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Group fights to keep fees on exported coal
Tuesday, June 17, 2008

The fight over whether coal companies should be required to pay millions of dollars in federal royalties on the rapidly increasing amounts of coal mined for export has moved from the courts to Congress.

Just days after a federal appeals court ruled that the royalty payments used to reclaim thousands of acres of abandoned mine land don't violate the export clause of the U.S. Constitution, language inserted into an unrelated tax bill would mandate refunds of what it calls "excise taxes" on exported coal.

The Pennsylvania AML Campaign, a coalition of 200 conservation and community organizations, yesterday urged U.S. Sens. Arlen Specter and Bob Casey Jr. to reject and remove the language, saying it would reduce the amount of money available to fix dangerous and degraded abandoned mine lands and polluted streams.

U.S. coal exports increased 19.2 percent last year to 59.2 million tons, about 6 percent of the 1.12 billion tons mined, and are expected to continue to rise to meet growing demand in China and India.

"The coal industry sued to stop paying the cleanup funds on exported coal and lost," said R. John Dawes, co-chairman of the AML Campaign. "Now they're moving to 'Plan B' to try to fix it legislatively. It's tactical and we need someone to delete the language or insert a disclaimer saying none of the inserted language pertains to abandoned mine land programs. That would be an easy fix."

A Senate cloture vote on the legislation, which already has passed the U.S. House of Representatives, is scheduled for 2:30 p.m. today. Neither of the state's senators was available for comment on the AML Campaign request yesterday.

In December 2006, when the federal Abandoned Mine Lands Fund was reauthorized, the fees assessed on mined coal that support the fund were reduced to 31.5 cents a ton for surface-mined coal and 13.5 cents a ton for deep-mined coal.

Pennsylvania, which has 184,000 acres of unreclaimed abandoned mine land -- more than any other state -- and 4,600 miles of mine-polluted streams, is projected to get $1.36 billion over the next 18 years for land and stream restoration. That amount would be reduced by millions if fees paid on coal exports are refunded.

Bethel Park-based Consol Energy and its subsidiaries were among 68 coal mining and trading companies that challenged the legality of the royalties that have been assessed since 1977 on every ton of mined coal and bring in millions of dollars a year to the Abandoned Mine Lands Fund. The companies argued that the fees were taxes on exports, which the Constitution's export clause forbids.

But the U.S. Court of Appeals for the Federal Circuit ruled Wednesday that the money collected by the U.S. Office of Surface Mining is a fee on the produced or extracted coal, not a tax imposed on the sale of the coal. Mining companies involved in the case could appeal the decision to the U.S. Supreme Court.

Don Hopey can be reached at dhopey@post-gazette.com or 412-263-1983.
First published on June 17, 2008 at 12:00 am
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