NMA Condemns Administration’s Politically Contrived Coal Lease Policies as Damaging to Jobs, Communities and Taxpayers

Days before leaving office, the Obama administration has once again advocated policies designed solely to destroy America’s coal industry in the face of a political referendum favoring good jobs and affordable energy. Instead of the open and honest conversation promised by the administration on federal coal leasing policies, today’s report predetermines outcomes before the program review has been completed.

“The Secretary of the Interior’s purported rationales to overhaul the federal coal lease program rest on politically contrived reasoning that will result in less federal and state revenue, the loss of more high-wage jobs as well as an indispensable source of affordable electricity for millions of families,” concluded NMA president and CEO Hal Quinn.

The Secretary has outsourced the Department’s energy and land management responsibilities to “keep it in the ground” activists by blithely accepting their unsupported contentions, beginning with the long-rejected notion that the current leasing system fails to deliver a fair return. In fact, bonus bids paid for leases have outpaced the increase in coal prices. Detailed analyses by Norwest Corp. show Federal royalty rates are 30-65 percent higher than prevailing rates for private coal, where bonus bids are seldom paid as they always are on federal coal. In the major federal coal leasing region, the combination of leasing fees, royalties and taxes amounts to payments of 39 percent of revenues for federal coal producers, which are in addition to any corporate taxes paid on any final profits.

“If the administration was sincerely interested in increasing revenue, it would lift its moratorium on federal lease sales and commit to an efficient process that optimizes, rather than reduces, the benefits that flow to every American from the development of the nation’s federal coal resources,” said Quinn.  “Frankly, most of the policies suggested by the Secretary are beyond the power of the executive branch as she conceded earlier in her tenure.  Fortunately for coal miners and energy consumers, the coal leasing moratorium can be terminated on day one of the new administration,” Quinn added.

See the article here.