SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2013

For the transition period from            to

Commission File Number 000-33433

KAISER VENTURES LLC

(Exact name of small business issuer as specified in its charter)

3633 East Inland Empire Blvd.337 North Vineyard Ave., Suite 4804^th Floor

Ontario, California 91764

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (909) 483-8500

No Change

(Former name, former address and former fiscal year, if change since last report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicated by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.):     Yes  ¨    No  x

At May 1, 2012,2013, the registrant had 7,002,8067,096,806 Class A Units outstanding including: (i) 104,267 Class A Units outstanding but reserved for distribution to the general unsecured creditors in the Kaiser Steel Corporation bankruptcy; (ii) 113,101 Class A Units outstanding and reserved for issuance to holders of Kaiser Ventures Inc. stock that have to convert such stock into Kaiser Ventures LLC Class A Units; and (iii) 13,000 units outstanding that are subject to certain vesting requirements.

KAISER VENTURES LLC AND SUBSIDIARIES

TABLE OF CONTENTS TO FORM 10-Q

AVAILABILITY OF PREVIOUS REPORTS

The Company will furnish without charge, to each member, upon written request of any such person, a copy of the Company’s 20112012 Annual Report on Form 10-K. Those requesting a copy of such report that are not currently members of the Company may also obtain a copy of the reports directly from the Company upon payment of a nominal photocopying charge. Requests for a copy of any report filed with the Securities and Exchange Commission should be directed to Executive Vice President-Administration, at 3633 East Inland Empire Boulevard, Suite 480,337 N. Vineyard Ave., 4^th Floor, Ontario, California 91764. All such reports can also be accessed from the Company’s website atwww.kaiserventures.com.

The reader is encouraged to read this Report on Form 10-Q in conjunction with the Company’s 20112012 Annual Report on Form 10-K as the information contained herein is often an update of the information in such report.

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PART I

FORWARD-LOOKING STATEMENTS

Except for the historical statements and discussions contained herein, statements contained in this Report on Form 10-Q constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any 10-K Report, 10-KSB Report, Annual Report, 10-Q Report, 10-QSB Report, 8-K Report or press release of the Company and any amendments thereof may include forward-looking statements. In addition, other written or oral statements, which constitute forward-looking statements, have been made and may be made in the future by the Company. You should not put undue reliance on forward-looking statements. When used or incorporated by reference in this 10-Q Report or in other written or oral statements, the words “anticipate,” “estimate” “project” and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks, uncertainties, and assumptions. We believe that our assumptions are reasonable. Nonetheless, it is likely that at least some of these assumptions will not come true. Accordingly, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated, expected, or projected. For example, our actual results could materially differ from those projected as a result of factors such as, but not limited to: the filing by Mine Reclamation, LLC of a voluntary petition in bankruptcy pursuant to Chapter 11 of the U.S. Bankruptcy Code; pre-bankruptcy activities of Kaiser Steel Corporation, the predecessor of Kaiser, and asbestos claims; insurance coverage disputes; the results of current or threatened litigation; the challenge, reduction or loss of any claimed tax benefit or tax treatment; any obligations that could arise out of any sale of the Company’s ownership interests in Kaiser Eagle Mountain, LLC, Lake Tamarisk Development, LLC and Mine Reclamation, LLC;LLC or the assets of any such entity; the impacts and risks of the proposed dissolution and winding-up of the Company; and/or general economic conditions in the United States and Southern California. The Company disclaims any intention to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

ADDITIONAL INFORMATION

A reader of this Report on Form 10-Q is strongly encouraged to read the entire report, together with the Company’s 20112012 Annual Report on Form 10-K and10K for background information and a complete understanding as to material developments concerning the Company. Such report can be found on Kaiser’s website atwww.kaiserventures.com under the “Member Relations” tab.

WHO WE ARE

Unless otherwise noted: (1) the term “Kaiser LLC” refers to Kaiser Ventures LLC; (2) the term “Kaiser Inc.” refers to the former Kaiser Ventures Inc.; (3) the terms “Kaiser,” “the Company,” “we,” “us,” and “our” refer to past and ongoing business operations conducted in the form of Kaiser Inc. or currently Kaiser LLC, and their respective subsidiaries. Kaiser Inc. merged with and into Kaiser LLC effective November 30, 2001; (4) the terms “Class A Units” and “members” refer to Kaiser LLC’s Class A Units and the beneficial owners thereof, respectively; and (5) the term the “merger” refers to the merger of Kaiser Inc. with and into Kaiser LLC effective November 30, 2001, in which Kaiser LLC was the surviving company. Kaiser is the reorganized successor to Kaiser Steel Corporation, referred to as KSC, which was an integrated steel manufacturer that filed for bankruptcy protection in 1987.

The Consolidated Financial Statements are located at the end of Item 3, beginning on Page 1012 of this Report and are incorporated herein by this reference.

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BUSINESS UPDATE

Overview

Our business is developing and monetizing as appropriate the remaining assets we received from the KSC bankruptcy. bankruptcy and the possible opportunities related to such assets. In 2000 Kaiser’s then Board of Directors approved a cash maximization strategy with the goal of seeking to reasonably maximize future distributions to our members. On January 15, 2013, our Board of Managers approved a Plan of Dissolution and Liquidation and the attendant Second Amended and Restated Limited Liability Company Operating Agreement, both of which remain subject to approval by the Company’s Class A members. The dissolution of the Company will be a final step in the cash maximization strategy. As a result of comments received from the Securities and Exchange Commission and other factors, the Dissolution and Liquidation Plan and the Second Amended and Restated Limited Liability Company Operating Agreement were each revised by the Board of Managers on April 10, 2013. The Plan of Dissolution and Liquidation (as revised, the “Plan of Dissolution”) and the Second Amended and Restated Limited Liability Company Operating Agreement (as revised, the “New Operating Agreement”) will require the approval of the Company’s Class A members which has been called for May 22, 2013.

Following is a summary of our current material assets other than cash and securities:

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KAISER VENTURES LLC AND SUBSIDIARIES

Cash Maximization Strategy Status

In September 2000, Kaiser Inc.’s Board of Directors approved a strategy to maximize the cash ultimately to be distributed to our owners taking into account all circumstances and applicable legal requirements. This strategy was continued with the conversion of Kaiser Inc. to a limited liability company at the end of 2001. Consistent with this strategy, Kaiser Inc. historically completed or entered into a number of transactions which resulted in Kaiser Inc. distributing a total of $12 per unit in cash to its shareholders. In particular the adverse final decision in the federal land exchange litigation in March 2011 negatively impacted MRC’s ability to pursue the Landfill Project, which in turn altered and adversely impacted the timing of the continuing implementation of the cash maximization strategy. However, with the sale by Kaiser Recycling of its ownership interest in the West Valley MRF, LLC (“WVMRF, LLC”), LLC, in April 2012 the Company’s Board of MangersManagers declared and paid a distribution of $1.50 per Class A Unit to unitholders of record as of May 9, 2012. In addition, funds were reserved for known future liabilities and for possible future contingent liabilities. Further implementation of the cash maximization strategy isand a further winding-down of the Company are dependent upon, among other things, the sale of its remaining assets, which the Company continues to pursue.

In furtherance of the cash maximization strategy, the Company has been seeking to sell its ownership interest in MRC, in KEM and in LTD. Any possible sale of the KEM property was subject, in all instances, to the rights of the District to acquire the Landfill Project on or before October 31, 2011. The final implementation of the cash maximization strategy has been negatively impacted by, among other asset sales.things, the adverse final decision in the federal land exchange litigation which has halted MRC’s ability to continue to pursue the Landfill Project, the adverse actions of the District, MRC’s bankruptcy and unsettled economic conditions. However, the Company’s Board of Managers has determined that the proposed dissolution of the Company is currently the best opportunity to achieve possible future distributions to its members. Additionally, if the dissolution of the Company occurs, the final implementation of the cash maximization strategy could take a significant additional period of time depending upon the timing of the resolution of MRC’s bankruptcy and the sale of our remaining assets.

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We are continuing to evaluate all reasonable options with regard to the disposition of our remaining assets.

