Crime

Six owners of Eastern Kentucky coal mines among top 10 nationally for unpaid fines

Kentucky coal.
Kentucky coal. Herald-Leader

Coal operations in Eastern Kentucky accounted for six of the top 10 highest unpaid health and safety fines nationwide, according to an analysis by two news organizations.

In addition, fines at Eastern Kentucky mines were included in the delinquent payments of a seventh coal-mine owner in the top 10, West Virginia billionaire Jim Justice, but the report did not break out unpaid fines by state for his mines.

Mine Safety and Health News, a news service that covers federal mine regulatory issues, and National Pubic Radio teamed up for the analysis of unpaid federal fines.

The comparison showed that mines with delinquent penalties since 2009 have an injury rate that is 50 percent higher than mines that paid their fines.

At mines with delinquent fines from before and after 2009, the injury rate was 71 percent higher than at mines where the companies paid health and safety fines.

The mine operators with delinquent penalties reported nearly 4,000 injuries to employees. Twenty-five miners were killed while working at mines with delinquent fines, the report said.

The mine owner, or controller, with the highest amount of unpaid safety penalties as of Sept. 30, at $4.7 million, was Horace Garrison Hill of Virginia, who operated D&C Mining in Harlan County, according to the report.

Like many mines included on the list of top delinquencies, D&C is abandoned now. It produced coal worth $50 million during the time it was accumulating unpaid fines, according to the analysis.

The report said D&C continued operating while it failed to pay fines on 1,500 citations. The penalties dated back years when miner Rome Meade, 58, was crushed to death at D&C in an equipment accident in 2009.

Hill told NPR that mine managers were responsible for whatever occurred at D&C.

Three people with interests in a number of Eastern Kentucky mines collectively owed the second-highest amount of unpaid fines, at $2.9 million, the review found.

The report said mines with unpaid fines controlled by Ralph Napier, John D. North and Jack H. Ealy included K&D Mining, K and D Mining and Orion Resources. One mine also listed Connie Napier as a controller.

Ralph Napier and North also were the controllers of the Kentucky Darby LLC mine in Harlan County, where a methane explosion killed five miners in May 2006. The mine accounted for more than $500,000 of the unpaid fines.

The report said Napier did not respond to requests for comment.

In 2012, an attorney for Napier, North and Ealy told Congress the three couldn't pay fines because they'd spent all their money on miners' salaries, operations and safety needs.

Justice had the third-highest amount of unpaid fines, totaling $2.1 million at 71 mines, according to the report.

The report said Justice donated more than $50 million to various causes during the time his companies have had delinquent fines.

Other controllers with Eastern Kentucky mines whom the report identified as being among the top 10 in delinquent fines were Darrell Wagner, who owns Wilcoal Mining and Solid Fuel, based in Bell County; George Chris Waugh, who had mines in Knott, Floyd and Pike counties; Rowland Goble and Charles A. Ratliff, whose companies worked in Knott and Floyd counties; and the late Carl Kirk, who controlled mines in Martin, Floyd and other counties.

Most of the unpaid penalties covered in the review were 2 to 10 years old, though some went back 20 years, according to the report from Mine Safety and Health News and NPR.

Delinquent fines at coal mines have been a problem for a number of years.

Safety advocates argue that financial penalties are a key part of getting coal operators to follow safety laws. Fines are no deterrent if the operators can escape paying, advocates argue.

"If the operator knows that he can get by with not paying those expenses, then there's no incentive for the operator to comply with the health and safety regulations," Davis Sledd, a former assistant federal prosecutor who handled Eastern Kentucky mine-safety cases, told the news services.

Sledd compared it to speeding tickets being useless if drivers didn't have to pay them.

Lexington attorney Tony Oppegard, who represents miners in safety cases, said that not being forced to pay fines perpetuates lawlessness by some operators who cut corners to boost the bottom line.

Oppegard said he thought some coal operators in Eastern Kentucky "think they can act with impunity" because of the power the industry has had over jobs in a place with a history of little other well-paying employment.

The report by Mine Safety and Health News and NPR said delinquent mine-safety fines across the country total $77 million.

But a small percentage of mines account for the delinquencies. Only 7 percent of all mine controllers have delinquent fines, the report said.

Sledd and others interviewed for the report said the system for collecting penalties was weak. One problem is that the U.S. Mine Safety and Health Administration doesn't have authority to shut down a mine solely on the basis of unpaid fines, according to the report.

Another is that the person or company running the mine might be a contractor, while someone else controls decisions about matters such as safety.

Sledd said his experience was that people actually running mines sometimes concealed their identities.

MSHA chief Joe Main told the news services that the agency was doing all it could to collect penalties under the current system.

Delinquent penalties and a history of violations are among the criteria MSHA has used under Main to focus increased oversight on some mines.

"We do not wait for them to rack up fines before we do something these days, like we did in the past," Main said.

Legislative proposals to toughen the collection system have not succeeded.

For the complete report, go to Bit.ly/1y0Hjwu.

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