Gene Kitts, senior vice president of mining services, International Coal Group, appeared on behalf of the National Mining Association (NMA) before the House Natural Resources Committee’s Subcommittee on Energy and Mineral Resources, delineated the strategies used by OSM and other federal agencies to “eviscerate” coal mining production. He outlined the chronology of OSM actions, focusing on OSM’s pending stream protection rule and 10-day notice policy, and the consequences of those actions.

OSM abandoned the 2008 Stream Buffer Zone (SBZ) rule prior to implementation, without consultation with the states and absent formal justification for its actions. The SBZ drew upon a programmatic environmental impact statement that included 30 scientific and economic studies, multiple public hearings and an environmental impact statement that supported the final rule. The rule also added significant environmental protections and requirements for mine operators.

A pending Stream Protection Rule, which OSM was on track to propose by February 28, 2011, but recently pulled back, is much broader in scope than the SBZ and will apply nationwide. Analyses conducted on OSM’s behalf predict the rule will curtail almost one-third of all surface coal mining production in Appalachia, more than 20% in the Illinois Basin, more than 25% of the coal production in the Gulf Region and 84% of Alaska’s coal production—costing more than 20,000 jobs in Appalachia alone. The NMA calculates the job losses to be more extensive due to the impact on underground mining. Both the rulemaking and the process used by OSM have been universally criticized by the states charged with administering the Surface Mining Control and Reclamation Act (SMCRA)

On November 15, 2010, OSM issued a memorandum asserting the agency’s authority to interfere with, change or, in essence, veto state permitting decisions, contradicting Section 503 of SMCRA, which grants a state with an approved state program exclusive jurisdiction over the regulation of surface coal mining operations within its borders. Currently, all coal mining states except Tennessee and Washington have approved state programs.

Kitts offered two examples within his own company in which OSM had used its 10-day notice policy to interfere with state-issued permits. In Kentucky, according to Kitts, “OSM has improperly inserted itself into a state water discharge permit…[which is] not a matter over which OSM has any authority under SMCRA, and is another example of improper mission creep.” He also described how OSM has “unlawfully frustrated the deliberate statutory design of mutually exclusive state-federal jurisdiction…[and] has enabled a third party to circumvent the exclusive avenue and the specific deadlines for permit appeals under the state program,” in West Virginia.

“Permit delays and regulatory uncertainty are thwarting capital investment that will create and sustain the high-wage jobs needed and valued in our coal communities,” said Kitts. He urged the committee to stop funding the agency’s controversial 10-day notice policy and stream protection rule and “restore the necessary funding for state to properly implement their SMCRA regulatory programs as intended by Congress.”