[House Report 113-364]
[From the U.S. Government Publishing Office]


113th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     113-364

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



 
 PREVENTING GOVERNMENT WASTE AND PROTECTING COAL MINING JOBS IN AMERICA

                                _______
                                

 February 28, 2014.--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

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 2824]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Natural Resources, to whom was referred 
the bill (H.R. 2824) to amend the Surface Mining Control and 
Reclamation Act of 1977 to stop the ongoing waste by the 
Department of the Interior of taxpayer resources and implement 
the final rule on excess spoil, mining waste, and buffers for 
perennial and intermittent streams, and for other purposes, 
having considered the same, report favorably thereon without 
amendment and recommend that the bill do pass.

                          Purpose of the Bill

    The purpose of H.R. 2824 is to amend the Surface Mining 
Control and Reclamation Act of 1977 to stop the ongoing waste 
by the Department of the Interior of taxpayer resources and 
implement the final rule on excess spoil, mining waste, and 
buffers for perennial and intermittent streams.

                  Background and Need for Legislation

    This legislation is the result of years of ongoing 
dysfunction and waste at the Department of the Interior's 
Office of Surface Mining. Regrettably the Obama Administration 
made the reckless decision to discard the results of a 
multiyear rulemaking process for a Stream Buffer Zone Rule that 
concluded in 2008 in favor of starting from scratch with its 
own new rulemaking. That rulemaking process has been an 
unmitigated disaster which has already taken five years and 
cost the taxpayers more than $9 million without a single 
result. Meanwhile, states, industry and workers are left in 
limbo unsure of what the operating rules are on the ground. To 
stop the waste and provide clarity to states and the 
Administration, the bill implements the 2008 rule then directs 
the Department of the Interior to study the impact of the rule 
for a prescribed time period prior to initiating another new 
rulemaking. This will provide certainty to the economy, the 
various agencies and states and allow a clear examination of 
what may need to be changed in the future so that further 
costs, wasteful bureaucratic mistakes are not made resulting in 
lawsuits.
    The Surface Mining Control and Reclamation Act of 1977 
(SMCRA) is the primary federal law that regulates the 
environmental effects of coal mining in the United States. 
SMCRA created two programs: title V for regulating active coal 
mines and title IV for reclaiming abandoned mine lands. SMCRA 
also created the Office of Surface Mining (OSM), an agency 
within the Department of the Interior, to promulgate 
regulations, to fund state regulatory and reclamation programs, 
and to ensure consistency among state regulatory programs.
    Twenty-five states and three Tribal Nations have coal 
operations. Twenty-three states have primacy (this means that 
the state has the responsibility for carrying out the 
provisions of SMCRA within the state) over the title V and 
title IV programs in their states. Two Tribal Nations have 
submitted regulatory programs under title V to OSM for approval 
for primacy. Currently the 23 primacy states are still 
operating under the 1983 stream buffer zone rule. The 2008 rule 
only affects Tennessee, Washington and the three Tribal 
Nations--the Crow, Navajo and Hopi.
    State primacy is important in that each state has different 
topography, geologic parameters and climatic conditions that 
can and do affect permit requirements. The state regulators 
have the firsthand knowledge and expertise to develop 
regulations and administer them for the on-the-ground 
environmental conditions found within the state.

                      BACKGROUND (112TH CONGRESS)

