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F I S C A L I M P A C T R E P O R T

SPONSOR Ulibarri

ORIGINAL DATE

LAST UPDATED

1-26-07

HB

SHORT TITLE Nuclear Energy and Uranium Resources

SB SJM10

ANALYST Woods

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Environment (NMED)

Energy, Minerals and Natural Resources Department (EMNRD)

SUMMARY

Synopsis of Bill

Senate Joint Memorial 10 recognizes the importance of nuclear energy and the uranium

resources in New Mexico. Specifically, the joint memorial notes:

•

a nuclear renaissance of worldwide scope has emerged, creating an unprecedented gap

between the

•

substantially increasing domestic and international demand and the current level of natural

uranium production and supply; and

•

the need for electricity to fuel the nation's economy continues to increase; it is projected that

the United States will demand fifty percent more electricity by 2025 and increased reliance

on alternative energy sources, including nuclear power, is necessary to meet electricity

demand; and

Senate Joint Memorial 10 – Page

2

•

the acceptance of nuclear-powered energy in the United States and worldwide has increased

as citizens, including leading environmental activists, recognize nuclear energy as the most

large-scale, cost-effective energy source that can reduce greenhouse gas emissions while

continuing to satisfy a growing demand for electric power; and

•

domestic nuclear utilities require a secure source of domestic, natural uranium in order to

have the confidence to construct new reactors that will promote the nation's energy

independence and meet electric power demands; and

•

New Mexico's uranium resources are a tremendous asset for the state, as New Mexico is

known to have more uranium resources than any other state in the nation, estimated at six

hundred million pounds and worth approximately $43 billion at current market prices and,

therefore, represent significant severance and other direct and indirect revenue streams and

other benefits for the state of New Mexico and its citizens; and

•

jobs associated with the uranium industry offer highly competitive wages and benefits

packages, and uranium mining will bring much-needed economic development to Cibola

and McKinley counties by infusing large levels of new capital investment; and

•

the city of Grants is proud to be known as the "uranium capital of the world," and the

Grants, Milan and Cibola county communities have gone on record in support of the rebirth

of the uranium industry in New Mexico; and

•

the New Mexico uranium mining industry is committed to maintaining a clean and safe

environment for its workers and the public at large, and improved extraction and processing

technologies and updated regulatory requirements have been developed and are being

employed to ensure that new uranium production can be conducted in a manner protective

of human health and the environment;

The memorial resolves that the Department of Environment and the Energy, Minerals and Natural

Resources Department be requested to collaborate with the New Mexico uranium industry to resolve

existing barriers in order to advance consideration of uranium production in New Mexico.

The memorial further resolves that copies of the memorial be transmitted to Governor Richardson,

ant to the cabinet secretaries of the Department of Environment and the Energy, Minerals and

Natural Resources Department.

SIGNIFICANT ISSUES:

EMNRD notes that the memorial requests that, along with NMED, it collaborate with the

uranium industry to resolve existing barriers in order to advance consideration of uranium

production in the state. It adds that EMNRD’s Mining and Minerals Division administers the

Neww Mexico Mining Act which requires permitting, bonding and reclamation of conventional

uranium mines. This law does not cover in-situ leach operations, which are another means of

extracting uranium. EMNRD has offered guidance to the industry by providing information

about how permits may be obtained as our agency would with any prospective permit applicant.

EMNRD has been available for informational meetings when requested by the uranium industry

and will continue to provide guidance and support in completing the permitting process as

necessary. SJM 10 does not identify the “existing barriers" cited in line 12 page 3. EMNRD has

approved several uranium exploration permits in 2006 and is considering several others at this

Senate Joint Memorial 10 – Page

3

time. EMNRD opines that – although SJM10 does not identify what existing barriers need to be

addressed – the department is aware of opposition to uranium development by certain individuals

and groups. Further, that it is not clear what SJM10 requires during a permit review, and that it

presently works with all parties including industry and the public in the implementation of the

state’s mining laws.

NMED observes that the collaboration may provide improvements to the current regulatory

environment for uranium production in New Mexico. Some potential solutions may require

cooperation with federal agencies. The topic of uranium production evokes strong positive and

negative reactions in the public.

OTHER SUBSTANTIVE ISSUES

NMED indicates that SJM 10 would require interdepartmental meetings and stakeholder

meetings to identify barriers and potential solutions for the advancement of uranium production.

The potential solutions may require more staff time for implementation such as a developing

policy, guidelines, rules, regulation or legislative changes. Some issues would be affected by

federal laws such as the Atomic Energy Act (1954) and Uranium Mill Tailing Radiation Control

Act (1978). Those federal laws have in some cases led to exemptions or jurisdictional

boundaries for state versus federal regulation. The issue of Indian Country affects many

proposed uranium projects, which would possibly fall under tribal or pueblo regulation instead of

the state. Currently, the Navajo Council has banned uranium mining. Additional coordination

with tribal and pueblo entities may be necessary. The U.S. Environmental Protection Agency

and U.S. Nuclear Regulatory Commission may need to be involved in some instances.

Numerous abandoned mine sites and health issues remain following uranium production that

peaked in the 1970s. Communities adjacent to uranium production facilities have strong positive

and negative reactions about uranium production. Another key to the implementation of

potential solutions would be public involvement because of the sensitive nature of uranium

production and waste issues. Since the 1970s, improvements have been made in pollution

prevention technology and expertise. Substantive state laws and regulations have been enacted

and implemented. For example, the Water Quality Control Commission Regulations (20.6.2

NMAC) were amended for abatement (1995) and a lowering of the uranium standard (2004) has

been added. The New Mexico Mining Act (1993) requires reclamation of uranium mines and

regulates exploration activities.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

NMED observes that barriers to uranium production in New Mexico may not be identified or

removed. However, if barriers arise under the current permitting processes, NMED and

EMNRD along with other stakeholders may take steps collaboratively or separately to resolve

the issues.

BFW/mt