DATE: November 8, 2000

TO: Planning Commission

FROM: Cheryl Easterwood, Director
Community Development Department

FILE NO.: MIN2000-00002, Small Mine Permit

PROPOSAL: To conduct a Small Mine operation with ongoing reclamation on the Rock Dump for a period of about two years.

On September 26, 2000 the Planning Commission conducted a public hearing on this application. The Commission continued action on the matter, and asked that the applicant and staff prepare additional information for the Commission=s consideration. Specifically, the Commission asked for an updated or consolidated project description, a professionally prepared noise analysis, and additional information on the financial warranty.

This staff report will address the new material. It is a supplement to the original report. The original report and the minutes of the September 26 meeting are included in the packet.

The applicant has prepared a condensed, consolidated project description. It describes the project, provides an engineered plan, and discusses the bonding requirement of the State.

DMC Technologies prepared a noise analysis to determine potential noise impacts of the operation. We reviewed the first submittal, and asked for another examination of the impacts based on the worst case, or the closest Douglas residences. Addendum #1 shows this analysis. The consultant also provided an Executive Summary of the two reports.

DMC found that the total source noise level is 94 dBA. The noise level with no mitigation at the closest Douglas residence is calculated to be 61.3 dBA. The noise monitoring conducted by CBJ this summer established the background noise level in Douglas to be 43 dBA. An increase of nearly 20 dB would be clearly unacceptable to Douglas residents. Accordingly, mitigation is necessary.

The consultant examined the mitigation proposed by the applicant. He found that housing the mill, one of the noisiest pieces of equipment, in an insulated container van would result in about 11 dB of noise reduction. He found that the wall of stacked container vans would achieve about 22 dB of noise reduction. The predicted noise received at the closest Douglas residences is 38 dBA. This is below background noise levels in Douglas and would not be noticeable.

The consultant prepared a very thorough analysis. He submitted his calculations so as to allow a third party review of the work. We did ask a third party consultant to review the study.

BRC Acoustics concurred with the noise source levels and distance attenuation figures. They agreed that stacking container vans may be an effective noise barrier. However, using the same assumptions as DMC, BRC calculated barrier effects closer to 16 - 19 dB. BRC agreed with DMC that the height of the barrier is the critical feature for a barrier with respect to the noise source. BRC noted that the terrain slopes from down from the site towards the barrier, and that some of the noise sources are 10 feet high. Therefore, it may therefore be difficult to achieve maximum calculated attenuation as the equipment may not be a uniform 20 feet below the barrier as was apparently assumed.

DMC Technologies also explained in a telephone conversation that using rubber screen material instead of metal screens is standard in many places, and that this would result in a 10 to 15 dBA decrease in noise from the screen.

If we take the most conservative figures, and assuming that the vans are generally about 20 feet above the noise source, we see that the vans may produce about 16 dB of reduction and the rubber screens and the housing of the mill will result in another 10 dB of noise reduction. With these three mitigations we can estimate that the noise received in Douglas will be about 35 to 38 dBA. If we think that the vans will be less effective due to the height of the equipment relative to the height of the vans, the noise received in Douglas will be increased. If we just assume for the sake of argument that the vans will be half as effective (about 8 dB), we find predicted noise levels in Douglas to be about 43 dBA or equivalent to the current daytime background noise.

Based on CBJ monitoring this summer, we estimate that the nighttime baseline noise is about 5 dBA below the daytime level. With some restrictions on operating hours, we believe the operation may be conducted without causing noise impacts at night.

We conclude that with proper mitigation this project may be conducted without detriment to the residents of Douglas. In view of the continuous nature of the operation, we believe it is important to proceed conservatively until we learn more about the actual impacts of the operation.

We recommend a series of conditions which will provide assurance that the operation is conducted so as to avoid negative noise impacts. We recommend that the applicants proffered mitigation be implemented (container van noise barrier and mill housed in container van). We further recommend that screen be fitted with rubber screens and that the operation be monitored after start up to make sure that the predictions are accurate. If the noise levels exceed the predictions, the applicant will be required to perform additional mitigation until the noise level is brought down to within 5dBA over baseline or 48 dBA.