    On December 12, 2008, after a five-year deliberative 
process that included extensive environmental analyses, public 
comment, and a concurrence from the Environmental Protection 
Agency,\1\ published its final rule on ``Excess Spoil, Coal 
Mine Waste, and Buffers for Perennial and Intermittent 
Streams,'' commonly referred to as the Stream Buffer Zone Rule 
in the Federal Register. The rule was to go into effect on 
January 12, 2009.\2\
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    \1\http://s3.amazonaws.com/propublica/assets/docs/
johnson_kempthorne_letter_081204.pdf.
    \2\http://www.gpo.gov/fdsys/pkg/FR-2008-12-12/html/E8-29150.htm
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    However, before the new regulation could go into effect, 
the National Parks Conservation Association and Coal River 
Mountain Watch filed suit against the Department of the 
Interior and OSM for failing to consult with the Fish and 
Wildlife Service with regards to endangered species.\3\
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    \3\Referenced lawsuits were filed in December 2008 and January 
2009, effectively stopping the implementation of the Stream Buffer Zone 
Rule. Coal River Mountain Watch, et. al v. Salazar No. 08-2212 (D.D.C) 
filed; National Parks Conservations Ass'n v. Salazar No. 09-115 (D.D.C)
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    OSM announced that it was withdrawing the newly promulgated 
regulation and attempted to put in place more restrictive 
regulations using guidance documents. The National Mining 
Association (NMA) challenged these actions under the 
Administrative Procedure Act (APA). The court ruled against the 
Department, holding that withdrawing the rule without public 
notice and comment would violate the APA, and said that OSM 
could only change or revoke the regulations by going through a 
formal rulemaking process. OSM then reached an out-of-court 
settlement with the environmental groups agreeing to an 
expedited time frame for writing the rule (the Department 
agreed to publish the rule by February 28, 2011).
    While Interior Secretary Salazar claimed in court documents 
that the rule was ``legally infirm,'' internal memorandum and 
documents from OSM show that the Obama Administration began 
working to change the rule immediately upon taking office. In 
fact, in OSM's June 18, 2010, Federal Register Notice 
announcing the new ``Stream Protection Rule'' it stated: ``we 
had already decided to change the rule following the change of 
Administrations on January 20, 2009.''\4\
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    \4\http://www.gpo.gov/fdsys/pkg/FR-2010-06-18/html/2010-14727.htm
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    On January 26, 2011, portions of the environmental impact 
statement being prepared in support of the new ``Stream 
Protection Rule'' were leaked to the public. The Associated 
Press reported that OSM's preferred ``Stream Protection Rule'' 
could cost at least 7,000 jobs and reduce coal production in 22 
states.\5\
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    \5\http://www.wvgazette.com/News/MiningtheMountains/201101280708
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    Embarrassed by the critical reporting and the ensuing 
outrage at the projected job losses, OSM attempted to have the 
contractor that calculated the job loss numbers revise its 
initial findings by assuming that the 2008 rule had been 
implemented and was in effect across the country, when this was 
not the case. When the contractor refused, the Administration 
cancelled the contract.
    Shortly after the press reports and the dismissal of the 
contractor the Committee on Natural Resources launched an 
investigation into the Obama Administration's efforts to 
rewrite the 2008 Stream Buffer Zone Rule.
    After several oversight hearings and interviews with 
contractors and subcontractors working on the new rulemaking, 
it was clear that one of the problems for the Administration 
and major frustrations for the states that were cooperating 
agencies was the expedited time frame the Administration had 
agreed to for issuing the rule as part of the settlement 
agreement with the environmental organizations. According to 
several sources, this was an unprecedented timeframe to 
complete rulemaking of this magnitude.
    The Committee's solution was to craft a bill that would 
serve to extend the rulemaking exercise, giving the 
Administration time to put together a defensible rule.
    In November 2011, Congressman Bill Johnson (R-OH) 
introduced H.R. 3409, the Coal Miner Employment and Domestic 
Energy Infrastructure Protection Act.
    On September 20, 2012, the Committee's oversight office 
released a report on the status and findings in the on-going 
investigation into the re-write of the ``Stream Buffer Zone 
Rule.''\6\
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    \6\http://naturalresources.house.gov/oversight/coalregs/
---------------------------------------------------------------------------
    H.R. 3409 was a part of the Stop the War on Coal Act and 
passed the House on September 21, 2012.\7\
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    \7\http://naturalresources.house.gov/news/
documentsingle.aspx?DocumentID=309512
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                             113TH CONGRESS

    In late January 2013, environmental groups announced that 
they were reopening their lawsuit on the 2008 Stream Buffer 
Zone Rule because the Department had missed all of the agreed 
upon deadlines for the new rulemaking.
    Partly in response to the renewed litigation, the Committee 
has sent two additional letters to Secretary Salazar, the first 
on February 22, 2013, and the second on March 23, 2013, 
requesting information about the current status of the rule, 
asking for information about communications with the litigants, 
and expressing the Committee's disappointment in the lack of 
transparency and failure to comply with the Committee's 
document requests
    Finally, on April 2, 2013, the Committee on Natural 
Resources received a response to the February 22, 2013, letter 
from Joseph Pizarchik, Director of OSM. While the response did 
not provide everything that the Committee had requested, 
Pizarchik stated: The Stream Protection Rule remains under 
development, as does its associated Draft Environmental Impact 
Statement (EIS) and Regulatory Impact Analysis (RIA). At this 
time, OSM plans to publish a proposed rule in 2014.
    In addition, he stated that OSM has spent approximately 
$8.6 million on the rulemaking exercise, $6 million of which 
has been spent for the EIS and RIA, although neither has been 
completed. Some of the original money was reprogramed from 
state SMCRA programs. For comparison the Stream Buffer Zone 
Rule cost the previous Administration approximately $5 million 
for a five year process.
    Five months after the latest request, the Committee 
received another production of documents in response to the 
request for information about the Department's communications 
with the plaintiffs and the status of the litigation. Many of 
the documents received were redacted so that all relevant 
information was withheld from Congress. The latest Federal 
Register update estimates that the Department will publish a 
proposed rule in August 2014, more than five months from now.

