[House Report 112-429]
[From the U.S. Government Publishing Office]


112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     112-429

======================================================================

 
  USE OF PAYMENTS UNDER SURFACE MINING CONTROL AND RECLAMATION ACT OF 
    1977 FOR NONCOAL RECLAMATION PROJECTS AND ACID MINE REMEDIATION

                                _______
                                

 April 16, 2012.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Hastings of Washington, from the Committee on Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 897]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Natural Resources, to whom was referred 
the bill (S. 897) to amend the Surface Mining Control and 
Reclamation Act of 1977 to clarify that uncertified States and 
Indian tribes have the authority to use certain payments for 
certain noncoal reclamation projects and acid mine remediation 
programs, having considered the same, report favorably thereon 
without amendment and recommend that the bill do pass.

                          Purpose of the Bill

    The purpose of S. 897 is to amend the Surface Mining 
Control and Reclamation Act of 1977 to clarify that uncertified 
States and Indian tribes have the authority to use certain 
payments for certain noncoal reclamation projects and acid mine 
remediation programs.

                  Background and Need for Legislation

    S. 897 seeks to clarify a provision of the Surface Mining 
Control and Reclamation Act of 1977 (SMCRA) that in the past 
has allowed uncertified states and tribes to use certain 
payments from the Abandoned Mine Land (AML) fund for high 
priority non-coal reclamation projects. High priority coal and 
non-coal AML sites are those that pose a serious threat to 
human health and safety. Problems with the provision arose 
after passage of the 2006 amendments to SMCRA through a 
Department of the Interior (DOI) Solicitor's Opinion and the 
Office of Surface Mining's (OSM) final rule issued for the 2006 
amendments. DOI argued that because funds for the ``prior 
balance replacement'' funds were paid out of the general fund 
of the U.S. Treasury and not the AML trust fund, the funds were 
not eligible to be used for non-coal AML projects.
    As further explained by the author of the measure, Senator 
Jeff Bingaman (D-NM) (on identical legislation introduced in 
the 111th Congress):

          [This bill is] important to public health and safety 
        and the environment in the West. This legislation 
        addresses a recent interpretation by the Department of 
        the Interior, DOI, which restricts the ability of 
        states to use certain funds under the Abandoned Mine 
        Land (AML) Program authorized by SMCRA, for non-coal 
        mine reclamation.
          The Tax Relief and Health Care Act of 2006 contained 
        amendments to SMCRA reauthorizing collection of an AML 
        fee on coal produced in the U.S. and making certain 
        modifications to the AML program. Under this program, 
        which is administered by DOI, funds are expended to 
        reclaim abandoned mine lands, with top priority for 
        protecting public health, safety, general welfare, and 
        property and restoration of land and water resources 
        adversely affected by past mining practices. The 
        program is largely directed to abandoned coal mine 
        reclamation, but under section 409 of SMCRA, limited 
        funds have been available to address non-coal mine 
        sites.
          Unfortunately, the Department of the Interior has 
        interpreted the amendments in a manner that limits the 
        ability of western states to use certain funds under 
        SMCRA to address significant problems relating to non-
        coal abandoned mines, despite the fact that these funds 
        had previously been available for these purposes.
          Section 409 of SMCRA, provides that states may 
        address public health and safety hazards at abandoned 
        mine sites, both coal and non-coal. Western states such 
        as New Mexico, Colorado, and Utah, have prioritized the 
        use of AML funds to undertake the most pressing 
        reclamation work on both coal and non-coal mine sites. 
        While activities on non-coal sites have consumed a 
        relatively insignificant portion of the funding 
        provided for the overall AML program, the results in 
        terms of public health and safety in these states is 
        considerable, and there is significant work yet to be 
        done. For example, New Mexico alone has over 15,000 
        remaining mine openings with a vast majority of these 
        being non-coal. All AML-related fatalities in the State 
        in the last few decades have been at non-coal mine 
        sites.
          I disagree with this interpretation by DOI. This 
        result was not the intention of those of us working on 
        the SMCRA amendments, and I believe the interpretation 
        is in error. First, OSM's interpretation disregards the 
        fact that section 409 was left un-amended by the 
        Congress. Furthermore, this interpretation is 
        inconsistent with assurances repeatedly given to us by 
        OSM during the consideration of the legislation that 
        non-coal work could continue to be undertaken with 
        these AML funds. Finally, the interpretation has the 
        unacceptable result of requiring states to devote funds 
        to low priority coal sites while leaving dangerous non-
        coal sites unaddressed.