The Engineering Department has determined a bonding amount that would protect the CBJ from an unseen catastrophe during the mining operation instead of simply bonding to remove the machinery and fill the holes. Possible events that could require restoration due to one of these events could be removing spilled oils, repairing an undermined street, repairing a damaged sewer or water line, as well as filling the excavated cells, grading the surface and seeding any disturbed public lands, and preventing erosion from the restored site.

The previous estimate of $10,000 was arrived at using prices to fill the last excavated cell and remove machinery from the site. A bond to protect the CBJ from any of the above unforeseen catastrophes, could easily be calculated at $150,000. The applicant does have an existing $500,000 bond that is stated to include the CBJ. However, it seems to guarantee that reclamation be in accordance with the lease and agreements by the applicant. We do not know if it extends far enough to include restoration of public facilities.

Accordingly, we recommend that the financial warranty be set in the amount of $150,000.

This Small Mine Permit action for the AJ Rock Dump Gold Project is similar to others taken by the Planning Commission in that a series of findings must be made by the Commission prior to taking action on the permit. AFindings@ are a specific statement demonstrating that the requirements of CBJ law applicable to the project are met. Seven requirements set forth at CBJ '49.15.330 are applicable to all Conditional Use and Mining Permits. In addition, nine requirements set forth in the CBJ mining ordinance (CBJ '49.65.125 and '49.65.135) are applicable to the AJ Rock Dump Gold Project. The following section lists the Conditional Use and the Mining Ordinance requirements in bold-faced type followed by the department=s recommended finding.

1. Is the proposed use (a mining operation) appropriate according to the Table of Permissible Uses?
2. Yes. The proposed use is appropriate according to the Table of Permissible Uses. The Table provides at 14.400 that proposals for AMining Operations@ are to be reviewed as Conditional Use applications as modified by the Mining Ordinance.

The term AMining Operation@ is defined at CBJ '49.80.120 as:

AThe development, construction or reclamation of a mine, including associated infrastructure, or the exploitation or extraction of a mineral commodity from its occurrence on or in the earth, or the operation of a mine. This includes open pit mining, placer mining and underground mining, and the disposal of refuse, tailings or waste rock from any such operation . . . @

The AJ Rock Dump Project consists of extracting materials from the earth, processing these materials, and then replacing the metal-free tailings back into the excavated cell. The operation thus, falls within the definition of a Amining operation.@

3. Is the application complete?
4. Yes. The application was signed, accompanied by the applicable fee, and contains the information necessary to determine that the mine will comply with the Mining Ordinance and other applicable sections of the Land Use Code.

Thunder Mountain Mineral, Inc. submitted an initial permit application and the application fee on May 11, 2000. A supplemental application was submitted to the Community Development Department (CDD) on September 1, 2000 which responded to a CDD request for additional information. A Noise Analysis was submitted on November 4, 2000 and condensed application information was received on November 6, 2000.

The Mining Ordinance, at CBJ '49.65.125(b) requires that an application for a small mine permit contain:

Information establishing the right to use the affected surface.

A copy of the State of Alaska upland mining lease was provided with the application as was a copy of the Settlement Agreement reached between the mining claim holder and the surface owners. The Public Notice of the intent to issue a mining lease explains that Howard and Michael Hayes have leasehold mineral locations on the Rock Dump. They proposed to convert 14 of these acres to an upland mining lease. The applicant to conduct the mining is Thunder Mountain Minerals, with the actual operator being Golden Placer, LLC of Juneau.

A map showing the location of the small mine

The application contains several maps which display the location of the operation.

A description and timetable of the mining operation including a mining plan

The application contains a description of the mining operation at page 7 of the supplemental application. A timetable, now somewhat out of date, is provided at page 38 of the November 1999 application materials. It shows that after permitting, one month will be allocated to mobilization and survey work, followed by one month of establishing equipment and conducting trial runs. Production will then begin. A general timetable is also discussed on page one and two of the Settlement Agreement.

A plan for reclamation

The reclamation plan is generally described in the November 7, 1999 permitting and lease application information. Reclamation is more specifically detailed in the DNR lease, item #11 and in the Settlement Agreement, page 4.

A description of potential environmental, health, safety, and general welfare impacts

The application does not describe potential environmental impacts, but rather describes a relatively simple operation with few, if any, impacts to the environment, health, safety and general welfare.

