Copper industry re-writes NM pollution rules

Posted by Christine, May 15, 2013

By Laura Paskus for the Santa Fe Reporter

Close your eyes, and picture a radical.

Bill Olson is not that guy. With a neat brown beard and a fondness for western shirts and jackets, even the occasional bolo tie, he’s the quintessential water nerd. When asked, over coffee and a blueberry scone, to talk about groundwater, he actually grins. Delightedly.

In short, he’s not exactly the person you’d expect to find at the center of a controversy over New Mexico’s environmental rules.

And yet, here he is.

Olson is a former bureau chief at the New Mexico Environment Department, which regulates how industry impacts the state’s natural resources. Specifically, he has worked to keep groundwater—the underground aquifers that provide most of New Mexico’s drinking water—from becoming contaminated.

“I’m passionate about groundwater and protection issues,” he says. “It’s something that’s important to me.”

It’s early May, and the state has just wrapped up a few grueling weeks’ worth of hearings about a new water pollution rule for copper mines.

To industry, the new rule represents the chance to profit and create jobs in New Mexico. Others see it as an abdication of the state’s responsibility to protect groundwater—and a move to hand over the public’s water to private companies.

“Really, we’re concerned that this copper rule turns back the clock, and turns back everything that New Mexico’s been doing to protect groundwater for 35 years,” says Phil Sisneros, a spokesman for the New Mexico Attorney General’s Office.

Bruce Frederick, a water rights attorney for the New Mexico Environmental Law Center, goes even further. In his view, the new rule violates the state’s 1978 Water Quality Act.

“We think it’s illegal,” he says frankly. “Now, they’re giving across-the-board exemptions for pollution from copper mines. It’s a sweet deal.”

And Olson—known for his evenhandedness—is caught smack in the middle.


Before understanding the rule itself, it’s important to know why anyone would change it in the first place.

In 2009, the New Mexico Legislature passed a law requiring new groundwater rules for two industries: copper mining and dairy farming. At the time, the bill was cast as a way to clarify pollution rules by setting certain standards. The state’s Water Quality Control Commission—a 14-member group of state employees, gubernatorial appointees and citizens—would be in charge of writing the new rules.

The commission has no technical staff, so it delegated the task to NMED.

One critical aspect of the 2009 law, which was negotiated between lawmakers and industry, requires agreement from stakeholders before a new rule is approved. So not only did NMED need someone to write the rules; it also needed to hold meetings and revise the rules as needed. After NMED did the groundwork, the commission could accept or reject the changes.

That long, arduous process began in 2009.

First came the dairy rule. NMED tapped Olson, then chief of the department’s Ground Water Quality Bureau, to help rewrite it. At the time, Olson had weathered five different administrations and sat for 13 years on the Water Quality Control Commission. When it comes to technical jargon and regulatory mazes, he knows his stuff. He’s also known for navigating a middle line between industry and environmentalists.

Southwestern New Mexico’s Chino Mine opened in 1910. Under current rules, copper mines are allowed to pollute the underlying groundwater as long as they obtain a “variance,” or exemption, from the Water Quality Control Commission.
Wikimedia Commons

In 2010, after months of meetings and three weeks of public hearings, Olson and his staff released the new rule. Among other changes, it would require dairies to install plastic liners to keep waste pits full of manure from contaminating water. But the dairy industry appealed, claiming the new regulations were too strict. Upon taking office, Gov. Susana Martinez tried to block the rule from being published—a procedural end-run that, in retrospect, foreshadowed future controversy.

The state Supreme Court stymied Martinez’ move, issuing a stern rebuke: “No one is above the law.” In 2011—just as Olson was retiring—the state and the dairy industry reached a settlement.

But Olson’s time at NMED wasn’t quite over: A few months later, the agency hired him as a contractor to write the new copper rule.

New Mexico has three copper mines: Cobre, Chino and Tyrone. All three are currently owned by Freeport-McMoRan Copper & Gold Inc., the world’s largest publicly traded copper company. Copper is an integral part of life; it’s used in electronics and for everything from water pipes to telecommunications wire.

The three mines have shaped southwestern New Mexico’s economy. They employ 1,550 people directly; indirectly, nearly twice that. But they also have a history of polluting groundwater. According to a 2012 report by the New Mexico Office of the Natural Resource Trustee, groundwater pollution totals more than 20,000 acres beneath the three mines. (In 2010, Freeport paid the state $13 million to settle allegations it had contaminated that water; that money is dedicated to groundwater restoration projects.)

On a recent Monday morning, Olson sits at a table in the Santa Fe Baking Company, a spot he favored for lunch while working for the state.