    S. 897 corrects the problem created by DOI by modifying the 
language of SMCRA to clarify that funding would be available 
for non-coal reclamation as it was prior to the passage of the 
2006 amendments. Under the proposed legislation, western, non-
certified States could continue to use the payments from their 
``prior balance replacement'' funds (previously un-appropriated 
state share balances) for non-coal reclamation.

                            Committee Action

    S. 897 was introduced on May 5, 2011, by Senator Jeff 
Bingaman (D-NM). On November 2, 2011, the bill passed the 
Senate by unanimous consent. The bill was then referred to the 
House Committee on Natural Resources, and within the Committee 
to the Subcommittee on Energy and Mineral Resources. On 
February 17, 2011, the Subcommittee held a hearing on the House 
companion bill, H.R. 785, sponsored by Congressman Stevan 
Pearce (R-NM). On February 29, 2012, the Full Natural Resources 
Committee met to consider S. 897. The Subcommittee on Energy 
and Mineral Resources was discharged by unanimous consent. 
Congressman Edward Markey (D-MA) offered amendment designated 
.003 to the bill; the amendment was not adopted by a bipartisan 
roll call vote of 14 to 30, as follows:


    The bill was then ordered favorably reported to the House 
of Representatives by voice vote.

            Committee Oversight Findings and Recommendations

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Natural Resources' oversight findings and 
recommendations are reflected in the body of this report.

                    Compliance With House Rule XIII

    1. Cost of Legislation. Clause 3(d)(1) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(2)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974. Under clause 3(c)(3) of rule 
XIII of the Rules of the House of Representatives and section 
403 of the Congressional Budget Act of 1974, the Committee has 
received the following cost estimate for this bill from the 
Director of the Congressional Budget Office:

S. 897--An act to amend the Surface Mining Control and Reclamation Act 
        of 1977 to clarify that uncertified states and Indian tribes 
        have the authority to use certain payments for certain noncoal 
        reclamation projects and acid mine remediation programs
    CBO estimates that enacting S. 897 would have no 
significant net impact on the federal budget over the 2012-2022 
period. Because enacting S. 897 could affect direct spending 
(increasing it in some years and decreasing it in others), pay-
as-you-go procedures apply. Enacting S. 897 would not affect 
revenues. S. 897 contains no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
and would impose no costs on state, local, or tribal 
governments.
    Each year, the Office of Surface Mining (OSM) provides more 
than $300 million in grants and payments to states and Indian 
tribes to reclaim land and water resources that have been 
degraded by past mining activities. Because such grants and 
payments are not subject to annual appropriations, they are 
considered direct spending. States and tribes that currently 
have backlogs of coal reclamation projects--so-called 
uncertified states--are obligated under current law to use a 
portion of those grants exclusively for certain coal projects.
    S. 897 would allow uncertified states and tribes to use 
those funds for other types of reclamation projects not related 
to coal mining. CBO expects that this change would increase 
direct spending--by up to $2 million a year--in the near term 
by accelerating spending of reclamation grants. However, that 
short-term increase would be offset by reduced spending in 
later years. On balance, CBO expects that implementing the 
legislation would result in no net change in direct spending 
over the 2012-2022 period.
    Under current law, once states and tribes certify that they 
have completed all outstanding coal reclamation projects, they 
become eligible for additional payments from OSM. Under S. 897, 
some states and tribes may substitute noncoal projects for coal 
projects in the near term and delay their certification status, 
which would delay certain payments that would increase direct 
spending under current law. Based on information from OSM and 
some of the affected states and tribes, CBO expects that no 
uncertified states will become certified over the next 10 
years, and CBO estimates that any delay in making payments to 
states that become certified would not affect direct spending 
over the 2012-2022 period.
    The Statutory Pay-As-You-Go Act of 2010 establishes budget-
reporting and enforcement procedures for legislation affecting 
direct spending or revenues. S. 897 would have no net effect on 
direct spending over the 2012-2022 period. The bill would 
increase direct spending from certain payments to states and 
tribes to reclaim abandoned mines in the near term, but those 
increases would be offset by decreased direct spending for 
those activities in later years. The changes in the deficit 
that are subject to pay-as-you-go procedures are shown in the 
following table.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              By fiscal year, in millions of dollars--
                                           -------------------------------------------------------------------------------------------------------------
                                             2012    2013    2014    2015    2016    2017    2018    2019    2020    2021    2022   2012-2017  2012-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact............       0       1       2       2      -2      -2      -1       0       0       0       0         1          0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    On August 5, 2011, CBO transmitted a cost estimate for S. 
897, a bill to amend the Surface Mining Control and Reclamation 
Act of 1977 to clarify that uncertified states and Indian 
tribes have the authority to use certain payments for certain 
noncoal reclamation projects and acid mine remediation 
programs, as ordered reported by the Senate Committee on Energy 
and Natural Resources on July 14, 2011. The two versions of the 
legislation are similar, and their estimated costs are the same 
over the 2012-2022 period; however, because we now assume that 
S. 897 will be enacted during fiscal year 2012, we estimate 
that implementing it would have no significant impact on direct 
spending until 2013.
    The CBO staff contact for this estimate is Jeff LaFave. The 
estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.
    2. Section 308(a) of Congressional Budget Act. As required 
by clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives and section 308(a) of the Congressional Budget 
Act of 1974, this bill does not contain any new budget 
authority, credit authority, or an increase or decrease in 
revenues or tax expenditures. CBO estimates that enacting S. 
897 would have no significant net impact on the federal budget 
over the 2012-2022 period. Because enacting S. 897 could affect 
direct spending (increasing it in some years and decreasing it 
in others), pay-as-you-go procedures apply. Enacting S. 897 
would not affect revenues.
    S. 897 would allow uncertified states and tribes to use 
federal grant funds for other types of reclamation projects not 
related to coal mining. CBO expects that this change would 
increase direct spending--by up to $2 million a year--in the 
near term by accelerating spending of reclamation grants. 
However, that short-term increase would be offset by reduced 
spending in later years. On balance, CBO expects that 
implementing the legislation would result in no net change in 
direct spending over the 2012-2022 period.
    3. General Performance Goals and Objectives. As required by 
clause 3(c)(4) of rule XIII, the general performance goal or 
objective of this bill is to amend the Surface Mining Control 
and Reclamation Act of 1977 to clarify that uncertified States 
and Indian tribes have the authority to use certain payments 
for certain noncoal reclamation projects and acid mine 
remediation programs.

