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The original documents are located in Box 33, folder "Strip Mining (3)" of the James M.
Cannon Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 33 of the James M. Cannon Files at the Gerald R. Ford Presidential Library
THE WHITE HOUSE
WASHINGTON
May 7, 1975
ADMINISTRATIVELY CONFIDENTIAL
MEMORANDUM FOR:
JIM CANNON
FROM:
JERRY H. J JONESL
SUBJECT:
Strip Mining Legislation
Your memorandum to the President on the above subject has been
reviewed and the following notation was made next to "see me":
-- Tilt, if any, toward veto.
Please note that to signal anything could be harmful to Hathaway's
proceedings.
FORD LIBRARY j
CC: Don Rumsfeld
1312 VIVA a WI ID 08
DECISION
THE WHITE HOUSE
washington
May 3, 1975
MEMORANDUM FOR:
THE PRESIDENT
FROM:
JIM CANNON Jun
SUBJECT:
STRIP MINIMG LEGISLATION
The Senate-House Conference Committee has reported out
a compromise bill which will be taken up by the Senate
on Monday and the House on Wednesday.
We anticipate that by Monday there will be (a) many
questions as to your position on the bill, and
(b) pressure from opponents of the bill for you to
signal a veto so that a higher negative vote can be
built up.
The Conference Results
Tab A summarizes the results on substantive changes from
last year's bill. Tab B is a preliminary estimate of
duction and other impacts of the bill. However, Frank pro- Zarb
wants to look more carefully at the energy impacts before
giving a recommendation on signing or veto.
Briefly:
Success or good progress was achieved on six of the
eight critical changes requested from last year's bill.
Two new problems were created: State control over
Federal lands and bans on mining in alluvial valleys.
The seriousness of the alluvial valley provision will
depend on court resolution of an inconsistency between
tation. restrictive bill language and a loose report interpre-
The experts' preliminary estimates of production losses
(51-162 million tons) are about the same as for last
year's bill. However, the progress that has been made
should help keep losses in the lower end of the range.
FORD LIBRARY 07839,
- 2 -
Arguments
The arguments for and against the bill will remain essentially
the same:
For: It's good environmentally, will back up state regu-
latory activities, stop bad strip mining practices and
reclaim land, including abandoned lands; politically
possible. difficult to oppose; and sustaining a veto may not be
Against: The bill creates another Federal-state regulatory
system and bureaucracy; it's a long, ambiguous bill which
invites years of litigation; compared to no bill, there
will be adverse impacts on coal production, oil imports,
electric bills and employment; restrains western coal
development; and will put small mines in Appalachia out
of business.
Expected Agency Positions
We expect Rog Morton, EPA, CEQ, and Agriculture to recommend
signing the bill. Treasury and Commerce probably will con-
tinue to favor a veto. As indicated, Frank Zarb hasn't decided.
Hill Situation
The Senate passed its bill by 84-13 and the House by 333-86.
Since then, the miners' Washington demonstration and an
intensified lobbying effort apparently have changed some
votes. Opponents of the bill are claiming that at least
150 votes could be produced to sustain a veto in the House.
At present, Congressional Relations staff believes this count
is optimistic and that sustaining a veto probably will be
extremely difficult.
Recommendation
Frank Zarb and I recommend that you do not take a position
on the bill before the House and Senate votes. * Instead,
the burden should be left on the opponents to demonstrate
what they can do. Administration spokesmen would say that
we are continuing to assess the Conference bill (which just
became available late Friday, May 2) and that you have made
no decision.
The Congressional Relations Staff is pooling the Senate and
House leadership and will have a report for you over the
weekend or early Monday. They will also ask on Monday for
a House whip check.
Decision: Do not signal position.
Agree
Disagree
See me
*Jack Marsh concurs.
THE WHITE HOUSE
WASHINGTON
May 7, 1975
ADMINISTRATIVELY CONFIDENTIAL
MEMORANDUM FOR:
JIM CANNON
FROM:
JERRY H. CONESA
SUBJECT:
Strip Mining Legistation
Your memorandum to the President on the above subject has been
reviewed and the following notation was made next to "see me":
-- Tilt, if any, toward veto.
