Hearings and Business Meetings

SD-366 Energy Committee Hearing Room 10:00 AM

Andrew McElwaine

Mr.

"Reauthorization of the Federal Abandoned Mine

Reclamation Fund"

Testimony of

Andrew S. McElwaine,

President and CEO of the Pennsylvania Environmental Council

Before the

U.S. Senate Environment and Natural Resources Committee

September 27, 2005

Introduction

Mr. Chairman and members of the Committee, thank you for inviting

me to participate in today’s hearing. My name is Andrew McElwaine and I am

President and CEO of the Pennsylvania Environmental Council, a statewide

non-profit group that has offices throughout the state.

I am testifying on behalf of the Pennsylvania Abandoned Mine Land

Campaign, a coalition of over 200 Pennsylvania conservation groups,

including 150 watershed organizations from all Commonwealth coalfield

counties. Over the last two years, we have also worked with community

leaders from ten states in an effort to formulate recommendations that have the

broadest base of support.

I want to reiterate our profound appreciation for your interest in

working for an effective AML reauthorization. To be successful, the AMLF

reauthorization must combine necessary, predictable, mandatory funding

without compromising existing environmental laws.

It is essential to our state and others that the federal government extend

and reform the abandoned mine land reclamation program as I will describe in

my testimony. And of course an AMLF program that works to protect

communities and restore environments also produces jobs and creates

economic opportunities.

We hope that our expressions of support and caution, aimed at helping

you arrive at an agreement that truly works for communities in Pennsylvania

and the other coal producing states, can help you resolve outstanding issues

within the next few days.

History

Pennsylvania has the most abandoned mine land sites in the nation and

has been a leader in improving the quality of its environment after many years

of mismanagement.

In 1968, Pennsylvania passed the Land and Water Conservation and

Reclamation Act, a major initiative to address abandoned mine reclamation.

This act spurred Operation Scarlift, which was instituted to clean up the

damage caused by abandoned mines. It used a total of $141,000,000 to

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complete 500 stream pollution abatement projects, extinguish 75 fires, remove 150 areas of

subsidence, and prevent air pollution at 30 sites of burning refuse banks.

Since that time, Pennsylvania has initiated several other programs that have provided

state funding for abandoned mine reclamation. Most recently, under Governor Ridge in 1999,

the state created its Growing Greener program which made available a substantial portion of

$500 million for reclamation and stream clean ups. In July of this year, Governor Rendell

signed into law Growing Greener II, which provides $625 million for stream clean ups and

other environmental improvements. At least $60 million will be available specifically for

AML related impacts.

Pennsylvania has also pursued an aggressive remining program, where the state has

formed partnerships with the private operators and citizen groups to maximize the use of

AML funds. DEP estimates that $950 million in federal and state money has been spent in

Pennsylvania to deal with abandoned mine problems. As indicated earlier, a substantial

portion of that funding came from state sources. We have adopted a strategic approach that

identifies those sites that are most dangerous or having the greatest environmental impact and

target our resources accordingly.

Remaining Environmental Problems

Despite our successes, significant environmental problems related to past mining

practices remain. The National Abandoned Mine Land Inventory lists for Pennsylvania over

$1 billion of Priority 1 and 2 sites. These numbers were calculated in the early 1980’s, nearly

a quarter century ago, and have not been adjusted for inflation.

These estimates reflect real problems. According to the US Department of Interior’s

Office of Surface Mining (OSM), since 1999, more than 40 people have drowned in mining

pits and quarries. At least 15 deaths, and many more injuries, have occurred during the same

time period in falls and ATV rollovers at quarries and pits. In the last year Pennsylvania saw

five more fatalities related to AML sites. Abandoned mine sites have left extensive dangerous

highwalls, open pits, coal refuse spoil piles, old mine openings, and more than 3,000 miles of

streams polluted by abandoned mine drainage. Past coal mining practices have led to erosion,

landslides, polluted water supplies, destruction of fish and wildlife habitat, and an overall

reduction in natural beauty.

The OSM reports that over 3.6 million people in the United States live within one mile

of Priority 1 & 2 Sites. More than half, just over 1.6 million of those listed, live in

Pennsylvania. (See Appendix A, which is taken from as white paper prepared on this topic by

OSM in 2003). People continue to die, local economies are stymied, and ongoing

environmental degradation is obvious to even casual observers. As is reflected in Appendix

B, over 184,000 acres in our state still need to be reclaimed. And, Pennsylvania is not alone;

other states face similar ongoing problems.

Overview of What We Seek:

Provided below are provisions that were crafted over a two year period in a

collaboration of coalfield community leaders from ten states:

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· Funding for water (Abandoned Mine Drainage): Abandoned mines leak acidic,

alkaline, and metal-contaminated water, polluting public water supplies, destroying

fish and wildlife habitat, depressing local economies, and threatening human health

and safety. Pennsylvania is representative of eastern coal states with abandoned mine

drainage (AMD) problems, and abandoned mine drainage is the largest contributor to

water quality impairment in the Commonwealth. Over 3,000 miles of Pennsylvania’s

streams are impaired by AMD. It is critical that abandoned mine drainage

problems continue to be eligible for funding.

· Keep priorities 1, 2, and 3: Three priority areas are eligible for funding to correct

adverse effects of coal mining practices under Title IV. Priority 1 provides for the

protection of public health, safety, general welfare, and property from extreme danger.

Priority 2 provides for the protection of public health, safety, and general welfare.

Priority 3 provides for the restoration of degraded land and water resources and the

environment. States need to retain the discretion to use their allocations from the Fund

for projects falling into any of the three priorities. The current priorities should be

maintained, including the ability to fund water-related projects under Priorities 2

and 3.

