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By Kerry Shapiro and Dan Quinley

On September 9, 2021, the House Environmental and Natural Resources (“ENR”) Committee finished its mark-up of the $3.5 trillion reconciliation budget measure. Inserted at the very end of the 117-page mark-up is Section 70807: Hardrock Mining, which is a quiet attempt to reform the Mining Law of 1872.

The ENR Committee’s change would, for the first time, impose fixed royalties on all locatable minerals mined on Federal land. Under the terms of the proposed legislation, minerals, mineral concentrates, or products derived from locatable minerals, would be subject to royalty fees at the following rates:

  • 8% for all new mining operations
  • 8% for all new federal land added by plan modification to existing mining operations
  • 4% for mining operations with an existing approved plan of operations, or who submitted a plan of operations prior to the effective date of the legislation

All royalty percentages would be calculated based on gross income derived from mining. Continue reading

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By Kerry Shapiro and Patricia Belton

Last week, the California Supreme Court handed down an important decision on prevailing wage law favorable to industry. On August 16, 2021, the California Supreme Court issued its decision in Mendoza v. Fonseca McElroy Grinding Co., Inc. S253574, answering the question whether prevailing wage must be paid for mobilization work, which involved transporting heavy machinery to and from a public works site under Labor Code section 1772. The Court held that section 1772 does not expand the categories of public work that trigger obligation to pay at least the prevailing wage and that under this theory, prevailing wage did not need to be paid for mobilization work. In so far as there may be some other statutory basis for compensating mobilization and travel time at the prevailing rate, those issues were beyond the scope of the Court’s decision. The Court’s decision is consistent with the positions argued in the case by Fonseca, and by JMBM client California Construction and Industrial Materials Association (“CalCIMA”), which had filed an Amicus Brief in support of Fonseca. Continue reading

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State Water  Board Announces Intent to Enforce 2019 Procedures for Discharges of Dredged or Fill Material as State Policy

By Kerry Shapiro, Martin Stratte, and Daniel Quinley

On February 3, 2021, the State Water Resources Control Board (“SWRCB”) issued a “Notice of Opportunity to Comment and Notice of Public Hearing and Consideration of Adoption” (“Notice”) of a resolution “to confirm that the State Wetland Definition and Procedures for Discharges of Dredged or Fill Material to Waters of the State (Procedures) are in effect as state policy for water quality control.”  The Notice states that SWRCB will consider the resolution at a public video/teleconference meeting on April 6, 2021.

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By Kerry Shapiro and Martin Stratte

On January 20, 2021, President Biden’s first day in office, Acting Secretary of the Interior Scott de la Vega issued Secretarial Order No. 3395 (Order), which temporarily suspends decision-making authority delegated to Department of the Interior (DOI) Bureaus and Offices, such as the Bureau of Land Management. The Order will be in effect for at least 60 days.

According to the DOI website, the Order, while in effect, reserves decision-making authority for “Department leadership” described in the Order as “confirmed or Acting official[s]” who hold certain positions enumerated in the Order. The positions to which decision-making authority is reserved include the Secretary, Deputy Secretary, Solicitor, and six Assistant Secretaries identified in the Order.

Thus, the Order suspends the decision-making authority of DOI Bureaus and Offices, and restricts such authority to a select few high-level DOI officials who have been or will be put in place by the Biden Administration, until after the Administration has had at least 60 days to appoint new, and evaluate existing, officials within DOI Bureaus and Offices. Continue reading

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By Kerry Shapiro, Martin Stratte and Daniel Quinley

On December 18, 2020, the Sacramento County Superior Court prohibited the State Water Resources Control Board (“SWRCB”) from implementing California’s new wetlands and “waters of the state” protection program, and limited SWRCB’s application of the regulatory program to only waters already protected under the federal Clean Water Act. The court’s ruling essentially invalidates SWRCB’s nearly two-decade-long effort to fill the gap left by the shrinking scope of regulation under the federal Clean Water Act following the Supreme Court’s 2001 decision in Solid Waste Agency of Northern Cook Cty. v. U.S. Army Corps of Engineers (“SWANCC”).

In January 2019, SWRCB hastened its adoption of its new regulations – the “Procedures for Discharges of Dredged or Fill Material to Waters of the State” (“Procedures”) – after the Trump Administration introduced the new “Navigable Waters Protection Rule” to regulate pollutant discharges to Waters of the United States (“New WOTUS Rule”).  The New WOTUS Rule limits the reach of the federal Clean Water Act and is presently in effect as of June 22, 2020.

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On December 9, 2020, the California Energy Commission (CEC) appointed nine members of the new Blue Ribbon Commission on Lithium Extraction in California (Lithium Valley Commission).  The appointments were made pursuant to Assembly Bill 1657 (Garcia, Chapter 271, 2020) (AB 1657), which was signed into law by Governor Newsom on September 29, 2020.

AB 1657 requires the CEC to establish the Lithium Valley Commission to review, investigate, and analyze issues and potential incentives regarding lithium extraction and use in California, and submit a report to the Legislature documenting its findings and recommendations, on or before October 1, 2022.  AB 1657 also authorizes the CEC to appoint nine of the 14 members of the Lithium Valley Commission.