A description of the measures taken to mitigate adverse health, safety, and general welfare impacts

The application discusses an operation which will largely avoid adverse impacts by virtue of its small scale. Efforts to contain noise and dust are described.

A description of measures taken to comply with air and water quality standards

Measures taken to comply with air and water quality standards are discussed on page 36 of the November 7, 1999 submittal as well as on page 7 of the supplemental.

A description of methods to be used to properly handle hazardous and toxic substances, sewage, and solid waste

The AJ Rock Dump Gold Project will not use any hazardous or toxic substances. No sewage disposal will be required. Solid waste will be taken to the landfill as necessary.

A map indicating that there will be no affected surface within the boundary of the mining and exploration surface activities exclusion district

A map showing the boundaries of the exclusion district is attached. The small mine is outside of this district.

A listing of all permits applied for or granted by other agencies

The application materials included a copy of the Final Consistency Determination regarding the lease and the proposed mining plan of operations. No other authorizations are required for this mine.

5. Will the proposed mining operation comply with the other requirements of this chapter?
6. Yes. The proposed development complies with the other requirements of this chapter. Notice was provided in the Juneau Empire under AYour Municipality@ which ran on September 15, 2000. A public notice sign was posted on the site at least 14 days prior to the meeting and notice was mailed to owners of record of all property within 500 feet of the subject property. Neighborhood Associations were also provided notice. The public also received notice of the continuation hearing.
7. Will the proposed mining operation materially endanger the public health or safety?
8. No. We have found no evidence that the proposed small mine will materially endanger the public health and safety. If the mine is operated within the appropriate industry guidelines, the project description and the conditions of this permit, the mine will have no adverse impact on public health or safety. The CBJ Engineering Department has reviewed plans submitted by a licensed engineer and is satisfied that adjacent properties will not be subject to damage.
9. Will the proposed mining operation substantially decrease the value of or be out of harmony with property in the neighboring area?
10.  No. We have found no evidence that the proposed small mine would substantially decrease the value of or be out of harmony with the immediate neighboring area. The immediate neighboring area affected by the proposal consists of a barge loading facility, tank farm, and sewer treatment plant as well as several industrial/commercial uses.
11. Will the proposed development be in general conformity with the land use plan, thoroughfare plan, or other officially adopted plans?
12. Yes. The proposed small mine is in conformity with the CBJ Comprehensive Plan. Specifically, it is in conformance with Policy 2.6 which states that it is the policy of the CBJ to support the development of mineral resources in an environmentally sound manner, giving proper recognition to the unique values of the community.
13. Will the proposed development comply with the Juneau Coastal Management Program?
14. Yes. The project is in conformance with the Juneau Coastal Management Plan (JCMP). The JCMP addresses mining at CBJ '49.70.940. This section provides that mining shall be regulated so as to be compatible with standards of the JCMP, adjacent uses and activities, and statewide and national needs.

MINING ORDINANCE FINDINGS

15. Will the mining operation be conducted outside of the boundary of the Mining and Exploration Surface Activities Exclusion District?
16. Yes. The project map and description show that the project is located entirely outside of the exclusion district.
17. Will be mining operation be conducted in accordance with applicable provisions of the CBJ code and in such a way as to mitigate adverse environment, health, safety and general welfare.
18. Yes. This standard embraces every aspect of the analysis of the mining operation. Our analysis has found that the operation, as conditioned, will comply with applicable CBJ codes and will be conducted in such a way as to mitigate adverse impacts on the environment, health, safety and general welfare.
19. Will the mining operation be conducted in such a way that air quality and water quality will be maintained in accordance with federal, state, and CBJ laws, rules, and regulations?
20. Yes. Air and water quality will be maintained throughout the life of this mine. Air quality concerns are limited to dust generation. The applicant has taken several precautions to ensure that dust does not become a problem. The Department of Environmental Conservation has standards for dust emissions. DEC staff will ensure compliance with the appropriate standard if necessary.

The mining activity is expected to have no adverse impact on water quality. No chemicals are used in the processing. The removal of heavy metals from the tailings may be viewed as a positive for water quality although this would be extremely difficult to quantify. The applicant will collect data to show that water collected from the tailings cells and pond is statistically similar to the groundwater already present in the tailings.