Please note that to signal anything could be harmful to Hathaway's
proceedings.
CC: Don Rumsfeld
R.FORD is LIBRARY 076835
washington
May 3, 1975
MEMORANDUM FOR:
THE PRESIDENT
FROM:
JIM CANNON Join
SUBJECT:
STRIP MINIMG LEGISLATION
The Senate-House Conference Committee has reported out
a compromise bill which will be taken up by the Senate
on Monday and the House on Wednesday.
We anticipate that by Monday there will be (a) many
questions as to your position on the bill, and
(b) pressure from opponents of the bill for you to
signal a veto so that a higher negative vote can be
built up.
The Conference Results
Tab A summarizes the results on substantive changes from
last year's bill. Tab B is a preliminary estimate of pro-
duction and other impacts of the bill. However, Frank Zarb
wants to look more carefully at the energy impacts before
giving a recommendation on signing or veto.
Briefly:
Success or good progress was achieved on six of the
eight critical changes requested from last year's bill.
Two new problems were created: State control over
Federal lands and bans on mining in alluvial valleys.
The seriousness of the alluvial valley provision will
depend on court resolution of an inconsistency between
tation. restrictive bill language and a loose report interpre-
The experts' preliminary estimates of production Losses
(51-162 million tons) are about the same as for last
year's bill. However, the progress that has been made
should help keep losses in the lower end of the range.
GERALD FORD LIBRARY
Arguments
The arguments for and against the bill will remain essentially
the same:
For: It's good environmentally, will back up state regu-
latory activities, stop bad strip mining practices and
reclaim land, including abandoned lands; politically
difficult to oppose; and sustaining a veto may not be
possible.
Against: The bill creates another Federal-state regulatory
system and bureaucracy; it's a long, ambiguous bill which
invites years of litigation; compared to no bill, there
will be adverse impacts on coal production, oil imports,
electric bills and employment; restrains western coal
development; and will put small mines in Appalachia out
of business.
Expected Agency Positions
We expect Rog Morton, EPA, CEQ, and Agriculture to recommend
signing the bill. Treasury and Commerce probably will con-
tinue to favor a veto. As indicated, Frank Zarb hasn't decided.
Hill Situation
The Senate passed its bill by 84-13 and the House by 333-86.
Since then, the miners' Washington demonstration and an
intensified lobbying effort apparently have changed some
votes. Opponents of the bill are claiming that at least
150 votes could be produced to sustain a veto in the House.
At present, Congressional Relations staff believes this count
is optimistic and that sustaining a veto probably will be
extremely difficult.
Recommendation
Frank Zarb and I recommend that you do not take a position
on the bill before the House and Senate votes. * Instead,
the burden should be left on the opponents to demonstrate
what they can do. Administration spokesmen would say that
we are continuing to assess the Conference bill (which just
became available late Friday, May 2) and that you have made
no decision.
The Congressional Relations Staff is pooling the Senate and
House leadership and will have a report for you over the
weekend or éarly Monday. They will also ask on Monday for
a House whip check.
Decision:
Do not signal position.
Agree
Disagree
See me
* Jack Marsh concurs.
FORD LIBRARY i GERALD
THE WHITE HOUSE
WASHINGTON
May 9, 1975
MEMORANDUM FOR THE VICE PRESIDENT
FROM :
JIM CANNON Jun
SUBJECT :
Strip Mining
The President faces a very important decision
related to energy, the economy, and the environment
when the strip mining bill which Congress passed
comes to him to be signed or vetoed.
His decision, which may have to be made next week,
is interrelated with the Hathaway confirmation, the
farm veto, and other issues before the Congress.
It seems to me important that you have this rough
draft of the issues and a proposed veto message.
Moreover, I feel that it is very important that
you be present for the discussion which will take
place before the President's decision.
