Members of a U.S. Senate committee Wednesday morning approved legislation aimed at preserving the health care benefits and pensions for thousands of union coal miners and their families.
The Senate Finance Committee approved by a vote of 18-8 the Miners Protection Act, which is being pushed by the United Mine Workers union and by members of West Virginia’s congressional delegation.
While neither Sen. Joe Manchin, D-W.Va., nor Sen. Shelley Moore Capito, R-W.Va., serve on the finance panel, both had been pushing for the bill and, in June, secured an agreement from the Senate’s Republican leadership that the measure would get a fair hearing in committee sometime this month.
Senate Majority Leader Mitch McConnell, a Republican from coal-producing Kentucky, previously blocked a similar provision from being included in a federal budget bill.
Manchin said that Wednesday’s committee vote takes the legislation “one step closer” to passage, and Capito emphasized that the bill has bipartisan support — half of the bill’s 20 sponsors are Republicans — that should help it in coming months.
“She remains hopeful that the bill will come to the Senate floor before year’s end and is doing everything she can to make that happen,” said Ashley Berrang, a Capito spokeswoman.
“Now that this important first step has been achieved, it is vital that Congress move as quickly as possible to finally pass this legislation that will mean so much to the lives of thousands of senior citizens across America,” UMW President Cecil Roberts said. “There is no more time to waste.”
Retired miners are facing uncertainty because a key UMW pension plan is severely underfunded after suffering significant investment losses during the 2008 Wall Street financial crisis and the downturn in the coal industry that has forced some major operators into bankruptcy court.
If the plan becomes insolvent, the miners and their families face benefit cuts and the federal Pension Benefit Guarantee Corp. will assume billions of dollars in liabilities.
About 89,000 miners or family members currently receive pensions, and another 22,000 have vested in the plan, but are not yet receiving pensions, according to the UMW.
Also in financial trouble are the health care benefits of about 22,000 miners who could see those benefits cut off by the end of the year because of coal industry bankruptcies.
The UMW-backed legislation would allow the pensions and benefits to be funded through part of a transfer of up to $490 million a year in general tax dollars that already flows through the federal Abandoned Mine Lands program, as part of the complex formula that provides additional money for the abandoned mine cleanup program and UMW benefit programs.
New estimates provided by the Congressional Budget Office show the legislation would funnel an average of $220 million a year to the UMW benefit and pension programs between 2017 and 2016, or a total of more than $2.2 billion over that decade.
The eight votes against the legislation came from Republican Finance Committee members, who complained that Obama administration environmental regulations have destroyed the coal industry and, in doing so, put UMW health-care benefits and pensions at risk.
“You can’t be trying to crush the industry with one hand and bail it out with another,” said Sen. Mike Enzi, a Republican from Wyoming, which is the nation’s largest coal-producing state, but has few UMW-represented mining operations.
Sen. Sherrod Brown, D-Ohio, reminded committee members that while environmental regulations have affected the coal industry, the mining downturn was largely caused by competition from low-priced natural gas.
“To be honest about this, if you’re going to be blaming everything on the Obama administration, and I know that’s sort of a cottage industry in this body, then I think you ought to be a little bit more honest about the role of the price of natural gas,” Brown said.
Enzi and other Republicans said they also objected to the concept of bailing out the UMW pension plan with general taxpayer dollars from the U.S. Treasury, saying that doing so sets a bad precedent for other multi-employer pension plans around the country that also are facing serious financial problems.
The Miners Protection Act is the most recent in a long line of federal government actions aimed at protecting coal miners, whose work often leaves them sick or disabled but whose industry has frequently tried to dodge long-term liabilities for health care benefits and pensions.
Those government actions date back to the 1940s, when creation of a health and welfare fund for miners through a deal between legendary UMW President John L. Lewis and then-Interior Secretary Julius A. Krug helped end a stalemate between the union and the government, which had seized the nation’s mines in response to a strike.
More recently, Congress passed legislation in 1992 to preserve benefits for UMW retirees as coal companies tried to abandon the union’s national contract and benefit programs. And since 1995, interest on the federal AML program’s trust fund — a fund that comes from coal industry taxes — was diverted to ensure health care benefits for retirees.
In a new memo made public Wednesday by Enzi, the Congressional Research Service concluded that, while the federal government might not have an absolute legal “obligation” to provide health care and pension benefits for retired miners, the Krug-Lewis agreement from 1946 “has been recognized as an expression of the federal government’s interest in making medical and other benefits available to mine workers.”
UMW spokesman Phil Smith said, “We have never maintained at any time that the United States government had a legal obligation to fund these benefits. If we believed that it did, we would be in court, not in Congress. That said, we continue to believe that the Congress has a moral obligation to these retirees and widows and note that Congress itself has lived up to that obligation repeatedly over the years.”
Reach Ken Ward Jr. at email@example.com, 304-348-1702 or follow @kenwardjr on Twitter.