00 SPONSOR SUBSTITUTE FOR SENATE BILL NO. 155 01 "An Act relating to exploration and mining rights; relating to annual labor 02 requirements with respect to mining claims and related leases; relating to statements of 03 annual labor; defining 'labor'; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05  * Section 1. AS 38.05.190(a) is amended to read: 06 (a) Except as provided in (b) of this section, [THE RIGHT TO ACQUIRE] 07 exploration and mining rights under AS 38.05.185 - 38.05.275 may be acquired or 08 held only by 09 (1) citizens of the United States at least 18 years of age; 10 (2) legal guardians, conservators, or trustees of citizens of the United 11 States under 18 years of age or citizens of the United States that are incapacitated  12 adults under AS 13.26 on behalf of the citizens; 13 (3) individuals [PERSONS] at least 18 years of age who have 14 declared their intention to become citizens of the United States; 01 (4) aliens at least 18 years of age if the laws of their country grant like 02 privileges to citizens of the United States; 03 (5) corporations, limited liability companies, or other entities that  04 are organized under the laws of the United States or of any state or territory of the 05 United States and qualified to do business in this state; 06 (6) trusts that are registered in this state under AS 13.36 and for  07 which at least one trustee is a person described in (1) - (5) of this subsection; or  08 (7) [(6)] associations of persons described in (1) - (6) [(1) - (5)] of this 09 subsection. 10  * Sec. 2. AS 38.05.190(b) is repealed and reenacted to read: 11 (b) An unqualified person who acquires an interest in exploration or mining 12 rights by conveyance or operation of law, or a person who was qualified under (a) of 13 this section at the time of location or acquisition of exploration and mining rights and 14 later becomes unqualified, may either become qualified or transfer the interest to a 15 qualified person within 90 days from the date the department sends written notice 16 under (c) of this section. If the unqualified person does not cure the defect or transfer 17 the interest to a qualified person, the department may declare the interest void under 18 (d) of this section. 19  * Sec. 3. AS 38.05.190 is amended by adding new subsections to read: 20 (c) If the department learns that an unqualified person has acquired an interest 21 in exploration or mining rights through conveyance or operation of law, the 22 department shall send written notice to the owner and address listed in the most recent 23 statement of annual labor filed under AS 38.05.210(b) or to the address in the deed or 24 assignment of the claim, stating that the interest will be void if the unqualified person 25 does not cure the defect or transfer the interest. 26 (d) The department may declare void the exploration or mining interest of a 27 person who fails to comply with (b) of this section but may not declare the interest 28 void if the person becomes qualified under (e) of this section. 29 (e) An unqualified person may cure a defect in qualification, before or after 30 receiving notice under (c) of this section, by becoming qualified or transferring the 31 person's interest to a qualified person. A person may not cure a defect in qualification 01 for an exploration or mining interest that has been declared void under (d) of this 02 section. 03 (f) If an unqualified person fails to cure a defect in qualification within 90 04 days after the department sends written notice under (b) of this section, the department 05 may declare the exploration or mining interest void and the affected land becomes 06 open to location. A third party may not locate on the affected land or file a judicial 07 action to declare the exploration or mining interest invalid within those 90 days. 08 (g) In this section, "qualified to do business in this state" means holding a 09 certificate issued by the commissioner of commerce, community, and economic 10 development necessary to conduct business in the state. 11  * Sec. 4. AS 38.05.195(b) is amended to read: 12 (b) The locator may locate a claim using one of the following methods: 13 (1) a locator may locate a claim based on the ground location of a 14 [COMPLETE] quarter section or quarter-quarter section of a township on a 15 rectangular survey system approved by the commissioner; a claim established in this 16 manner may be known as a [THE] meridian, township, range, section, and claim 17 system location, or MTRSC location; a locator using the MTRSC system to locate a 18 claim shall in good faith mark the corners of a location as closely as practical to the 19 existing quarter section or quarter-quarter section of the rectangular survey system 20 approved by the commissioner; the corners marked on the ground of a claim 21 established in accordance with this paragraph and regulations of the commissioner 22 control in the event of a conflict over boundaries for the quarter section or quarter- 23 quarter section on the protracted or actual survey approved by the commissioner; a  24 valid MTRSC location establishes rights to deposits of minerals in or on all state  25 lands within the quarter section or quarter-quarter section that are open to claim  26 staking at the time of location; or 27 (2) a locator may locate a claim based on the staking of a ground 28 location in which the claim may not exceed 1,320 feet in its longest dimension; the 29 boundaries of a claim based on staking and located after January 1, 1985, shall run in 30 the four cardinal directions unless the claim is a fractional claim or the commissioner 31 determines that staking in compliance with this paragraph is impractical because of 01 local topography or because of the location of other claims; a claim established in this 02 manner may be known as a non-MTRSC location. 