Proposed Dissolution of the Company. On January 15, 2013, the Company’s Board of Managers approved the dissolution and liquidation of the Company, subject to the approval of the Company’s Class A members. The Board of Managers concluded that it was in the best interests of the Company and its members to dissolve and liquidate as the final step in implementing the Company’s previously approved cash maximization strategy. The Plan of Dissolution, New Operating Agreement and the proposed name change require approval by the Company’s Class A members. Preliminary proxy materials were filed with the Securities and Exchange Commission in January 2013 and the final proxy materials were mailed to the Class A members beginning approximately April 23, 2013. Assuming the Plan of Dissolution and the New Operating Agreement are approved by the Company’s Class A members, the Company plans on selling its remaining assets, discharging or making adequate provision for all of its known and contingent liabilities and distributing the net liquidation proceeds, if any, in one or more future distributions to members. However, there could be no further distributions to members if our remaining assets are sold for substantially less than we currently anticipate and/or if liquidation expenses and actual and contingent liabilities are higher than we currently understand and estimate. Accordingly, we are not able to predict with certainty the precise nature, amount or timing of any future distributions, primarily due to our inability to accurately predict (i) the amount of our remaining liabilities, (ii) the amount that we will expend during the course of the liquidation, or (iii) the net realizable value, if any, of our remaining non-cash assets. The Board has not established a firm timetable for any interim or final distributions to the Company’s members. If the Plan of Dissolution is approved by the Company’s Class A members, the individuals serving on the Board of Managers will resign from the Board of Managers and the Board of Managers will be eliminated and replaced with a single Liquidation Manager with the power and authority to manage the liquidation and dissolution of the Company and the winding up of its affairs. The target date to complete dissolution is June 30, 2014, but that date could be extended to December 31, 2014, or beyond.

Further details of the Plan of Dissolution and the New Operating Agreement are provided in the proxy statement that has been mailed to the Company’s Class A members. The special Class A members’ meeting would be the commencement of the final step in the Company’s cash maximization strategy.

MEMBERS OF THE COMPANY ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY ALL RELEVANT MATERIALS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE PROXY STATEMENT, BECAUSE THESE MATERIALS WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS.

If the Plan of Dissolution is approved, we intend to immediately seek relief from the SEC to modify our reporting obligations under the Securities and Exchange Act of 1934, as amended, and in particular, to seek relief from the requirement to provide quarterly Form 10-Q Reports and audited annual financial statements. We anticipate that, if granted such relief, we would be required to continue filing current reports on Form 8-K to disclose material events relating to our dissolution and liquidation, along with any other reports that the SEC might require but we would no longer be filing audited financial statements. If the SEC does not grant us the requested relief, we will be required to continue filing all of our periodic and current reports as required by the Securities Exchange Act of 1934, as amended, and to provide audited financial statements, both of which would reduce the amount of funds available, if any, for distribution to members because of the costs associated therewith.

As more fully detailed in the proxy statement that has been furnished to the Company’s Class A members, there are a number of risks associated with dissolving the Company and winding-up its business. These risks include, but are not limited to:

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Eagle Mountain Landfill Project and MRC

In 1988, the Company entered into a 100-year lease agreement (the “MRC Lease”) with MRC. MRC was seeking to develop the Company’s former iron ore mine near Eagle Mountain, California into a large, regional rail-haul, municipal solid waste landfill. On May 26, 2000, the Company also entered into a Real Estate Option Agreement (the “MRC Option”) with MRC which would permit MRC to acquire the real property for the Landfill Project upon the terms and conditions set forth in the MRC Option. The MRC Option has not yet been exercised and it currently expires on June 1, 2012,May 28, 2013, if it is not extended by mutual agreement. The Company currently owns approximately 84.247% of the Class B units and 100% of the Class A units of MRC. On October 30, 2011, MRC filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy. For additional information, please see the discussion above under the first bullet point paragraph in “Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - OPERATIONS—BUSINESS UPDATE - UPDATE—Overview.”

As part of the proceedings in Bankruptcy Court, MRC will need to develop a plan of reorganization which will include decisions regarding the status of the MRC Lease, the MRC Option and the Landfill

KAISER VENTURES LLC AND SUBSIDIARIES

Project Sale Agreement, among other things. In addition, MRC will consider and take action with respect to the proof of claims filed in the bankruptcy proceeding including whether to accept, reject, compromise or take other action with respect to any particular proof of claim that was timely and properly submitted. In addition, litigation and threatened litigation have arisen in the context of the MRC bankruptcy. For additional information, please see the discussion under “PART II. Item 1. LEGAL PROCEEDINGS.”

MRC Financing.Since Kaiser became an owner of MRC in 1995, MRC has been financed through a series of private offerings of securities to its existing equity owners. However, the Company has determined that it will not provide any future equity financing to MRC to pursue the Landfill Project, but MRC may need additional funds to complete its bankruptcy. Under certain circumstances, Kaiser LLC as

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well as others may become “debtor-in-possession” lenders to MRC.

West Valley Materials Recovery and Transfer Station

Background. WVMRF, LLC was formed While Kaiser has made the determination that it will not provide future equity financing to MRC to pursue the Landfill Project, other non-related parties have expressed the desire to continue to pursue the Landfill Project in June 1997 by Kaiser Recycling Corporation (now Kaiser Recycling, LLC (formerly Kaiser Recycling, Inc.)), a wholly-owned subsidiary of Kaiser, and West Valley Recycling & Transfer, Inc., a wholly-owned subsidiary of Burrtec Waste Industries, Inc. (“Burrtec”). This entity was formed to construct and operate the materials recovery facility and is referred to as the WVMRF, LLC. This facility is permitted to receive up to 7,500 tons per day of municipal solid waste. Currently, the facility is processing approximately 3,000 – 3,500 + tons per day of municipal solid waste and recyclable materials.

Construction of the West Valley MRF was financed primarily by variable rate interest bonds issued by the California Pollution Control Finance Authority. As of March 31, 2012, the outstanding principal balance of the bonds fully due in June 2012, was $620,000 and due in June 2030 was $5,200,000. Union Bank of California (“Union Bank”) provides the letters of credit that support the Pollution Control Finance Authority bonds. At the time of the issuance of the bonds Kaiser LLC and Burrtec each severally guaranteed fifty percent (50%) of the principal and interest on the bonds to Union Bank in the event of a default by WVMRF, LLC.

Distribution.A cash distribution of $750,000 was received from the WVMRF, LLC during the first quarter of 2012.

Sale of Ownership Interest.On April 2, 2012, Kaiser LLC, Kaiser Recycling, Burrtec Waste Industries (“Burrtec”) and West Valley Recycling & Transfer, Inc. (“Buyer”), a wholly owned subsidiary of Burrtec, entered into that certain Purchase Agreement (the “Purchase Agreement”) For Units of WVMRF, LLC whereby Kaiser Recycling sold its ownership interest in West Valley to Buyer. The sale transaction closed on the same day as the Purchase Agreement was entered into by the parties to the agreement. Kaiser Recycling sold its ownership interest in WVMRF, LLC for a gross cash sales price of approximately $25,768,000. The Company will record a gain of approximately $20 million in the second quarter of 2012. Existing environmental obligations and agreements of the Company and Kaiser Recycling benefiting WVMRF, LLC, Buyer and Union Bank remain in place and an escrow of $363,000 was established to provide certain financial assurances. However, the Company’s guaranty of the outstanding California Pollution Control Finance Authority bonds was terminated.some manner.

OPERATING RESULTS

Note on WVMRF, LLC

The operating resultsDue to the sale of the Company during the first quarter of 2012 reflect our fifty percent (50%) ownership interest in WVMRF, LLC, for the 3 month period ended February 29, 2912. In addition, even though we sold our ownership interest in WVMRF, LLC on April 2, 2012, our secondthe Company’s consolidated financial statements for the first quarter operating

KAISER VENTURES LLC AND SUBSIDIARIES

results willof 2013 do not reflect theany operating results of WVMRF, LLC’sLLC. However, the consolidated financial statements for the three months ended March 31, 2012, operations. This is duedo reflect the Company’s 50% ownership in WVMRF, LLC for the three month period from December 1, 2011 to February 28, 2012. Due to the time required to close the books of the WVMRF, LLC and in keeping with past practice, there iswas a one month delay in reporting the results of WVMRF, LLCLLC.

Summary of Revenue Sources

Due to the nature of the Company’s projects and the Company’s recognition of revenues from non-recurring items, historical period-to-period comparisons of total revenues may not be meaningful for developing an overall understanding of the Company. Therefore, the Company believes it is important to evaluate the recent developments regarding its revenue sources.

