Stiff fines proposed for large coal mine operators
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Large coal mine operators who violate safety regulations -- and repeat offenders in particular -- will face much stiffer fines under proposed federal rules for assessing civil penalties.
The federal Mine Safety and Health Administration yesterday released its proposed rule for civil penalty assessments and announced six hearings for public comment, including an Oct. 19 hearing at the Pittsburgh Airport Marriott.
The 21-page listing in the Federal Register sets out a new structure for assessing fines, increases penalty points and reduces the discount mine operators currently receive for quickly correcting a problem.
MSHA officials estimate that, under the proposed rate structure, the average penalty assessment for all mines would increase from $213 to $587, and that total assessments will increase from $24.9 million to $68.5 million.
In the proposal, MSHA officials say current penalty assessments "are often too low to be an effective deterrent for noncompliance at some of the largest operations."
In a statement yesterday, Department of Labor Acting Assistant Secretary David G. Dye, who heads MSHA, said "we anticipate that these stronger penalties will induce mine operators to improve their safety and health programs."
The proposal drew criticism from both industry and labor groups, though for opposite reasons.
"It seems once again MSHA believes, as we do not, that safety is a function of fines. In proposing to raise them substantially, the agency mistakenly believes that this will bring a corresponding improvement in safety," said Luke Popovich, spokesman for the National Mining Association.
"Fundamentally, we disagree. No fine even approximates the cost of the down time to a company, let alone the human toll it suffers, from a serious mine accident."
Instead, Mr. Popovich suggested that improved safety would come from better technology, better training and "a more rational allocation of inspection resources to high-risk areas."
Meanwhile, the United Mine Workers of America officials say they believe the proposed rule falls short.
"The new fine schedule continues to be too modest to have the maximum deterrent effect that Congress intended," said Judy Rivlin, attorney for UMWA.
She further noted that setting fines is only one part of enforcement, that currently fines are too often reduced or not even collected.
Longtime mine safety advocate Tony Oppegard, an attorney representing some families of the five miners killed at the Kentucky Darby Mine in May, agrees.
"We have two mine operators in eastern Kentucky that owe $1 million in fines, and they haven't paid them in years, but they continued to get new mine licenses," he said.
"There should be some type of provision that operators who have not paid fines are barred from getting new permits."
Mr. Oppegard also questioned the provision that gives mine operators a 10 percent reduction on fines if they fix the problem promptly. Currently, the reduction is 30 percent.
"I don't understand the rationale for that. It should be eliminated entirely," he said.
One major change in the proposed rule is the elimination of single penalty assessments for minor offenses, which now carry a $60 fine.
Eliminating the single penalty "will cause mine operators to focus their attention on preventing all hazardous conditions before they occur and promptly correct those violations that do occur," according to the proposal.
The proposal also institutes fines of $5,000 to $60,000 if mine operators fail to notify officials of an incident within the required 15 minutes.
The proposal ratchets up penalties for the most flagrant violations and the number of penalty points assessed would rise dramatically, with each penalty point increasing the fine.
For example, if investigators conclude that a mine operator should have anticipated an incident, the new proposal would assess 50 penalty points instead of 10. If negligence is involved, the number of penalty points jumps from 25 to 50.
Similarly, a mine operator who violates the same safety standard 10 times in a 15-month period would be assessed 10 penalty points.
A MSHA analysis from Jan. 1, 2005 through March 2006, showed that 698 of the 10,227 mines cited for violations had six violations of the same standard, and 99 of 698 had more than 20 violations of same standard during the 15 months.
If an operator has 60 or fewer penalty points, the fine would increase $112. But at 100 penalty points, the amount is $2,748 and it can go up to $60,000 for 140 or more penalty points.
Under the federal statute, MSHA can reduce a fine if it is deemed so large that it could put the mine operator out of business.
In June, President Bush signed the Mine Improvement and New Emergency Response, or MINER, Act that increased maximum fines from $60,000 to $220,000. The proposed rule announced yesterday would set criteria that would determine fine amounts, up to the maximum.
Passage of the MINER Act came on the heels of 33 deaths in U.S. coal mines this year, including 12 miners at West Virginia's Sago Mine in January and five miners at the Kentucky Darby Mine in May. An additional four miners have died since then.
Leading up to the Oct. 19 Pittsburgh meeting, public hearings are scheduled for Sept. 26 at MSHA headquarters in Arlington, Va.; Sept. 28 in North Birmingham, Ala.; Oct. 4 in Salt Lake City; Oct. 6 in St. Louis; and Oct. 17 in Charleston, W.Va.
The proposed civil penalty assessment rule can be viewed on the MSHA Web site, www.msha.gov.
First Published September 9, 2006 12:00 am