                      LATEST FEDERAL COURT ACTION

    On July 17, 2013, the Department went back to federal court 
and again agreed with the environmental plaintiff groups in 
asking the court to vacate the 2008 Rule. This same request was 
denied in 2009 when the court told the Administration that 
granting its request to vacate the rule would ``wrongly allow 
the Federal Defendants to do what they cannot do under the APA, 
repeal a Rule without notice and comment.''\8\
---------------------------------------------------------------------------
    \8\National Parks Conservation Ass'n v. Salazar, 660 F.Supp 2d 3 
(D.D.C. 2009)
---------------------------------------------------------------------------
    Once again, this legislation is the direct result of the 
ongoing dysfunction, mismanagement, and waste at the Department 
of the Interior's OSM. In the last four years since the 
Department first made the decision to reject the 2008 Rule, it 
could have completed a simple rulemaking to vacate the 2008 
Rule, could have completed a thorough and valid notice and 
comment rulemaking for their proposed Stream Protection Rule, 
or could have decided to implement the 2008 Rule that is 
already on the books. Unfortunately, the Obama Administration 
has done none of those things. Rather it fired or dismissed 
contractors, refused to comply with legitimate oversight from 
the Committee on Natural Resources and cost the taxpayers more 
than $9 million, without a single result.

                      Section-by-Section Analysis


Section 1. Short title

    This Act may be cited as Preventing Government Waste and 
Protecting Coal Mining Jobs in America.

Section 2. Incorporation of surface mining stream buffer zone rule into 
        State programs

    H.R. 2824 amends Section 503 of SMCRA by requiring states 
with approved programs under the Act to adopt as part of their 
program a rule promulgated by OSM on December 12, 2008, 
concerning excess spoil, coal mine waste and buffers for 
perennial and intermittent streams. States would have a two-
year period to submit a program amendment that incorporates the 
2008 Rule.
    Once all of the state plans have been approved, the effects 
of the new regulations will be analyzed for a period of five 
years. On completion of the analysis, OSM is required to report 
back to the House and Senate Committees with jurisdiction over 
SMCRA on the effectiveness of the rule, impact on energy 
production, and identify and justify anything that should be 
addressed through a new rulemaking process.

                            Committee Action

    H.R. 2824 was introduced on July 25, 2013, by Congressman 
Bill Johnson (R-OH). It was referred to the House Committee on 
Natural Resources and within the Committee to the Subcommittee 
on Energy and Mineral Resources. On August 2, 2013, the 
Subcommittee held a hearing on the bill. On November 14, 2013, 
the Natural Resources Committee met to consider the bill. The 
Subcommittee on Energy and Mineral Resources was discharged 
from the bill by unanimous consent. An amendment offered by Mr. 
Holt.001 was NOT AGREED TO by a bipartisan vote of 15 to 24, as 
follows:


    An amendment offered by Mr. DeFazio.002 was NOT AGREED TO 
by voice vote. The bill was adopted and favorably reported to 
the House of Representatives by a bipartisan vote of 24 to 15, 
as follows:


            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:

H.R. 2824--Preventing Government Waste and Protecting Coal Mining Jobs 
        in America

