Minnesota Finally Had a PolyMet Contested Case Hearing. What Does That Mean?

By JT Haines, Northeastern Minnesota Program Director, Duluth Office, 4/26/23

So there was finally a “contested case hearing” on PolyMet’s long-disputed proposal to open a copper sulfide mine in the State of Minnesota. After years of discussion, review, and citizen petitions, many might still be wondering what a “contested case hearing” is, let alone what it means for Minnesotans’ efforts to protect clean water in our state. In this article we’ll revisit how we got here, get you up to speed on last month’s live hearing, and discuss what comes next.

What is a Contested Case Hearing and How’d We Get Here?
 

In Minnesota, a contested case hearing provides an opportunity for a state agency to have a hearing on disputed aspects of a project proposal in front of a neutral judge, generally before a permit decision is made. The purpose is to build the fact record to aid in the agency’s decision making. After receiving written and live testimony from experts from all sides, the judge makes a recommendation to the agency about the proposal. Unlike the large public hearings about PolyMet that took place in an auditorium setting where individuals shared views in three-minute chunks, a contested case hearing is a more formal process involving experts and cross examination.¹

Because of the particular dangers that PolyMet poses for Minnesota — impairment of water quality especially — public campaigns were mounted early on for a contested case hearing by downstream communities and environmental groups. For example, in 2017, Duluth for Clean Water delivered a letter to then-Governor Dayton and then-DNR Commissioner Landwehr reflecting the support of a majority of the Duluth city council and all three local legislators for such a hearing. MCEA and our partners also formally requested that DNR convene a contested case about PolyMet prior to issuance of permits. 

All made the case that various disputed aspects of the PolyMet proposal — the “upstream” dam design, the “hail mary” bentonite scheme, the “wet closure” tailings basin idea, and adequacy of financial assurance — require the additional scrutiny and neutral fact-finding that a contested case hearing would provide.

Despite this, both the DNR and MPCA declined to convene a contested case hearing before issuing permits to PolyMet in 2018.² Fortunately, in the case of the DNR Permit to Mine, the Minnesota Supreme Court agreed that DNR had erred in this decision. There was no evidence, the court said, showing that PolyMet’s “bentonite” plan would work to protect Minnesota’s water. The court sent the case back to DNR to hold a hearing on, at a minimum, the bentonite aspect of its wet tailings basin closure proposal.³

What happened at the hearing? What did we learn?
 

The live portion of the bentonite contested case hearing took place from March 27-March 31. This hearing was in regards to PolyMet’s proposal to try to control and limit pollution from a 2,000 acre tailings facility with a mixture of tailings and bentonite clay. Here are three key things to understand about the bentonite contested case hearing so far:

1. It’s fantastical. At its most basic level, PolyMet proposes to apply a mixture of bentonite clay and tailings to key areas in the tailings basin in an effort to control the amount of pollutants that would seep into ground and surface water from the operation. The idea is to use “agricultural equipment” to form an 18-inch layer below the surface of the basin dam walls and beaches with a mixture of 3% bentonite and existing tailings. To “seal” the 900-acre pond bottom, PolyMet proposes to use a remote control boat to drop bentonite, through the water to the pond floor, years after cessation of mining.⁴ This is the plan, by the way, that Don Sutton of Spectrum Engineering described to the DNR prior to permitting as a “hail mary type of concept” that “wouldn’t be allowed in other jurisdictions.”⁵

PolyMet line drawing of the bentonite boat.

2. It’s untested. In support of the scheme, PolyMet relies solely on "faith based engineering.” Neither PolyMet nor DNR has tested the bentonite proposal under real life conditions. Although the bentonite mixture is supposed to control seepage, PolyMet conducted only one test involving seepage control, and that one test was conducted on a bucket of LTV tailings. As our witnesses pointed out, in particular Dr. Michael Malusis, Chair of Bucknell University’s Engineering Department, no real scientist would ever conclude anything from such a test. Instead, our experts testified that there are no examples of bentonite covers that have been successfully used, and that industry guidance does not recommend them, particularly for cold climates. To assume that PolyMet’s plan could be adjusted as time elapses, after operations have begun, would be to rely on hopes that future engineering could solve these problems.
3. It won't work. Although PolyMet only presented testimony from its own contractors, MCEA and our partners presented testimony from unbiased experts. These experts included Dr. Craig Benson, a nationally recognized expert on cover systems, and Dr. Malusis, who researches and consults on bentonite engineering issues. Dr. Benson noted that in the last 10 years that he’s worked on this issue, the scientific community has learned that bentonite does not work the way it was previously thought. He cited example after example of bentonite barriers that degraded under real life air and water conditions, and did not perform as expected over time. He testified that PolyMet’s proposed bentonite barrier would not withstand the hundreds of years needed to protect Minnesota’s water.

