Vulnerable Mine Reclamation Bond Concerns Has W.Va. Senate Planning To Be Proactive

Concerns over vulnerable mine reclamation bonds in West Virginia has the Senate attempting to be proactive according to Senate President Craig Blair (R-Berkeley) who introduced Senate Bill 1, “Creating a Mining Mutual Insurance Company” on the first day of the 2022 legislative session.

Blair spoke during the Senate Finance Committee Thursday.

The bill passed through the finance committee unanimously. It will be reported for approval to the full Senate.

“We don’t have a lick of coal in the Eastern Panhandle, but I recognize how important it is to the state of West Virginia,” said Blair, an eastern panhandle resident. “I was around for workers comp. It took us a decade to get out of that mess.”

Blair suggested that drawing Procter & Gamble to invest in building its facility in the state may not have happened if the workers comp issues weren’t previously addressed.

The P&G facility broke ground in 2015 on its $500 million, 2.5 million square foot facility near Martinsburg and went into production in 2018. It now has more than 1,400 employees.

“P&G wouldn’t be here if we didn’t get out of that (workers comp) mess,” Blair said. “I propose we be proactive this time.”

At the annual Legislative Lookahead meeting Jan. 7, Blair said one company holds about 60 percent of the mine reclamation bonds and if anything would happen to that company it could cost the state between $1 billion and $8 billion, according to estimates.

“We need to ensure some stability and protect ourselves as much as possible,” Blair added.

“We’re hoping to take a $50 million loan, just as we did for workers comp and physicians mutual and make it so that these coal companies that choose to have their own mutual, that they can have their own mutual that they can get the mine reclamation bonds through there,” Blair explained during the annual Legislative Lookahead sponsored by the West Virginia Press Association Jan. 7.

“My confidence in this bill is strong,” Blair said. “I’m making an exception in sponsoring bills. It will provide an insurance policy for the state of West Virginia and the mining industry in this state. This isn’t a bailout. It’s an insurance policy of $50 million to protect us from an exposure of between $2-4 billion. We can’t afford to let that happen.”

None of the funds will come from the mine reclamation fund, Blair said.

“There’s other places to find the $50 million,” he stated.

Blair introduced David Rader, whom Blair said, “He’s coming out of retirement to help us with this.”

Rader was appointed to the board of directors of BrickStreet Mutual in 2006 when it became a private company and served on its board until 2017. He retired in 2011 as president and CEO of West Virginia Mutual Insurance Company, the largest medical professional liability insurer in the state.

“I’m here to help if you want to do this,” Rader told the committee. “I’m making myself available and glad to do that. I love West Virginia.”

Sen. Ron Stollings (D- Boone) asked Rader of the $50 million base, “How will it help us?”

“No one knows how bad it will be,” Rader answered. “In case there’s a crisis, you have to have a minimum to start with. It’s critical.”

Sen. Stephen Baldwin (D- Greenbrier) asked, “We don’t know the source (of the $50 million)?”

“That’s this committee’s responsibility,” Rader answered. “It’s something (Sen. Finance Chair Eric) Tarr is working on. To pass this bill without the $50 million, we have nowhere to go. Until we can show that surplus, there’s no reason to apply for insurance. They won’t talk to me.

Tarr (R-Putnam) said there are “several options” for the $50 million base.

“This will be a loan,” he said. “It’ll likely come from surplus.”

Rader said the base would permit the state to write about $200 million in bonds.

“$50 million is a good number to start,” he said. “I’m optimistic that even in a worst case scenario – it’s still a win-win. It’s a benchmark, not knowing what it’s going to be. My goal is to establish stability.”

Sen. Robert Plymale (D-Wayne) voiced approval, saying “What is being designed can be of great benefit to the people of West Virginia.”

Mine Reclamation, Clean Water and Broadband: What the Infrastructure Law Brings to Appalachia

The bipartisan infrastructure bill that became law last month has billions of dollars in it for roads, bridges, airports and transit systems in the Ohio Valley.

The law also addresses some of the region’s other pressing needs.

The $1 trillion infrastructure law has the potential to deliver big improvements to Appalachia. It will help reclaim abandoned mine sites, putting laid-off coal miners back to work.

It will help replace lead water pipes and clean up chemical contamination in water supplies.

It will also bring much-needed high-speed internet to rural communities, helping seniors on fixed incomes and children whose schools closed down during the coronavirus pandemic.

While some of the funding will produce immediate benefit for the region, other improvements may take years to complete. People familiar with the region’s needs see both short- and long-term impacts from the law.