Results of Operations

Analysis of Results for the Quarters Ended March 31, 20122013 and 20112012

Revenues. Total revenues for the first quarter of 20122013 were $325,000$107,000 as compared to $555,000$325,000 for the comparable period in 2011.2012. The reasons for this decrease are discussed below.

Revenue from the Company’s equity method investment in the WVMRF, LLC decreased by $241,000$298,000 to $298,000$0 for the first quarter of 2012 as compared to $539,000 for the same period in 2011.2013. This decrease which is the direct result of decreased operating profit fromthe sale of our entire member interest in the WVMRF, LLC is due primarily to lower recyclable sales resulting from a reduction in recyclable commodity prices (fiber and aluminum). Additionally, the WVMRF, LLC continues to receive lower waste volumes due to the lingering impacts of the U.S. economic recession. The impact of lower commodity prices was partially offset by lower recyclable rebates and buyback expenses in the first quarter ofon April 2, 2012.

Revenue from Eagle Mountain operations increased for the first quarter of 20122013 by $11,000$80,000 to $27,000$107,000 as compared to $16,000$27,000 for 2011,the same period in 2012, primarily due to increased revenue from tenant rentalsrock and other media rentalsaggregate sales, as well as, increased diesel sales as compared to the same period in 2011.2012.

Operating Costs. Operating costs decreased to $743,000$444,000 for the first quarter of 20122013 from $7,068,000$743,000 for the same period in 2011.2012. This decrease relates primarily to Asset Impairment expensedecreased expenses for machinery maintenance of $6,683,000, related$29,000, electrical maintenance and supplies of $54,000, salaries of $34,000, legal of $22,000, licenses, fees and permits of $22,000, outside services of $28,000, and consulting of $23,000. Some of these expenses were rebilled to the Eagle Mountain Landfill investment, which was recorded in the first quarter of 2011. The reduction in Asset Impairment expense was partially offset by increased expenses related to Eagle Mountain of $281,000 including $77,000 in non-capitalized MRC expensescustomers buying rock and $82,000 in electrical repair and mechanical repairs, as well as, $45,000 in outside Consultants and $25,000 in licenses and fees.aggregate.

Corporate General and Administrative Expenses.Corporate general and administrative expenses decreasedincreased to $525,000$591,000 for the first quarter of 20122013 from $526,000$525,000 for the same period in 2011.2012. This decreaseincrease is primarily related to the netincreases in printing costs of an increase in$23,000 and legal expensescosts of $70,000 related to the MRC bankruptcydissolution, as well as, a reduction in allocated salaries-out of $103,000 related to the sale of our interest in the West Valley MRF, LLC. These increases were partially offset by a reduction in salaries of $81,000, executive unit grants of $16,000 and a decrease in other outside services during this period as compared to 2011.legal expenses of $34,000.

Net Interest and Investment Income. Net interest and investment income, for the first quarter of 20122013, was a gain of $23,000$52,000 compared to a gain of $88,000$23,000 for the same period in 2011.2012. Of the $23,000$52,000 gain for

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the first quarter of 2012, $14,0002013, $83,000 was interest income, which was offset by a $31,000 net realized and $9,000 was a net unrealized gainloss on the Company’s short-term investments.

Loss Before Income Tax BenefitProvision and Allocation of Non-Controlling Interest. The Company recorded a pre-tax loss of $920,000$876,000 in the first quarter of 20122013 versus a pre-tax loss of $6,951,000$920,000 for the same period in 2011.2012. The Company is taxed as a partnership and thus the Company’s annual results of operations (on an income tax basis) are allocated to the unit holders for inclusion in their respective income tax returns.

KAISER VENTURES LLC AND SUBSIDIARIES

Net Loss Attributable to Controlling Interest.For the first quarter of 2012,2013, the Company incurredreported a net loss attributable to controlling interest of $890,000,$863,000, which is equal to $0.13$0.12 per unit, versus a net loss of $5,796,000,$890,000, or $0.86$0.13 per unit for the same period in 2011.2012.

FINANCIAL POSITION

Cash, and Cash Equivalents and Short-Term Investments. The Company defines cash equivalents as highly liquid debt instruments with original maturities of 90 days or less. Cash and cash equivalents decreased $48,000increased $559,000 to $756,000$4,721,000 at March 31, 20122013 from $804,000$4,162,000 at December 31, 2011.2012. Included in cash and cash equivalents is $295,000$105,000 and $534,000$124,000 held solely for the benefit of MRC at March 31, 20122013 and December 31, 2011,2012, respectively.

Below is a table showing the major changes in cash during 2012:2013:

Working Capital. During the first three months of 2012,2013, current assets decreased $666,000by $790,000 to $3.7$12.7 million, while current liabilities decreased $231,000$195,000 to $2.0$2.6 million. The decrease in current assets was the result of decreasesa decrease in (a) short term investments of $479,000; (b)$1,363,000, partially offset by an increase in cash and cash equivalents of $559,000 and an increase in accounts receivable and other of $139,000; and (c) $48,000 in cash and equivalents as discussed above.$14,000. The decrease in current liabilities is primarily the result of decreasesa decrease in accrued liabilities of $154,000 and $77,000$208,000 partially offset by an increase in accounts payable and accrued liabilities, respectively.of $13,000. As a result, net working capital decreased during the first three months of 20122013 by $435,000$595,000 to $1.7 million$10,181,000 at March 31, 2012.2013.

Below is a table showing the major changes in working capital.

Accounts Receivable and Other (Net). During the first three months of 2012,2013, accounts receivable and other current assets decreasedincreased by $139,000$14,000 primarily due to decreasesincreases in trade accounts receivable andassociated with aggregate rock sales at Eagle Mountain, which were partially offset by the amortization of prepaid insurance.

Short-Term Investments. During the first three months of 2012,2013, short-term investments decreased by $479,000.$1,363,000. This is primarily the result of maturing investments and the sale of investments to provideneed for operating funds. On March 31, 2012,

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2013, the Company had $2.2 million$6,900,000 of its excess cash reserves invested in such investments. Investments are marked to market and unrealized earnings or loss are reflected in the valueA vast majority of the investmentinvested cash is being reserved for future potential liabilities and in income for the period for which they are earned.

Investments. The Company’s equity share of income from the investment in the West Valley MRF, which totaled $298,000 for the first three months of the year, was offset by the receipt of cash distributions totaling $750,000 resulting in a $452,000 decrease to the Company’s investment in the West Valley MRF.

KAISER VENTURES LLC AND SUBSIDIARIES

As previously stated, the investment in the MRC Landfill Project was determined to be impaired and, therefore, was written-down by $6,683,000 during the first quarter of 2011 which was charged to earnings. As required by the ASC, all subsequent Eagle Mountain Landfill expenses will be expensed as incurred.commitments.

Other Assets. For the first three months of the year, there was a decrease in other assets of $80,000$77,000 which is the net result of the amortization of the environmental insurance policy of $75,000, and depreciation of $5,000$2,000 related to buildings and equipment.

Environmental Remediation. The Company purchased, in 2001, a 12-year $50 million insurance policy to cover substantially any and all environmental claims (up to the $50 million policy limit) relating to the historical operations of the Company. As of March 31, 2012,2013, based upon current information, we estimate that our future environmental liability related to certain matters and risks not assumed by CCG Ontario, LLC, a subsidiary of Prologis, in its purchase of the Mill Site Property in August 2000 would be approximately $2.7$2.3 million for which a reserve has been established. See Note“Note 2. “ENVIRONMENTAL—ENVIRONMENTAL MATTERS”. In the event a claim for damages is filed, prior to June 30, 2013, against the Company that relates to this reserve, management believes that the claim may be covered by insurance depending upon the nature and timing of the claim. In addition, in connection with the Tar Pits Parcel now owned toby Kaiser Recycling, LLC, insurance will bewas purchased in the second quarter of this year2012 to cover possible contingent environmental related liabilities and a third party escrow of approximately $20,000$363,000 in cash was established benefitting WVMRF, LLC and others. This amount was charged against the Company’s environmental reserve which encompassed this specific environmental exposure. The $113,621 premium for the purchased policy was paid from the cash escrow discussed above.

Non-Controlling Interest.Interest in MRC. During the first three months of 2012,2013, the Non-Controlling Interest decreased by $31,000$14,000 from $2,057,000$1,985,000 as of December 31, 20112012 to $2,026,000$1,971,000 as of March 31, 2012,2013, which is the net loss attributable to non-controlling interest for the three month period. As of March 31, 20122013 the resulting non-controlling interest is $2,026,000,$1,971,000, which relates to the approximate 15.8% ownership interest in MRC that the Company does not own.

