The Board of Examiners, chaired by Gov. Brian Sandoval, approved the refunds during a meeting Tuesday in Carson City, with Secretary of State Ross Miller also voting in favor. Attorney General Catherine Cortez Masto, the third member of the board, was not present.
Lawmakers struggling to plug an $800 million budget gap during the 2010 special session imposed new filing fees on mining claims, based on a tiered scaled. Small operators complained the increases would hurt them the most.
Under the law, anyone who held 11 to 199 mining claims were required to pay $70 per claim, for a maximum fee of $13,930. Holders of 200 to 1,299 claims were charged $85 per claim, while owners of 1,300 or more claims were assessed $195 per claim.
A district court earlier this year ruled the fees amounted to an unconstitutional tax, and they were repealed by the 2011 Legislature in a late session compromise with the mining industry that removed some tax breaks for such things as marketing, association dues and severance packages. Companies also agreed to give up for two years deductions on net proceeds for employee health care costs, which they already deduct from other businesses taxes.
Of the 334 refund applications approved Tuesday, about 260 will go to small-tiered operators. On the other end of the spectrum, Barrick Gold Corp. or its affiliates will receive about $4 million — half the $8.1 million total.
Money to pay for the refunds was included in the state general fund, and claim holders can apply for refunds until June 30, 2013.
Barrick spokesman Andy Lloyd said the Toronto-based company was not part of the lawsuit challenging the increased fees and did not oppose them in 2010.
“In fact, after the court struck down these fees in 2011, we offered to let the state retain the fees we had already paid in lieu of other options being considered during the legislative session,” he said in an email.
But Lloyd said state officials later notified the company that for legal and budgeting reasons, the state was required to return the money. He said Barrick in March pre-paid $101 million in net proceeds taxes for this year.
Besides repealing fees and eliminating mining tax deductions, SB493 also established a Mining Oversight and Accountability Commission to oversee the industry after the former head of the state Taxation Department conceded mining operators had not been audited for at least two years. Dino DiCianno retired the next day.
SB493 was a late compromise during the session that brought intense scrutiny to Nevada’s booming mining industry at a time when other revenue sources — sales and casino taxes — had plummeted in the wake of the Great Recession.
The state constitution limits taxes mines pay to 5 percent of net proceeds. The protection has been in place since Nevada gained statehood in 1864. But legislators this year approved a proposed constitutional amendment to repeal the cap.
If lawmakers approve the measure, SJR15, again in the 2013 legislative session, it will be placed on the ballot for voters in 2014.