July 6, 2022 

Gold mine can defend itself in lawsuit! ~ The Union

 The Sierra-Nevada's last working gold mine will be allowed to defend itself against a lawsuit brought by a state agency, a judge has ruled.


Owner Mike Miller of Original Sixteen-to-One Mine Inc. can now move ahead to gather evidence showing the Central Valley Region of the California Regional Water Quality Control Board improperly fined his company more than $2.1 million for failure to file water quality reports.

He called it a case of a state agency reaching far beyond state and federal mandates to assure clean water — and he's hoping state officials will take note.

“Somebody's feet should be held to the fire,” said Miller from his mine office in Alleghany, a remote town in far-western Sierra County, about an hour's drive from Grass Valley up winding Highway 49.

“This lawsuit should be settled and dismissed,” Miller added.

Staff from the water board's Central Valley Region could not be reached Friday for comment.

The Central Valley Region has a long-running dispute with the Sixteen-to-One.

It started with what should have been an improvement: In 1998, Miller took an obsolete stamp mill out of operation. Water from the mill went through a series of settling ponds before discharging into Kanaka Creek, he said.

Twenty years of water quality monitoring paid for by the mine showed the effluent had no adverse effect on the creek, Miller said.

Despite requests by Miller over the next five years, the regional water board did not revise the mine's state-mandated water permit to reflect the mill had been taken out of operation, Miller said. That would have changed his reporting requirements for water quality monitoring, he added.

Water monitoring

One of the elements monitored in the discharge was arsenic, which occurs naturally in the Sierra Nevada's gold-bearing rock formations.

Miller and board staff have disagreed over whether the Original Sixteen-to-One Mine was responsible for levels of arsenic found in the creek in 2002. Board staff at the time wanted the mine effluent to meet allowable arsenic levels that were to be implemented under federal guidelines in 2005, according to previous reports in The Union.

In addition, 10 other abandoned mines also discharge into Kanaka Creek, according to mine shareholder Mike Clark.

Water board staff issued an order in 2003 limiting levels of arsenic, mercury, other heavy metals, suspended solids and other qualities in Kanaka Creek. They also ordered daily monitoring of Kanaka Creek through February 2007, according to Sierra County Superior Court documents.

But the mine did not send 13 monthly monitoring reports from April 2006 to April 2007, according to court documents.

“I'm not against regulations,” Miller said. But the mine discharge had not changed the water quality of the creek, he added, calling into question the reason for monitoring in the first place.

In 2009, the Central Valley Region filed suit against Miller and the mine corporation, seeking to charge $2.1 million in fines for failing to monitor and send the monthly reports. (Miller was dismissed from the suit in March)

In June, the agency asked Sierra County to bypass the trial process, rule in its favor and impose the fine.

But on Dec. 9, Superior Court Judge John P. Kennelly turned down the water agency's request.

“Triable issues of fact exist,” Kennelly wrote in the decision.

Cherry-picking the law?

The dispute never went to an administrative hearing, and the lawsuit was never on a water board agenda before it was filed, violating constitutional due process rights and state open meeting laws, Miller argued.

Water agency staff based their argument on part of the state's clean water statute, but ignored other parts, Kennelly wrote.

In the case of a violation, California's water code allows staff to consider “the nature, circumstances, extent and gravity of the violation” when assessing a fine, Kennelly wrote.

Code also allows staff to consider the violator's “ability to pay, the effect on its ability to continue its business... the degree of culpability... and other matters that justice may require,” Kennelly wrote.

The opinion “recognized that the water agency staff took portions of a detailed statute to justify the merits of the lawsuit,” Miller wrote in response.

“The Central Valley Water Board and the governor (Jerry Brown) now have the chance to look into just how the staff is using statutes and regulations to levy fines, causing delays and unnecessary expenses,” Miller wrote.


© 2022 Original Sixteen to One Mine, Inc.
PO Box 909
Alleghany, California 95910

(530) 287-3223      
(530) 287-3455

      Gold Sales:  

(530) 287-3540


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