    H.R. 2824 would require certain states to implement, within 
two years, a rule published in 2008 by the Office of Surface 
Mining, Reclamation, and Enforcement (OSM) regarding the 
disposal of mine waste near streams (the stream buffer zone 
rule). The bill also would require OSM to assess the 
effectiveness of that rule after five years of implementation 
and to report its findings to the Congress. Finally, the bill 
would prevent OSM from issuing a new rule regarding stream 
buffer zones until the agency completes the report required 
under the bill.
    CBO estimates that implementing the bill would have no 
significant impact on the federal budget. Enacting the bill 
could affect offsetting receipts, which are treated as 
reductions in direct spending; therefore, pay-as-you-go 
procedures apply. However, CBO estimates that any such effects 
would be negligible. Enacting H.R. 2824 would not affect 
revenues.
    Under the 2008 stream buffer zone rule, which CBO expects 
would be implemented through 2021 under the bill, firms would 
be allowed to dispose of mine waste near streams if regulators 
determine that avoiding disturbance of the streams is not 
reasonably possible. Under the rule OSM is currently 
implementing, firms are prohibited from disposing of mine waste 
within 100 feet of streams; however, according to the Office of 
Information and Regulatory Affairs, OSM is in the process of 
preparing a new rule to govern such disposal. CBO has no 
information regarding the content of the new rule or when it 
might be implemented.
    The budgetary impact of enacting H.R. 2824 would depend, in 
part, on whether the stream buffer zone rule implemented under 
the bill would be more or less restrictive than the rule 
implemented under current law. If the rule implemented under 
the bill imposed relatively fewer restrictions on the disposal 
of mine waste, coal producers would use less costly methods to 
dispose of such waste and CBO expects that firms producing coal 
would increase their valuation of coal leases affected by the 
rule, including leases on federal lands. Under such a rule, CBO 
expects that proceeds to the federal government would increase 
from the sale of federal coal leases. Conversely, a relatively 
more restrictive disposal rule would reduce the value of coal 
leases and thus the proceeds from the sale of coal leases on 
federal lands.
    Based on information provided by OSM, CBO expects that 
implementing a new stream buffer zone rule would primarily 
affect coal mining that requires the removal of mountaintops in 
the Appalachian Mountains. In 2012, the federal proceeds from 
activities related to coal mining on federal lands in that area 
totaled $1.5 million. Because the existing federal proceeds 
from the area affected by this bill are small, and because it 
is unclear whether the rule imposed by this bill would be more 
or less restrictive than the rule that OSM will impose under 
current law, CBO expects that firms in the coal industry would 
not significantly change their valuation of coal leases under 
the bill, and therefore, that enacting H.R. 2824 would have a 
negligible impact on the federal budget.
    H.R. 2824 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA). 
The bill would impose additional requirements on states and 
tribal governments that choose to apply for exclusive 
jurisdiction--or ``primacy''--in regulating surface mining 
operations within their jurisdiction. However, those 
requirements would be conditions of participating in a 
voluntary federal program and thus not mandates as defined in 
UMRA.
    The CBO staff contacts for this estimate are Jeff LaFave 
(for federal costs) and Michael Kulas (for the state and local 
impact). 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, spending authority, credit authority, or an increase 
or decrease in revenues or tax expenditures. CBO estimates that 
implementing the bill would have no significant impact on the 
federal budget.
    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 stop the ongoing waste by the 
Department of the Interior of taxpayer resources and implement 
the final rule on excess spoil, mining waste, and buffers for 
perennial and intermittent streams.

                           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.

                       Compliance With H. Res. 5

    Directed Rule Making. The Chairman does not believe that 
this bill directs any executive branch official to conduct any 
specific rule-making proceedings.
    Duplication of Existing Programs. This bill does not 
establish or reauthorize a program of the federal government 
known to be duplicative of another program. Such program was 
not included in any report from the Government Accountability 
Office to Congress pursuant to section 21 of Public Law 111-139 
or identified in the most recent Catalog of Federal Domestic 
Assistance published pursuant to the Federal Program 
Information Act (Public Law 95-220, as amended by Public Law 
98-169) as relating to other programs.

                Preemption of State, Local or Tribal Law

    This bill is not intended to preempt any State, 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 (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

           SURFACE MINING CONTROL AND RECLAMATION ACT OF 1977




           *       *       *       *       *       *       *
TITLE V--CONTROL OF THE ENVIRONMENTAL IMPACTS OF SURFACE COAL MINING

           *       *       *       *       *       *       *



                             state programs

  Sec. 503. (a) * * *

           *       *       *       *       *       *       *

  (e) Stream Buffer Zone Management.--
          (1) In general.--In addition to the requirements 
        under subsection (a), each State program shall 
        incorporate the necessary rule regarding excess spoil, 
        coal mine waste, and buffers for perennial and 
        intermittent streams published by the Office of Surface 
        Mining Reclamation and Enforcement on December 12, 2008 
        (73 Fed. Reg. 75813 et seq.).
          (2) Study of implementation.--The Secretary shall--
                  (A) at such time as the Secretary determines 
                all States referred to in subsection (a) have 
                fully incorporated the necessary rule referred 
                to in paragraph (1) of this subsection into 
                their State programs, publish notice of such 
                determination;
                  (B) during the 5-year period beginning on the 
                date of such publication, assess the 
                effectiveness of implementation of such rule by 
                such States; and
                  (C) upon the conclusion of such period, 
                submit a comprehensive report on the impacts of 
                such rule to the Committee on Natural Resources 
                of the House of Representatives and the 
                Committee on Energy and Natural Resources of 
                the Senate, including--
                          (i) an evaluation of the 
                        effectiveness of such rule;
                          (ii) an evaluation of any ways in 
                        which the existing rule inhibits energy 
                        production; and
                          (iii) a description in detail of any 
                        proposed changes that should be made to 
                        the rule, the justification for such 
                        changes, all comments on such changes 
                        received by the Secretary from such 
                        States, and the projected costs and 
                        benefits of such changes.
          (3) Limitation on new regulations.--The Secretary may 
        not issue any regulations under this Act relating to 
        stream buffer zones or stream protection before the 
        date of the publication of the report under paragraph 
        (2), other than a rule necessary to implement paragraph 
        (1).