Contingent Liabilities. The Company has contingent liabilities more fully described above and in the notes to the consolidated financial statements.

Critical Accounting Policies

The Company’s accounting policies are more fully described in the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.2012. As disclosed in the Notes to the 20112012 Annual Consolidated Financial Statements, the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions about future events that affect the amounts reported in the consolidated financial statements and accompanying notes. Future events and their effects cannot be determined with absolute certainty and therefore, the determination of estimates requires the exercise of judgment. Actual results inevitably will differ from those estimates, and such differences may be material to the consolidated financial statements.

The Company believes the following critical accounting policies, which comply with the ASC, are important to the portrayal of the Company’s financial condition and results.

Investments. The Company accounts for investments under Section 320-10 of the ASC.The Company invests itsits’ excess cash reserves in high grade commercial paper (Standard & Poor’s rating of “A”“BBB” or above), and U.S. government bonds which it classifies as “available-for-sale” and which are recorded at the purchase price of the security plus or minus the discount or premium paid. Investments are marked to market and unrealized earnings are reflected in income for the period in which they are earned. Due to the current U.S. credit crisis, the fair value of the Company’s commercial paper investments has fluctuated significantly. However, the Company expects to hold these investments to maturity.maturity, thereby mitigating any unknown fluctuations in fair value.

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Investment in West Valley MRF, LLC. The Company accountsaccounted for its investment in WVMRF, LLC, under the equity method of accounting because of the Company’s 50% non-controlling ownership interest. However, as discussed elsewhere in this Report, the Company’s ownership interest in WVMRF, LLC was sold on April 2, 2012.

Landfill Permitting and Development. Through its 84.247% interest in MRC, the Company has been developing since 1995, for sale to a municipal entity or operating company, its property known as the Eagle Mountain Site in the California desert for use as a rail-haul municipal solid waste landfill. Pursuant to Section 970-10 of the ASC, capitalizable landfill site development costs are recorded at cost and will be expensed when management determines that the capitalized costs provide no future benefit. However, as discussed in more detail in this Report on Form 10-Q, effective June 30, 2010 and March 31, 2011, there was a determination of impairment of MRC’s investment in the Eagle Mountain Landfill Project which resulted in write-downs of the carrying amount of such investment in our consolidated financial statements. With the determination that an impairment exists no further costs have been or will be capitalized.

Environmental Insurance and Environmental Remediation Liabilities. The Company’s $3.8 million premium for the prospective insurance policy, which was reduced by a refund from the insurance carrier, is capitalized as a long-term asset and is being amortized on a straight-line basis over the twelve (12) year term of the policy. To the extent a pre-existing liability has not been recorded, claims made for environmental matters are recorded as litigation accruals in the Company’s consolidated financial statements pursuant to Section 450-10 of the ASC when it becomes probable that a loss has been incurred and the amount of such loss can be reasonably estimated. Claims accepted by the insurance company pursuant to coverage under the policy are recorded as insurance receivables when coverage is accepted and the amount to be paid by the insurance company can be reasonably estimated. In addition, a new limited environmental insurance policy for a ten year term was purchased by Kaiser Recycling as more fully discussed above.

Revenue Recognition. Revenues are recognized when the Company has completed the earnings process and an exchange transaction has taken place.

Conditional Asset Retirement Obligations. The Company accounts for certain asset retirement obligations at Eagle Mountain pursuant to ASC 410Accounting for Asset Retirement and Environmental Obligations.

Long-Lived Assets. In accordance with Section 360 of the ASC, long-lived assets are evaluated for potential impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. As discussed in more detail in this Report of Form 10-Q, effective June 30, 2010 and March 31, 2011, there were determinations of impairment of the Eagle Mountain Landfill investment, a long-lived asset, which resulted in write-downs of the carrying amount of such investment in our financial statements.

BUSINESS OUTLOOK

The statements contained in this Business Outlook, as well as in “Part I - I—Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Overview”,OPERATIONS—Overview,” are based upon current operations and expectations. In addition to the forward-looking statements and information contained elsewhere in this Report on Form 10-Q, these statements are forward-looking and, therefore, actual results may differ materially. See the Company’s disclosure regarding forward-looking statements in the section entitled “Forward-Looking Statements” above.

Ongoing Operations. As noted above, our revenues from ongoing operations have, in the past, generally been derived from the performance of our major long-term development projects and investments. We have previously sold most of our major projects and investments and as previously discussed on April 2, 2012, we soldhave disclosed in previous SEC filings, including our fifty percent (50%) ownership interest in WVMRF, LLC.LLC on April 2, 2012. Accordingly, our principal remaining assets and projects, other than cash and securities, are: (i) our

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KAISER VENTURES LLC AND SUBSIDIARIES

ownership interest in MRC, however, MRC filed a voluntary bankruptcy petition under Chapter 11 of the U.S. Bankruptcy Code on October 30, 2011; (ii) our 100% equity ownership of KEM which owns and controls

KAISER VENTURES LLC AND SUBSIDIARIES

approximately 10,000 acres at the Eagle Mountain Site on or in which millions of tons of iron ore, stockpiled rock and other mineral resources are present; and (iii) our 100% equity ownership interest in Lake Tamarisk Development which owns property near the Eagle Mountain Site. We have no material ongoing operations except in connection with such remaining assets and projects and in connection with addressing any liabilities we may have. Our principal sources of ongoing income over the last several years have been derived from the WVMRF, LLC, investment earnings and from miscellaneous income generated at the Eagle Mountain Site. As a result of the sale of our interest in WVMRF, LLC, no further distributionsequity income will be received from WVMRF, LLC.

MRC. As discussed in more detail in “Part I - I—Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - OPERATIONS—BUSINESS UPDATE - UPDATE—Overview,” on October 30, 2011, MRC filed a voluntary petition in bankruptcy pursuant to Chapter 11 of the U.S. Bankruptcy Code. The filing was necessary to protect and preserve MRC’s assets and options. Depending upon the results of the bankruptcy process, it is possible that the value of Kaiser’sthe Kaiser Eagle Mountain investment in MRC could be further impaired.

Mill Site Property. The only remaining Mill Site Property owned by the Company is an approximate five acre parcel referred to as the Tar Pits Parcel which is now owned by Kaiser Recycling. CCG Ontario, LLC substantially completed all material environmental remediation of this parcel pursuant to the terms of its agreement during 2002. CCG Ontario does have ongoing operations and maintenance obligation with respect to the Tar Pits Parcel. WVMRF, LLC has the right to purchase the Tar Pits Parcel for $1.00. Effective April 2, 2012, WVMRF, LLC leased material portions forof the Tar Pits Parcel from Kaiser Recycling. The lease is for 50 years with the right to extend the lease for 50 years in exchange for: (i) payment of all the property taxes for the Tar Pits Parcel; (ii) insuring the Tar Pits Parcel and naming Kaiser Recycling as an additional insured for general liability purposes; and (iii) performing various maintenance and security obligations on the property being leased. In addition, a cash escrow was established in the amount of $363,000 benefiting WVMRF, LLC and others in connection with possible contingent environmental and environmental related actions, a reserve for which had been previously recorded. A limited environmental insurance policy with a term of ten years was purchased for $113,621 with the policy premium being paid from the escrowed amount.

Cash Maximization Strategy. In September 2000, Kaiser Inc.’s Board of Directors approved a strategy to maximize the cash ultimately to be distributed to our owners taking into account all circumstances and applicable legal requirements. This strategy was continued with the conversion of Kaiser Inc. to a limited liability company at the end of 2001. Consistent with this strategy, Kaiser Inc. historically completed or entered into a number of transactions which resulted in Kaiser Inc. distributing a total of $12 per unit in cash to its shareholders. Lengthy, but adversely completed, litigation involving the Landfill Project has delayed the implementation of the goals of the cash maximization strategy. In particular the adverse final decision in the federal land exchange litigation in March 2011 negatively impacted MRC’s ability to pursue the Landfill Project, which in turn altered and adversely impacted the timing of the continuing implementation of the cash maximization strategy. However, with the sale by Kaiser Recycling of its ownership interest in the WVMRF, LLC, the Company’s Board of MangersManagers declared and paid a distribution of $1.50 per Class A Unit to unitholders of record as of May 9, 2012. In addition, funds were reserved for known future liabilities and for possible future contingent liabilities as required by Delaware Law. Further implementation of the cash maximization strategy isand a further winding-down of the Company’s investment in MRC are dependent upon, among other things, other asset sales. The Company is also exploring and implementing its options to further reduce its operating expenses.