03  * Sec. 5. AS 38.05.195(d) is amended to read: 04 (d) Locations may be amended in the manner and with the effect prescribed in 05 AS 38.05.200. [ANNUAL LABOR SHALL BE PERFORMED AND STATEMENTS 06 OF ANNUAL LABOR RECORDED AS PRESCRIBED IN AS 38.05.210 - 07 38.05.235.] 08  * Sec. 6. AS 38.05.210(a) is amended to read: 09 (a) Labor shall be performed or improvements made annually on or for the 10 benefit or development of each mining claim, leasehold location, and mining lease on 11 state land except that, where adjacent claims, leasehold locations, or mining leases are 12 held in common and are being developed or operated under a common plan of  13 development, either alone or with adjacent mineral interests, the expenditure may 14 be made on or for the benefit of any one claim, leasehold location, or mining lease. 15 The commissioner shall establish the date of the commencement of the year during 16 which the labor or improvements are to be performed. Labor shall be performed at the 17 following annual rates: (1) $100 for each [PER] claim, leasehold location, or lease if 18 the claim, leasehold location, or lease is a quarter-quarter section MTRSC claim, 19 leasehold location, or lease; (2) $400 for each quarter section MTRSC claim, 20 leasehold location, or lease; and (3) $100 for each partial or whole 40 acres of each 21 mining claim, leasehold location, or lease not established using the MTRSC system. If 22 more work is performed than is required by this section to be performed in any one 23 year, the excess value may be applied against labor required to be done during the 24 subsequent year or years, for as many as four years. For not more than five  25 consecutive years, instead [INSTEAD] of performing annual labor, the holder of a 26 claim, leasehold location, or mining lease may make a cash payment to the state equal 27 to the value of the labor required by this subsection. 28  * Sec. 7. AS 38.05.210(b) is amended to read: 29 (b) During the year in which annual labor is required or within 90 days after 30 the close of that year, the owner of the mining claim, leasehold location, or mining 31 lease, or some other person having knowledge of the facts, shall record with the 01 recorder of the district in which the claim, leasehold location, or mining lease is 02 located a signed statement of annual labor. The individual who signs the statement  03 shall certify that, to the best of the individual's knowledge, the information  04 contained in the statement is true and correct. The statement must include 05 [SETTING OUT] the following information:  06 (1) the assessment work year for which the statement is being  07 recorded;  08 (2) the name of and land administration number assigned by the  09 department for each mining claim, leasehold location, or mining lease benefited  10 by the labor;  11 (3) each meridian, township, range, and section in which a mining  12 claim, leasehold location, or mining lease is located;  13 (4) the recording district in which the mining claim, leasehold  14 location, or mining lease is located;  15 (5) the total amount of work required for the assessment work  16 year for a mining claim, leasehold location, or mining lease described in the  17 statement;  18 (6) a description of the labor performed during the assessment  19 work year;  20 (7) the value of  21 (A) the labor performed during the assessment work year;  22 (B) any excess labor value from a previous year applied  23 against the labor required; or  24 (C) any cash payment to the state equal to the value of the  25 annual labor required under (a) of this section;  26 (8) the name and mailing address of an owner designated to  27 receive notices regarding a mining claim, leasehold location, or mining lease [, AS 28 MAY BE REQUIRED BY THE COMMISSIONER, CONCERNING THE ANNUAL 29 LABOR OF THE PRECEDING YEAR, ANY LABOR IN EXCESS OF THAT 30 REQUIRED FOR THE PRECEDING YEAR, AND ANY PAYMENT OF CASH 31 INSTEAD OF ANNUAL LABOR. THE STATEMENT, PROPERLY RECORDED, 01 IS PRIMA FACIE EVIDENCE OF THE PERFORMANCE OF THE LABOR. THE 02 FAILURE OF ONE OF SEVERAL CO-OWNERS TO CONTRIBUTE THE 03 PROPORTION OF THE EXPENDITURES REQUIRED FOR ANNUAL LABOR 04 FROM THE CO-OWNER SHALL BE TREATED IN ACCORDANCE WITH 05 AS 38.05.215 - 38.05.235]. 