Kentucky

Feds crack down on collecting mining fines

Federal regulators are trying to get tougher with Kentucky coal companies that haven't paid overdue fines for health and safety violations, filing two federal collections lawsuits and shutting down one mine so far this year.

Such collection efforts were unusual until about three years ago.

The latest lawsuit charges that Right Fork Energy Inc. hasn't paid $201,000 in fines it owes for safety violations at three Pike County mines in 2006 and 2007.

An attorney representing the U.S. Mine Safety and Health Administration filed the lawsuit in federal court in Pikeville earlier this week.

"We're taking a heavier hand with these operators," said Amy Louviere, spokeswoman for MSHA.

The agency has filed similar lawsuits in other states as well, Louviere said.

No one from Right Fork Energy was available for comment. Federal records list only one mine for the company, and it shows no production there after 2006.

In January, MSHA sued Kentucky Darby LLC, a Harlan County mine where an explosion killed five workers and injured another in May 2006.

The lawsuit alleges that the company has failed to pay $505,000 it owes for safety citations before the blast, even though it agreed to pay.

Kentucky Darby said in its response to the lawsuit that it can't pay because it has no money. The company spent nearly $1 million making its mine at Holmes Mill safe after the explosion, but hasn't produced coal there since, the company said.

The lawsuit is pending.

And in March, MSHA issued an order shutting down a Knott County mine operated by Double A Mining Inc., because the company owed more than $300,000 in delinquent fines.

It was the first time MSHA had shut down a mine anywhere in the country because of unpaid fines.

The agency anticipates filing more lawsuits and issuing more closure orders, Louviere said.

"We will continue to pursue scofflaw mine operators that have significant delinquent debt," she said.

In the last two to three years, MSHA also has obtained injunctions or judgments against several other Kentucky coal companies in cases involving unpaid fines. Some other companies paid delinquent fines in the face of potential sanctions, such as being shut down.

One was Liggett Mining, which agreed in December to pay $276,000 in delinquent fines for safety violations at five Eastern Kentucky mines, according to MSHA.

Tony Oppegard, a Lexington lawyer who formerly worked for MSHA and Kentucky's mine-safety agency, said he thinks MSHA's more aggressive collection efforts grew from a spike in coal-mining deaths in 2006.

In addition to the blast in Harlan County, an explosion at a West Virginia mine killed 12 workers. Nationwide, MSHA counted a total of 47 deaths in coal mines in 2006, up from 31 the year before.

One issue highlighted in 2006 was that MSHA had failed to collect millions in safety fines levied against coal operators. That lack of enforcement undercut the incentive for companies to operate safely and avoid fines, safety advocates argued.

Companies routinely circumvented MSHA's usual administrative system for collecting fines, and the agency was not aggressive enough in going after payments, Oppegard said.

"I think it was an abysmal system for years," he said.

The agency is to be commended now for taking a tougher tack, Oppegard said.

Louviere said MSHA decided it needed to take a more aggressive approach against some companies than the standard collection process.

Congress and states approved safety changes after the 2006 mine disasters, including requirements for more inspections, improved communications and higher federal fines for violations.

After those changes, MSHA also began issuing notices to coal companies that they had a pattern of safety violations. That designation can lead to sanctions such as being shut down if companies don't correct the problem.

The rule had been on the books since the late 1970s, but MSHA hadn't used it much.

The enforcement has not gone unnoticed in the coal industry.

Bill Caylor, president of the Kentucky Coal Association, said it seems that safety inspectors are citing underground mine operations more frequently and that fines are higher.

Some citations are justified, but the industry questions whether others are, Caylor said.

"It's a new day, and it's a tough one for a lot of people," Caylor said. "It's very costly on underground mining right now."

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