DEQ reports ongoing rule reform, NEPA updates and cautious optimism on Montana Tunnels mine sale

Sonia Nowakowski, director of the Department of Environmental Quality, briefed the council on DEQ’s regulatory reform and on an unresolved mining bonding case involving the Montana Tunnels property.

Nowakowski said DEQ has amended or repealed more than 50 administrative rules since 2021 as part of a red‑tape review and is working through roughly 25 rule packages this year to implement 2025 legislation and improve readability. "We believe that all Montanans should be able to read the environmental regulations and understand them," she said, noting some rules have very high reading levels and outdated procedural requirements such as multiple paper copies.

DEQ has also begun revising NEPA model rules to reflect recently enacted 2025 bills; the agency expects to provide more detailed updates and potential draft language at the council’s May and July meetings.

On mining, Nowakowski summarized an ongoing courtroom process for the Montana Tunnels mine. DEQ requested a receiver and a restraining order to prevent sale or transfer; the court set a 120‑day window for the current owner to propose a sale that would "pay in full all creditors' claims" and address a roughly $17 million bond shortfall and approximately $3 million in county tax obligations. "We're somewhat disappointed to see this issue remain unresolved for another 4 months," she said, but described the court’s schedule as giving the state a path to be made whole.

Dan Walsh, DEQ’s Air, Energy and Mining division administrator, confirmed the upcoming deadline and said the department expects to review any buyer’s proposal to ensure it satisfies reclamation and bonding requirements.

Nowakowski also updated the council on energy bureau workload and trends in exploration licensing and operating permits, noting exploration projects are becoming larger, more sophisticated and longer in duration.