Attachment
THE WHITE HOUSE
WASHINGTON
May 9, 1975
MEMORANDUM FOR :
PHIL BUCHEN
MAX FRIEDERSDORF
ALAN GREENSPAN
BOB HARTMANN
JIM LYNN
JACK MARSH
BILL SEIDMAN
PAUL THEIS
FROM :
JIM CANNON
SUBJECT :
DECISION MEMORANDUM ON H.R. 25,
SURFACE MINING BILL
The President has asked for a decision memorandum by
close of business today on the strip mining bill.
The first draft of such a memorandum is enclosed, along
with a draft statement of disapproval in the event that
he decides to veto the bill.
May we have your comments and corrections as soon as
possible but not later than noon today so that we can
revise the memorandum and get it to the President.
May we also have your recommendation on the bill.
We will also be checking the memorandum with Frank Zarb,
Russ Train, Russ Peterson, Kent Frizzell and Rog Morton.
Thanks for your help.
Enclosure.
DRAFT 5/8/75
MEMORANDUM
FROM:
SUBJECT:
STRIP MINING BILL
H.R. 25, the Surface Mining Control and Reclamation Act
passed the Senate on Monday by Voice vote and the House
on Wednesday by a vote of 293-115.
This memorandum briefly describes the bill, compares it to
the one you proposed on February 6, identifies the impacts
on coal production and other economic considerations, lists
arguments for and against approval, and presents recommend-
ations of your advisers as to signing or vetoing the bill.
Jim Lynn will soon be providing an enrolled bill memorandum
which will provide more detail on the bill and agency positions.
The Bill
Briefly, the principal features of the bill:
Establish environmental protection and reclamation
standards for surface mining activities.
Call for State regulatory and enforcement activities.
Require Federal (Interior Department) regulation and
enforcement if States do not act.
Places an excise tax of 15-35¢ on each ton of coal to
create a trust fund for use in reclaiming public and
privately owned abandoned mined lands, and paying other
facility and service costs in areas affected by energy
development.
Provides funds for state mining and mineral institutes.
FORD
Background
ALD
The Executive Branch proposed bills in 1971 and 1973 to
establish environmental and reclamation standards for
surface and subsurface mining of coal and other minerals.
The Senate passed a coal surface mining bill in 1972 and
again in 1973. Despite extensive Administration efforts,
the House passed a tough bill in July 1974 and a similar
bill emerged from Conference in December 1974. The memorandum
of disapproval announcing the pocket veto of that bill
on January 1975 is enclosed at Tab A.
On February 6, 1975, you transmitted a new bill which
followed the wording of the vetoed bill except for 8 changes
identified in your letter (Tab B) as critical to overcome the
problems that led to your veto and 19 other changes which
-2-
were designed to reduce the coal production losses and make
the bill more workable.
The Senate passed its bill on
, 1975 by a vote of
84-13 and the House its bill by a vote of 333 86
In order to place in context many of the objections that
are now being voiced against the bill now before you, it
is important to note that the bill you transmitted in February
represented à substantial compromise from proposals advanced
?
over the past four years. For example, the Executive Branch
gave up after numerous attempts to obtain less rigorous
restrictions on steep slope mining and post-mining uses.
The Appalachian state objections to the bill are due to these
restrictions which would put small mine operators out of
business and generally restrict mining activities.
Enrolled bill compared to Your February 6th bill
Tab C summarizes the results of the Congressional action
with respect to the changes you requested. Briefly, it
indicates that:
Success or substantial progress was achieved on 6 of the
8 critical changes.
Three important new problems were created--involving
State control over Federal coal lands, restrictions on
mining in alluvial valley floors, and water rights.
Of the other 19 changes, 7 were adoped, 2 partially
adopted, 8 rejected and 2 made less acceptable.
Adverse impacts of the bill
Tab D summarizes the estimated impact of bill on coal
production, oil imports and dollar outflows, unemployment,
higher costs, and lock up of reserves. Briefly:
Coal Production. Interior and FEA experts have estimated
that the adverse impact on coal production from those
provisions that can be estimated will be from 40 to 162
million tons, or from 6 to 24% of the 685 million tons
of total coal production expected in 1977. These
estimates to not include the impact of provisions of the
bill that cannot be estimated such as (1) provisions for
designating lands unsuitable for mining, (2) requirements
for surface owner consent, or (3) production delays
expected from litigation.