Setting his orange coffee mug atop a white, ceramic plate specked with crumbs, he illustrates what’s at stake.

The mug represents a tailings pond or waste rock pile—the rocks dug up and discarded in the process of getting to the copper. He points to the base of the mug. That’s where a monitoring well should be: As close as possible to the source of the pollution, so NMED can quickly detect any contamination in the groundwater.

Of course, monitoring wells don’t prevent pollution; they simply measure it. In order to determine how much a given mine can pollute, NMED has used the general guidelines in the state’s Water Quality Act.

Take the sprawling Tyrone Mine, south of Silver City. In 2012, it produced 83 million pounds of copper. It includes eight open pits and 2,800 acres of waste rock and leach piles. About a decade ago, Freeport maintained that it could pollute as much as it wanted because the groundwater under Tyrone would never be used for drinking. (After all, who would ever build, say, a town on top of a mine?) The state didn’t buy it, and the two sides ended up before the Water Quality Control Commission and then in court.

In 2010, they reached an agreement: Freeport could legally pollute the water under Tyrone as long as it obtained a variance, or exemption, from the commission. A variance would allow the company to pollute a very specific area for five years. Over the past three years, Freeport has requested two variances for the Tyrone Mine; the commission has granted both of them.

But the existing process is both ad hoc and inconsistent, according to Eric Kinneberg, director of external communications for Freeport. Enforcing groundwater standards through individual variances, he writes in an email, has resulted in excessive red tape and delays—and the new copper rule is a much-needed improvement.

“Not only are clear rules important to Freeport-McMoRan’s ability to meet rigorous environmental protection standards,” he writes, “but they will also allow us to more reliably plan for potential expansion and investment opportunities.”

Since 2009, Freeport has played a key role in crafting the new rule. And, as Olson would soon find out, the company didn’t intend to keep begging for variances.

For seven months, Olson worked with the copper advisory committee and a technical committee to craft the new copper rule. Convened by NMED, the committees included the copper industry, environmental groups and technical experts. Throughout the process, Freeport made clear its desire to do away with the variance system. But Olson never incorporated that change into the rule, and in mid-August he sent the draft rule—revised and written with help from the committees—to NMED’s upper management.

From here, though, the story takes a surprising twist. Just as the rule was about to go public, NMED’s senior staff pulled it back. At the last minute, they made crucial changes—in essence, giving Freeport everything it wanted. Rather than prescribing and enforcing how mines must keep waste from seeping into groundwater, the new rule allows NMED to defer to mining companies themselves.

To explain the changes, Olson returns to the mug—that pile of contaminated waste rock—atop his plate.

The plate, he explains, represents a groundwater catchment system, a way to try to capture the pollution and keep it from traveling too far away. Under the new rule, monitoring wells are drilled beyond the catchment—meaning the company is legally allowed to pollute the space between the base of the mug and the edge of the plate.

Sure, the company will try to keep pollution from leaving the space below the plate. But aside from requiring them to be downgradient of the pollution source, the rule doesn’t say anything else about where monitoring wells must be drilled. It’s unclear, even, if a company could just keep making its plate bigger and bigger and keep pushing those wells out further and further away from the pollution source.

Understanding this takes months of filing Inspection of Public Records Act requests, watching excruciating technical testimony, talking with lawyers—and, finally, having a guy with a plate and a mug explain the issues.

But the mining industry has found a better way to sell the new rule to the public.

In October, just after the Attorney General’s Office and the New Mexico Environmental Law Center submitted their objections to the new rule, the New Mexico Mining Association hired The Garrity Group, a high-profile public-relations firm, to create a website about the copper rules. Polished and professional, the site includes video interviews with copper miners. One man describes growing up and wanting to be a copper miner; another recites a familiar mantra about the rule-making process: A diverse group of state officials, academics and environmental groups, he says, worked together to create a balanced rule for copper.

According to an emailed statement from Executive Director Mike Bowen, the New Mexico Mining Association supports the new rule because it represents proven technologies and best practices. The association, which represents copper, coal, uranium and other mining industries, has a lot at stake.

“The NMMA is interested and engaged,” Bowen writes, “because, depending on how the rule is written, it would indicate that other commodities mined in our state will also be regulated considering proven technologies and best practices.”

How the copper rule was effectively dismantled
—by the very agency charged with environmental protection—is a story in itself.

Last August, after months of negotiation and tweaking, Olson sent a “discussion draft” of the rule to NMED’s upper management.

Two days later, General Counsel Ryan Flynn wrote in an email, “NMED anticipates making changes to the rule over the next couple of weeks.”

