The U.S. Office of Surface Mining waited far too long to force West Virginia officials to fix a bankrupt abandoned mine reclamation system, a federal judge ruled Friday. Chief U.S. District Judge Charles H. Haden II said that OSM "unreasonably delayed" taking over the state's mine bonding program.
Since 1991, OSM officials have said that the state doesn't make coal operators post large enough bonds to pay to reclaim mine sites that they abandon. OSM has repeatedly told the state to reform the system. But federal officials have done nothing when the state ignored those orders. Last year, the West Virginia Highlands Conservancy filed a federal court lawsuit. The group's lawyers asked Haden to force federal intervention. In his Friday ruling, Haden did not order OSM to immediately take control of strip mine bonding in the state. But the judge refused - as OSM had requested - to throw out the case. Instead, Haden said that he would make sure there were no further delays and that neither the state nor OSM implement changes that fall short of a long-term solution.
In a 22-page opinion, Haden also condemned regulators, politicians and coal operators who he said profit by ignoring federal strip mining regulations. "The direct consequences of [OSM's] decade-long delay have been examined here before: thousands of acres of unreclaimed strip-mined land, untreated polluted water, and millions (potentially billions) of dollars of state liabilities," Haden wrote. "The indirect results, however, may be more damaging: a climate of lawlessness, which creates a pervasive impression that continued disregard for federal law and statutory requirements goes unpunished, or possibly unnoticed," he wrote. "Agency warnings have no more effect than a wink and a nod, a deadline is just an arbitrary date on the calendar and, once passed, not to be mentioned again.
"Financial benefits accrue to the owners and operators who were not required to incur the statutory burden and costs attendant to surface mining; political benefits accrue to the state executive and legislators who escape accountability while the mining industry gets a free pass," the judge wrote. "Why should the state actors do otherwise, when the federal regulatory enforcers' findings, requirements and warnings remain toothless and without effect?" Under the 1977 Surface Mining Control and Reclamation Act, states are allowed to regulate their own coal industries. Congress created OSM to watch over the states, and make sure they do a good job. Among other things, SMCRA requires states to make coal companies post reclamation bonds before they receive new mining permits. The idea was to make sure that mines abandoned after 1977 were cleaned up properly. Older mines that were abandoned before 1977 are cleaned up with a separate pool of money from a federal coal production tax. Under federal rules, states may adopt two types of bonding systems. Under one type of bonding, coal companies must post bonds that would cover the full cost of reclaiming their mine sites. If companies go belly up, they forfeit their bond money. States use the money to clean up the mine sites. In this kind of bonding, bond amounts, "shall be sufficient to assure the completion of the reclamation plan if the work [has] to be performed by the regulatory authority in the event of forfeiture," federal mining law states. Under the second type, coal company bonds do not have to cover the full reclamation costs. Companies can post much smaller bonds. But state regulators must maintain enough money in a bond fund to reclaim any sites that companies abandon. In West Virginia, the DEP uses the second type of bonding plan. This is known as an "alternative bonding" system. Bonds are capped at $5,000 per acre. This amount often doesn't cover the entire cost to reclaim an abandoned mine site. So all coal companies pay a small tax that is supposed to provide enough additional money to reclaim sites where the bond wasn't sufficient. This system has never been adequate. The $5,000-per-acre cap on bonds kept bonds from being sufficient to cover reclamation of abandoned sites. The state's 3-cents-per-ton tax on coal didn't generate enough money, either. Because of the inadequate funding, at least 15,000 acres of abandoned mines across the state remain unreclaimed. At more than 200 mine sites, a toxic stew of untreated mine runoff poisons streams. In 1991 and again in 1995, OSM ordered the state to fix the problem. "Instead, the state [DEP] continued to approve surface mining permits although the state's program ... demonstrably was inadequate for the state to reclaim the land and treat water should the bonds be forfeited," Haden wrote. "The state did nothing and OSM did nothing." Haden said that, under federal law, if the state fails to remedy a deficiency in its regulation of coal mining, OSM must act. "The statutory timeline for both the state and the [OSM] to act are short: 60 days," the judge wrote. OSM, the judge ruled, must either substitute federal enforcement for all or part of the state's program, or recommend that the Secretary of Interior revoke the state's ability to regulate its own mining industry. Haden noted that OSM did neither of these until June 29 of this year, the date that agency lawyers had to file a response to the Conservancy's lawsuit. "Thus, almost 10 years had passed before the impetus of this litigation finally led the Director to initiate the necessary corrective process," the judge said. On June 29, OSM gave the state until 45 days after the close of the 2002 legislative session to fix its bonding system. If the state didn't act by then, acting OSM Director Glenda Owens said that her agency would take over the bonding program. In early August, DEP Secretary Michael Callaghan announced that he had negotiated a deal with the coal industry on a fix. Under the deal, which Callaghan worked out privately with coal lobbyists, the state would increase its special reclamation tax from 3 cents per ton to 14 cents per ton for the next three years. After that, the tax would drop to 7 cents per ton. In his ruling, Haden did not mention the DEP-industry deal. The judge noted the OSM deadline of 45 days after the 2002 legislative session for the state to approve some kind of reform. "The Court intends to ensure the deadlines ... are honored," Haden wrote. "Additionally, while the Court does not intend to substitute its limited wisdom for that of the agency, any potential solution to the problems identified with the State alternative reclamation bonding system will be measured against the failures documented in the record so the Court may assure itself appropriate relief is available when legislative and administrative processes are exhausted or found futile." Haden ruled that Conservancy lawyers can continue to collect evidence for their suit. He also required the parties to report every six weeks to him "concerning progress toward meeting OSM's deadlines." The judge also said that DEP's proposed fix for the bonding program must be provided to the Court when it is filed with OSM.