Politics & Government

Environmentalists contest coal company settlement

Environmental groups have asked a judge to set aside a proposed settlement under which a coal company accused of thousands of water-quality reporting violations would pay the state $507,000.

The settlement is too small and will not deter further violations by Nally & Hamilton Enterprises, the environmental groups said in a court motion. The company did not admit liability as part of the settlement, according to the motion.

The groups also claim that the proposed settlement between the coal company and the state is deficient for other reasons, including that state regulators apparently did not investigate whether Nally & Hamilton's violations resulted from fraud; that the agreement does not address whether the company's actions covered up serious pollution discharges; and that it does not specify what the company must do to fix problems. "We are contesting this agreement because citizens living in coal-impacted communities deserve much better from a taxpayer-supported state agency that is supposed to be diligently protecting people over corporate profits," Suzanne Tallichet, a member of Kentuckians for the Commonwealth, said in a news release.

An attorney filed the motion Thursday for that group and Appalachian Voices, Waterkeeper Alliance, Kentucky Riverkeeper and Pat Banks, who is with Kentucky Riverkeeper.

The state Energy and Environment Cabinet filed an administrative complaint against Nally & Hamilton in May. That was after the environmental groups alleged that the company had repeatedly submitted false and incomplete reports about pollution discharges from surface mines in seven Eastern Kentucky counties, committing 12,000 violations.

The state's case against Nally & Hamilton addressed the same issues.

State regulators negotiated a proposed settlement with the company and cabinet Secretary Len Peters signed it last month, according to the court motion.

A judge had let the groups intervene in that state complaint, but state officials did not include the groups in the settlement negotiations and Peters ignored their objections, according to their motion.

The state agreement does not explain the reason for settling on a $507,000 payment from Nally & Hamilton, which is less than 1 percent of the total maximum penalty, the environmental groups said in their motion.

Eric Chance, with Appalachian Voices, called the settlement amount a slap on the wrist.

"This settlement creates the appearance that the cabinet is doing its job while letting Nally & Hamilton off the hook for a huge but unknown number of serious violations," Chance said in a news release.

Franklin Circuit Judge Phillip Shepherd must approve the settlement, said Burke Christensen, a Richmond attorney representing the environmental groups.

The motion asks Shepherd to set aside Peters' approval of the deal. If that happens, the environmental groups want to be involved in negotiating a better settlement, Christensen said.

Dick Brown, spokesman for the Energy and Environment Cabinet, said the Cabinet thinks the claims made in the environmental groups' motion are without merit.

The proposed agreement was posted publicly, and comments supplied by the groups were made part of the record, Brown said.