(Flynn, who was recently named NMED’s new cabinet secretary, came to the department from Modrall Sperling Law Firm, which counts Freeport among its clients. Requests to interview Flynn for this story were ignored.)

The rule that emerged in mid-September was a different animal. It incorporated language Freeport had previously proposed, but the committee had rejected. Most notably, it freed copper companies from having to apply for variances.

“Our collective jaws dropped. It was such an obvious betrayal,” Frederick says. During the process, he represented the Gila Resources Information Project, an environmental group that sat on NMED’s copper advisory committee. “If they had told us this was the plan, we wouldn’t have participated. We were basically tricked.”

For months, copper committee members had traveled for meetings, spending hundreds of hours working together and believing they had a say. When NMED released its revamped rule in September, the law center filed comments opposing it. Tall, with graying hair and brown eyes, Frederick has a deep, lawyerly voice. He also has a master’s degree in hydrology from the New Mexico Institute of Mining and Technology and, in the 1980s, worked for NMED’s predecessor, the Environmental Improvement Division.

“The department, at Freeport’s asking, allows waste rock piles and tailings ponds to contaminate groundwater as long as there is an interceptor system downstream, and then downstream of that, a monitoring well,” he explains. “The department went a step further, and eliminated the need to get variances. Ever.”

Frederick spares a tight smile: He has to thank Freeport for its restraint. Based on how solicitous NMED’s senior management has been, the copper company could have asked for even more.

The Attorney General’s Office also urged NMED to reconsider the rule. In its comments, the office notes that significant changes occurred between August and September—and that the revised draft “in essence wholly incorporates the comments of the mining industry and wholly rejects the comments of the environmental groups.”

Attorney Tracy Hughes, who spent a total of 17 years at NMED, now works at High Desert Energy + Environment Law Partners, LLC, a firm founded by four former NMED attorneys. Hughes represents the nonprofit environmental group Amigos Bravos in opposing the copper rule.

“We understand that in our society, there is a certain amount of pollution generated by our standard of living,” Hughes says. “We’re not anti-mining.” The problem is simply that the proposed rule violates state law, she says. In essence, it allows copper companies to pollute groundwater above legal levels—as long as the pollution doesn’t reach monitoring wells.

The impact doesn’t stop there, Sisneros notes. In addition to copper, other types of mines, dairies, wastewater treatment plants, federal nuclear weapons laboratories—in total, some 900 other facilities—also pollute groundwater. If NMED goes easy on the copper industry, he says, “It would set a very dangerous precedent.”

During rule-making hearings, commissioners spend hours listening to testimony about mining practices, how groundwater travels and other complicated details. They also must listen to the public. While the copper hearings in Silver City have been lively, the public hearings in Santa Fe were a testament to how little the public knows—or cares—about environmental regulations.

On a recent afternoon in Santa Fe near the capitol building, the nearly empty Apodaca Hall feels cavernous. The commissioners have spent all day sitting through technical testimony. Now, it’s time to hear from the public.

There are 16 people in the audience, including me. The evening before, there were even fewer.

“The New Mexico Environment Department is not the most popular branch of government, but it’s one of the most important,” state Sen. Richard Martinez, D-Española, tells the commissioners. It’s important that environmental groups, academics and industry have all been invited into the rule-making process, he says: “This kind of transparency is at the heart of the rules.”

A few others speak: Dora Dominguez says the state Economic Development Department supports the revised copper rule. Plumber Jeff Romero explains that copper pipes are better for domestic water lines than plastic. A few citizens speak against the proposed rule, most of them noting that water is scarce and should be protected. Some say the rule is a step backward, or that it’s illegal.

Public hearings are important to the process, and they reinforce the notion of democracy. But when it comes to actually writing the rules—and upholding their integrity—it is NMED’s staffers who matter most.

Copper ore is a valuable resource used in electronics, water pipes and various other applications. The process of separating the ore from the parent rock, however, can contaminate the groundwater beneath a mine.

And that, to some observers, reflects another worrisome aspect of the changing rules. Over the past two years, NMED has seen an exodus that includes some of its best, most senior employees—including several longtime bureau chiefs.

“These are among the best professional environmental agency people we’ve had in the state—people who had been there for many years—and it got so bad, they all left,” says Jim Norton, who for eight years was director of NMED’s Environmental Protection Division. Secretary and division director positions change from administration to administration, he says, but the bureau chiefs were once immune to political whims.

