMED AND STATEMENTS                                                           
07 OF ANNUAL LABOR RECORDED AS PRESCRIBED IN AS 38.05.210 -                                                                
08       38.05.235.]                                                                                                       
09    * Sec. 5.  AS 38.05.211(a) is amended to read:                                                                     
10 (a)  The holder of each mining claim, leasehold location, prospecting site, and                                         
11 mining lease, including a mining lease under AS 38.05.250, shall pay, in advance,                                       
12 rental for the right to continue to hold the mining claim, leasehold location,                                          
13 prospecting site, and mining lease, including a mining lease under AS 38.05.250.                                        
14       Rental is due and payable as follows:                                                                             
15 (1)  the rental amount for a prospecting site is fixed at $300 [$200] for                                           
16       the two-year term of the site;                                                                                    
17 (2)  annual rental for a mining claim, leasehold location, or mining                                                    
18 lease shall be based on the number of years since a mining claim, a leasehold location,                                 
19 or a mining lease's predecessor claim or leasehold location was first located; the                                      
20 annual rental amounts for a mining claim, leasehold location, or mining lease are as                                    
21       follows:                                                                                                          
22                                                 Rental Amount                                                           
23      for Each Mining                                                                                                    
24      Claim or Leasehold                                                                                                 
25      Location, Including                                                                                                
26  Number of Years  Rental Amount Per Each Quarter- Quarter                                                               
27       Since                 Acre for Mining    Section MTRSC                                                            
28       First Located         Leases                   System                                                             
29  0 - 5  $1.29 [$ .50] $50 [$ 20]                                                                                
30  6 - 10   2.32 [$1.00] 95 [   40]                                                                               
31  11- or more   5.27 [$2.50] 210 [100];                                                                          
01 (3)  the annual rental in any year for each quarter section claim,                                                      
02 leasehold location, or lease based on the MTRSC system is four times the rental                                         
03 amount for a quarter-quarter section mining claim, leasehold location, or lease in that                                 
04       year.                                                                                                             
05    * Sec. 6. AS 38.05.211(d) is amended to read:                                                                      
06 (d)  The rental amount established under this section shall be revised by the                                           
07 commissioner as provided in this section based on changes in the Consumer Price                                         
08 Index for all urban consumers, Anchorage Metropolitan Area (Semi-Annual Average)                                        
09 compiled by the Bureau of Labor Statistics, United States Department of Labor, as                                       
10 revised, rebased, or replaced by that bureau. The reference base index is the index for                                 
11 January - June 2018 [1989], as revised or rebased by that bureau. The rental amount                                 
12 shall be increased or decreased, as appropriate, by an amount equal to the change in                                    
13 the index described in this subsection rounded to the nearest whole $5 unit. The                                        
14 commissioner shall calculate the change in the rental amount each 10 years and, if the                                  
15 rental amount must be revised, shall adopt a regulation establishing the revised rental                                 
16 amount. A revised rental amount applies to a rental payment if the regulation                                           
17 establishing the revised rental amount took effect at least 90 days before the date the                                 
18       rental payment is due.                                                                                            
19    * Sec. 7. AS 38.05.211 is amended by adding a new subsection to read:                                              
20 (f)  For purposes of this section, "MTRSC system" means the system described                                            
21 in AS 38.05.195(b)(1) based on the ground location of a complete quarter section or                                     
22       quarter-quarter section of a township on a rectangular survey system.                                             
23    * Sec. 8. AS 38.05.265 is amended to read:                                                                         
24 Sec. 38.05.265. Abandonment. (a) Failure to properly record a certificate of                                          
25 location [OR A STATEMENT OF ANNUAL LABOR], pay any required annual                                                      
26 rental, or pay any required production royalty as required by AS 38.05.185 -                                            
27 38.05.200, 38.05.211, 38.05.212, 38.05.245 [38.05.210 - 38.05.245], 38.05.252 -                                     
28 38.05.275, and by regulations adopted under these sections constitutes abandonment                                      
29 of all rights acquired under the mining claim, leasehold location, or prospecting site                                  
30 involved, and the claim, leasehold location, or prospecting site is subject to relocation                               
31 by others, unless the failure constituting the abandonment is cured under (b) of this                                   
01 section. A locator or claimant of an abandoned location or a successor in interest may                                  
02 not relocate the claim, leasehold location, or prospecting site until one year after                                    
03 abandonment. The locator of an abandoned prospecting site may locate a claim or                                         
04 leasehold location on that site at any time. [A STATEMENT OF ANNUAL LABOR                                               
05 THAT DOES NOT ACCURATELY SET OUT THE ESSENTIAL FACTS IS VOID                                                            
06 AND OF NO EFFECT.] If an annual rental or a royalty payment is deficient but is                                         
07       otherwise timely paid, abandonment does not result if full payment is made within                               
08 (1)  the period prescribed by a deficiency notice from the                                                              