21. Will hazardous wastes, toxic substances, sewage, and solid waste be properly contained and disposed of?
22. Yes. There will be no hazardous wastes generated, no toxic substances used, and no sewage produced at the site. Solid waste will be removed as necessary and deposited at the landfill.
23. Will the mining operation be conducted so as to minimize safety hazards?
24. Yes. The operator will place a protective berm around the active mine cells, and will fence the storage pond. The employees will receive MSHA required safety training.
25. Will the mining operation be conducted so as to control and mitigate adverse impacts on the public and neighboring properties from noise, dust, unsightly visual aspects, subsidence, and erosion?
26. Yes. Noise, dust, unsightly visual aspects, subsidence and erosion have been addressed in the mining plan, and where necessary, in conditions of this permit. Noise will be controlled by conditions of the permit which place limits on hours of operation and require a noise barrier and enclosure of the noisiest equipment. Dust will be controlled by features of the equipment and by water as necessary. The operation will be shielded from view by AML container vans. An engineered mine/site grading plan has been reviewed by Terry Brenner of the CBJ Engineering Department, and Mr. Brenner finds no cause for concern related to subsidence or the stability of nearby properties. An erosion plan was also submitted and approved by the department.
27. Will historic sites be protected?
28. No historic sites will be affected by this small mine.
29. Will reclamation of the affected surface be in accordance with an approved reclamation plan?
30. Yes. The operator has submitted a reclamation plan which has been incorporated in the Settlement Agreement and in the State of Alaska, Department of Natural Resources, Upland Mining Lease. The plan calls for restoration of the land to its physical condition as it existed prior to the commencement of mining operations under the lease. Reclamation will take place concurrently with mining. After excavation and processing, the materials will be redeposited into the excavated cells. As materials are re-deposited, tests will be conducted to ensure that the materials have the same density as the materials prior to excavation. The mine sites will, after reclamation, appear as they did prior to mining.

The reclamation plan has been reviewed and approved by the Engineering Department. Two conditions are suggested below to address CBJ interests in the site reclamation.

31. Will a financial warranty meeting the requirements of CBJ '49.65.140 be submitted by the operator?

On the basis of the Recommended Findings set forth above, the Director recommends that a Small Mine Permit be approved for the operation of the AJ Rock Dump Gold Project. The Director recommends that the project be subject to the following permit conditions which are reasonably necessary to mitigate adverse impacts which may result from the mining operation. Further, the Director recommends that a financial warranty be established in the amount of $150,000, and grant the requested Small Mine Permit subject to the following conditions:

1. The permit shall be effective for a period of two years from the date of issuance.
2. The small mine shall not operate on Sundays or state of federally recognized holidays.
3. Prior to the commencement of operations, the applicant shall provide to CDD a contract or other binding commitment that AML: will have available throughout the term of this permit, container vans to serve as noise and visual barriers. The vans must be sufficient in number to screen the operation from Douglas residents.
4. The containers shall be placed tightly abutted end to end and the doors of the containers shall be closed.
5. The impact mill shall be housed in an insulated container van or the equivalent as approved by the department.
6. The screen shall be fitted with rubber screens.
7. The screen and the mill shall not be operated between the hours of 7:00 p.m. and 7:00 a.m.
8. The operator shall contact CDD a week before start up. If monitoring by CDD establishes that noise levels exceed the predicted noise levels, then the operation must cease until further mitigation is implemented so that the noise levels do not exceed 48dBA between 7:00 p.m. and 7:00 a.m. and 43 dBA between 7:00 p.m. and 7:00 a.m.
9. The operator shall use ambient - sensitive backup alarms set at the lowest noise levels that are still consistent with good safety practices and Mine Safety and Health Administration requirements.
10. Copies of the inspection results for the backfilled areas shall be submitted to the CBJ Engineering Department to verify suitability of the soil for building construction on each lot.
11. Upon completion of the backfilling operation, the CBJ Public Works, Wastewater Division, will inspect the sewer main between lots 6 and 7 to ensure the line has not been damaged or settled. Any repair work required for the main will be at the expense of Thunder Mountain Minerals.
12. Any lighting used in the operation must be shielded so that there is no direct line of sight from the light to the receiving Douglas properties.