MTPR

Voices For, Against Coal Royalty Reform Heard In Billings

Aug 12, 2015

An overflow crowd packed the Montana/Dakota’s BLM state office in Billings to speak on the federal coal program Tuesday. The agency is seeking comment on possible changes to make sure it’s obtaining the full economic value for the mining of federal coal. Comments ranged from whether the government is getting enough revenue, to climate change, to the "war on coal."

Linda Lance, the second in command at the Bureau of Land Management in Washington, D.C. told the packed meeting-room that the agency is seeking balance.

"It’s to balance both development and conservation. That sounds a whole lot easier than it is."

Lance says the BLM wants to get it right. She says this topic is broad. It includes how the federal agency sets and collects royalties on the market price of coal, how to make the process more transparent, and how to manage coal in light of the climate change objectives coming from the Obama Administration.

Some in attendance worried about how new regulations would impact their jobs.

"I’m scared. I’m fearful of my future," says Ryan White of Sheridan, Wyoming. White works at Cloud Peak Energy’s Spring Creek Mine in the Montana portion of the Powder River Basin.

"I go to work each morning wondering when the government is going to financially force my company out of business. I see pressure coming from the president, from the EPA, from the office of Resource Revenue, and now the BLM to essentially shut down coal mining. I see the government trying to destroy my job and my future."

White asks why would a coal company lease federal coal if the taxes and royalties are increased? If that happens others say then no taxes and royalties would be collected.

But state Representative Margie MacDonald of Billings counters that the BLM needs to manage coal fairly.

"Many of the speakers today are focusing on the faulty premise setting a fair and fiscally sound valuation for a publicly held asset is going to shut out the light and shut down the jobs. That is just not the case," McDonald says.

MacDonald points to a practice by some coal companies to sell coal to their own subsidiaries at a lower-than-market price. That’s what the royalty is assessed on. Then the company re-sells the coal at a higher price. She says that loophole needs to be closed.

Others said they weren’t trying to punish coal miners or undercut communities, but they wanted to make sure American taxpayers were getting their fair share of the revenue from a federal resource.

Lori Byron, a physician in Hardin echoed that sentiment.

"It’s not BLM’s job to keep coal companies solvent," Byron says. "That’s the company’s job. Coal is a federal resource that we need to manage right, and I want my government to enact sound public policy that closes the loopholes."

Still, that talk brought an emotional reaction from families who work in the coal industry.

Tammy Livingston works for one of Cloud Peak Energy’s Powder River Basin mines.

"For the first time since I become a single parent I haven’t had to work six to seven days a week to support my two teenage kids," she said, through tears. "Sorry."

Livingston worries raising the royalty rate could mean she’ll lose her job.

Other speakers express concern about climate change.

Lee Metzger is a retired biology faculty member from the University of Montana. He’s now with the group 350 Missoula. He says the BLM should consider the cost of CO2 emissions in its cost analysis.

"The insanity of developing new fossil fuel resources when we know most of it must remain in the ground. And Powder River Basin Coal should be at the top of our our list for fossil fuel reserves that must not be developed. The enormous benefits of leaving this dirty coal in the ground overwhelm all economic gain from its extraction sale and use," Metzger claims.

Other supporters of mining say the BLM should look instead at the long, cumbersome lease process.

State Senator Duane Ankney is a retired coal miner from Colstrip. He says coal companies do more than just pay taxes and royalties, they also employ people, and donate money to local communities and groups.

"I think these proposed rules is a solution looking for a problem, with all due respect,' Ankney says.

The Republican says statements by top federal officials, including from Interior Secretary Sally Jewel, tell him the government wants to make the red tape redder.

"That this is not a way to get the taxpayer his fair share or anything else. It’s simply to follow this administration’s war on coal," according to Ankney.

These listening sessions – most in the heart of coal country - were called by the Interior Secretary to gather public comments on how the BLM manages federal coal, a public resource.

Spokesman Al Nash says 79 people spoke at the Billings session which ran nearly two hours past its scheduled end time.

The listening session in Billings was the second in a series planned this month across the country. The next session is Thursday in Gillette, Wyoming.

The BLM is also seeking written comments. The deadline is September 17.