Penn Future - Current Cases - Citizens for Pennsylvania's Future: Working to Protect Pennsylvania's Environment and Economy

Pennsylvania Coal Mine Bonding Program – ABS Program Amendment

Location: Statewide

Client(s): Pennsylvania Federation of Sportsmen's Clubs Inc., Pennsylvania Chapter Sierra Club, Pennsylvania Trout Inc., Tri-State Citizens Mining Network Inc., Mountain Watershed Association Inc., PennFuture

Counsel: Kurt J. Weist

Summary: Ensure that Pennsylvania's bonding program for coal mines meets the minimum standards of federal law, and specifically the requirements of 30 C.F.R. § 800.11(e)(1), as interpreted in the decision of the U.S. Court of Appeals in PFSC v. Kempthorne, 497 F.3d 337 (3d Cir. 2007).

Forum: Office of Surface Mining Reclamation and Enforcement

Docket Number: OSM 2008-0021 and OSM-2010-0017

Developments:

In November 2012, Pennsylvania made a third submission of information to OSM. OSM opened a 15-day public comment period on February 19, 2013. Our coalition submitted a comment letter and supporting information on March 5, 2013.

Background
As a result of the decision of the U.S. Court of Appeals in PFSC v. Kempthorne, 497 F.3d 337(3d Cir. 2007), which is discussed in Pennsylvania Coal Mine Bonding Program -- Review of Federal Agency Actions, Pennsylvania dramatically revised and completed a state rulemaking proceeding during 2008. It included the regulations promulgated through that proceeding in a proposed amendment to its state coal mining regulatory program submitted to the federal Office of Surface Mining Reclamation and Enforcement (OSM) on August 1, 2008. The proposed amendment, known as the "ABS Program Amendment," seeks OSM's approval of Pennsylvania's use of site-specific trust funds as mine drainage treatment guarantees. The amendment also asks OSM to approve two new statewide trust accounts created by the 2008 state rulemaking proceeding.

On behalf of the coalition of organizations, PennFuture submitted comments on the ABS Program Amendment to OSM on February 27, 2009. The comments request that OSM:

partially approve Pennsylvania's use of site-specific mine drainage treatment trust funds as an alternative bonding system, while imposing conditions designed to correct such problems as authorizing the trustee to hold an excessively risky investment portfolio containing up to 80 percent stocks, and assuming that any equities in the portfolio will earn an average rate of return of 11.1 percent;
partially approve Pennsylvania's new statewide trust accounts, subject to conditions designed to ensure that the accounts will guarantee the treatment of discharges from all existing and potential "ABS Legacy Sites" in perpetuity;
defer ruling on provisions of Pennsylvania's proposal that would allow the new trust accounts to be funded through appropriations, or with "other monies" not specifically identified in the submission, until a specific appropriation is made or specific alternative source of funding is identified.

On August 10, 2010, OSM issued a final rule partially approving Pennsylvania's August 1, 2008 program amendment. Among other things, OSM's final rule:

sidestepped many issues raised by our coalition concerning the use of trust funds, and specifically how PADEP calculates the amount of money that must be deposited in a trust fund to guarantee perpetual treatment of a post-mining discharge. Although finding that our comments provided "potential cause for concern," OSM did not decide most of the issues we raised.
affirmed several of our coalition's comments, and in response to one of them, required Pennsylvania to submit another program amendment by October 12, 2010 to provide land reclamation guarantees for two large anthracite mines, including the former Lehigh Coal and Navigation open pit mine in Schuylkill and Carbon Counties.

In accordance with OSM's final rule, Pennsylvania submitted a new program amendment to OSM on October 1, 2010. The new submission provided details about the amounts of money available in the state's Surface Mining Conservation and Reclamation Fund to complete the reclamation of the two anthracite mines at issue in the event the mine operators fail to do so.

On March 9, 2011, PennFuture submitted the coalition's comments to OSM on Pennsylvania's October 1, 2010 program amendment. The comments objected that the state's new submission repeated its earlier mistake by focusing on the amount of money available, but failing to demonstrate that the state has an enforceable obligation to use that money to reclaim the two anthracite mines at issue.

Three months later, in June 2011, Pennsylvania submitted supplemental information to OSM. In mid-October, OSM published a notice giving the public 15 days to comment on Pennsylvania's supplemental submission. On November 1, 2011, our coalition submitted a second set of comments to OSM, once again explaining why Pennsylvania had failed to demonstrate that the reclamation of the mines at issue was fully guaranteed.

Pennsylvania submitted still more information to OSM in November 2012. In response to another 15-day comment deadline, our coalition submitted a new comment letter and supporting information to OSM on March 5, 2013. Most of our comments explained why the adequacy of the dollar amount of the discharge “treatment trust” for one specific mine is at issue in this proceeding, and why, as a result, OSM must address a series of issues we had raised in the 2008-2010 ABS Program Amendment proceeding, which OSM had declined to decide without site-specific information.

Supporting documents