Appalachian states have an abundance of mines that were abandoned before 1977, and they present hazards to public safety and the environment.

The infrastructure bill dedicates $11.3 billion to abandoned mine reclamation. Adam Wells, regional director for economic and community development for Appalachian Voices, said the bill offers two things the region desperately needs.

“I think the top line here is that it can immediately put people to work in coalfield communities, using skills and equipment that folks have at the ready,” he said, “and the benefit of environmental remediation is great to see as well.”

Wells said one challenge will be putting the people in place to administer the funding, which he said is the largest sum ever dedicated to mine reclamation.

“So they’re going to have to really rapidly staff up and get new systems in place to get that money back out the door at the pace that’s needed,” he said.

Coalfield communities have been promised either a rebound in coal, or an influx of new jobs building solar panels and other clean energy technology. So far, neither has materialized.

Wells said mine reclamation buys time for Appalachia to build a new, diversified and more resilient economy.

“Reclamation feels pretty grounded in what is possible, and what’s happening,” Wells said.

The infrastructure law includes $50 billion in Environmental Protection Agency funds to upgrade the country’s drinking water, wastewater and stormwater systems.

Critically, it enables the replacement of lead service pipes. The water crisis in Flint, Michigan, brought the issue to the forefront. More recently, the water system in Clarksburg, West Virginia, was revealed to have elevated levels of lead in drinking water.

Clarksburg is in the process of replacing its lead service lines.

The water funds will also help state and local governments address another growing problem: Contamination from PFAS, or forever chemicals.

Much of the funding will flow through state revolving funds. Todd Grinstead, executive director of the West Virginia Rural Water Association, said the assistance is welcome.

“You’re looking at quite an increase in funding for our state revolving funds, both the clean water and the drinking water side,” he said.

Grinstead said the large increase in state revolving funds can allow water systems to retire debt. That keeps them from having to charge their customers more to make needed investments.

“And when utilities do projects, they don’t like increasing bills for people. They like to do it cheap as they can,” he said. “But it’s also necessary to do the upgrades to be able to keep the quality of service up.”

With population loss in many coalfield communities, water systems aren’t adding many new customers. But they still have to repair and replace the infrastructure they have.

“It’s one thing to get money and install pipes and stuff. But time goes by pretty quick,” Grinstead said. “And next thing, you know, you’ve got stuff that needs replaced.”

The COVID pandemic laid bare one of the biggest disparities between population centers and rural communities: Access to high-speed internet.

With schools closed, many students had difficulty making the connection for remote learning.

Dale Lee, president of the West Virginia Education Association, said frustrated parents drove their kids to school parking lots to get WiFi.

Lee said some schools brought buses to remote communities to attempt to connect students to the internet. It couldn’t reach all of them, he said.

“In our rural state, like we have in West Virginia, this is a major problem,” he said. “And it’s a problem, not only for education and our students, but it’s for attracting businesses too.”

The infrastructure law provides $65 billion to build out broadband connections in rural areas.

Some liken it to the rural electrification efforts of the 1930s, which proved transformative for large portions of the country but took years to build.

“It is a very helpful thing. And the key now is to use the funds and get things going as quickly as possible,” Lee said. “But again, it’s not gonna happen overnight.”

Lee said educators from across the country gave input as lawmakers developed the broadband component of the infrastructure bill.

Lee said it has to be affordable for low-income families and seniors on fixed incomes. The law does include funding to reimburse households for a portion of their monthly internet costs.

“I mean, this is not an easy task,” he said. “It will take some time plus, you also have to provide some assistance to low income families to ensure that their kids can have this connectivity.”

Kentucky Court Orders Justice To Pay Penalty Over Mine Reclamation

A Kentucky court has found coal companies owned by West Virginia Gov. Jim Justice in default of a 2019 mine reclamation agreement.

A judge in Frankfort on Tuesday ordered Justice to pay a nearly $3 million penalty, plus interest, over mine reclamation work at three sites in eastern Kentucky that was not completed before deadline.

The judge revoked five of Justice’s permits, including some at mines he’d planned to reopen.

Justice also must pay attorneys fees to the state Energy and Environment Cabinet.

Attorneys for Justice had argued that the coronavirus pandemic made it impossible to meet the deadlines for completing the reclamation work.

The state countered that at least one of the deadlines passed before COVID-19 had widespread impacts and that one site had been left untouched for years.

