Democratic News

Feb 23 2016

Cantwell Questions Secretary Jewell on the Dangers of Self-Bonding by Coal Companies

Cantwell Conservation and Coal Reform Priorities Reflected in Interior Department’s Budget Request


Washington, D.C. – Today, U.S. Senator Maria Cantwell (D-Wash.), ranking member of the Senate Energy and Natural Resources Committee, questioned Interior Secretary Sally Jewell about self-bonding of coal companies, reforms to the federal coal leasing program and the Land and Water Conservation Fund. Secretary Jewell testified before the committee regarding the Interior Department’s budget request for Fiscal Year 2017.

In the 1970s, Congress passed legislation requiring coal companies to ensure that they could cover the cost of reclamation – that is, rehabilitating land after coal mining operations on it have stopped. That law provided the Interior Department with the option to allow coal companies to waive out of this requirement and to “self-bond,” or assure the agency that they have sufficient funds themselves to cover reclamation costs.

With several large coal companies filing for bankruptcy, it is increasingly likely that companies will be unable to cover their reclamation costs and shift their risks to the taxpayers. Sen. Cantwell reminded Secretary Jewell: “I don’t think there’s anything in federal statutes that mandates that the federal government lease a certain amount of coal off the federal lands.”

And Sen. Cantwell further urged that the Interior Department end the practice of self-bonding: “And how are we making sure that the taxpayer isn’t left on the hook [for reclamation work by bankrupt companies]? Do you think self-bonding is working? Does it present a problem and a risk to the taxpayer?

Sen. Cantwell stated similar steps have been taking in hardrock mining to end the practice of self-bonding: “We should do the same thing here.”

On a related note, Sen. Cantwell supports “taking a long-term, forward-looking approach to responsible energy development on public lands, and their related climate effects,” as the Interior Department is doing. In fact, Sen. Cantwell thanked Secretary Jewell “for her bold action to modernize the federal coal program,” following Sen. Cantwell’s multiple calls to reform the program.

The Secretarial Order that Secretary Jewell issued in January requires the Bureau of Land management to undertake a Programmatic Environmental Impact Statement for the coal leasing program that considers the climate impacts of burning coal mined from federal lands. It would be the first time in 37 years the environmental impact statement would be updated – long overdue.

During the hearing, several Republicans were agitated about the pause on new leasing activities, but Sen. Cantwell flagged that five previous administrations – including four Republican administrations – had put in place leasing moratoria in the past.

We can’t continue with business as usual. That enormous gap between public revenue and the ultimate cost to the public is simply indefensible,” Sen. Cantwell noted.

As for conservation, Sen. Cantwell discussed the bipartisan legislation to permanently reauthorize the Land and Water Conservation Fund (LWCF) that she and Sen. Murkowski negotiated. That legislation also creates a new, dedicated fund to address the National Park Service’s deferred maintenance needs.

The omnibus appropriations bill passed in December extended the LWCF’s authority for three years and increased its appropriated amount by almost 50 percent to $450 million. But this isn’t enough – “While this is certainly a step in the right direction and was a hard-fought achievement, I want to make sure that we continue to get permanent reauthorization and full, dedicated funding [for LWCF].” As such, Sen. Cantwell supports the president’s budget request to fully fund the LWCF at $900 million, which includes a proposal to transition to a mandatory funding stream for the program.

Sen. Cantwell also asked Deputy Secretary of the Interior Mike Connor about the senator’s Yakima water bill, S. 1694. Deputy Secretary Connor responded: “The [Yakima] process is a model – not only for working through watershed challenges but for any natural resource management. It’s the right process to bring folks together in a holistic and realistic manner and decide on a path forward that addresses both water supply, environmental needs and tribal responsibilities. We are increasing our budget over time for Yakima enhancement activities and we have put in additional resources to support that effort.”

Read her full statement below:

“Thank you, Madam Chair, for scheduling this important hearing. It’s good to be here to discuss the president’s budget proposal for the Department of the Interior. I welcome all the witnesses here this morning.

“And certainly welcome to Secretary Jewell, as this will be your final budget presentation before the committee, so thank you for your work on this.

“Many of the priorities in this budget, such as full funding for the Land and Water Conservation Fund and the development and funding of a National Park Service Centennial initiative, reflect tireless efforts by those in the agency to work on these issues.

“One of the signature issues here involves finding new ways to get young people outdoors to experience and enjoy our national parks and public lands.

“This budget includes funding for the Secretary’s ‘Every Kid in a Park’ initiative, which provides a free, one-year admission pass for every fourth grader in the country to visit our national parks and other public lands.  

“So thank you, Secretary Jewell, for your leadership on that initiative. It’s greatly appreciated. I commend you for that and look forward to discussing many of these proposals.

