The coal industry’s compliance with mining and reclamation rules improved slightly in the latest evaluation period but was still well below the level achieved nearly a decade ago, according to a new federal report.
Federal regulators also found that five of nine bonds forfeited by coal companies that were examined as part of the report were not large enough to cover the entire cost of reclaiming the mined areas, the report said.
However, those forfeitures happened before the state implemented changes aimed at fixing the problem.
The findings were part of an annual review of Kentucky’s surface-mining program by the U.S. Office of Surface Mining Reclamation and Enforcement.
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Kentucky has authority to enforce federal surface-mining rules in the state, with OSM oversight.
The latest report covered July 1, 2014, to June 30, 2015. OSM provided it to the Herald-Leader this week.
The report said the state has made significant improvements in assessing the potential impact of surface and underground mines on watersheds.
The state also has had continued success in effectively reclaiming abandoned mine sites and has been a leader in promoting planting trees to reclaim surface-mined areas, the report said.
However, the number of acres with reforestation as the intended post-mining land use went down 41 percent during the evaluation period.
That follows a trend of fewer mining permits being issued, the report said.
Kentucky’s coal industry, especially in the eastern end of the state, has been hit hard the last few years by a combination of competition from cheap natural gas, tougher federal environmental rules and the growth of renewable-energy sources.
Coal production has plunged and jobs are down by more than half.
Regulators are supposed to do one full and two partial inspections each quarter on each active mine site and one full inspection on inactive and abandoned sites.
In the 2014-15 period, there were more than 1,600 “inspectable units,” which include surface mines, the above-ground areas of underground mines, and infrastructure such as haul roads and coal-washing plants.
The report said the state met the required inspection frequency on 98 percent of sites, though state officials said their records show a 99 percent rate.
Inspectors did fewer partial inspections than required, but completed nearly 600 more full inspections than required, for a total of more than 19,000 overall.
Kentucky had traditionally met the required frequency on more than 98 percent of sites, but slipped to 83 percent in the 2008-09 year, when a large number of inspectors retired and budget shortfalls prevented filling the slots.
The concern over not completing all inspections is that environmental violations could go unabated for some time.
The report said state officials pushed to improve the inspection frequency after the dip a few years ago, stressing the importance of inspections and using supervisors and other employees to bolster that work.
The downturn in mining also played a role because the number of active mines to inspect went down.
The state met the required inspection frequency on 100 percent of units in the 2012-13 year and 99 percent in 2013-14.
The OSM report noted the Kentucky Department for Natural Resources, which enforces the surface-mining law, put more inspectors on the job in 2014-15 than the prior year.
Still, tight budgets have prevented the state from meeting the required match for federal funds for the program.
That means the state does not draw down all available federal funding — a total of more than $6 million since 2008, according to federal reports.
The report said the coal industry’s compliance with environmental and reclamation standards was 69 percent in 2014-15, up from 68 percent the year before.
OSM defines that rate as the percentage of random, joint inspections by federal and state officials in which they see no violations.
Those violations include things such as mud or water from mines causing impacts to nearby areas or runoff that exceeds limits on pollutants.
The industry improved its compliance rate from 60 percent in 1990 to a high of 88 percent in 2005-06 and held it there for awhile, but the rate slid to 65 percent in 2009-10, according to OSM.
The latest report said 87 percent of mine sites inspected in 2004-15 were free of impacts to areas outside the permit boundaries, the same as the year before.
The report said five of the nine reclamation bonds reviewed were not high enough to cover the cost of properly reclaiming mines.
Coal companies have to post bonds that the state can use reclaim mines if the companies don’t do so as required.
OSM has said in prior evaluations that most bonds it studied some years were not sufficient to properly reclaim areas.
The forfeited bonds reviewed for the 2014-15 report covered only 39.5 percent of the cost of proper reclamation, OSM calculated.
However, companies forfeited those bonds before the state put new standards in place under pressure from OSM.
The new rules include higher required bonds and a bond pool aimed at guaranteeing reclamation.
“The current bonding scheme is adequate,” said Allen Luttrell, commissioner of the state Department for Natural Resources.
OSM said the changes should mean a dramatic drop in the number of inadequate bonds.