ALJDEC

98F-018-LAN · State Land Department · 1998-10-30

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

On October 30, 1998, a hearing was held to determine if the State Land Department of the State of Arizona (the “Department”) had properly denied the Applicant’s renewal application for a mineral exploration permit. Franklin Shiflett (the “Applicant”) appeared on his own behalf. Assistant Attorneys General Theresa M. Craig and Karen E. Baerst represented the Department. Evidence and testimony were presented. Based upon a review of the entire record, the following Findings of Fact, Conclusions of Law and Recommended Decision are made.

FINDINGS OF FACT

1. On or about June 28, 1997, the Department granted to the Applicant a Mineral Exploration Permit (the “Permit“). See State’s Exhibit S-3. This Permit gave the Applicant the exclusive right for a period of one year (subject to renewals until July 1, 2002) to prospect for minerals on state trust lands near Apache Junction, Arizona (the “Site”). Id.

2. The Permit explicitly stated the following: Before significant earth movement may commence, the Lessee or Permittee hereof shall satisfy the Arizona State Land Department, in writing, that no significant cultural, historical, antiquity or archaeological values will be destroyed, and, in the event such values will be destroyed, that proper mitigation measures have been agreed upon between said Lessee or Permittee and the Arizona State Land Department, and further said Lessee or Permittee shall report all of such values as they are later discovered after such approval is given initially. See State’s Exhibit S-3, page 3.

3. The Permit further stated the following: PRIOR TO THE BEGINNING OF ANY EXPLORATION, A PLAN OF OPERATIONS AND RESTORATION MUST BE FILED WITH THE STATE LAND DEPARTMENT AND APPROVED BY THE STATE LAND COMMISSIONER OR HIS DEPUTY. State’s Exhibit S-3, page 4 (emphasis added).

4. A Plan of Operation allows the Department to evaluate the exploration methods utilized by an applicant to determine (1) the potential disturbance by the applicant to the state trust lands; (2) the feasibility of the applicant’s exploration operation; (3) the potential value of the applicant’s exploration; and (4) how to return the state trust lands to their previous condition.

5. On or about May 13, 1997, the Department received the Applicant’s Plan of Operation (the “First Plan”). See State’s Exhibit S-5. The Applicant wrote in his First Plan (regarding the scope of his operation) the following: About 15’x30’. Remove loose dirt & rock. Pile dirt & rock as close to site as possible. When completed to back fill hole and re-seed area. Actual hole to be very small. 4’x4’x10’ deep. About 6 yards of fill or less.

Id. at page 2.

6. On or about May 14, 1997, the Department received the Applicant’s Application to Obtain Mineral Resources (“Mineral Application”). See State’s Exhibit S-4. In the Mineral Application, the Applicant stated that he was exploring for copper ore. Id.

7. John H. Madsen is an archaeologist for the University of Arizona, Arizona State Museum (the “Arizona State Museum”). On or about July 22, 1997, Mr. Madsen wrote a letter to the Applicant recommending that the Site be surveyed for archaeological remains before the Applicant’s First Plan could be approved. See Applicant’s Exhibit A. The Applicant testified that he never conducted an archaeological survey at the Site because the Arizona State Museum’s letter was only a recommendation. The Applicant testified that he did not want to pay a significant amount of money for an archaeological survey when it was not mandatory. 8. Chester Oakley is a Geologist II for the Department. Mr. Oakley is certified as a registered geologist with the Arizona State Board of Technical Registration. Mr. Oakley conducts field surveys for the Department. He also reviews exploratory permits, mining leases, plans of operation and renewal applications for the Department. Mr. Oakley testified that the Applicant’s First Plan was never approved by the Department because the archaeological survey was never performed. Mr. Oakley testified that the Department did not have sufficient information to approve the First Plan without the archaeological survey.

9. On or about June 9, 1998, the Applicant submitted to the Department an Application for Renewal of Mineral Exploration Permit #08-102957 (the “Renewal Application”). See State’s Exhibit S-1. In the Renewal Application, the Applicant wrote that he had spent $432.00 for labor and equipment at the Site. Id. The Applicant also testified that he has initiated some exploration at the Site.

10. On or about June 12, 1998, the Department received the Applicant’s second Plan of Operation (the “Second Plan”). See State’s Exhibit S-7. The Applicant wrote in his Second Plan (regarding the scope of his operation) the following:

Area about 10’ by 10’. Working with small hand picks & shovels. Have removed about 2-3 yards of dirt in a small hole.

Id. at page 2.

11. Mr. Oakley testified that the Applicant’s Renewal Application was rejected because the Applicant initiated a mineral exploration without performing an archaeological survey at the site and without getting his First Plan approved. Mr. Oakley further testified that the Applicant did not provide sufficient information (i.e. an archaeological and geological survey) for the Department to approve the Renewal Application.

