Reclamation on hundreds of Kentucky coal mine permits is taking far too long

Hundreds of coal surface mine permits are lagging in reclamation progress in Kentucky according to a review of state data by Appalachian Citizens’ Law Center. 

Reclamation is typically divided into three phases – phase I, phase II, and phase III. As each permit completes the phases of reclamation, a portion of the permit’s bond is released, with completion of phase III bringing final bond release. During phase I reclamation, contemporaneous reclamation regulations require that specific actions necessary to achieve phase I bond release be achieved in a set timeframe in order to assure stability and drainage control. In general, a permit can achieve phase I bond release when it meets those contemporaneous reclamation requirements. Beyond that, however, there are no enforceable time limits on how quickly a permit must meet its phase II and phase III reclamation requirements. 

The analysis found that permits are slow to achieve phase I release. Despite not being in active status and not having produced coal for at least 18 months, only 55% of permits reviewed had achieved the first stage of reclamation. Of the permits that had not even reached phase I release, 24 permits had not produced coal in at least 2 decades. 

To complete phase II of reclamation, a permit must be successfully revegetated and not be contributing any suspended solids to waterways outside of the permit area. The report also determined that few permits are expediently achieving phase II release. Only 7% of permits expected to have reached the second phase of reclamation had done so. The majority of permits took at least 7 years to reach this milestone, with one taking 28 years to reach phase II release. 

When a permit completes phase III of reclamation, it is fully reclaimed, the bond is released, and the permittee is released from liability. Based on the report’s analysis, most permits in Kentucky could reasonably be expected to be fully reclaimed in 6 years, yet 333 of the 408 permits reviewed had not produced coal for at least 6 years and had not been fully reclaimed. ACLC determined that of the permits reviewed, 30% have not produced coal in more than 15 years and 7 have not produced coal for more than 30 years.

This report builds upon two earlier reports by ACLC. The first examined whether permits classified as active are actually producing coal. That report determined that over 40% of mines classified as active had not actually produced coal in 5 years or more. The second examined permits with outstanding violations, determining that over half of the notices of noncompliance had been outstanding for more than a year, and over 20% had been outstanding for more than 3 years. The most common notices of noncompliance were related to reclamation requirements. 

Together, ACLC’s three reports show that mine permits are not being reclaimed contemporaneously. They are functionally abandoned – neither producing coal, nor making timely reclamation progress. As the first report found, reclamation delays occur at the active stage of mining, where there is no limit to how long a mine can remain in active status (and avoid progressing through the stages of reclamation) so long as there is coal to be mined on the permit. And, as this most recent report shows, delays also occur after mines start moving through the phases of reclamation. Further, our report on noncompliance revealed that these mine sites are problematic. Over a third of the outstanding notices of noncompliance were associated with mines in phases of reclamation. If a mine lacks productive potential, enforcement measures that rely on orders for the cessation of production until the violation is remediated are largely ineffective. Delaying reclamation and the persistence of outstanding violations can increase the final cost of reclamation, increasing the risk that the posted bond is insufficient to complete the required reclamation.

The result is that many mines are no longer providing economic benefits for Kentucky, and are also preventing land from being put back into other use. Functionally abandoned mines often impact nearby communities – mines can create landslides and subsidence, contribute to water pollution, and exacerbate flooding. These problems are occuring not only in Kentucky, but also in many other states where coal mining occurs. Policy changes are necessary to create effective enforcement mechanisms to prevent mine abandonment and ensure timely reclamation. Specifically, we recommend:

1. Pass the Bond Improvement and Reclamation Assurance Act to ensure that mines are adequately bonded. This will help ensure that mines are adequately reclaimed if/when the permits are revoked and the bonds forfeited. This change is critical for two reasons. First, coal company bankruptcies and subsequent forfeitures have become more common in the last decade, and are likely to increase as the industry declines and operators fail to meet reclamation milestones. Because of these bankruptcies, regulatory authorities are being required to use forfeited bonds to reclaim permits more often.  Second, the lack of sufficient bond amounts may act as a disincentive for regulators to stringently enforce against functionally abandoned mines out of concern that stringent enforcement may lead a permittee to abandon its reclamation obligation and leave the duty to reclaim to the regulatory authority.   
2. Increase financial penalties for failing to abate violations. Over a third of the outstanding notices of noncompliance were associated with mines in phases of reclamation, indicating that the current system may not provide an effective means of compelling compliance with reclamation requirements. If a mine lacks productive potential, enforcement measures that rely on orders for the cessation of production of coal are largely ineffective. Increasing financial penalties may increase compliance from some companies. However, some companies may be unwilling or unable to pay penalties. In those cases, permit revocation is likely the necessary outcome.
3. Create strong, clear, temporal requirements for each phase of reclamation. These requirements should be instituted at the federal level and should define a maximum amount of time allowed for permittees to achieve each phase of reclamation and bond release.