WV Senate panel green-lights bill increasing mine permit fees to boost funding for regulators

Jan. 25—A West Virginia Senate energy panel advanced a bill Tuesday that would increase fees associated with surface coal mine permits designed to boost funding for surface mining regulators.

The Senate Energy, Industry and Mining Committee signed off on Senate Bill 462, which is aimed at sustaining funding for the state Department of Environmental Protection's Division of Mining and Reclamation.

The panel's move comes after a budget presentation from DEP Secretary Harold Ward to the Senate Finance Committee last week showed that coal tonnage fees supporting the Division of Mining and Reclamation's revenues from coal production fees are expected to fall as the industry declines.

SB 462 would provide the first update for the state's water pollution control permits for surface coal mining operations in 20 years.

SB 462 would increase the fee for permit renewals from $1,000 to $3,000. The bill would differentiate major permit modifications from minor ones, instituting a $2,000 fee for the former and a $1,000 fee for the latter. State law currently imposes a $500 fee for all permit modifications.

The measure would also increase the annual permit fee from $1,000 to $2,000 and create a $500 fee for applications for water quality certification of activities covered by U.S. Army Corps of Engineers permits.

"All parties that are involved in this were contacted and in agreement with it," said Sen. Randy Smith, R-Tucker, chair of the Energy, Industry and Mining Committee.

No fiscal note for the bill currently exists. DEP General Counsel Jason Wandling said one would be published for the Senate Finance Committee, to which the Energy, Industry and Mining Committee referred the bill.

Ward's DEP budget presentation last week showed that average coal tonnage fees (2 cents per clean ton mined) deposited into the Division of Mining and Reclamation's operations fund was just under $1.4 million — a 25.6% decrease from fiscal year 2019. The amount of coal mined in tons is projected to increase slightly in the next two years to about 80 million tons annually before gradually falling to 73 million tons by 2025.

As fee revenues have declined, so have full-time equivalent positions in the Division of Mining and Reclamation, from roughly 300 in the early 2010s to around 190, according to Ward.

"Money is a problem, as you can see," Ward told Senate Finance Committee members.

The fee changes in SB 462 would generate $4.3 million annually for the DEP, Ward indicated to Senate Finance Committee members.

Ward said increasing water pollution control permit fees would provide a "couple-year jumpstart" to guard agency finances against what he said would be an inevitable decline of the coal industry.

A legislative audit report released in June found lawmakers and environmental regulators risk letting the state's mining reclamation program slip into insolvency through gaping holes in statutory and permitting oversight.

The report concluded the DEP has failed to comply with state and federal law in its reclamation program oversight, resulting in missed opportunities to financially shore up a program that will keep requiring hundreds of millions of dollars to reclaim permit sites per federal regulations.

Mike Tony covers energy and the environment. He can be reached

at 304-348-1236 or mtony@hdmediallc.com. Follow

@Mike__Tony on Twitter.

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