The National Mining Association (NMA) is seeking Federal assistance to help the coal mining industry survive the fall out of the coronavirus. The NMA has asked the Trump administration to designate the entire coal supply train (mines, barges, railroads and power plants) as “critical infrastructure” under a 2013 Presidential policy directive.
However, Trump has declined the NMA request but instead promised to deploy the Defense Production Act, which gives him the power to guarantee supplies of resources necessary to national security, in the fight against COVID-19. Whether through that law or “other means,” the NMA said it wants Trump to stop coal-fired power plants from shutting down.
Additionally, the NMA is arguing for relief to Federal Black Lung fees. Even before the Covid-19 crisis, the nation’s coal mining companies were struggling to comply with the $1.10 per ton fee on underground mined coal and $0.55 per ton on surface mined coal. Congress restored the black lung tax in 2018 despite opposition from the NMA.
Recently, Democrats have proposed legislation to extend those rates for 10 more years. However, the NMA is seeking to have the fees cut back to the original 1977 levels of $0.50 per ton for underground coal and $0.25 for surface mined coal. The NMA argues that the current fee structure costs the industry $220 million.
The U.S. Department of Labor advised Congress that no one will lose benefits regardless of the rate because Black Lung benefits are guaranteed by the U.S. Treasury. However, according to the Government Accounting Office (GAO), a 25% increase in the black lung rate would avoid leaving taxpayers with a multi-billion-dollar burden by 2050.
In addition, the NMA is asking Congress to temporarily halve the Abandoned Mine Land (AML) fee. In 2019, coal mine companies paid $142 million in fees to fund abandoned mine clean up nationwide. If cut in half, the rates would be 14 cents per surface ton, 6 cents per underground ton and 4 cents per ton of lignite. In 2019, the anthracite mining industry paid $564,629.31 into the AML fund.
The NMA’s final request to Congress was to suspend or reduce Federal royalty payments. According to the group, the 12.5 % per ton paid on public land, which is the same for gas and oil production is generally much higher than on private land.
According to NMA President and CEO, Rich Noland, “This relief is in line with other industries and will help companies mitigate the economic impact of Covid-19.”Go back to previous page