Justice’s attorneys also tried to persuade the court to reduce the penalty based on work completed and to set aside the 8% per day interest rate it had agreed to pay.

“The Cabinet, nor the Court, has any obligation to continue to grant Defendants leniency,” Franklin Circuit Judge Thomas Wingate wrote in his 21-page order Tuesday.

Both Justice and his son, Jay, were named as defendants in the case.

A spokesman for Justice didn’t respond to a request for comment.

An NPR investigation in 2016 found that Justice’s coal companies owed $15 million in taxes and safety penalties across six states, including nearly $7 million in Kentucky.

Manchin Tells House Democrats to Vote on Bipartisan Infrastructure Bill

U.S. Sen. Joe Manchin has been negotiating for weeks with congressional Democrats on a big social spending bill. But they appear to be at a stalemate.

Manchin told reporters at the Capitol Monday that the House of Representatives should vote on a bipartisan infrastructure bill the Senate approved in August.

That’s not, however, what progressive House Democrats want. They want to vote on both bills at the same time. And even though they’ve come down on the original price tag, Manchin is still not on board.

“For the sake of the country, I urge the House to vote and pass the bipartisan infrastructure bill,” he said. “Holding this bill hostage is not going to work in getting my support for the reconciliation bill.”

Manchin said he wants more time to evaluate the social spending bill’s impact on the deficit and the economy. Those numbers would come from the nonpartisan Congressional Budget Office, but the process can take a while.

With the slimmest of margins in Congress, Democrats can neither afford to lose Manchin’s vote, nor a number of progressives in the House. Balancing their priorities has proved a difficult task.

The infrastructure bill has a big provision that would help West Virginia and Appalachia.

The more than 2,000-page bill includes $11.3 billion for the cleanup of abandoned mine lands and extends mine reclamation programs for 15 years.

Manchin, the chairman of the Senate Energy and Natural Resources Committee, included both provisions in the bill.

It also includes billions of dollars to plug orphaned oil and gas wells.

Mine reclamation alone could create hundreds of jobs in West Virginia and generate billions of dollars in economic activity, a recent analysis found.

Environmental Groups Tell Bankruptcy Court Blackjewel Continues To Skirt Obligations

A coalition of conservation and environmental groups is once again calling attention to pollution and unmet environmental obligations at mines controlled by now-bankrupt coal operator Blackjewel LLC. 

In a letter submitted to the bankruptcy court on Wednesday, Appalachian Citizens’ Law Center and eight other groups said the majority of the companies’ surface mine permits in West Virginia, Kentucky and Virginia have not been transferred to new operators as the company promised. 

The mines also continue to amass environmental violations, despite assurances by Blackjewel that mine reclamation and other environmental obligations would be taken care of by the new owners of the mines. 

“It is unfortunately very clear that Blackjewel is allowing the mining operations for which permits remain in its possession to deteriorate and accrue mounting numbers of permit violations,” the letter states. 

In Kentucky, the groups say the company has failed to transfer 149 of the company’s 213 permits. Fifty-nine transfers have been submitted. Only five permits have been transferred to new owners. 

In Virginia, 34 transfers have been completed, while eight are in process. Of the 29 permits where no action has been taken, the groups note four were slated to go to Kooper Glo Mining

In West Virginia, five of the 12 permits have been transferred. 

“We are therefore very concerned that Blackjewel will seek to abandon those permits during the course of this bankruptcy,” the groups write. 

According to their analysis of state and federal databases, Blackjewel mines continue to wrack up environmental violations, including complaints about water quality, sediment control and pollution exceeding discharge limits. 

In Kentucky, the groups found the number of on-the-ground violations jumped from 42 in the first quarter of 2019 to 119 in the first quarter of 2020. The bulk of the violations occurred at mines where there have been no moves to transfer the permit to a new owner. 

In West Virginia, the Department of Environmental Protection has issued 13 violation notices at Blackjewel mines still controlled by the company, the letter details. That includes serious issues reported at the Rush Creek mine complex near the Kanawha State Forest.

In a Tuesday filing, Kentucky environmental regulators echoed some concerns raised by the environmental groups. The state’s Energy and Environment Cabinet asked the court to force Blackjewel to bring its mining operations into compliance. The agency said the problem has escalated even after two court hearings addressed the issues earlier this year. It cited 606 outstanding violations of Kentucky’s mining laws and 13,125 violations of their state water quality permits, primarily the result of failing to submit discharge monitoring reports.

