Comstock Mining Update – April 28, 2015


The fiasco of the Lucerne Pit is a good example of what’s wrong with the way government monitors mining in Nevada. We can thank Comstock Mining Inc. for that, if for nothing else; if CMI weren’t such a brazen scofflaw, we wouldn’t see the problem as clearly as we do.

Ongoing destruction of the Virginia City National Historic Landmark at the Lucerne Pit in Gold Hill NevadaIt is almost impossible for our public servants to bring this rogue to account because no one agency — other than the County Commissioners — can oversee the entire operation of a mine.

Earth Day Letter from the Comstock

Silver City Nevada ParkComstock Residents Association board member Joe McCarthy wrote this letter to the Nevada Mining Association on Earth Day:
The current Industrial scale mining on the Comstock is a “Billboard of Shame.” While a few investors make money, the Virginia Range’s sensitive environment is being obliterated, our precious wildlife habitats displaced and two of Nevada’s irreplaceable communities, Gold Hill & Silver City, emptied. Nevada is now being treated to a grotesque advertisement of excess and arrogance. We are witnesses to a mining company being allowed to dig up mountains, hills and valleys, pollute waterways & night skies, muck up pristine air, all within the boundaries of our communities, without recourse or repercussion.

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The mission of MSATS (the state’s Mining Safety & Training Section) is to establish and determine mine operator compliance with state and federal regulations and assist them in meeting compliance. Beyond that, it sees nothing. Or rather, we don’t know what it sees because nothing registers except the extent of compliance with state and federal regulations. If the mine complies in that respect, it can collapse highways at will as far as MSATS is concerned.

MSHA (the federal Mining Safety and Health Administration) received two recent hazardous condition complaints about CMI’s Lucerne pit, one in February and one in March. CMI has been charged with five violations at the pit as a result of these investigations, although their fines have not been levied yet, and some investigations are still ongoing.

But MSHA’s area of responsibility is employee safety, period. It has no authority over community issues or the roadway and no interest in them either. If it finds employee safety violations MSHA is all over it, otherwise, if it notices any other violations it keeps mum.

Gold Hill Hotel, Gold Hill NevadaCMI Gives Up On Hospitality, Leases the Gold Hill Hotel

On March 20, 2015, the Company entered into an agreement to lease the Gold Hill Hotel effective April 1, 2015. CMI retains ownership to the land and Gold Hill Hotel properties while leasing the facilities to independent operators. The initial term of the lease agreement begins on April 1, 2015, and ends in March 2020. The tenant may renew the lease for two extended terms of five years each. Lease payments are due in monthly installments. The Company does not expect to have hospitality revenue or expenses after April 1, 2015.

MOAC is the state’s Mining Oversight and Accountability Commission. It was created to be a single administrative body overseeing the activities of the various state agencies that have responsibility for the taxation, operation, safety and environmental regulation of mines and mining in Nevada. The Commission also identifies particular state entities that are subject to its supervision with respect to their activities related to mines and mining. It consists of seven members serving 2-year terms, appointed by the Governor.

It was established because mining companies weren’t paying taxes, weren’t even being audited, and it operates as a part of the Nevada Department of Taxation despite its additional areas of responsibility beyond the fiscal. But it has no authority to impose penalties for infractions, and apart from getting important information ‘on the record’ there’s not much it can do about them on its own.

NDOT (Nevada Department of Transportation) has responsibility for the roadway, but no authority over pit mines, and no apparent interest in them even when they are being dug dangerously near the roadway it’s responsible for. So when MSHA cites CMI for violations, it feels no compulsion to notify NDOT about it, and NDOT isn’t interested in hearing about it anyway. CMI has been cited for five violations by MSHA, but isn’t required to notify anyone about it, and won’t until it can think up a positive spin to put on it.

Doodads, Silver City NevadaDoodads Forced to Close

Doodads, the happy little store by the side of the road in Silver City had closed. Sheree writes, “Hello dear friends, due to circumstances beyond our control, we are closing Doodads Emporium. On Saturday, April 11 and Sunday, April 12 from 10 am to 6 pm we will have our last big sale. We hope you will tell your friends and help us clear the place out. Who knows when the road will reopen. If you have consignment items, please let me know if you want to come pick them up or if we can sell them for the best price we can do. It’s been a grand five years, thanks for your support. Best wishes, Sheree and Will.”
Will wrote to CMI suggesting that the company’s responsibility for closing the highway isn’t confined to the scene of the collapse, and pointing out that their business was ruined by it, but received no response. Howdy, neighbor. . . .

NDOT says, “We at NDOT have prescriptive rights solely to operate the roadway, but do not own any of the land next to or beneath State Route 342. Because it is not our land, we do not have any jurisdiction to view or review or approve or disapprove any land use such as Comstock mining operations.”

So even if NDOT had noticed the pit encroaching on the well-known fragile area near the roadway, it would not have occurred to them to mention it to anyone because it is none of their business.

Whose business is it then?

It is the business of the County Commissioners. They are the ultimate authority over land use issues. They could have pulled CMI’s Special Use Permit the first time it was violated, but in Storey County the Commissioners have a serious reluctance to impose themselves on economic entities. In other words, money talks in Storey County, and even when it makes golden promises endlessly without result, the Storey County Commissioners are endlessly enthralled.

Commissioners Hess and Kershaw were termed out, and Commissioner Sjolvangen was voted out, but the three current Commissioners are carrying on the torrid romance with Corrado De Gasperis and CMI that the first three began. When the road caved in, they paraded down to the site and pledged that the road would be restored asap.

And that was that. The road is still closed, and so is Doodads, while CMI is happily hauling dirt. Visitors and commuters to and from the south are forced to use the unwelcoming Truck Route, built for the slow, heavy — and sparse — truck traffic of the 1930s, instead of the historic Main Street through Silver City and Gold Hill.

This meets Mr. De Gasperis’ definition of a ‘win-win-win situation’ as expressed in a recent interview:

“SR-342 was built on loose fill and eroded from weather events to the point that it needs to be re-routed. We will move the road as we were planning on doing anyway, but it will help the State, help the County and accelerate many of our business and reclamation plans. Classic win-win-win.”

Imagine that! The road collapsed because of bad weather! And everyone wins except the people who depend on the highway.

CMI has managed to stay in business — which is strip mining the Virginia City National Historic Landmark — despite its unprofitability because Storey County officials have bent and broken the rules to allow it. Let’s see how they handle this pathetic episode.



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