Proposed Dissolution of the Company. On January 15, 2013, the Company’s Board of Managers approved the dissolution and liquidation of the Company, which is subject to the approval by the Company’s Class A members. The Board of Managers concluded that it was in the best interests of the Company and its members to dissolve and liquidate as the final step in implementing the Company’s

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previously approved cash maximization strategy. The Plan of Dissolution, New Operating Agreement and the proposed name change require approval by the Company’s Class A members. Preliminary proxy materials were filed with the Securities and Exchange Commission in January 2013 and the final proxy materials were mailed to the Class A members beginning April 22, 2013. Assuming the Plan of Dissolution and the New Operating Agreement are approved by the Company’s Class A members, the Company plans on selling its remaining assets, discharging or making adequate provision for all of its known and contingent liabilities and distributing the net liquidation proceeds, if any, in one or more future distributions to members. However, there could be no further distributions to members if our remaining assets are sold for substantially less than we currently anticipate and/or if liquidation expenses and actual and contingent liabilities are higher than we currently understand and estimate. Accordingly, we are not able to predict with certainty the precise nature, amount or timing of any future distributions, primarily due to our inability to accurately predict (i) the amount of our remaining liabilities, (ii) the amount that we will expend during the course of the liquidation, or (iii) the net realizable value, if any, of our remaining non-cash assets. The Board has not established a firm timetable for any interim or final distributions to the Company’s members. If the Plan of Dissolution is approved by the Company’s Class A members, the individuals serving on the Board of Managers will resign from the Board of Managers and the Board of Managers will be eliminated and replaced with a single Liquidation Manager with the power and authority to manage the liquidation and dissolution of the Company and the winding up of its affairs. The target date for the Liquidation Manager to complete dissolution is June 30, 2014, but that date could be extended to December 31, 2014, or beyond.

Seeking a Reduction in SEC Reporting

If the Plan of Dissolution is approved, we intend to immediately seek relief from the SEC to modify our reporting obligations under the Securities and Exchange Act of 1934, as amended, and in particular, to seek relief from the requirement to provide quarterly Form 10-Q Reports and audited annual financial statements. We anticipate that, if granted such relief, we would be required to continue filing current reports on Form 8-K to disclose material events relating to our dissolution and liquidation, along with any other reports that the SEC might require but we would no longer be filing quarterly audited financial statements. If the SEC does not grant us the requested relief, we will be required to continue filing all of our periodic and current reports as required by the Securities Exchange Act of 1934, as amended, and to provide audited financial statements, both of which would reduce the amount of funds available, if any, for distribution to members because of the costs associated therewith. If a requested reduction in SEC reporting is obtained following an approval of the Plan of Dissolution, this Report on Form 10-Q for the quarter ended March 31, 2013, may be the last report on Form 10-Q for the Company.

Liquidation Accounting

If the dissolution of the Company is approved by its Class A members, the Company will change its basis of accounting from a “going-concern”, which contemplates realization of assets and satisfaction of liabilities in the normal course of business, to liquidation accounting effective as of the earliest practicable date in accordance with generally accepted accounting principles. Under liquidation accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated settlement amounts. Recorded liabilities will also include the estimated costs associated with carrying out the Plan of Dissolution, including all estimated costs of the Company until all assets are sold, all known liabilities are provided for and the Certificate of Cancellation is filed on behalf of the Company.

Corporate Overhead. With the sale of our ownership interest in WVMRF, LLC, it anticipated that there will bewas a reduction during the second quarter of 2012 in the staffing of the Company’s accounting department to reflect the reduced requirements resulting from the sale of our interest in WVMRF, LLC and of our remaining operations and projects. The costs of such reductions, shall beincluding the payment of severance, were recorded atduring the time the decision to make suchsecond quarter of 2012. Further reductions is made by the Company.in overhead costs are being implemented during 2013.

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KAISER VENTURES LLC AND SUBSIDIARIES

Capital Resources.Kaiser LLC expects that its current cash balances and short-term investments together with cash generated from current and future asset sales as well as expense reductions will be sufficient to satisfy the Company’s ongoing projected operating cash requirements for at least the next twelve months even after payment of the $1.50 per unit distribution declared by the Board of Managers on May 9, 2012.months.

KAISER VENTURES LLC AND SUBSIDIARIES

MRC Bankruptcy. On October 30, 2011, MRC filed a voluntary petition relief under Chapter 11 of the U.S. Bankruptcy Code. MRC continues to operate as a debtor in possession. MRC’s bankruptcy is not currently expected to have a material direct adverse result on Kaiser except that Kaiser will incur attorneys’ fees and costs as a result of the bankruptcy and Kaiser may elect to become a debtor-in-possession lender to MRC to provide the funds necessary to complete the bankruptcy process.

Item 3. CONTROLS AND PROCEDURES

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-14.

Based on its review of the Company’s disclosure controls and procedures, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its subsidiaries) that is required to be included in the Company’s periodic Securities and Exchange Commission filings. Specifically, the Company has: (a) requested annually that all of the critical employees, officers and Members of the Board of Managers of the Company complete an extensive internal control and risk management questionnaire; and (b) internally reviewed and tested the implementation of its internal controls against the Company’s written control procedures. The above conclusions are based upon the work performed. There were no significant changes in internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Additionally,However, with the termination of two accounting positions due to the sale of Kaiser Recycling, Inc.’s ownership interest in WVMRF, LLC, including the termination of the Company’s controller position as of June 30, 2012, going forward there will be fewer individuals that will be able to review and correct any omission or errors that may occur in the Company’s accounting controls and procedures. The effect of this will be mitigated by the part-time employment of the now retired former controller and expanded oversight of the detailed accounting functions by the Company’s Chief Financial Officer and General Counsel. As previously noted, the effectiveness of the Company’s disclosure controls and procedures are evaluated effective as of the end of each calendar quarter.

CONSOLIDATED FINANCIAL STATEMENTS

[[REMAINDEROFTHIS PAGE INTENTIONALLY LEFT BLANK]

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CONSOLIDATED BALANCE SHEETS

(Unaudited)

as of

The accompanying notes are an integral part of the consolidated financial statements.

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KAISER VENTURES LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

as of

The accompanying notes are an integral part of the consolidated financial statements.

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CONSOLIDATED STATEMENTS OF OPERATIONS

for the Three Months Ended March 31

The accompanying notes are an integral part of the consolidated financial statements.

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KAISER VENTURES LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

for the Three Months Ended March 31

(Unaudited)

Supplemental disclosure of Cash Flow Information

The accompanying notes are an integral part of the consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Note 1. BASIS OF PRESENTATION

The unaudited consolidated financial statements of Kaiser Ventures LLC and Subsidiaries (the “Company”) as of March 31, 20122013 and 2011,2012, as well as the related notes, should be read in conjunction with the Company’s audited consolidated financial statements and related notes as of and for the year ended December 31, 2011,2012, included in the Company’s Annual Report on Form 10-K. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the Company’s financial position at March 31, 2012,2013, and results of operations and cash flows for the three month period ended March 31, 20122013 and 2011.2012.

The Company’s consolidated financial statements include the following significant entities: Lake Tamarisk Development, LLC; Kaiser Eagle Mountain, LLC; Kaiser Recycling LLC; all of which are 100% owned; and Mine Reclamation, LLC, which is 84.247% owned.

In addition, the Company has determined that Business Staffing, Inc. which provides administrative services to the Company, is a variable interest entity due to a lack of sufficient equity at risk even though the Company does not own any interest in Business Staffing, Inc. which is 100% owned by three officers of the Company. The Company has also determined it is the primary beneficiary of Business Staffing, Inc. because the Company has the power to direct activities that most significantly impact the economic performance of Business Staffing, Inc. Accordingly, the Company has consolidated this entity into the consolidated financial statements. The consolidation of this entity does not change any legal ownership, and does not change the assets or the liabilities and equity of Kaiser Ventures LLC and Subsidiaries as a stand-alone entity. The only material assets of Business Staffing that are reflected on the Company’s balance sheet as of March 31, 2013, are $635,000 in cash and the related severance liability of $635,000. All other assets and liabilities of Business Staffing are immaterial. As of December 31, 2012, the respective amounts were $686,000 in cash and the related severance liability of $686,000.