“The president’s proposed budget of $13.4 billion for the Department of the Interior (DOI) reflects a very modest increase, totaling half of one percent over current funding levels.  

“In my view, this is a very responsible proposal. It balances funding for the Interior Department’s often conflicting conservation and development mandates.

“More importantly, I am pleased that the budget and recent secretarial directives are taking a long-term and forward-looking approach to responsible energy development on public lands and to address the impacts of climate change into the future.

“At the budget hearing last year, I expressed my concern that the department’s efforts to reform the coal program were not going far enough, fast enough.

“What a difference a year makes.

“I want to thank Secretary Jewell for her bold action to modernize the federal coal program.

“She has been a deliberative and thoughtful person when it comes to this issue, and thank you for the open and honest conversation.

“What we have now is the Bureau of Land Management (BLM) is in the process of proposed rule-making. The bureau has also held listening sessions on this throughout last August.

“So the Secretarial Order that Secretary Jewell issued this January requires the Bureau of Land Management to undertake a Programmatic Environmental Impact Statement (EIS) to update the coal leasing program and ensure that taxpayers get a fair return.

“While the Programmatic EIS is being prepared, no new federal coal leases will be issued, with limited exceptions. The Programmatic EIS is long overdue. It has been 37 years since the current EIS was written. I think 37 years was long enough, so I’m thankful this process is underway.

“This pause on new leasing activities is consistent with the actions of five previous administrations — four Republican and one Democratic—as well as a leasing moratorium approved by a Republican-controlled Senate in the 1980s.

“We cannot continue with business as usual.  The costs to taxpayers and the public do not match.  We cannot continue to lease coal for $1 a ton, and collect only another dollar in royalties, while the costs to society of burning that coal are $70 or more per ton. That enormous gap between public revenue and the ultimate cost to the public is simply not defensible.

“There is much more to do in reforming coal leasing, so I plan to ask you about this. Finishing the stream protection rule and fixing reclamation self-bonding requirements are also hugely important issues to addressing the legacy and impact of coal mining to society. I want to thank you for taking action in addressing these issues.
“This past year has been a busy one for the Land and Water Conservation Fund (LWCF). Working with Senator Murkowski and other members of this committee, we were able to develop bipartisan legislation to permanently reauthorize the Land and Water Conservation Fund and create a new dedicated fund to address National Park Service maintenance needs.  

“This legislation, which is in the energy bill that we are trying to move forward on, is a critical agreement and hopefully we are able to get this enacted.

“The omnibus appropriations bill that was passed in December extended the LWCF authority for another three years and increased funding by almost 50 percent, to $450 million.

“While this is certainly a step in the right direction and was a hard-fought achievement, I want to make sure that we continue to get permanent reauthorization and full dedicated funding.

“I strongly support the president’s budget proposal to fully fund the Land and Water Conservation Fund at its authorized level of $900 million. The president’s proposal to transition to a mandatory funding stream for the program in future years is also something I fully support.

“I’d like to mention a couple of other issues.

“In addition to conservation proposals, I am pleased to see the president’s budget is focused on science, as well as landscape and watershed management. I am particularly pleased to see proposals throughout the budget to foster climate change resilience in these areas.

“I believe that we must invest in science and smart solutions.

“In this vein, I am particularly pleased to see the administration’s continued commitment to the Yakima Basin Project. The $3 million increase in the proposed budget for the Yakima basin is critical to completing a fish passage project and continuing to provide the stewardship that is needed.

“This project will restore fish runs that have been blocked for more than a century and one of the largest sockeye salmon runs in the lower 48.  

“Secretary Jewell, as a fellow Washingtonian, I know you understand how important restoration of salmon fisheries is to our entire economy.

“I want to thank the Bureau of Reclamation for being such great partners on a plan that I think is a model for the rest of the nation in watershed management.  

“It is the 100th anniversary of the founding of the National Park Service. Along those lines, I would like to say that I support the efforts to get legislation and was happy to introduce the initiative by the administration.

“We need to work together with Senators Murkowski, Portman and the National Park Service to develop a bipartisan centennial bill to make sure that the parks’ next 100 years are well-positioned.

“I know that this is a big challenge here in supporting new dollars and the challenges of coming up with how we upgrade our park system. But I am sure that if there is anyone here that can meet that task, it is Secretary Jewell, because of her love of the National Park System, her great utilization of it and her great promotion of it.

“So, I hope that a number of the issues that have been detailed by both Chairman Murkowski and myself, as we talk about these proposals, actually come to fruition with some legislation that we can get passed. Because clearly, the next 100 years of our parks deserve the investments that were made during the first 100 years.

“So, with that, Madam Chair, I thank you for holding this important hearing.”
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