12. Mr. Oakley also testified that the Renewal Application was denied because past geological surveys have shown that the Site has little potential for mining minerals such as copper or gold. Mr. Oakley testified that past geological surveys show that the Site is located on a mile deep layer of volcanic material. Mr. Oakley testified that there is no “veining” or “alteration of rock” in this layer of volcanic rock material to indicate mineral deposits.

13. Mr. Michael Rice is the Manager of the Department’s Mineral Section. Mr. Rice oversees the leasing programs concerning state trust lands. Mr. Rice determines if certain activities (i.e. mineral exploration) conducted on state trust lands conform with standard geological practices. Mr. Rice also determines if these activities will generate sufficient revenues for the beneficiaries (i.e. public schools) of the Arizona State Land Trust. Mr. Rice testified that the Department’s goal is to develop the state trust lands to their most beneficial use while allowing minimal or no disturbance to the lands.

14. Mr. Rice testified that state trust lands (including the Site) have been designated by the Arizona Legislature as eligible (upon nomination by the Department’s Commissioner) for conservation pursuant to A.R.S. §37- 312(B)(2). Mr. Rice testified that he would recommend to the Commissioner of the Department that the Site should be closed to mineral exploration. Mr. Rice testified that the value derived from conserving the state trust lands (including the Site) outweighs the $20.00 per year received by the Department for leasing the Site to the Applicant.

15. The Applicant testified that he is currently having an archaeological survey conducted at the Site. The Applicant further testified that a geological survey of the Site has indicated that the Site has potential for mineral exploration. However, the Applicant refused to disclose the geological survey to the Department. The Applicant testified that the Department will receive more revenues from his mineral exploration than it would receive by closing the Site for conservation.

16. On or about September 10, 1998, the Department denied the Applicant’s Renewal Application. See State’s Exhibit S-8. On or about September 14, 1998, the Applicant requested a hearing in this matter. See State’s Exhibit S-9.

CONCLUSIONS OF LAW

1. The Applicant has the burden of proof, and the standard of proof on all issues is by a preponderance of the evidence. Culpepper v. State, 187 Ariz. 431, 930 P.2d 508 (App. 1996). A "preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not." Morris K. Udall, Arizona Law of Evidence, §5 (1960). It "is evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not." Black's Law Dictionary, 1182 (6th ed. 1990).

2. No excavation is permitted on an archaeological site without the permission (i.e. a permit) of the Director of the Arizona State Museum. See A.R.S. §§41-841 & 41-842. The Applicant did not receive such permission from the Arizona State Museum. Accordingly, the undersigned Administrative Law Judge concludes that the Department properly denied the Applicant’s Renewal Application.

3. The Commissioner of the Arizona State Land Department is responsible for the preservation of historic properties which are under the Department’s control. A.R.S. §41-861. The Department must undertake any preservation of historic properties in a matter consistent with the professional standards recommended by the state historic preservation officer. Id. The undersigned Administrative Law Judge concludes that the Department lacked sufficient information (i.e. an archaeological survey) from the Applicant to obtain the required recommendation from the state historic preservation officer. Accordingly, the undersigned Administrative Law Judge concludes that the Department properly denied the Applicant’s Renewal Application.

4. The Applicant has failed to prove by a preponderance of the evidence that the Department improperly denied his Renewal Application. The evidence shows that the Applicant disturbed the Site without (1) conducting an archaeological survey; (2) obtaining the approval of the Arizona State Museum; and (3) obtaining the Department’s approval for the first Plan of Operations. Accordingly, the undersigned Administrative Law Judge concludes that the Department properly denied the Applicant’s Renewal Application.

5. The preponderance of the evidence also shows that there is little potential for discovering valuable minerals at the Site. Unfortunately, the Respondent refused to disclose the only evidence (i.e. his geological survey) that allegedly supports his claim that there are valuable minerals at the Site. Absent evidence to the contrary, the Department properly determined that the most beneficial use of the Site is to close it for conservation purposes. Accordingly, the undersigned Administrative Law Judge concludes that the Department properly denied the Applicant’s Renewal Application.

RECOMMENDED DECISION

Based upon the foregoing, the undersigned Administrative Law Judge recommends that the Applicant’s appeal of the Department’s denial of his Renewal Application be denied. The Department’s denial of the Applicant’s Renewal Application is proper.

Done this day, November 4, 1998.

_________________________________ Casey J. Newcomb Administrative Law Judge

Original transmitted by mail this ____ day of November, 1998, to:

Mr. J. Dennis Wells, Director Arizona State Land Department 1616 West Adams Phoenix, AZ 85007

ATTN: Merv Mason

By _______________________________

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Office of Administrative Hearings 1700 West Washington, Suite 602 Phoenix, Arizona 85007 (602) 542-9826