“Yet, instead of using the Estate’s limited resources to maintain their operations necessary to avoid causing harm to the affected land and water, the Debtors continue to spend millions of dollars on professional fees – an amount in excess of five million dollars ($5,000,000.00) for the third quarter calendar year 2019 alone,” the agency said. 

In an email, a spokesperson for FTI Consulting, which is representing Blackjewel, said the company had no comment at this time. 

 

W.Va. Officials Recommend $27 Million In Abandoned Coal Mine Cleanup Funding

West Virginia officials Thursday announced the names of the recipients they are recommending for millions of dollars in federal funding to help clean up abandoned coal mines.

The West Virginia Department of Environment Protection is recommending 12 projects in the Mountain State receive $27 million in Abandoned Mine Land Pilot program funding. 

“They are great projects for West Virginia that will spur economic development,” said Gov. Jim Justice, speaking at a virtual press conference Thursday. 

The AML Pilot program was created by Congress in 2015 to provide additional federal funding to the six Appalachian states with the most abandoned coal mines, including West Virginia.

The program provides funding to clean up abandoned mines and boost the economic and development goals of local communities. Project recipients ran the gamut, although all are required to be on or adjacent to mine sites that ceased operation prior to the passage of the Surface Mining Control and Reclamation Act of 1977.

About half of the projects recommended for funding this year will expand outdoor recreation opportunities and lodging options along the Hatfield-McCoy Trail system in southern West Virginia. Development along the Cheat River and Blackwater River also received funding. 

More than half of the funding will go to projects expanding access to clean water in communities, including some in Raleigh, Summers and Fayette counties. 

The group Reconnecting McDowell was recommended to receive $1 million to help finance the construction of the Renaissance Village in Welch, which will offer rental apartments to teachers and others in McDowell County. 

Federal regulators with the Office of Surface Mining Reclamation and Enforcement must still give final approval to recommended projects and funding amounts. 

Here is a list of the recommended recipients: 

Indian Creek ATV Resort Project           $3,378,000

Building the Indian Creek ATV Resort to serve as an anchor development for the newest Hatfield-McCoy Trail system in Boone County. Project includes construction of 20 cabins, 15 RV Sites, and will be the location of the new Coal River Trail System.

Oak Hill Sanitary Board – Minden Sanitary Sewer System Rehabilitation            $1,500,000

Upgrading existing sewer lines, pumping stations, and sanitary collection system.

Claudia L. Workman Wildlife Education Center $959,613

Building an educational and wildlife viewing center within the Forks of Coal State Natural Area, located on Corridor G, just south of Charleston.

Renaissance Village in McDowell County          $1,000,000

Aiding in the construction of a housing facility for teachers. The proposed facility will also have space available for commercial use.

Twin Hollow Campgrounds and Cabins Expansion Project         $2,699,422

Expanding the Twin Hollow Campgrounds and Cabins Resort in Mingo County to an even larger, more prominent destination that will bring in thousands of Hatfield-McCoy Trail Riders annually and facilitate a private sector investment of $3,970,230 over the next five years.

Reclaiming the Cheat River as an Economic Asset through Trail Investment and Nurturing Greenspace (RECREATING)                            $1,000,000

Improving trail and river access by building a destination trailhead at the Preston site.

Harper Eccles Sewer Extension Project              $7,647,398

Providing approximately three miles of public sewer to residents along Route 3 in Raleigh County.

Rhodell Water Service Upgrade Project             $2,125,000

Constructing approximately three miles of public water service to residents along Route 33 in Raleigh County.

White Oak Waterline Extension Project            $1,319,050

Providing approximately 19,750 linear feet of public water service to residents along the border of Raleigh and Summers counties.

The Blackwater River Loop Project: Hiking, Biking and Heritage Tourism        $818,000

Constructing a water treatment system to improve water quality of the north fork of the Blackwater River and make the site a visitor-friendly education project. This project will also create a scenic trail between the towns of Thomas and Davis and restore the Davis Coal and Coke Company engineering building for use.

Fleming – An Old Mining Town Transformation to Rustic Ravines                          $250,000

Building a lodge and wedding/conference venue, cabins, cottages, pods, RV and ATV parks, tennis amenities, basketball amenities, walking/hiking trails, ATV trails, an Alpine Coaster, a disc golf course, a miniature golf course, and an indoor driving range to increase tourism.

Brenton and Baileysville Waterline Extension Project$4,500,000

Providing water service to 254 customers, Baileysville Elementary and Middle School, along with a potential expansion of the Hatfield-McCoy Trail. 

 

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