09       commissioner; or                                                                                                  
10 (2)  30 days after a final judgment establishing the amount due if the                                                  
11       deficiency amount due was contested.                                                                              
12 (b)  Unless another person has located a mining claim or leasehold location                                             
13 that includes all or part of the mining claim or leasehold location abandoned under (a)                                 
14 of this section or the area is closed to mineral location under AS 38.05.185 -                                          
15 38.05.275, a person may cure the failure to record or pay that constituted the                                          
16       abandonment and cure the abandonment by                                                                           
17 (1)  properly recording a certificate of location [OR A STATEMENT                                                       
18 OF ANNUAL LABOR], paying any required annual rental, and paying any required                                            
19       production royalty; and                                                                                           
20 (2)  paying a penalty equal to the annual rent for the mining claim or                                                  
21       leasehold location that was abandoned under (a) of this section.                                                  
22    * Sec. 9. AS 38.05.265 is amended by adding a new subsection to read:                                              
23 (c)  Unless another person has located a mining claim or leasehold location that                                        
24 includes all or part of the mining claim or leasehold location abandoned under former                                   
25 AS 38.05.265(a) or the area is closed to mineral location under AS 38.05.185 -                                          
26 38.05.275, a person may cure the failure to record a statement of annual labor that                                     
27 constituted an abandonment under (a) of this section, as that subsection read on the                                    
28 day before the effective date of sec. 8 of this Act, and cure the abandonment by                                        
29 properly recording a statement of annual labor and otherwise complying with (b) of                                      
30 this section, except a penalty under (b)(2) of this section is not required when a failure                              
31       to record a statement of labor alone constituted the abandonment.                                                 
01    * Sec. 10. AS 27.10.130, 27.10.150, 27.10.160, 27.10.170, 27.10.180, 27.10.190, 27.10.200,                         
02 27.10.210, 27.10.220, 27.10.230, 27.10.240; AS 38.05.210, 38.05.215, 38.05.220, 38.05.225,                              
03 38.05.230, 38.05.235, 38.05.240, and 38.05.242 are repealed.                                                            
04    * Sec. 11. The uncodified law of the State of Alaska is amended by adding a new section to                         
05 read:                                                                                                                   
06 APPLICABILITY. Notwithstanding the effective date of this Act, the amendments to                                        
07 AS 27.10.010 by sec. 1 of this Act, the amendments to AS 38.05.195 by sec. 4 of this Act, the                           
08 amendments to AS 38.05.265 by sec. 8 of this Act, and the repeal of AS 27.10.130,                                       
09 27.10.150, 27.10.160, 27.10.170, 27.10.180, 27.10.190, 27.10.200, 27.10.210, 27.10.220,                                 
10 27.10.230, 27.10.240, AS 38.05.210, 38.05.215, 38.05.220, 38.05.225, 38.05.230, 38.05.235,                              
11 38.05.240, and 38.05.242 by sec 10 of this Act, apply only to labor years beginning on and                              
12 after September 1, 2018. The provisions in AS 27.10.010, 27.10.130, 27.10.150, 27.10.160,                               
13 27.10.170, 27.10.180, 27.10.190, 27.10.200, 27.10.210, 27.10.220, 27.10.230, 27.10.240,                                 
14 AS 38.05.195, 38.05.210, 38.05.215, 38.05.220, 38.05.225, 38.05.230, 38.05.235, 38.05.240,                              
15 and 38.05.242, as those sections read the day before the effective date of secs. 1, 4, and 10 of                        
16 this Act, apply to any annual labor requirements, including requirements to record affidavits                           
17 or statements of labor, for the labor year that began September 1, 2017, and that ends                                  
18 September 1, 2018. The provisions of AS 38.05.265(a) and (b), as those sections read on the                             
19 day before the effective date of secs. 8 and 9 of this Act, apply to any annual labor                                   
20 requirements for the labor year that began September 1, 2017, and that ends September 1,                                
21 2018, except that under AS 38.05.265(c), a penalty is not required to cure where a failure to                           
22 record a statement of labor alone constituted the abandonment.                                                          
23    * Sec. 12. The uncodified law of the State of Alaska is amended by adding a new section to                         
24 read:                                                                                                                   
25 APPLICABILITY OF RENTAL AMOUNTS. AS 38.05.211(a), as amended by sec. 5                                                  
26 of this Act, applies to rental amounts calculated by the commissioner of natural resources                              
27 under AS 38.05.211(d), as amended by sec. 6 of this Act, on or after the effective date of this                         
28 Act.                                                                                                                    
29    * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new subsection                         
30 to read:                                                                                                                
31 TRANSITIONAL PROVISION: REGULATIONS. The Department of Natural                                                          
01 Resources may adopt regulations necessary to implement the changes made by this Act. The                                
02 regulations take effect under AS 44.62 (Administrative Procedure Act), but not before the                               
03 effective date of the law implemented by the regulation.                                                                
04    * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to                         
05 read:                                                                                                                   
06 TRANSITION: MINING LEASES. Upon written request to the department by the                                                
07 holder of a mining lease issued under AS 38.05.205 or 38.05.250, the department shall amend                             
08 the lease to remove any annual labor requirements included in the lease, if the holder of the                           
09 mining lease submits the written request not later than two years after the effective date of                           
10 secs. 1 - 11 of this Act.                                                                                               
11    * Sec. 15. Section 13 of this Act takes effect immediately under AS 01.10.070(c).                                  
12    * Sec. 16. Except as provided in sec. 15 of this Act, this Act takes effect September 2, 2018.