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July 29, 2015

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The Policy Racket

House passes Rep. Heck’s mine-cleanup legislation

Congress is halfway toward clearing the red tape on the Three Kids Mine reclamation project, a necessary step before the city of Henderson can sell the abandoned mine and start the cleanup that’s been so long overdue.

The House of Representatives passed Rep. Joe Heck’s bill to hand over almost a thousand acres of Bureau of Land Management land near Lake Mead Parkway across from Lake Las Vegas that’s part of the abandoned manganese mine — now home to open pits of trash and sludge — by voice vote on Tuesday.

“This legislation is a win for the economy, it’s a win for the environment and it’s a win for the federal taxpayer,” Heck said Tuesday, adding that he believed the cleanup project would create up to 3,000 jobs. “It could serve as a model for other similar sites across the country.”

But that’s just what some Democrats — though they did not object to passage of the bill — are concerned about.

The Three Kids Mine is being highly lauded on its specifics: It won’t cost the federal government anything, it will speed up the lingering cleanup project, and the entire Nevada delegation is backing the measure.

Some Democrats in the House worry the bill is the first step toward excusing the government from bearing any responsibility to clean up contaminated sites.

The bill directs the Department of Interior to convey the BLM land to Henderson, which will sell it, with the 314 acres of private land that’s also part of the site, “at fair market value.” The sale would be financed privately and with the help of tax-increment financing — a way of betting on the future appreciation of the value of the project and the tax revenue it will likely bring in to finance the development of the blighted site.

It also indemnifies the federal government from responsibility just in case something goes wrong with the cleanup company.

“I have concerns about precedent that will be set by waiving the liability of the U.S.,” Rep. Raul Grijalva said as lawmakers were debating Heck’s bill. “It’s not a perfect opportunity from my perspective.”

Heck, R-Nev., explained that the prospective buyer will be required to join a consent agreement ensuring the cleanup would be paid for in full regardless of what might happen in the developing company along the way.

According to the Congressional Budget Office, there is a chance the arrangement “could reduce the amount of appropriated funds BLM spends on remediation and reclamation activities in the future.”

Fifteen percent of the area is thought to be contaminated, and the cleanup is expected to run up a cost from $300 million to $1.2 billion, lawmakers said. The CBO’s valuation of the site also is a little daunting for anyone eyeing tax-increment financing to pay the cost: They don’t expect the project to generate any revenue “over the next 10 years.”

The Henderson Redevelopment Agency has already concluded an option contract with Lakemoor Development, which has plans to turn the toxic dump into a neighborhood center, with retail outlets and houses.

All that remains from Congress’ end, then, is to get the bill through the Senate similarly, without significant objection.

There, Reid has already lent his support to the bill.

“When I grew up in Henderson, this was way out of town; now it’s in the middle of a community,” Reid said in a taped interview released to YouTube by his staff earlier this year. “We need to make it so the city of Henderson can develop this area.”

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