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Jim Tait Real Estate

home : letters : letters May 26, 2016

3/15/2013 8:36:00 AM
We have been duped - and to what end?

To the Editor:

US Steel was willing and ready to sell the conservation rights on 16,000 acres of land along the Penokee Range through negotiation with The Nature Conservancy (TNC) in 2003 – including their mineral rights.

This is the same land Gogebic Taconite (GTAC) wants to mine. The same land for which GTAC has secured an option to obtain the mineral rights from current owners RGGS Land and Minerals (Texas) and La Point Mining Company (Minnesota). The same land that drove the “Mining for Jobs” bill, SB1 and AB1.

In 2003, TNC applied for Forest Legacy Program funds to help purchase the conservation easement from US Steel. Land and Water Conservation Funds were to be used to help the Forest Service buy another 6,000 acres. The resulting easements would have maintained the recreational uses and timber production on a total of 22,000 acres along the Penokee Range. Mining would not have been allowed.

Forest Legacy easements commit land to a forest management plan that recognizes and encourages management of the forest for public recreation, scenic beauty, timber production, and conservation benefits. The easements are permanent and binding on future landowners.

The 2003 Forest Legacy Project was named “Bad River Headwaters.” Wisconsin DNR records indicate the Federal Government awarded $3,428,000 toward the purchase of the conservation easements. The State of Wisconsin match funds totaled $1,143,000. The total value of the land interests was $10 million.

The records state that although negotiations had been going well between TNC and the landowners, one of the larger landowners decided to sell their holdings to another party. The new owner was not interested in selling a conservation easement to the State. A State of Wisconsin Final Report dated June 12, 2006, explains that: “[t]he new owners have indicated that they may mine the property in the future.”

The larger landowner was US Steel. The purchaser was RGGS Minerals.

If there is a profitable orebody on the Penokee Range, why was US Steel willing to sell a conservation easement on that land? The easement would have banned mining in perpetuity. Certainly US Steel knew the implications of a conservation easement. Most certainly, US Steel knew the value of its mineral rights on the Range.

The other parties to this transaction also must have known the value of the mineral rights. In fact, the State of Wisconsin was required to obtain an appraisal in order to determine the fair market value of the land interests (State of Wisconsin Forest Legacy Program, Program Narrative, 424 Application, Fiscal Year 2003, Bad River tract).

There must be an appraisal of the mineral value in the land GTAC claims it wants to mine. Clearly all the parties in 2003 knew the value of the mineral deposits. Certainly today’s proponents of a taconite mine on the Penokee Range must also know.

In 2003, one of the largest steel-producing companies in the world was willing to sell a conservation easement for its 16,000 acres on the Penokee Range knowing that mining would be prohibited. Yet in 2013 our legislators insist there is profit and jobs to be had in those same hills. Facts suggest otherwise. We have been duped. To what end?

Susan Sommer
Phelps




Reader Comments

Posted: Saturday, February 7, 2015
Article comment by: Jon Wesenberg

When Cline first proposed leveling half of the Penokee range for iron, ore was fetching upwards of $140/tonne (metric ton, 2200lbs) because China was building whole cities which are still unoccupied today. Since then, demand for ore has plummeted while capacity in Brazil and Australia have increased. The three largest iron ore suppliers in the world (BHP Billiton, Rio Tinto and Fortescue) have production prices as low as $20/tonne and are doing to other producers exactly what Saudi Arabia is trying to do to other oil producers - drive them out of business. I don't think Cline could even remove all of the overburden for that price. Meanwhile, iron ore futures are trending below $60 and Minnesota producer Cliffs Resources is no longer paying dividends.

IMHO, Cline wanted to build the GTac mine and sell it while demand was high. Unlike oil, there is plenty of much better and less expensive iron ore left, mainly in Brazil, Australia and Canada. Even if ore prices recover in 10-15 years, GTac may never be a profitable proposition.


Posted: Monday, April 1, 2013
Article comment by: Joe Thompson

While this paper does shill quite often for the Republicans and only rarely if ever for Democrats, they deserve some credit for calling the current administration out on proposing costs for redaction on open records requests.

Posted: Monday, April 1, 2013
Article comment by: Tim Behselich

Jeff:

Don't hold your breath waiting for the Times to write anything negative about their idols on the legislature. Moore and the boys feel all the actions have been on the up and up, I'm sure. The GOP lords and masters are always above board......

Cue Dem bashing and accusations of the same being done on their side in 3...2...1...


Posted: Monday, March 25, 2013
Article comment by: Jeffrey Schimpff

I am curious why, in your "open government grade report," you failed to issue a grade to the Republican Party controlling the legislature. They have been asked to provide details on how they went about gerrymandering our state election district boundaries in a successful effort to further erode our democratic process and the rule of the will of the people.

The Republican party, it turns out, has apparently had the records destroyed. Now, even an "F" grade can be worth as many as 59 points on a grading scale. I suggest you issue the Republican Party a "Zero" grade for for complete lack of compliance with the spirit of open government.

Jeff Schimpff
Madison, WI




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