                           Earmark Statement

    This bill does not contain any Congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined 
under clause 9(e), 9(f), and 9(g) of rule XXI of the Rules of 
the House of Representatives.

                    Compliance With Public Law 104-4

    This bill contains no unfunded mandates as defined under 
Public Law 104-4.

                Preemption of State, Local or Tribal Law

    This bill is not intended to preempt any local or tribal 
law.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

SURFACE MINING CONTROL AND RECLAMATION ACT OF 1977

           *       *       *       *       *       *       *


TITLE IV--ABANDONED MINE RECLAMATION

           *       *       *       *       *       *       *


                            RECLAMATION FEE

  Sec. 402. (a) * * *

           *       *       *       *       *       *       *

  (g) Allocation of Funds.--(1) * * *

           *       *       *       *       *       *       *

  (6)(A) Any State with an approved abandoned mine reclamation 
program pursuant to section 405 may receive and retain, without 
regard to the 3-year limitation referred to in paragraph 
(1)(D), up to 30 percent of the total of the grants made 
annually to the State under paragraphs (1) and (5) and section 
411(h)(1) if those amounts are deposited into an acid mine 
drainage abatement and treatment fund established under State 
law, from which amounts (together with all interest earned on 
the amounts) are expended by the State for the abatement of the 
causes and the treatment of the effects of acid mine drainage 
in a comprehensive manner within qualified hydrologic units 
affected by coal mining practices.

           *       *       *       *       *       *       *


                   FILLING VOIDS AND SEALING TUNNELS

  Sec. 409. (a) * * *
  (b) Funds available for use in carrying out the purpose of 
this section shall be limited to those funds which must be 
allocated to the respective States or Indian tribes under the 
provisions of paragraphs (1) and (5) of section 402(g) and 
section 411(h)(1).

           *       *       *       *       *       *       *


SEC. 411. CERTIFICATION.

  (a) * * *

           *       *       *       *       *       *       *

  (h) Payments to States and Indian Tribes.--
          (1) In general.--
                  (A) * * *

           *       *       *       *       *       *       *

                  (D) Use of funds.--
                          (i) * * *
                          (ii) Uncertified states and indian 
                        tribes.--A State or Indian tribe that 
                        has not made a certification under 
                        subsection (a) in which the Secretary 
                        has concurred shall use any amounts 
                        provided under this paragraph for the 
                        purposes described in [section 403] 
                        section 402(g)(6), 403, or 409.

           *       *       *       *       *       *       *


                                  
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