Kaiser is the reorganized successor to Kaiser Steel Corporation, referred to as KSC, which was an integrated steel manufacturer that filed for bankruptcy protection in 1987. Since KSC’s bankruptcy, we have been developing assets remaining after the bankruptcy and have realized substantial value from certain of those assets. Currently, our principal remaining assets are: (i) our 84.27% ownership interest in MRC, however, MRC filed a voluntary bankruptcy petition under Chapter 11 of the U.S. Bankruptcy Code on October 30, 2011; (ii) our 100% equity ownership of KEM which owns and controls approximately 10,000 acres at the Eagle Mountain Site on or in which millions of tons of iron ore, stockpiled rock and other mineral resources are present; and (iii) our 100% equity ownership interest in Lake Tamarisk Development which owns property near the Eagle Mountain Site

Our 50% ownership interest in the West Valley MRF,WVMRF, LLC was sold on April 2, 2012. For further information on this transaction, see “Note 9. SUBSEQUENT EVENTS.5. INVESTMENT IN WEST VALLEY MRF, LLC.”

Note 2. ENVIRONMENTAL MATTERS

The Company purchased an insurance policy effective June 30, 2001 that is designed to provide broad prospective commercial general liability, pollution legal liability, and contractual indemnity coverage for the Company’s ongoing and historical operations.operations on a claims mode basis through June 30, 2013. The policy has a twelve (12) year term and limits of $50 million in the aggregate for defense and indemnity, with no deductible or self-insured retention. The policy is designed to provide coverage for future claims in excess of the Company’s existing and historic insurance policies; however, to the extent that these other insurance policies are not responsive to a claim, the policy will provide first dollar coverage for a claim resulting from property damage, personal injury, bodily injury, cleanup costs or violations of environmental laws. The policy also provides for a broad defense of claims that may be brought against the Company. The policy is specifically intended to provide

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KAISER VENTURES LLC AND SUBSIDIARIES

additional coverage for potential liabilities arising from pollution conditions or known and/or potential asbestos-related claims. The policy also provides contractual indemnity coverage for scheduled indemnity obligations of the Company arising from, e.g., prior corporate transactions and real estate sales. The Company expects this policy will cover substantially any and all environmental claims (up to the $50 million policy limit) relating to the historical operations of the Company.Company that are filed prior to June 30, 2013.

The aggregate cost for this policy was approximately $5.8 million, of which, based upon discussions among the respective members of the Boards of Directors, KSC Recovery paid $2 million and the Company paid the balance of approximately $3.8 million. The portion of the policy paid by KSC Recovery was expected to cover known and/or potential asbestos claims; while the portion of the policy paid by the Company was expected to cover future potential claims arising from the Company’s historical operations.

KAISER VENTURES LLC AND SUBSIDIARIES

The Company’s original $3.8 million premium for the prospective insurance policy was capitalized as a long-term asset and is being amortized on a straight-line basis over the 12 year term of the policy. To the extent a pre-existing liability has not been recorded, claims made for environmental matters are recorded as litigation accruals in the Company’s consolidated financial statements pursuant to Section 450-10 of the ASC when it becomes probable that a loss has been incurred and the amount of such loss can be reasonably estimated. Claims accepted by the insurance company pursuant to coverage under the policy are recorded as insurance receivables when coverage is accepted and the amount to be paid by the insurance company can be reasonably estimated. Generally, unless previously accrued, the liability and the receivable relating to claims covered by this policy should occur in the same accounting period, thereby having no adverse or beneficial impact on the Company’s operating results for that accounting period.

Note 3. INVESTMENTSIn addition to the foregoing policy, an additional insurance policy with a term of ten years covering certain possible contingent environmental and other related events that could arise and impact the WVMRF, LLC and others was purchased by Kaiser Recycling during the second quarter of 2012. The policy premium of $113,621 was paid from the escrow account originally totaling $363,000 that was established as a result of the sale of Kaiser Recycling, LLC’s ownership interest in WVMRF, LLC. The amount of this escrow was charged against the Company’s existing environmental liability reserve.

The Company has an Investment Policy which provides for the investment of excess cash balances primarily in bond funds, commercial paper, and debt instruments. At March 31, 2013 and December 31, 2012, the Company had all of its investments in bonds, bond funds or high grade commercial paper (Standard & Poor’s rating of “A”“BBB” or above) which isare classified as “available-for-sale.”

Pursuant to Section 825-10 of the ASC, the Company at the end of a period, compares the actual market value to the actual cost and uses that calculation to determine any gain or loss on the maturity or sale of each available-for-sale investment.

The following is a summary of the fair value of investment securities classified as “available-for-sale” as of March 31, 20122013 and December 31, 2011.2012. For each item included in the table below the gains or losses from Fair Value reporting are included in income for the quarter.

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KAISER VENTURES LLC AND SUBSIDIARIES

Note 4. FAIR VALUE OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES

ASC 825-10 defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. ASC 825-10 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825-10 establishes three levels of inputs that may be used to measure fair value:

Level 1 - —Quoted prices in active markets for identical assets or liabilities.

Level 2 - —Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.

KAISER VENTURES LLC AND SUBSIDIARIES

Level 3 - —Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed is determined based on the lowest level input that is significant to the fair value measurement.

Our short-termshort and long-term investments in commercial paper and bonds represent available-for-sale securities that are valued primarily using quoted market prices utilizing market observable inputs in active markets for identical assets.

The following table presents information about our assets measured at fair value on a recurring basis at March 31, 20122013 and December 31, 2011,2012, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value.

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KAISER VENTURES LLC AND SUBSIDIARIES

In addition to the assets listed in the table, other short-term financial assets and liabilities of the Company consist of accounts receivable, accounts payable and certain accrued liabilities. These financial assets and liabilities generally approximate fair market value based on their short-term nature.

On April 2, 2012, Kaiser Recycling, LLC sold its 50% ownership interest in the West Valley MRF, LLC

Effective June 19, 1997, which owns and operates the WVMRF, a transfer station and materials recovery facility near Fontana, California. The gross cash sales price for the 50% ownership interest was approximately $25,769,000. The Company recorded a gain on the sale of $20,588,000 in the second quarter of 2012. Existing environmental obligations of the Company and Kaiser Recycling Corporation (“KRC”) (now Kaiser Recycling, LLC)benefiting West Valley MRF, LLC and West Valley Recycling & Transfer, Inc. (“WVRT”), a subsidiaryLLC (the owner of Burrtec Waste Industries, Inc. (“Burrtec”), which are equal members of West Valley MRF, LLC (“WVMRF”), (a California limited liability company) entered into a Members Operating Agreement (“MOA”) which is substantially the equivalent of a joint venture agreement for a limited liability company. The construction and start-up ofother 50% interest in the West Valley MRF was completed during December 1997.

Mostand the buyer of the financing for the construction ofKaiser Recycling’s ownership interest in the West Valley MRF of approximately $22 million,MRC, LLC) remain in place. An escrow originally totaling $363,000 was obtained through the issuance and sale of two California Pollution Control Financing Authority (the “Authority”) Variable Rate Demand Solid Waste Disposal Revenue bonds. The bonds are secured by an irrevocable letter of credit issued by Union Bank of California, N.A. (“Union Bank”).

KAISER VENTURES LLC AND SUBSIDIARIES

The payment schedule as of February 29, 2012,established to provide certain additional financial assurances for the California Pollution Control Authority bonds is summarized below.

Company’s and Kaiser Recycling, Inc.’s existing contingent environmental obligations. The Company also remains responsibleamount of this escrow was charged against the Company’s existing environmental reserve. Kaiser Recycling, LLC purchased an environmental insurance policy for any pre-existing environmental conditions on$113,621 which was paid from the land on whichescrow account, leaving a balance of $249,379 in the WVMRF is located, which is covered by insurance.escrow account.

The Company is accountingaccounted for its investment in West Valley MRF, LLC under the equity method.

Due to the time required to close the books of the West Valley MRF,WVMRF, LLC and in keeping with past practice, there iswas a one month delay in reporting the results of West Valley MRF,WVMRF, LLC. The condensed summarized financial information of West Valley MRF, LLC is as follows:

The increase in current assets between November 30, 2011 and February 29, 2012 is due primarily to an increase in cash. The decrease in Members’ Equity for the West Valley MRF between November 30, 2011 and February 29, 2012, is primarily due to the fact that cash distributions exceeded net income during this period.