· Full allocation to states of future fees: As of June 30, 2005, the Fund has an

unappropriated balance of over $1.7 billion. The state share of this balance is

approximately $1.1 billion. (Pennsylvania maintains the fourth highest balance at

$58.4 million.) Future collections to the Fund should be fully allocated for their

intended purpose of cleaning up abandoned mine problems.

· Encourage redevelopment of abandoned mine lands: As abandoned mine lands

are reclaimed, they offer potential locations for economic development projects. By

developing and marketing abandoned mine lands that would normally struggle to

attract new investment, these "grayfields" can be turned into regional benefits by

creating economic opportunities, preventing sprawl, and conserving open space and

natural resources. For example, government facilities could be encouraged to locate

on these sites rather than on previously undeveloped green spaces. States should be

able to use Title IV funds in ways that promote reclamation, leverage private

investment, and, where it is appropriate, encourage redevelopment.

· Reformulation: Many states that fueled the coal boom in the early and middle part of

the last century currently have low coal production, yet they have the largest legacy of

adverse mining impacts from before 1977. Currently, the federal share of collected

monies is allocated based on 40% for current production, 40% on historic production,

and 20% to the Rural Abandoned Mine Land Program (RAMP). It has been damaging

to coalfield communities that RAMP has not been funded in the last eight fiscal years.

If RAMP is retained, then it should be funded through same off-budget structure as the

rest of the AML program. This will allow states with the most pre-1977 problems to

correct them much more quickly. The allocation formula should be changed to

60% historic and 40% current production.

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· Take the program off-budget: Each fiscal year, the President and Congress must

appropriate monies from the fund as part of the federal budget process As a result,

the Fund is subject to political pressures and fiscal pressures from other federal

programs. The fees collected to the fund should be returned to states and tribes

without the need for appropriation each year, thus ensuring that the funds will be

used for their intended purposes. This would enable states to better plan strategic

multi-year AML reclamation projects.

· Increase the minimum program funding to $4 million: States which have

significant AML problems, but which have small AML programs, are supposed to be

guaranteed minimum funding of their programs by statutory mandate. Since 1990,

this funding has been set at $2 million. In many years, minimum program states have

received significantly less. Increasing this amount would help make up for past underfunding

and ensure that states with significant AML problems but low production

would be able to continue running effective programs. This potentially effects eleven

states. Annual funding for minimum program states should be raised to $4

million.

· Non-primacy states should get a guaranteed minimum: States which do not have

their own coal regulatory programs are not eligible for a 50% share of funds collected

in the state or funding based on historic production. Federally managed (non-primacy

states) programs should be guaranteed minimum program funding if they demonstrate

the ability to operate an effective abandoned mine reclamation program. This would

enable a state like Tennessee to mitigate the damage in one decade instead of four.

· Maintain transfer of interest to the Combined Benefit Fund: Interest generated on

the Abandoned Mine Reclamation Fund is currently transferred to the Combined

Benefit Fund to defray health care costs for retired miners and their dependents whose

companies have gone bankrupt or are no longer in business. The CBF pays for health

care expenses remaining after Medicare and Medicaid reimbursement and pays for

prescription drugs. The transfer of interest to the Combined Benefit Fund should

continue with no fee reduction.

· Extend the end date: The scope of the abandoned mine problem continues to outpace

available resources. Based on current funding levels, projected future production, and

estimated costs of cleaning up inventoried sites, it will at least 15 years, potentially

more than 20 years to address abandoned mine problems. Extending the program 20

years would honor the intentions of the original law to unburden communities plagued

by unreclaimed coal mines. The program should be extended until at least 2025.

Essential Provisions:

There are a number of provisions that my organization and the Pennsylvania coalition

believe are essential for AML reauthorization to protect coalfield communities and restore

damaged natural resources. First and foremost, we need to remember that this program was

originally created to address the significant environmental problems facing Pennsylvania and

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other states. We should not lose sight of this, so we believe that reauthorization legislation

should do the following:

1. Off-budget mandatory assured funding of AML programs in historic production states.

2. The environmental provisions included in HR2721 should be incorporated within any

AML reauthorization legislation:

a. Minimum program states should receive $4million/year for the length of the

program;

b. Mandatory payments to states should be made within 30 days of collection,

and no less frequently than semi-annually;

c. Allow full state discretion in utilization of state set-aside funds, with state setaside

funds increased from the current 10% to 30%;

d. Preserve Priorities 1, 2 and 3 -- essential for water quality restoration;

e. Remining: PEC supports remining because there have been many successful

projects, though we understand that it remains controversial within some

coalfield communities. In appendix C, we outline some of the conditions that

the coalition with which we are involved believes should accompany a

remining program.

3. Keep AML reclamation fees at current levels with the current structure. In 1977, no

inflation factor was built into the fee, so while the costs of AML reclamation have

gone up significantly over the past 28 years, the fees have remained unchanged, and

now represent a much small fraction of both the cost of coal and the cost of

reclamation. Even with the fee unchanged, the program is not likely to collect enough

money to complete AML restoration within 15 years.

4. AML Reauthorization period should be no less than 15 years, 20 is needed, because in

past years so little AML money has been made available, so the restoration intended

by Congress has not actually been funded.

5. AML reauthorization legislation should specify that the source of funding for AML

programs should be AML reclamation fees

Conclusion

The legacy of past mining practices is still evident on the landscape and in the waters

of Pennsylvania and other states. It adversely impacts our safety, environmental quality,

economic viability, and overall quality of life. We have made progress, but our work is not

done. It is essential to our state and others that the federal government extend and reform the

abandoned mine land reclamation program. Our coalition believes strongly that the final

legislation should include the provisions that I have listed above. Our communities and

environmental quality depend on your action.

Again, thank you inviting me to testify. I am available to answer questions.