Taxing and Bonding: The Strange Bedfellows
August 17, 2012
Politics makes strange bedfellows. In policy circles, a lawmaker who opposes you on one issue may become your ally on the next. Usually though, this does not happen on the same issue. The issue here is who should pay to clean up toxic pollution from mines. On the one hand, we could have taxpayers pick up the tab. Or we could make polluters pay. I prefer the latter. And for the most part, I’d tend to think that members of Congress concerned about government spending, deficits, and American’s tax burden would too.
Currently, there is no independent funding stream dedicated strictly to clean up of abandoned hardrock mine lands (AML). Instead, we have the coal-mining industry subsidizing the hardrock mining industry. The Surface Mining Control and Reclamation Act of 1977 (SMCRA) imposes a per ton fee on coal mining divided among the states for AML clean up. Clearly not the ideal solution, but it’s better than nothing.
Wyoming had been due to receive about $150 million of this funding over the next two years and over $700 million during the next ten. About 20 other states with thriving coal industries had some of this funding coming there way too. Until Senator Max Baucus of Montana pulled the plug. During the legislative wrangling over how to pay for a different bill, the Surface Transportation Bill (HR 4348), Big Sky’s senior senator chose to slip in an amendment capping these clean up funds and diverting them to offset the transportation bill’s cost.
Fortunately, Wyoming’s representative Cynthia Lummis has introduced a bipartisan bill (HR 6113) removing the Baucus language and restoring this important polluter-funded revenue stream. Siding with her Wyoming constituents, American taxpayers, deficit hawks, public health and the environment all in one swoop, Congresswoman Lummis has hit the political sweet spot on a common sense bipartisan idea: Polluters pay, not taxpayers.
Although no one knows the precise number, Earthworks estimates that this country has at least 500,000 abandoned hardrock mines with an estimated cost of $30-$70 billion. Someone has to pay for this. One solution is to require that mine operators post a bond that the regulating agency holds in trust until the mining company completes its reclamation. This is part of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund). A 2005 report from the General Accounting Office, Congress’ investigatory arm, revealed that financial assurances provided by mining companies for reclamation costs vastly underestimate the true cost of clean up. So, in 2009 the Obama Administration began a rulemaking process designed to institute standards that more realistically account for the actual cost of mine reclamation.
Now that 44 is taking his shot at ensuring that taxpayers do not get shackled with the toxic mess left by mining companies, Congresswoman Lummis appeared ready to undercut this effort by sponsoring a rider to the Interior and Environment Appropriations bill. A “rider” is legislative speak for a provision slipped in to a must pass bill that could not otherwise survive alone. The Lummis rider would have prevented EPA from strengthening these bonding requirements mining companies presumably sticking taxpayers with the clean up costs.
For all the clamor we so often hear from the House Majority, purporting to decry wasteful government spending, these same policy makers sometimes do not suffer this hang up when it comes to protecting industry profits. In the end, Speaker Boehner and Majority Leader Reid agreed on a temporary continuing budget resolution which delays the appropriations process- the Lummis rider included- for another six months.
Now I suppose smart folks could draw principled distinctions between supporting polluter-funded AML money for Wyoming through SMCRA while opposing polluter-funded bonds through CERCLA. I’m not that picky about the precise legal mechanism for protecting taxpayers, public health, communities, and the environment. Nor do l lose much sleep over political motives. I appreciate Congresswoman Lummis’ leadership on HR 6113 and urge her support of the polluters pay principle in other contexts as well.