The Company recognized equity income from the West Valley MRF, LLC of $298,000 and $539,000 for the first three months of 2012 andperiod from December 1, 2011 respectively.to February 28, 2012.

Our 50% ownership interest in the West Valley MRF, LLC was sold on April 2, 2012. For further information on this transaction, see “Note 9. SUBSEQUENT EVENTS.”

Note 6. EVALUATION OF LONG-LIVED ASSETS

In accordance with Section 360 of the ASC, long-lived assets are evaluated for potential impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Our reviewsreview as of March 31, 2012,2013, concluded that no impairment had occurred during the first quarter of the following long-lived assets had occurred:

KAISER VENTURES LLC AND SUBSIDIARIES

(a) our 50% ownership interest in the West Valley MRF because the West Valley MRF continues to generate significant net income2013 requiring consideration of a write-down and positive cash flow; and (b) our other real estate and building and equipment are recorded at the lower of cost or fair market values.

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With the denial of our appeal to the U.S. Supreme Court, our quarterly analysis pursuant to the ASC of whether the MRC investment in Eagle Mountain Landfill Project was impaired, resulted in a determination of impairment and a write-down of the carrying amount of the MRC investment in Eagle Mountain Landfill Project as of March 31, 2011. As required by GAAP, the impairment determination and resulting calculation of fair value of the carrying amount of the MRC investment in Eagle Mountain Landfill Project were made utilizing a probability analysis of the remaining options with regard to the Landfill Project after the U.S. Supreme Court declined to accept the petition requesting further review of the adverse U.S. 9^th Circuit Court of Appeals decision as of March 28, 2011. The total amount of the write-down was $6,683,000 which was charged to earnings in the first quarter of 2011. As of March 31, 2012, there were no events or changes in circumstances that indicated that the carrying amount of MRC’s investment in Eagle Mountain Landfill Project may not be recoverable. Possible further impairment in the MRC investment in Eagle Mountain Landfill Project resulting from MRC’s bankruptcy filing on October 30, 2011, may be required in the future as the impact of the bankruptcy filing is determined.KAISER VENTURES LLC AND SUBSIDIARIES

Note 7. COMMITMENTS AND CONTINGENCIES

Environmental Contingencies. As discussed in Note 2, effective June 30, 2001, the Company purchased a 12-year $50 million insurance policy which is expected to cover substantially any and all environmental claims (up to the $50 million policy limit) relating to the historical operations of the Company.Company that are filed prior to June 30, 2013. To the extent a pre-existing liability has not been recorded, claims made for environmental matters are recorded as litigation accruals in the Company’s consolidated financial statements pursuant to ASC 450-10 when it becomes probable that a loss has been incurred and the amount of such loss can be reasonably estimated. Claims accepted by the insurance company pursuant to coverage under the policy are recorded as insurance receivables when coverage is accepted and the amount to be paid by the insurance company can be reasonably estimated.

As of March 31, 2012,2013, the Company estimates, based upon current information and discussions with environmental consultants, that its future environmental liabilities related to certain matters not assumed by CCG Ontario, LLC in its purchase of a substantial portion of Kaiser’s former Fontana mill site property (“Mill Site Property”), including a certain groundwater matter as well as potential matters at Eagle Mountain and at other historical locations, will be approximately $2.7$2.3 million. In the event that a future environmental claim for damages is filed against the Company such claim may be covered by insurance depending upon the nature and timing of the claim.

In addition, an insurance policy covering certain possible contingent environmental and other related events that could arise and impact the WVMRF, LLC and others subsequent to the sale of the Company’s interest in the WVMRF, LLC was purchased by Kaiser Recycling during the second quarter. The policy premium of $113,621 was paid from the existing escrow account established by the Company at the time of the sale. These potential contingent environmental related events for which insurance coverage was purchased existed regardless of the sale of Kaiser Recycling’s ownership interest in WVMRF, LLC but such sale did accelerate the timing on fully addressing such potential contingent liabilities.

MRC Financing. Since Kaiser became an owner of MRC in 1995, MRC has been financed through a series of private placements to its existing equity owners. As a result of a private placement completed in September 2011 MRC raised total proceeds of approximately $1,300,000, of which amount Kaiser contributed $1,146,344, which increased Kaiser’s ownership interest in MRC from 83.13% to 84.247%.

Contingent DistributionsCompensation Expense on Class B, C and D Units. Upon the sale of certain of the Company’s assets at a price equal to or greater than certain minimum sales prices, distributionsadditional compensation payments will be made on the Class B, C and D Units in accordance with their respective terms. With the sale of Kaiser Recycling, LLC’s ownership interest in West Valley MRF, LLC, compensation payments totaling $771,000 were due and paid during the second quarter of 2012 in accordance with the terms and conditions of the Company’s Class C and D Units.

Restricted Cash.Restricted Cash consists primarily of certificates of deposit used to secure certain letters of credit that provide indemnification to governmental entities regarding landfill project approvals and mining rights and other mine related matters.

Note 8. RECENT ACCOUNTING PRONOUNCEMENTS

From time to time, new accounting pronouncements are issued byOn April 22, 2013, the Financial Accounting Standards Board (“FASB”)(FASB) issued an Accounting Standards Update (ASU) that are adoptedimproves financial reporting by clarifying when and how public and private companies and not-for-profit organizations should prepare statements using the liquidation basis of accounting. ASU No. 2013-07, Presentation of Financial Statements (Topic 205): Liquidation Basis of Accounting, is effective for interim and annual reporting periods beginning after December 15, 2013, with early adoption permitted. Under the new standard, an organization will be required to prepare its financial statements using the liquidation basis of accounting when liquidation is “imminent.” Liquidation is considered imminent when the likelihood is remote that the organization will return from liquidation and either (a) a plan for liquidation is approved by the company as of the specified effective date. Unless otherwise discussed,person or

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management believespersons with the authority to make such a plan effective and the likelihood is remote that the impactexecution of recently issued standards, which are not yet effective,the plan will not havebe blocked by other parties or (b) a material impact on the company’s consolidatedplan for liquidation is being imposed by other forces (for example, involuntary bankruptcy). The ASU requires financial statements upon adoption.

In September 2011,prepared using the FASB issuedliquidation basis of accounting to present relevant information about an accounting standards updateentity’s expected resources in liquidation by measuring and presenting assets at the amount of the expected cash proceeds from liquidation. The entity should include in its presentation of assets any items it had not previously recognized under U.S. GAAP but that gives anit expects to either sell in liquidation or use in settling liabilities. An entity the optionshould also recognize and measure its liabilities in accordance with U.S. GAAP that otherwise applies to first assess qualitative factors to determine whetherthose liabilities. The entity should not anticipate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. This guidance will be legally released from being the primary obligor under those liabilities, either judicially or by creditors. The entity also is required to accrue and separately present the costs that it expects to incur and the income that it expects to earn during the expected duration of the liquidation, including any costs associated with sale or settlement of those assets and liabilities. Additionally, the ASU requires disclosures about an entity’s plan for liquidation, the methods and significant assumptions used to measure assets and liabilities, the type and amount of costs and income accrued, and the expected duration of the liquidation process. If the dissolution of the Company is approved by its Class A members, the Company will be required to change its basis of accounting to liquidation accounting effective for annual goodwill impairment tests performed for fiscal years beginning after December 15, 2011,as of the earliest practicable date in accordance with early adoption permitted. TheU.S. GAAP. If such approval is obtained, the adoption of the guidance did not have a material impact on the consolidated financial statements.

In June 2011, the FASB issued guidance regarding the presentation of comprehensive income. The new standard requires the presentation of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The new standard also requires presentation of adjustments for items that are reclassified from other comprehensive income to net income in the statement where the components of net income and the components of other comprehensive income are presented. The updated guidance is effective on a retrospective basis for financial statements issued for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2011. The adoption of this guidance did notexpected to have a material impact on our consolidated financial statements.

In May 2011, the FASB issued additional guidance on fair value measurements that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. The updated guidance is effective on a prospective basis for financial statements issued for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2011. The adoption of this guidance did not have a material impact on our consolidated financial statements.

