Politics & Government

Proposal to spend $1 billion in struggling coal regions faces uncertain future

A coal train near Typo Tunnel Lane in Typo on Dec. 11, 2006.
A coal train near Typo Tunnel Lane in Typo on Dec. 11, 2006. LEXINGTON HERALD-LEADER

A White House proposal to spend $1 billion in coal regions struggling with a downturn in jobs faces an uncertain outcome.

However, the Obama Administration is still pushing on the proposal, and local resolutions supporting it continue to increase in Eastern Kentucky and nearby areas.

More than 20 counties or cities in the Central Appalachia coalfield have passed resolutions backing the proposal, said Eric Dixon of the Appalachian Citizens' Law Center in Whitesburg.

That number has tripled since two months ago.

"The momentum continues to build," said Dixon, who has worked with local governments on the resolutions.

The White House calls the idea the POWER+ plan. President Obama announced it in February.

The proposal is intended to help areas where changes in the nation's energy landscape have driven down coal-industry jobs that once underpinned the economy, or caused coal-fired power plants to close.

The number of coal jobs in Eastern Kentucky has plunged by half in recent years because of factors that include competition from cheap natural gas and other coal regions, tougher federal rules to protect air quality, and the depletion of easy-to-reach reserves.

Harlan County Judge-Executive Dan Mosley said he thinks real unemployment in the county is around 30 percent.

"The local employment situation is still dire," Mosley said. "People are struggling."

Obama's plan has several pieces, including job training for laid-off miners; funding for infrastructure projects; money to shore up pensions for 100,000 retired union miners or their families; and tax credits to promote the use of technology to capture power-plant emissions of carbon dioxide, a big contributor to climate change.

Another key piece called for spending $1 billion from the federal abandoned mine land, or AML, fund. Coal companies pay a fee into the fund on each ton of coal mined. The fund is to be used to fix problems such as landslides and water pollution from mining that took place before 1977, when Congress approved new surface-mining rules.

About $2.5 billion has built up in the fund. Obama called on Congress to approve spending $1 billion of it over five years, which is much more quickly than it would be distributed otherwise.

The idea is to tie the reclamation work to projects that would help diversify the economy or provide a longer-term economic benefit, such as reclaiming sites to be used for forestry, agriculture or tourism.

The money would be shared among about 10 states, so it would not be nearly enough to fix all the abandoned mine sites in Kentucky. There was $461 million worth of unfunded AML projects in the state as of April.

But there would be enough money for a significant boost to efforts to transform coalfield economies in Appalachia, said Dixon, who has studied the AML fund.

"The plan would help create immediate jobs reclaiming abandoned mines and would empower communities to develop long-term job-creating projects on reclaimed mines," he said.

Dixon said that's why a number of local governments have signed resolutions supporting the proposal.

In Kentucky, fiscal courts in Pike, Bell, Perry, Floyd, Harlan and Letcher counties, as well as the cities of Whitesburg, Vicco, Evarts, Benham and the Benham Power Board approved resolutions backing the White House proposal, said Dixon.

"That's gonna create a lot of opportunities," Mosley, a Democrat, said of the AML proposal. "With our unemployment rate through the roof, it was a no-brainer for us to pass the resolution."

In addition, 11 counties or cities in Virginia, West Virginia and Tennessee, as well as a regional planning commission in Virginia, also have gone on record supporting the proposal.

The Appalachian Citizens' Law Center, Kentuckians for the Commonwealth, Appalachian Voices and others have pushed for support for the proposal.

Supporters of the plan said they appreciated the announcement this week of nearly $15 million for projects across the country under the plan, including $6 million in Kentucky.

The AML proposal would dwarf that, however, said Carl Shoupe, a former miner in Harlan County and member of Kentuckians for the Commonwealth.

"A lot more could be done by Congress passing the POWER+ initiative," he said.

Many of the resolutions in Kentucky call on Republican U.S. Rep. Hal Rogers, whose district includes the Eastern Kentucky coalfield, to push for Obama's proposal.

Rogers, chairman of the powerful House Appropriations Committee, did support the pieces of the proposal that were under his purview in the budget process, said his chief of staff, Megan O'Donnell Bell.

That included millions in funding for job training for laid-off miners and other programs in the current budget.

Bell said Rogers included money to continue such programs in the next budget.

Rogers also put an additional $30 million in the House version of the fiscal year 2016 budget for a program aimed at accelerating reclamation of abandoned mine sites "with economic and community-development end uses in mind," according to the committee language.

That money would go to the three Appalachian states with the most serious abandoned-mine reclamation needs, which includes Kentucky.

Rogers said he would work to keep that money in the overall budget, which must still be hammered out with the Senate.

However, the AML part of Obama's plan faces a hurdle because it would require a change in the surface-mining law, as opposed to just a budget appropriation.

Rogers' office said the White House did not provide suggested legislative language on implementing the plan early enough during the House budget process.

The proposal could still be included as the House and Senate work on the budget, but concern that Western coal states would lose AML money to Eastern states could be another roadblock.

Most of the damage from abandoned, pre-1977 mines is in Appalachian states, so they would stand to get the most money under Obama's proposal.

However, Wyoming accounts for about 40 percent of the nation's coal mining, and as a result a big share of the money that goes into the AML fund.

Wyoming officials have argued the state has been shortchanged at times in AML funding.

In 2012, for instance, the state was "singled out" for a steep cut in AML money, said Joe Spiering, spokesman for Wyoming U.S. Rep. Cynthia Lummis, a Republican.

Spiering described Obama's AML proposal as a "raid" on the fund, and said every state that gets money from it, east and west, "should be concerned about moving AML dollars and the authority over how to spend them from successful state AML programs to bureaucrats in Washington."

Rogers said he has long advocated for Kentucky to get more AML money, but Wyoming interests have blocked such changes.

"As much as I'd like to see a change in what we get out of the AML fund, the doing of that is a herculean task that a lot of us have been unable to do all these years," Rogers said.

Rogers said he'll need help from the White House to change the AML law.

Jason Walsh, a White House policy advisor who took part in a conference call with reporters this week, said the White House is still vigorously working on the POWER+ proposal.

Administration officials have been talking with members of Congress on legislative language, and want to make sure any bill has bipartisan support, he said.

"We need Congress to work with us," Walsh said.