Miners fear federal coal reforms jeopardize rural Utah

(Trent Nelson  |  The Salt Lake Tribune)   Yellow t-shirts of pro-coal citizens fill a room at the Salt Palace Convention Center in Salt Lake City, Thursday May 19, 2016, where the Bureau of Land Management (BLM) solicited public input at a public meeting as the next step in the Department of the Interiorís comprehensive review of the federal coal program. (Trent Nelson | The Salt Lake Tribune) Yellow t-shirts of pro-coal citizens fill a room at the Salt Palace Convention Center in Salt Lake City, Thursday May 19, 2016, where the Bureau of Land Management (BLM) solicited public input at a public meeting as the next step in the Department of the Interiorís comprehensive review of the federal coal program.
Public hearing • Changes in federal management — including a three-year moratorium on new coal leases — draw a show of industry unity and some dissenting opinions.

The nation’s emotion-fueled debate over coal mining’s future passed through Salt Lake City on Thursday, when federal officials hosted a listening session to gather comments that will guide broad reforms for how federal coal is managed.

As far as miner Jason Nichols of Price sees it, though, the discussion serves little purpose other than shutting down an industry that, for decades, has provided low-cost power and kept rural Utahns employed.

“Everyone is trying to pick the pockets of coal miners,” said Nichols, who works in the Skyline Mine, as he demonstrated with a dozen miners outside the Salt Palace Convention Center on Thursday. Overhead, he held a sign indicating the link between coal royalties and school funding.

“Coal is still the backbone of the nation’s energy supply. Restricting access to this affordable and abundant resource will destroy jobs and lead to higher and higher electric bills for every American,” said Mark Compton, president of the Utah Mining Association, speaking inside the hearing. “If we are going to raise the standard of living here in the U.S. and around the world, coal must remain part of our energy mix.”

But the industry’s critics believe the federal government sells publicly owned coal too cheaply without consideration of coal mining’s environmental footprint and coal combustion’s impact on climate change. Environmentalists insist the Bureau of Land Management should restructure the way it sells coal leases and sets royalty rates, while also doing more to rein in coal’s “external” costs: greenhouse-gas emissions, and degraded air and lower water quality and eroding wildlife habitat.

“Why would we not choose to capture the sun directly and in its cleanest form? The answer is change is hard — hard for miners’ families trying to make a living in the boom-and-mostly-bust industry, hard for politicians beholden to fossil fuel interests and for power companies’ bottom lines,” Paul Zuckerman told BLM officials at the Salt Palace.

Thursday’s hearing was the second of six planned nationwide as the Interior Department conducts its “programmatic environmental impact statement” for reforming the nation’s coal program, which taps publicly owned reserves.

About 42 percent of the nation’s coal comes from lands administered by the BLM and the U.S. Forest Service, mostly in Western states. In Utah, 83 percent of coal production is extracted from federal leases. At the end of 2015, the BLM administered 308 coal leases on 475,000 acres. Utah’s share is 72 leases on 84,553 acres holding about 200 million tons, enough to sustain current levels of production for at least 13 years.

In January, Interior Secretary Sally Jewell announced the reform initiative and imposed a three-year moratorium on new coal leases. The initiative arises as the coal industry faces unprecedented challenges — demand has plummeted in the face of cheap natural gas and concerns about coal’s impact on the climate.

A short-term leasing pause is not expected to disrupt mine operations, yet many pro-coal speakers Thursday implored the BLM to lift the moratorium. Utah expects to challenge it in the courts, according to Laura Nelson, director of the governor’s energy-development office.

“BLM’s actions threaten several major coal mine expansion projects, including the Sufco and Alton Coal mine expansions, which have spent years complying with expensive environmental reviews and other permitting requirements in good faith, only to discover that the BLM is changing the rules on them,” Nelson said.

Officials heard diametrically opposed narratives Thursday as dozens of speakers paraded to the mic to give their three minutes’ worth.

Many of the speakers were employees of the three mines owned by Bowie Resource Partners, Utah’s largest coal producer. According to Corey Heaps, the general manager of Skyline, his mine employs 339 on a payroll totaling $35 million. The mine, which straddles the Sanpete-Carbon county line, pays $67 million to vendors and is responsible for a total economic benefit of $129 million.

But critics like Ryan Alexander of Taxpayers for Common Sense say industry has had a sweet deal for too long. Federal leases sometimes sell for 40 cents per ton at auctions where there is one bidder. Producers pay annual rents of $3 per acre and royalties of 8 percent, or 12.5 percent if the coal is surface mined.

These rates were set in 1976 and are in desperate need of updating, Alexander said.

All 530 seats in the Salt Palace hearing room were filled, many by miners clad in yellow shirts proclaiming their allegiance to coal. Pro-coal attendees outnumbered environmentalists about three- or four-to-one.

Utah’s U.S. Reps. Jason Chaffetz and Chris Stewart, both Republicans, expressed dismay that the hearing wasn’t held in Price, the capital of Utah coal country, whose communities will be most affected by the coal-program overhaul.

The agency must consider coal’s many benefits in terms of well-paying jobs, low power rates and revenues to local governments, Chaffetz said through his energy adviser, Kelsey Berg. Chaffetz likened the study to “a witch hunt,” looking for problems where none exist.

But coal’s critics say you don’t have to look far to detect problems. Audits have discovered coal companies pay below-market rates to lease coal reserves, underpay royalties and are not always adequately bonded. And now companies are falling into bankruptcy in the face of a collapsing coal demand, raising the possibility that taxpayers will be on the hook for mine reclamation.

Montana rancher Steve Charter, a past president of the North Plains Resource Council, runs cattle over a mine outside Billings.

“For the past 40 years, I have had a ringside seat to personally witness the broken federal program that has allowed coal companies to take advantage of loopholes and giveaways and avoid accountability at the expense of taxpayers, land, air and wildlife,” Charter said. “This deeply flawed system has not ensured mined land is reclaimed and aquifers restored. Out of a total of 562 square miles of mined land across Montana, Wyoming, Utah, Colorado, New Mexico and North Dakota, only 14 percent has been fully reclaimed.”

But many speakers, like Scofield Town Council member Carol Levanger, claimed coal mining’s impacts are overstated and royalties ought to be lowered to encourage further production. Levanger’s town, population 26, on the Wasatch Plateau has seen active mining on and off since 1877.

“I dare say some would think that place ought to be a barren wasteland. It would be looking like raped land. It does not. It is green, it is beautiful. There is hunting, there is fishing,” said Levanger, who works at Skyline. “The mine water runs right behind my house. The dogs play in it. There are fish in the stream. The fish are healthy. They taste good, and I haven’t grown a third eyeball yet.”

The sessions continue in Knoxville, Tenn., on May 26; Seattle on June 21; and Grand Junction, Colo., on June 23. The BLM is accepting written comments until July 28.

Brian Maffly covers public lands for The Salt Lake Tribune. Maffly can be reached at bmaffly@sltrib.com or 801-257-8713.

Twitter: @brianmaffly