The nine members appointed on December 9, 2020 include:

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Just what makes a decision “final” enough to support a Fifth Amendment takings claim?

In his article, “‘Finality’ may be the next key issue in takings litigation,” published by the Daily Journal, Daniel Quinley of JMBM’s Natural Resources and Mining Group, addresses a recent Ninth U.S. Circuit Court of Appeals’ decision that indicates that determining the “finality” of a local agency’s decision may well be the next key issue in takings litigation. He writes:

“At the very least, one can rest assured that demonstrating that a local agency has made a definitive agency decision will remain critical in bringing successful Takings claims. For now, that process will involve continued robust participation in the local agency’s decision-making, timely requests for variances or exemptions, and efforts toward clearly capturing an agency’s definitive intent regarding a specific property.”

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On Tuesday, March 31, 2020, San Francisco and six other Bay Area counties and one city each issued a virtually identical Shelter-in-Place Order (collectively, the “Order”) that is, in many ways, more restrictive than (i) Governor Newsom’s March 19, 2020 Stay-Home Executive Order N-33-20, and (ii) San Francisco’s March 16, 2020 Shelter-In-Place Order.

In particular, the Order limits the scope of certain construction-related activities previously exempt under those prior orders, and mandates the implementation of new “Social Distancing Protocols” for Essential Businesses still operating, which must be in place by April 2, 2020.

Who issued the Order? The Order was issued by the following seven counties—Alameda, Contra Costa, Marin, Santa Clara, City and County of San Francisco, San Mateo, and Sonoma (who issued the Order late Tuesday evening, after the other six counties)—and one city—City of Berkeley. Although the counties and cities each independently issued an Order, the text is nearly, if not completely, identical.

What does the Order do? The Order establishes stricter limits on business operations, including a narrower scope of construction authorized to continue under the Order, and requires a business to “cease all activities” in Bay Area locations subject to the Order, unless the business qualifies as an “Essential Business”. (Although non-Essential Businesses are allowed to continue “Minimum Basic Operations” necessary to maintain certain activities such as payroll.)

How are construction materials companies affected? Construction materials companies may qualify as “Essential Businesses,” as long as those companies “support or supply” other “Essential Businesses” with “supplies necessary to operate”. Continue reading

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This blog provides important updates to the analysis in our March 20 and March 23 blogs addressing the impact on workers in the construction and industrial materials industries of Governor Newsom’s March 19, 2020 Executive Order N-33-20 (“Order”) mandating, subject to certain exceptions, that “all individuals living in the State of California to stay home.”

For background, the Order states that workers “needed to maintain continuity of operations” of 16 critical infrastructure sectors identified by the U.S. Cyber & Infrastructure Security Agency (CISA) were exempt and thus may continue to work. CISA previously identified those 16 sectors in a March 19, 2020 Memorandum entitled, “Identification of Essential Critical Infrastructure Workers During COVID-19 Response” (“CISA Memorandum”).

Although clarifications regarding the applicability of the Order to workers in the construction materials industry were issued by the State Public Health Officer on March 22 (see March 23 blog), no corresponding clarification was expressly issued with respect to the industrial materials industry.

Update affecting the industrial materials industry and its workers:

  • As we previously reported in our March 20 blog, the treatment under the CISA Memorandum of workers employed by industrial material producers and suppliers, whose materials are not used in construction materials, was somewhat unclear.
  • However, on March 28, 2020, CISA issued an Advisory Memorandum identifying an “Essential Critical Infrastructure Workforce” list, which specifically identifies “Workers necessary for the manufacturing of … industrial minerals”. The key language is shown on page 13 of 15 of the Advisory Memorandum at the first bullet point under Critical Manufacturing.
  • The Advisory Memorandum thus clarifies that the industrial materials industry and its workers are a part of the 16 critical infrastructure sectors identified by CISA, and therefore exempt from the Order’s stay-home mandate, even if the industrial materials are not used in construction materials.

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This blog provides important updates to the analysis in our prior blog addressing the impact on workers in the construction materials industry of Governor Newsom’s March 19, 2020 Executive Order N-33-20 (“Order”) mandating, subject to certain exceptions, that “all individuals living in the State of California to stay home.”

For background, the Order states that workers “needed to maintain continuity of operations” of 16 critical infrastructure sectors identified by the U.S. Cyber & Infrastructure Security Agency were exempt and thus may continue to work. On March 20, the State’s COVID-19 website clarified that the exemption from the Order applied to construction activity, including housing construction. Although this clarification was very helpful, the Order remained somewhat uncertain regarding the status of  construction materials industry workers. Late on Friday, March 20, the State Public Health Officer (“SPHO”) issued a list of “Essential Critical Infrastructure Workers” to be exempt from the Order, and thus allowed to continue working, to ensure “continuity of functions critical to public health and safety, as well as economic and national security.” Again, very helpful, but did not specifically address construction materials.

On Sunday, March 22, 2020, the SPHO issued important updates (“Updates”) to the list of “Essential Critical Infrastructure Workers” directly addressing the construction materials industry. Specifically, the Updates confirm that:

    1. Essential Workforce for Public Works includes construction materials suppliers; and
    2. Essential Workforce for Community-Based Government Operations and Essential Functions include workers who provider services related to construction materials sources.

Continue reading