As MCEA’s lead attorney Ann Cohen summarized at the hearing,

"All agree — and when I say "all," I mean DNR and Petitioners agree — that testing here has not been conducted, and that the testing that has been proposed is not adequate. Testing needs to be done, including field testing, because what happens in the lab, all agree — and when I say "all" here, I mean even PolyMet's experts agree — that what happens in the lab does not reflect what happens in the field. And so testing must be done, including field testing, in order for PolyMet to demonstrate that its proposed closure system is practical and workable. And that just hasn't happened here."

The bottom line is PolyMet has known about the issues with the bentonite proposal for a long time, and has nonetheless based the whole tailings basin proposal on a scheme that is a hail mary, that hasn’t been adequately tested, and that frankly won’t work.

What’s next?
 

We expect ALJ LaFave to issue his findings and recommendation from the bentonite hearing to the DNR sometime in the August timeframe he provided. Then, after the parties have had an opportunity to comment, it will be the responsibility of the DNR to consider the judge’s recommendation and make a new decision on whether to re-issue the Permit to Mine. DNR is not obligated to follow the ALJ’s recommendations. In our view, the evidence has shown that the bentonite plan proposed by PolyMet is not practical and workable under the law, would not protect our resources, and DNR should not re-issue the permit. 

(courtesy Duluth for Clean Water, published in the Duluth News Tribune, March 18, 2023)

Also in front of the DNR are two additional issues. One, DNR must resolve who the permittee would be if the permit is to be reissued. How the DNR will resolve this issue has recently become more murky. Glencore (this Glencore) has acquired most of PolyMet since the 2018 permitting,⁶ and PolyMet itself is now part of a “joint venture” with another multinational mining company, Teck Resources. (You can read more about that here.) And two, DNR would need to establish a definite term (closure date) for the PolyMet proposal if permits are to be reissued.

In the coming months DNR will have more opportunities to protect our communities and water in the face of the PolyMet proposal. It’s worth remembering the stakes: if the PolyMet mine is built as proposed and the bentonite scheme fails, groundwater for downstream communities, nearby lakes, rivers and streams could all be contaminated for hundreds of years. In the worst case scenario, it could lead the entire tailings basin to fail and cause a landslide of toxic mine waste.

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¹ You might be surprised to learn that before this contested case hearing, there hadn’t actually been any witnesses on the stand to discuss the facts surrounding PolyMet’s proposal, and zero opportunities to ask those witnesses questions. You might think "but what about all of the court cases at the Minnesota Court of Appeals and Minnesota Supreme Court?" The appeals of permits issued to PolyMet to this point have all about the law and whether the permits complied with the law. This hearing was the first time there were experts testifying under oath as to the facts of the proposal. One of the many reasons the recent PolyMet hearing was so important.

² The permits were issued by the Dayton Administration just days before the new Walz administration was elected.

³ While it has so far declined to have contested case hearings on the important additional issues like the adequacy of financial assurance, the seepage control system, and the upstream dam design, it has been made clear by the courts that DNR could, if it chose to, have hearings on these issues as well. 

⁴ Or something like that – PolyMet kept changing the plan throughout the hearing. Downstream group Duluth for Clean Water has satirized the plan to great effect in this video.

⁵ Don Sutton expressed his concern and shock of the plan in a memo dated all the way back to 2012, sent to Jennifer Engstrom, one of DNR’s witnesses at the contested case hearing.

⁶ Glencore became the majority owner of PolyMet in 2019, just months after the original permit was issued. It increased its ownership to 82% in the most recent stock offering in 2023. https://www.startribune.com/meet-glencore-the-global-behemoth-behind-the-polymet-mine-project/512685412/