           *       *       *       *       *       *       *


                            DISSENTING VIEWS

    This bill is an unwarranted ambush on an ongoing rulemaking 
process, an uncharacteristic attack by the Majority on the 
principle of federalism and states' rights, and an 
unconscionable assault on the health of the residents of 
Appalachian communities suffering from the devastating impacts 
of mountaintop removal mining.
    As documented by a 2005 Environmental Impact Statement, 
nearly 2,000 miles of streams were buried or degraded by 
mountaintop removal mining from 1985 through 2002. Mountaintop 
removal mining destroys wildlife habitat, contaminates surface 
and drinking water, leads to flooding, and as a number of new 
studies show, increases the incidence of cancer, birth defects, 
lung disease, and heart disease in people who live nearby.
    Unfortunately, the Majority has willfully ignored the 
negative health and environmental impacts of mountaintop 
removal mining. Instead, they have trained their fire on the 
Obama Administration's attempts to write a rule that would 
actually protect streams, as opposed to the illegal Bush 
Administration's midnight rule that undermined existing 
protections put in place by President Reagan, and was recently 
vacated by a U.S. district court.
    The Majority has conducted a multi-year investigation into 
the drafting of the Stream Protection Rule, holding three 
oversight hearings with the Director of the Office of Surface 
Mining, issuing two subpoenas, receiving over 13,500 pages of 
documents and 25 hours of audio recordings. However, this witch 
hunt has uncovered no misconduct on the part of the Department 
of the Interior (DOI) or the Office of Surface Mining--a 
conclusion also reached by the DOI Office of Inspector General 
in a report released in December 2013. However, the 
investigation has succeeded in distracting the Department from 
completing the rulemaking and wasting taxpayer money; the 
Department reported that in 2013, responding to all the 
document requests from the Majority took over 19,000 staff 
hours at a cost of nearly $1.5 million.
    H.R. 2824 attempts to prevent the Office of Surface Mining 
from moving forward with a new rule, before a draft rule has 
even been published or debated. Further, the bill forcibly 
enacts the 2008 Bush rule in every state with a coal mining 
program, regardless of whether the state prefers to maintain 
stricter standards, and despite the fact that the rule was 
vacated on February 20, 2014, by the D.C. District Court. 
Requiring the states to adopt a vacated rule will result in a 
tremendous waste of state resources, as the states could be 
forced into litigation immediately upon adoption, and then 
would be required to adopt the new rule when it is finalized.
    Finally, the bill's mandatory implementation period means 
that no attempt could be made to protect Appalachian streams 
from mountaintop removal mining before 2021. In the meantime, 
streams will continue to get buried, habitat will continue 
being destroyed, threatened and endangered species will 
continue being harmed, and communities throughout the region 
will continue to suffer from degraded water quality, flooding, 
and health impacts.
    During markup up on H.R. 2824, the Majority rejected an 
amendment by Energy and Mineral Resources Subcommittee Ranking 
Member Holt that would have allowed the Secretary of the 
Interior to take into account the growing body of peer-reviewed 
scientific evidence that mountaintop removal mining is harmful 
to the health of nearby communities, and an amendment by 
Ranking Member DeFazio that would have kept in place 
implementation of the Reagan Administration rule.
    We strongly oppose H.R. 2824, a bill that would force 
states to enact an illegal rule and prohibit the Administration 
from implementing thoughtful protections for the environment 
and communities from the impacts of mountaintop removal mining.

                                   Peter A. DeFazio.
                                   Rush Holt.
                                   Matt Cartwright.
                                   Jared Huffman.
                                   Katherine M. Clark.
                                   Raul M. Grijalva.
                                   Grace F. Napolitano.
                                   Alan S. Lowenthal.
                                   Madeleine Z. Bordallo.

                                  
