Call it the Civil War on Coal.
For some time now, coal communities across America have pilloried the Obama administration for regulations they say will kill the industry. Now those same towns are fighting each other along an East-West divide over a pot of money that could spur economic recovery in downtrodden Appalachian locales.
At issue is the Abandoned Mine Lands reclamation fund, a program created by Congress in 1977 that has drifted from its mission of fixing up old mine sites that pollute waterways and scar mountaintops. Funded by a fee based on production imposed on coal-mining companies, states were supposed to receive half the money as a way to speed reclamation of mines abandoned before 1977, which Appalachian states have looked to for rehabilitating land to buoy economic prospects.
But soon after Congress established the program, mining in Appalachia — home to a bulk of the sites that must be cleaned up — cratered while Western mining, particularly in Wyoming, boomed. The Appalachian decline began in the 1980s after companies had tapped most of the more easily mined coal. Then a 1990 expansion of the Clean Air Act that aimed to reduce acid rain cemented the shift to using low-sulfur Western coal. Since the law requires that states be repaid based on how much they put into the program, Western states that now produce more coal get a bulk of the money though they have far fewer pre-1977 abandoned mines than Ohio, Pennsylvania, Kentucky, Tennessee, Virginia and West Virginia.
About $4.2 billion of high-priority cleanup sites remain, with $3 billion of the currently unfunded sites in Appalachia, according to the Interior Department's Office of Surface Mining Reclamation and Enforcement.
The Appalachian states want Congress to change the payment formula so that they can get the money to clean up those sites, while Wyoming's boosters say the state has been historically underfunded and needs the money now.
"I've tried over the years to do this — always hit a barrier because the East and West U.S. are competing and blocking each other from getting access to those funds, and consequently we can't get any consensus toward passing a bill," House Appropriations Committee Chairman Hal Rogers, R-Ky., recently told the Washington Examiner. "So you know, I'd like nothing better than to break open that Abandoned Mine Lands fund of money ... and get at it for the purposes that we're talking about. But it's just been impossible so far."
The interest in addressing the program comes as President Obama is preparing a big push on a proposal to change how the fund pays states. The White House budget calls for changing the program's formula to speed $1 billion in payments over five years to Appalachian communities hardest hit by coal's woes to patch up old mine sites in hopes of driving economic development.
House Natural Resources Committee Chairman Rob Bishop, R-Utah, told the Examiner that he plans to look at reforming the Abandoned Mine Lands fund, possibly as soon as the fall. He's not necessarily looking to acquiesce to Appalachian states, saying gruffly that the push is "obviously coming from leadership," a nod to Rogers.
But House lawmakers are running into the same traps that have derailed previous attempts to tweak the program. While Bishop is looking at changes, he wants to protect his Western brethren as well, saying he wants to correct "unfairness" done to Wyoming. Bishop also isn't sure that he will include any provisions to hasten payments to Appalachian states.
"There are just other states that are in the same position," he said. "If you close down arbitrarily a coal mine, you close down a coal mine. That community is hit whether they're part of Kentucky or they're someplace else where that coal mine is hit. It's the same devastation."
The program has collected more than $10.5 billion in fees from coal companies, according to the Interior Department. It has paid out $8 billion of that to states and the United Mine Workers of America, the union that gets interest accrued through the fund to help pay coal miners' healthcare costs (the union estimates that accounts for $30 million annually).
But those payments have slowed significantly. The "unfairness" Bishop speaks of refers to when Congress essentially turned off the fund's spigot in 2012 by capping payouts to states at $15 million annually, instead using the money to pay for a two-year highway funding bill. A measure concerning the nation's helium supply raised the cap to $28 million in fiscal 2014 and $75 million in fiscal 2015, but it is expected to return to $15 million with the start of the new fiscal year Oct. 1.
The limit hurt Wyoming, which six years earlier won big changes that boosted funds to the state to correct historical underpayment. The cap was partly a backlash from abuse of a 2006 measure that allowed the funds to be used on non-coal abandoned mines — particularly because Western native tribes live near a number of abandoned uranium mines, which lack a similar cleanup fund. But money from the fund went to build basketball courts and shopping centers. As a result, the Cowboy State received $13.5 million from the fund in 2013, compared with $150 million the previous year.
The lack of payments came to a head for Wyoming Republican Rep. Cynthia Lummis in June. She told the Examiner that her vote against allowing President Obama to gain trade promotion authority, which went against House GOP leadership, was a protest against the lack of attention the payment cap had received. The stance cost Lummis her job on Majority Whip Rep. Steve Scalise's team.
"My frustration finally reached its limits [on that June vote] which was why I voted against the rule," she said, later adding, "Wyoming is being viewed as a slush fund and I feel like Wyoming's been stabbed in the back and I take it personally. So I have really strong feelings about this."
Many of those issues could be addressed in a looming reauthorization battle, as the fund would end in 2021 without new legislation. Skirmishes over whether to lower the per-ton fee or change the payout formula await.
The Obama administration has been touting its proposal partly to get ahead of those talks. Obama promoted his plan when announcing the first-ever carbon emissions limits for power plants Aug. 3, which conservatives and the industry contend will raise power costs and kill coal.
"They'll claim this plan is a 'war on coal,' to scare up votes — even as they ignore my plan to actually invest in revitalizing coal country, and supporting health care and retirement for coal miners and their families, and retraining those workers for better-paying jobs and healthier jobs," Obama said about opponents of the rule.
The mismatch between goal and execution has long been recognized. Under former President George W. Bush, Interior Secretary Gale Norton proposed a 2004 change that would have shifted more dollars to Appalachian communities. The agency said there was a "fundamental imbalance between the goals ... and the requirements for allocating funds" because "there is no relationship between current production and the magnitude of the [abandoned mine land] problem in each state."
Lawmakers, though, have bristled at some of the requirements in the White House proposal, such as having states work with specific nonprofit groups to access the funds. They also complain the Obama administration's plan is short on details as to how to execute an alteration to the payout formula.
Recognizing the East vs. West issue, and in an effort to offer an alternative to Obama's proposal, the House included a $30 million pilot program in the fiscal 2016 House Interior and Environment Appropriations bill for mine reclamation in Appalachian areas. It's a work-around that Rogers said will have to suffice if Western lawmakers block alterations to the Abandoned Mine Lands fund.
"They don't want to see us change the formula that would give the Eastern states what they say is an advance. So, consequently, they've protected it," Rogers said.