06  * Sec. 8. AS 38.05.210(c) is amended to read: 07 (c) The statement of annual labor required in (b) of this section, whether  08 recorded before or after the effective date of this Act, may be corrected or 09 amended at any time before the department declares a mining claim or leasehold  10 location invalid. A corrected or [WITHIN TWO YEARS OF THE DATE BY 11 WHICH THE ANNUAL LABOR STATEMENT WAS REQUIRED TO BE 12 RECORDED. AN] amended statement of annual labor shall be recorded [FOR 13 RECORD] in the same manner as the original statement. Additional labor claimed in a  14 corrected or [AN] amended statement may not be applied against labor required to be 15 done during a subsequent year. A corrected statement following notice of deficiency  16 under (g) of this section shall be recorded within 90 days after the notice is sent.  17  * Sec. 9. AS 38.05.210 is amended by adding new subsections to read: 18 (e) A single statement of annual labor may be recorded for labor performed on 19 or for the benefit of more than one mining claim, leasehold location, or mining lease. 20 (f) A statement of annual labor, timely recorded, is prima facie evidence of the 21 performance of the labor. 22 (g) The department may not declare a mining claim or leasehold location 23 invalid based on a deficiency in a statement of annual labor until 90 days after the date 24 the department sends written notice regarding a deficiency in the statement to the 25 owner of the mining claim or leasehold location by certified mail, return receipt 26 requested, to the most recent address on file with the department. The department shall 27 send an additional copy of the notice by regular mail. 28 (h) If a person fails to correct a deficient statement of annual labor within 90 29 days after notice is sent under (g) of this section, the department may declare the 30 mining claim or leasehold location invalid and the affected land becomes open to 31 location. A third party may not locate on the affected land or file a judicial action to 01 declare the mining claim or leasehold location invalid within those 90 days. 02 (i) The department may not declare a mining claim, leasehold location, or 03 mining lease invalid based on a deficiency in a statement of annual labor, or a judicial 04 action seeking invalidation as the result of a deficiency in a statement of annual labor, 05 later than five years after the date the deficient statement of annual labor is recorded. 06 (j) Prior to an allegation of a deficiency in a statement of annual labor, the 07 department is not required to review whether a statement of annual labor meets the 08 requirements in (b) of this section or regulations adopted by the department to 09 implement this chapter. 10 (k) The failure of one of several co-owners to contribute the proportion of the 11 expenditures required for annual labor from the co-owner shall be treated in 12 accordance with AS 38.05.215 - 38.05.235. 13  * Sec. 10. AS 38.05.240 is amended to read: 14 Sec. 38.05.240. Labor defined for AS 38.05.210 - 38.05.235. In AS 38.05.210 15 - 38.05.235, "labor" includes work performed or improvements made in good faith  16 on or for the benefit of a mining claim, leasehold location, or mining lease that is  17 directly related to prospecting for, developing, or producing minerals, including  18 (1) excavating, tunneling, drilling, or clearing land in support of  19 prospecting for, developing, or producing minerals;  20 (2) constructing or maintaining roads, trails, or landing strips;  21 (3) extracting or producing ore;  22 (4) performing a metallurgical analysis, an environmental study,  23 or an economic feasibility study, or conducting engineering or permitting  24 activity;  25 (5) constructing settling ponds, water supplies, or other utilities;  26 (6) providing worker housing;  27 (7) performing reclamation activities under a reclamation plan  28 approved under AS 27.19.030;  29 (8) transporting workers and equipment in the state to or from a  30 mining site; the claimed value of transportation under this subparagraph may  31 not exceed 50 percent of the total value of labor in a statement of annual labor  01 recorded under AS 38.05.210(b) for the assessment year; 02 (9) conducting a geological, geochemical, geophysical, or [AND] 03 airborne survey [SURVEYS CONDUCTED] by a qualified expert [EXPERTS] and 04 verified by a [DETAILED] report filed in the recording district office in which the 05 claim, leasehold location, or mining lease is located that [WHICH] sets out 06 (A) [FULLY (1)] the location of the survey [WORK 07 PERFORMED] in relation to the [POINT OF DISCOVERY AND] boundaries 08 of the claim, leasehold location, or mining lease;  09 (B) [, (2)] the nature, extent, and cost of the survey; [IT,] and 10 (C) [(3)] the name, address, and professional background of the 11 person conducting the work; the [. THE] commissioner, by regulation, shall 12 define the nature of acceptable survey work and the qualifications of a person 13 competent to perform the [THIS] work; an [. THE] airborne survey  14 conducted under this paragraph [SURVEYS, HOWEVER, MAY NOT BE 15 APPLIED AS LABOR FOR MORE THAN TWO CONSECUTIVE YEARS 16 OR FOR MORE THAN A TOTAL OF FIVE YEARS ON ANY ONE 17 MINING CLAIM, LEASEHOLD LOCATION, OR MINING LEASE, AND 18 EACH OF THOSE SURVEYS] shall be nonrepetitive of any previous survey 19 on the same claim, leasehold location, or mining lease. 