Note 9. SUBSEQUENT EVENTS22

On April 2, 2012, Kaiser Recycling, LLC sold its 50% ownership interest in the West Valley MRF, LLC which owns and operates the WVMRF, a transfer station and materials recovery facility near Fontana, California. The gross cash sales price for the 50% ownership interest was approximately $25,768,000. The Company will record a gain on the sale of approximately $20 million in the second quarter of 2012. Existing environmental obligations of the Company and Kaiser Recycling benefiting West Valley MRF, LLC and West Valley Recycling & Transfer, LLC (the owner of the other 50% interest in the West Valley MRF and the buyer of Kaiser Recycling’s ownership interest in the West Valley MRC, LLC) remain in place. An escrow of $363,000 was established to provide certain additional financial assurances for the Company’s and Kaiser Recycling, Inc. environmental obligations. In addition, the Company’s guaranty of certain outstanding debt of West Valley (approximately $5,820,000 as of March 31, 2012) was terminated.

With the completed sale of the ownership interest in West Valley MRF, LLC, compensation related actions were implemented under the previously disclosed terms of applicable compensation arrangements for officers and under the terms of the Company’s Class C and D Units. In accordance with the terms and conditions of the Company’s Class C and D Units $770,735 was due and paid as distributions on such units. In addition, a bonus of approximately $173,000 was paid to an officer in accordance with the terms of his employment agreement.

On May 9, 2012, the Company’s Board of Managers declared a distribution of $1.50 per Kaiser Class A Unit to unitholders of record as of such date.

The Board of Managers also confirmed that a “Change in Control” occurred under the terms of the Amended and Restated Services Agreement, as amended, between the Company and Business Staffing, Inc. and under the terms of the employment agreement of each executive officer. A “Change in Control” requires the funding, but not the payment, of severance benefits.

KAISER VENTURES LLC AND SUBSIDIARIES

PART II

As discussed in our Annual Report on Form 10-K for 2011,2012 we are engaged in certain claims and litigation. As of the date of the filing of this Report on Form 10-Q, there have not been any material developments in the legal proceedings involving the Company from the date of the filing of our Report on Form 10-K for the period ended December 31, 2011,2012, except as noted below.

MRC/Landfill Project.As discussed under “Part I - Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS – BUSINESS UPDATE”, MRC filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for Central District of California, Riverside Division, bankruptcy case number 6:11-bk-43596 (the “Bankruptcy Court”). MRC continues to operate its business as a “debtor in possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, Rules and orders of the Bankruptcy Court.

On March 14, 2012, Eagle Crest Energy Company (“ECEC”) filed a declaratory relief action in the Bankruptcy Court against MRC, KEM and Kaiser LLC. ECEC is seeking to permit a proposed hydro-electric pumped storage project at the Eagle Mountain Site. The lawsuit seeks declaratory relief only and not damages. In summary, the suit seeks a declaration from the Bankruptcy Court stating that ECEC’s right of eminent domain (with ECEC assuming it would have such a right) and the process of seeking a license from FERC is not impacted by MRC’s bankruptcy. MRC, Kaiser LLC and KEM are seeking dismissal of such suit.

On March 30, 2012, the District filed a proof of claim in MRC’s bankruptcy case. While the amount of the District’s claim is not certain from its proof of claim, it asserts that the claim could amount to or exceed “hundreds of millions of dollars.” The District further claims that it will seek recovery of its damages from Kaiser LLC independently of the bankruptcy proceeding. However, no legal proceeding against Kaiser LLC has been commenced as of the date of the filing of this Report on Form 10-Q. Kaiser LLC and MRC will vigorously defend the allegations asserted by the District, including asserting claims against the District and others as may be appropriate.below:

Iron Partners Litigation Settlement Completed.. The anticipated trialIn April 2008, the Company, along with KSC Recovery, Inc. (the Kaiser Steel Corporation bankruptcy estate), and the federal government were sued by Iron Partners LLC in the U.S. District Court for the Western District of Washington (Iron Partners, LLC v. Maritime Association, United States Department of Transportation, et al litigation., U.S. District Court, Western District Washington at Tacoma, Case No. C08-5217 RJB). This case was postponed from April 2012tentatively settled in the fourth quarter of 2012. The settlement agreement and all payments required pursuant to late 2012.the settlement agreement were completed in the first quarter of 2013. The full amount of the Company’s share of the settlement was paid by one of the Company’s insurance carriers.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not applicable.

Item 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

Item 4. RESERVED

Not applicable.

Item 5.

OTHER INFORMATION

As discussed in more detail under Item 5. OTHER INFORMATION

On1 above, on April 2, 2012,10, 2013, the Board of Managers held a meeting at which it approved the sale by Kaiser Recycling of its ownership interest in WVMRF, LLC. With the completed sale of the ownership interest in WVMRF, LLC, compensation related actions were implemented underCompany adopted a revised Plan of Dissolution and Liquidation for the previously disclosedCompany and approved a revised Second Amended and Restated Operating Agreement for the Company (the “Revised Restated Agreement”), which are both subject to approval by the Company’s Class A members.

In connection with the approval of the revised Plan of Dissolution and Revised New Operating Agreement the Company entered into an Amended and Restated Liquidation Manager Agreement dated as of April 10, 2013 with Richard E. Stoddard (the “Revised Liquidation Manager Agreement”) and consented to the First Amendment effective as of April 10, 2013 (the “Amendment”) to the Transition Employment Agreement between James F. Verhey, the Company’ Executive Vice President-Finance and Chief Financial Officer, and Business Staffing, Inc. (“BSI”) dated effective January 1, 2013 (the “Verhey Transition Agreement”) The material terms of applicable compensationthe Revised Liquidation Manager Agreement and the Amendment are more fully discussed below.

Effective April 10, 2013, the Company entered into the Revised Liquidation Manager Agreement with Richard E. Stoddard, the Company’s current President, Chief Executive Officer, and Chairman of the Board of Managers primarily to reflect its agreement with Mr. Stoddard on the nature of a contingent fee to be payable to him as the “Liquidation Manager” under certain circumstances. The Revised Liquidation Manager Agreement amends and restates the Liquidation Manager Agreement entered into by the Company and Mr. Stoddard on

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KAISER VENTURES LLC AND SUBSIDIARIES

arrangements for officersJanuary 15, 2013 (the “Original Agreement”). Although the Board approved and underentered into the terms ofRevised Liquidation Manager Agreement, such agreement does not become effective until the approval by the Company’s Class C and D Units. In accordance with the terms and conditionsA members of the Company’s Class CRevised Plan and D Units $770,735 was duethe Revised Restated Agreement and paidpending such approval, Mr. Stoddard’s Transition Employment Agreement with BSI will remain in place.

The following summary is qualified in its entirety by the full text of the Revised Liquidation Manager Agreement, which is filed as distributionsExhibit 10.1 to the Company Current Report on such units. In addition, a bonusForm 8-K dated April 10, 2013, and is incorporated herein by reference. With the exception of approximately $173,000 was paidthe changes described below, the Revised Liquidation Manager Agreement makes no material modifications to Mr. Verhey in accordance with the terms of his employment agreement. These items will be charged to compensation expense on the Company’s financial statements for the second quarter of 2012.

On May 9, 2012, the Board of Managers declared a distribution of $1.50 per Kaiser Class A UnitOriginal Agreement as originally filed as Exhibit 10.1 to the Company’s unitholders of recordCurrent Report on such date. Such distribution has been sentForm 8-K dated January 18, 2013.

The Revised Liquidation Manager Agreement makes two changes to the Company’s unitholders.

In addition,compensation payable to Mr. Stoddard in his capacity as Liquidation Manager as originally contemplated by the Board of Managers at such meeting took the following additional actions:Original Agreement, as follows:

Exhibit 10.1^* - Second Amendment to the Employment Letter Agreement of Gerald A. Fawcett dated May 9, 2012.^**

Exhibit 10.2 - Second Amendment to the Amendment Restated Administrative Services Agreement dated May 9, 2012.^**

Exhibit 31.1 - —Certificate of Richard E. Stoddard, Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a).**

Exhibit 31.2 - —Certificate of James F. Verhey, Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a). **

Exhibit 32 - —Certificate of Richard E. Stoddard, Chief Executive Officer, and James F. Verhey, Chief Financial Officer, pursuant to Section 1350. **

Exhibit 101 - —The following materials from Kaiser Ventures LLC’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012,2013, formatted in XBRL (eXtensible Business Reporting Language); (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Statements of Income; (iii) Condensed Consolidated Statements of Cash Flows; (iv) Condensed Consolidated Statements of Shareholders’ Equity; and (v) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.^**

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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