“They play an absolutely crucial role: These are the people who know the state and federal laws on the books to protect the environment and who respond to whatever comes at them, whether from a Republican or Democrat administration,” he says. “Any administration will try to shape things the way they think things should be shaped, but it’s the job of those bureau chiefs—these are the stable people—to say, ‘Wait a minute, that’s illegal’ or ‘That’s against the rules that have been in place for decades.’”

The department has been hemorrhaging attorneys, too. At the end of 2012, the NMED attorney working on the copper rule resigned. In addition to Hughes and her law partners, there’s Tannis Fox, a former general counsel who left the department in late 2011 and is now leading the charge against the rule as an assistant attorney general.

“It’s like with the bureau chiefs: all the solid environmental attorneys who have been there, sometimes for decades, have left because they don’t want to be part of the dismantling of environmental laws and regulations,” Norton says.

As administrations change, there will always be political pressure, he allows, “but to have this level of devastation in the environment department? This is unprecedented.”

In September, when Olson read the re-written rule, he was shocked. He was also told he wouldn’t be testifying before the Water Quality Control Commission. Thinking there was nothing more he could do, Olson terminated his contract with NMED.

The more he mulled things over, though, the more he knew they weren’t right. The rule contradicted everything he had worked for.

“It’s bad groundwater policy to allow pollution to occur,” he says. “Especially now that we’re in a drought, and we’re going to be pumping more groundwater.”

Olson set aside thoughts of spending his retirement riding horses; he abandoned the hope of landing future contracts with NMED. In February, he announced he would testify before the commission as a private citizen.
Immediately, NMED objected.

According to a letter obtained through a public-records request, Flynn called Olson to tell him that NMED wanted reimbursement for money it had paid him to work on the copper rule. According to the letter, which Olson sent to NMED, Flynn also accused him of breaking the contract’s confidentiality and reminded him he’d been told to remain neutral on the copper rule.

In March, NMED filed a motion to exclude Olson’s testimony and any transcripts from previous hearings.

As though to further stack the deck, the Water Quality Control Commission saw a member shakeup. Most commissioners serve at the discretion of state department heads; four are appointed by the governor. By the end of last year, Frederick says the commission—once a group of technical experts and scientists—had become bunch of “good ol’ boys” who sided with NMED and Freeport even during the hearings.

“We would cross-examine NMED or Freeport witnesses, and the commissioners would ask questions, almost as if they were advisors for Freeport or the environment department,” Frederick says. The reverse was true of the law center’s witnesses, he says, whom commissioners often cross-examined.

“They’re ideologically driven, and it looks like they’ve already made up their minds,” he says. It’s the commissioners’ duty to protect groundwater, he adds, which according to New Mexico law belongs to the public. Instead, he says, “This commission seems to think its duty is to bend over backwards and hand the public’s water over to Freeport.”

NMED didn’t stop at trying to block Olson from testifying. It also lined up its own witnesses: Resource Protection Division Acting Director Tom Skibitski and a contractor, Adrian Brown.

Skibitski began his career in construction management; at NMED, he’s worked on everything from underground storage tanks to US Department of Energy facilities. His résumé reflects no comprehensive experience with groundwater, and email records of the rulemaking process do not show his involvement.
Brown, a civil engineer and president of the International Mine Water Association, landed a $75,000 contract for his work as an expert witness. (According to an amendment to the contract, Brown voluntarily reduced his hourly rate from $225 to $150.)

When Olson appeared before the commission, toward the end of the hearings in April, only nine of its 14 members were there to hear him correct misinformation offered by both Skibitski and Brown.

“I thought it was important to give the commission factual information,” Olson says now.

After a weekend of catching up on sleep and trying to unwind from the hearings, at the café, he explains that capture systems aren’t foolproof.

“Nothing is perfect. That’s why you try to prevent pollution rather than capture it,” he says. “Groundwater movement isn’t uniform. There are fractures and channels, and you don’t always know where those are.”

With the copper rule, Olson is not casting his lot with environmentalists and demonizing the copper mining industry. That’s just not his thing.

“There always has to be a balance, and you have to be doing things that are practical for industry to do,” he says. That’s not what the new rule does. Instead, he says, “It’s almost like we’re trying to institutionalize a failed system.”

In all the discussions about rules and regulations, it can be easy to miss the big picture. While a rule can always change, an environmental legacy is forever. Even though he’s no longer with NMED, Norton worries about the future.

“If the copper regulations go through, they are going to allow groundwater to be polluted by mining companies,” he says. “That lasts forever. Once you pollute the groundwater like that, it can’t be reclaimed.”

Click here to see all the testimony submitted by witnesses and attorneys to the WQCC.

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