(Washington, DC) - The U.S. Office of Surface Mining Reclamation and Enforcement (OSM) announced today it is publishing a final rule to enable the agency to continue collecting fees to help defray the costs of health benefits for coal miners even if Congress allows the Abandoned Mine Land (AML) fee to expire September 30.

"This is a precaution we have to take," said Jeff Jarrett, OSM director. "We are continuing to work for reauthorization of the AML reclamation fee, but time is running out and we have a responsibility to make sure we can continue to transfer funds to the United Mine Workers of America's Combined Benefit Fund (CBF) even if Congress allows the reclamation fee to expire."

Under the Surface Mining Control and Reclamation Act (SMCRA), OSM's authority to continue collecting fees to pay for reclamation of abandoned coal mines will expire on September 30 unless reauthorized or extended. However, the Act also provides that even if the AML fee expires, operators must continue to pay fees to fund annual transfers to the CBF. Under SMCRA, transfers can take place only in years in which operators pay fees. Because collections would no longer be used to reclaim abandoned mine lands and would only fund the CBF fund, the fees would be significantly lower than current fees.

The UMWA fund provides medical benefits for 17,394 coal miners living in 45 states who worked for companies that no longer exist. States with the most miners receiving benefits are Pennsylvania (4,935), West Virginia (3,957), Kentucky (2,507), Virginia (1,200) and Ohio (883).

The Bush Administration has proposed legislation to extend OSM's authority to collect the fee for AML reclamation and to make reforms in the distribution of AML funds that would devote more of the fees being collected to the worst AML problems. The proposal also seeks to increase the level of funding available to the beneficiaries of the CBF. Sen. Arlen Specter (PA) has introduced the Administration's proposal as S. 2049 and Rep. John Peterson (PA) has introduced the legislation in the House as H.R. 3778.

If Congress reauthorizes the AML reclamation fee before it expires September 30, the rule OSM is publishing will not be needed immediately. However, if Congress does not act before the fee expires, the necessary rules will be in place to ensure that fee collection and transfers to the CBF continue.

Because of the urgent need to have a rule in place before the date that the current reclamation fee rates expire, OSM is invoking the "good cause" exemptions of the Administrative Procedure Act and is adopting the rules immediately on an final basis without prior notice or opportunity for public comment. However, OSM is also publishing a proposed rule inviting the public to comment on the final rules after publication. OSM will evaluate those comments and if necessary publish a revised final rule.

Background
Title IV of the Surface Mining Control and Reclamation Act of 1977 (SMCRA) created an abandoned mine reclamation program funded by a fee assessed on each ton of coal used, sold, or transferred (35 cents for surface-mined coal, 15 cents for coal from underground mines, and 10 cents for lignite). Money from these fees is placed in a fund, which, subject to appropriation, is used to reclaim lands and waters adversely impacted by mining conducted before the enactment of SMCRA and to mitigate the adverse impacts from these sites on individuals and communities.

The Energy Policy Act of 1992 amended SMCRA to transfer, subject to certain limitations, an amount equal to the amount of interest earned on the fund to the United Mine Workers of America Combined Benefit Fund for use in paying health care benefits to "unassigned beneficiaries" -- former coal miners and their dependents for which no company is responsible for paying premiums. The Energy Policy Act also amended SMCRA to extend collection of the reclamation fees through September 30, 2004, with an additional requirement that after that date the fee must be established at a rate sufficient to continue to provide for transfers to the Combined Benefit Fund with respect to unassigned beneficiaries.

OSM's new rule provides that OSM will determine fee rates for coal produced after September 30, 2004, on an annual basis using a formula designed to ensure that fee collections for each year equal the amount transferred from the AML fund to the CBF at the beginning of that year.

The new fee rates will be based upon estimates of the CBF's needs for unassigned beneficiaries, the AML fund's estimated interest earnings, and projected coal production for which there is a reclamation fee payment obligation. The rates will be adjusted as necessary to reflect any differences between estimated and actual CBF expenditures, AML fund interest earnings, and fee collections in prior years. Under SMCRA, total transfers each year may not exceed the amount of interest earned by the AML fund during that year, CBF expenditures for health care benefits for unassigned beneficiaries during that year, or $70 million, whichever is the smallest number.

OSM will publish a Federal Register notice 30 days before the start of each fiscal year stating what the fees will be during that year. OSM will also notify permittees individually via Payer Letters.

Interested persons may submit comments on the proposed rule. Comments may be mailed or hand carried to the Office of Surface Mining Reclamation and Enforcement, Administrative Record, Room 101, 1951 Constitution Avenue, NW, Washington, DC 20240, or comments may be sent via electronic mail to osmregs@osmre.gov. Information concerning the proposed and final rules is available online at: www.osmre.gov/.

Alaska	12	Kentucky	2,507	Oklahoma	123
Alabama	628	Louisiana	2	Oregon	17
Arkansas	169	Massachusetts	4	Pennsylvania	4,935
Arizona	44	Maryland	128	South Carolina	49
California	101	Michigan	123	South Dakota	2
Colorado	403	Minnesota	4	Tennessee	608
Connecticut	6	Missouri	25	Texas	45
District of Columbia	4	Mississippi	10	Utah	79
Delaware	7	Montana	43	Virginia	1,200
Florida	329	North Carolina	134	Vermont	3
Georgia	57	New Hampshire	5	Washington	79
Iowa	16	New Jersey	32	Wisconsin	8
Idaho	6	New Mexico	39	West Virginia	3,957
Illinois	112	Nevada	12	Unknown	2
Indiana	260	New York	72
Kansas	16	Ohio	883	Total	17,394

* States of residence are determined from latest known addresses provided by beneficiaries. Some residences may have changed. Unassigned beneficiary count is as of the beginning of FY 2004 (October 1, 2003). The number of beneficiaries will change at the beginning of FY 2005 (October 1, 2004).

Proposed Rules
Final Rule
Frequently Asked Question's for Combined Benefit Fund Fee Rules