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Duluth News Tribune, January 15, 2011

Environmental groups file suit over loan to PolyMet
By John Myers

Minnesota environmental groups on Friday filed a lawsuit claiming a $4 million loan from the Iron Range Resources and Rehabilitation Board to PolyMet Mining Co. violates state environmental laws.

The board approved the loan to PolyMet in December so the company could buy private land within the Superior National Forest. The land then would be traded to the U.S. Forest Service in exchange for federal land near Babbitt, where the proposed mine would be located.

But environmental groups cite Minnesota laws and court decisions that prohibit state agencies like IRR from investing in projects before environmental review and permits are approved.

The loan, which would be paid back if the fledgling company begins selling

copper and other metals, is the first major state contribution to the $600 million mine project that backers say will provide 400 jobs for 20 years. It would be Minnesota’s first copper mine.

“Minnesota law prohibits state agencies from providing any approvals, permits or loans for proposed projects that are still going through the environmental review process,” said Marc Fink of Duluth, an attorney with the Center for Biological Diversity.

Frank Ongaro, executive director of Mining Minnesota, a copper industry trade group, said several state agencies regularly provide funding for projects that aren’t fully approved.

“It really is an issue (for) the Attorney General’s Office, who will have to defend the agency. But it sure seems like this happens all the time and that we are seeing some selective concern by these groups,” Ongaro said.

The Minnesota Department of Natural Resources, U.S. Army Corps of Engineers, U.S. Forest Service and other agencies currently are reworking the environmental-impact study on the PolyMet proposal. The Environmental Protection Agency, tribal resource agencies and other groups have been highly critical of the environmental review effort. The latest review now is including the proposed land exchange. In comments submitted on the environmental review, the EPA rated the PolyMet proposal as “environmentally unsatisfactory — inadequate” due to long-term water-quality impacts.

The suit was filed by the Center for Biological Diversity, Minnesota Center for Environmental Advocacy, Save Lake Superior Association, Friends of the Boundary Waters Wilderness and Indigenous Environmental Network.

“Our state laws require agencies to ensure our clean water and other natural resources will be protected before they throw the state’s support behind a project,” said Betsy Daub, policy director for the Friends of the Boundary Waters Wilderness, in announcing the suit. “In this case,

unfortunately, Iron Range Resources acted like the PolyMet mine is a sure thing even though the environmental review is far from over.”

In 2007, the St. Louis County Board was found in violation of the Minnesota Environmental Policy Act for allowing wetlands work to begin for an exchange with PolyMet before the review process was complete.

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