As Minnesota spends millions to restore peatlands, it sells mining rights for $12 an acre

The DNR has to balance its responsibility for protecting public peatlands and overseeing their restoration with its role in raising revenue by selling peat mining rights for royalties for the School Trust. But peat sales have only ever made up a sliver of its annual revenue. The School Trust earns the vast majority of its money, more than $35 million a year, from iron and taconite royalties and timber sales. Since 1980, peat leases have earned the fund an average of $43,000 a year, which would be enough to give each of the 510 school districts, academies and charter schools in the state about $84.

“We’ve set up the law so the DNR has a very mixed mission,” said Paula Maccabee, a lawyer with the conservation group WaterLegacy. “You have the entity that is making the royalties from the mining and has long-standing relationships with these companies deciding what to do about wetlands.”

The EPA gave the DNR $12 million to restore peatlands on public land. By the state’s own math, that money may restore fewer acres — between 4,000 and 9,600 acres — than the DNR is leasing to mining companies for one one-hundredth of that cost.

While the DNR negotiates all leases to mine peat on public lands, those leases have to be approved by the state’s Executive Council, which is made up of Gov. Tim Walz, Lt. Gov. Peggy Flanagan, Secretary of State Steve Simon, Auditor Julie Blaha and Attorney General Keith Ellison.

Blaha referred questions to the DNR. No other members of the council returned messages seeking comment.

Strommen and Henderson of the DNR presented the terms of the latest peat mine lease to the Executive Council in 2023, recommending its approval. The council unanimously approved it, allowing a Canadian company to mine 1,190 acres in Koochiching County for the next 25 years for $11.85 an acre. The government also receives $7.50 per ton of peat moss extracted.