20  * Sec. 11. AS 38.05.265 is amended to read: 21 Sec. 38.05.265. Abandonment. (a) Failure to perform the labor or make  22 improvements or make a payment in lieu of labor under AS 38.05.210(a), timely 23 [PROPERLY] record a certificate of location or [A] statement of annual labor, timely 24 pay any required annual rental, or timely pay any required production royalty under  25 AS 38.05.212 [AS REQUIRED BY AS 38.05.185 - 38.05.200, 38.05.210 - 38.05.245, 26 38.05.252 - 38.05.275, AND BY REGULATIONS ADOPTED UNDER THESE 27 SECTIONS] constitutes abandonment of all rights acquired under the mining claim, 28 leasehold location, or prospecting site involved, and the claim, leasehold location, or 29 prospecting site is subject to relocation by others, unless the failure constituting the 30 abandonment is cured under (b) of this section. A locator or claimant of an abandoned 31 location or a successor in interest may not relocate the claim, leasehold location, or 01 prospecting site until one year after abandonment. The locator of an abandoned 02 prospecting site may locate a claim or leasehold location on that site at any time. [A 03 STATEMENT OF ANNUAL LABOR THAT DOES NOT ACCURATELY SET 04 OUT THE ESSENTIAL FACTS IS VOID AND OF NO EFFECT.] If an annual rental 05 or a royalty payment is deficient but is otherwise timely paid, abandonment does not 06 result if full payment is made within 07 (1) the period prescribed by a deficiency notice from the department 08 [COMMISSIONER]; or 09 (2) 30 days after a final judgment establishing the amount due if the 10 deficiency amount due was contested. 11 (b) Unless another person has located a mining claim or leasehold location 12 that includes all or part of the mining claim or leasehold location abandoned under (a) 13 of this section or the area is closed to mineral location under AS 38.05.185 - 14 38.05.275, a person may cure the failure to record or pay rents or royalties that 15 constituted the abandonment and cure the abandonment by 16 (1) properly recording a certificate of location or a statement of annual 17 labor, paying any required annual rental, and paying any required production royalty; 18 and 19 (2) paying a penalty equal to the annual rent for the mining claim or 20 leasehold location that was abandoned under (a) of this section. 21  * Sec. 12. AS 38.05.270 is amended to read: 22 Sec. 38.05.270. Transfers. The sale, lease, or other transfer of mining property 23 or interest in mining property shall be recorded [OR SHALL BE APPROVED BY 24 THE DIRECTOR IN COMPLIANCE WITH SUCH REGULATIONS AS THE 25 COMMISSIONER MAY ADOPT]. The heirs and assigns of mining property or 26 interest in mining property have the same rights and duties as their predecessors. 27  * Sec. 13. AS 38.05.275(a) is amended to read: 28 (a) Mining locations made on state land, including shoreland, tideland, or 29 submerged land, or state selected land, under AS 38.05.185 - 38.05.275 or in the 30 manner described in AS 27.10, acquire for the locator mining rights under 31 AS 38.05.185 - 38.05.275, subject to existing claims and to any denial of or restriction 01 in the tentative approval of state selection or patent of the land to the state. If 02 shoreland, tideland, or submerged land is included in a mining location or within the 03 projected boundaries of a mining location made in accordance with this section, the 04 locator shall record a certificate of location under AS 38.05.195. The certificate of 05 location must identify the position of the mining location in the system of rectangular 06 or protracted surveys. If the mining location is made in the manner described in 07 AS 27.10, the commissioner may require that the locator amend the mining location to 08 conform with AS 38.05.185 - 38.05.275 and thereafter to comply with the 09 requirements of AS 38.05.185 - 38.05.275. A mining location on state selected land  10 located within an active unpatented federal mining claim may be located only by  11 or with the written and recorded permission of the holder of the unpatented  12 federal mining claim.  13  * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to 14 read: 15 APPLICABILITY. (a) AS 38.05.210(c), as amended by sec. 8 of this Act, applies to 16 statements of annual labor filed before, on, or after the effective date of this Act. 17 (b) AS 38.05.210(e) - (i), enacted by sec. 9 of this Act, apply to all pending claims or 18 actions filed before, on, or after the effective date of this Act. 19 (c) AS 38.05.275(a), as amended by sec. 13 of this Act, applies to mining locations 20 made on state selected land on or after July 1, 2020. 21  * Sec. 15. The uncodified law of the State of Alaska is amended by adding a new section to 22 read: 23 TRANSITION. Until the Department of Natural Resources adopts regulations 24 consistent with the changes made in this Act, the Department of Natural Resources may not 25 declare a mining claim, leasehold location, or prospecting site abandoned under 26 AS 38.05.265, as amended by sec. 11 of this Act, on the basis that a statement of annual labor 27 fails to include the information required by AS 38.05.210, as amended by secs. 6 - 9 of this 28 Act. 29  * Sec. 16. This Act takes effect immediately under AS 01.10.070(c).