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Northern Plains Resource Council, Inc. v. Montana Board of Land Commissioners

October 23, 2012

NORTHERN PLAINS RESOURCE COUNCIL, INC. AND NATIONAL WILDLIFE FEDERATION, PLAINTIFFS AND APPELLANTS,
v.
MONTANA BOARD OF LAND COMMISSIONERS, STATE OF MONTANA, ARK LAND COMPANY, INC. AND ARCH COAL, INC., DEFENDANTS AND APPELLEES. MONTANA ENVIRONMENTAL INFORMATION CENTER AND SIERRA CLUB, PLAINTIFFS AND APPELLANTS,
v.
MONTANA BOARD OF LAND COMMISSIONERS, ARK LAND COMPANY, INC. AND ARCH COAL, INC., DEFENDANTS AND APPELLEES.



APPEAL FROM: District Court of the Sixteenth Judicial District, In and For the County of Powder River, Cause Nos. DV-38-2010-2480 and DV-38-2010-2481 Honorable Joe L. Hegel, Presiding Judge

The opinion of the court was delivered by: Mike McGRATH

Submitted on Briefs: October 10, 2012

Decided: October 23, 2012

Filed:

Clerk

Chief Justice Mike McGrath delivered the Opinion of the Court.

¶1 The Northern Plains Resource Council, the National Wildlife Federation, the Montana Environmental Information Center, and the Sierra Club (collectively referred to as NPRC) appeal from the District Court's memorandum and order of February 3, 2012 granting summary judgment to the Montana Board of Land Commissioners, Ark Land Co., and Arch Coal. We affirm.

¶2 We restate the issue for review: Whether the State Land Board properly issued leases to Ark Land Co., a subsidiary of Arch Coal, Inc., without first conducting environmental review under the Montana Environmental Policy Act, Title 75, Chapter I, MCA.

PROCEDURAL AND FACTUAL BACKGROUND

¶3 Plaintiffs filed suits seeking declaratory rulings that the State Land Board wrongfully failed to conduct environmental studies required by the Montana Constitution prior to entering leases with Arch Coal on March 8, 2010. The leases cover State lands located in the Otter Creek drainage, a tributary of the Tongue River, in southeastern Montana. Arch Coal leased the State's mineral interest for the purpose of strip mining for coal. In 1997 the State of Montana obtained the mineral rights to these lands from the United States, and they are part of a larger coal reserve covering almost 20,000 acres. That land is checker-boarded with mineral interests that are 82% privately owned; 10% State owned; and 8% owned by the United States. The State holds its mineral interest in trust for the financial support of public education.

¶4 In 2003, the Legislature authorized the State to offer the Otter Creek mineral interests for leasing. After study, appraisal, presentation of a draft lease, and opportunity for public comment, the State Land Board approved leases to Arch Coal in 2010. The State received a bonus payment from Arch Coal of $85,000,000.

¶5 The Arch Coal leases do not authorize or permit any mining activity, and do not authorize or permit any degradation to any land or water. The leases do not allow any significant surface disturbance without acquisition of all required permits from the State of Montana. The leases specifically provide:

All rights granted to Lessee under this Lease are contingent upon Lessee's compliance with the Montana Strip Mine Siting Act and the Montana Strip and Underground Mine Reclamation Act (Title 82, Chapter 4, Parts 1 and 2, MCA) and upon Lessor review and approval of Lessee's mine operation and reclamation plan. The rights granted under this Lease are further subject to agency responsibilities and authority under the provisions of the Montana Environmental Policy Act.

Lessor may prescribe the steps to be taken and reclamation to be made with respect to the land and improvements thereon. Nothing in this section limits Lessee's obligation to comply with any ...


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