The experts have been unable to narrow the range of
there estimate--or provide a "most likely" figure because
3
they cannot predict how the courts will interpret many
provisions of the bill. For example, Court resolution
of an inconsistency between restrictive bill language
and a loose report interpretation can determine whether
losses are closer to the estimated 11 million ton
minimum loss or the 66 million ton maximum loss
estimated for this provision.
Changes in the bill achieved during the current
session should help hold the losses toward the lower
end of the range. On the other hand, the provisions
for which estimates are not developed could drive the
losses toward or above the high end of the range.
Contentions have been made that the absence of a bill
is contributing to uncertainty and thus holding up
plans for expanded coal production. We have no evidence
to support this contention and suspect that production
will increase more rapidly without a Federal bill.
This point is discussed in more detail at Tab E.
Oil Imports. Most of the lost coal production will
have to be replaced by imported oil. If 80% is
replaced by oil and the other 20% by more deep-mined
coal, the oil imports associated with the estimated
losses would range between 139 and 559 million barrels
of oil per year, involving dollar outflows from $1.5
to $6.1 billion.
Job Losses. In addition to the Job losses associated
with the dollar outflows, Interior and FEA have estimated
that direct and indirect job losses will range between
,000 and 36,000. These will be partially offset by
lower productivity due to tighter restrictions, jobs
in reclaiming abandoned mine lands (requiring relocation
of unemployed) and after some years, expanded underground
mining.
Higher Costs. In addition to the higher costs of
foreign oil to replace coal, the added costs that will
be paid through higher prices or taxes include:
- $145 to $155 million in excisé taxes for the
"reclamation" fund.
- Higher strip mining production and reclamation
costs-- estimated at $162 to $216 million annually
- About $90 million for Federal and State Government
regulatory systems and research.
Electric Bills. Since most coal is used in electrical
generation, electric bills will go up. The amount
will vary widely from utility to utility depending upon
the dependence on coal and the impact on the utility's
coal supply. Imported oil costs more than 10 times
as much as an equivalent amount of coal in BTU terms.
- 4-
Arguments for Approval of the bill
Strip mining is still devastating the environment in
some areas.
State laws, regulations and enforcement is not strong
enough and Federal backup enforcement is necessary.
Thousands of acres of abandoned mined lands are scars
on the landscape and should be reclaimed.
Your Administration has a negative environmental record
due to the previous strip mine bill veto, proposed clean
air act amendments, decision not to propose a land use
bill, and Hathaway's appointment.
A veto would jeopardize Hathaway's appointment.
The Administration is on record as favoring a strip mining
bill and the Congress accepted a substantial number of
the changes you proposed on February 6.
Job Losses will be partially offset by employment in
reclamation and underground mining.
Arguments against approval
Creates another Federal-State regulatory system and
bureaucracy.
Bill is long and ambiguous, inviting years of litigation.
Bill is not significantly different from the one you vetoed.
States have tightened laws, regulations and enforcement over
past 4 years making Federal legislation less desirable and
possibly unnecessary.
Production losses and impact on imports and dollar outflow.
Job losses.
Higher consumer costs, particularly for electricity.
Restrains Western coal development and locks up substantial
reserves.
Puts small mines out of business, particularly in Appalachia.
If Senate floor debate prevails, establishes bad precedent
of making Federal mineral rights subject to State bans on
mining.
Approval will gain no environmental votes but probably will
loose some on energy, employment and economic grounds,
- 5 -
Sustaining a Veto
The Congressional Relations staff believes that a veto
can be sustained in the House.
Last Day for Action:
May
, 1975.
Alternatives, Recommendations and Decision
1. Sign the Bill
2. Veto. Issue
3. Allow to
Statement at
Become law
Tab F.
without
signature
Buchen
Cannon
Friedersdorf
Greenspan
Hartman
Lynn
Marsh
Morton
Peterson
Seidman
Simon
Train
Zarb
Interior
Agriculture
Justice
TVA
Labor
TAB A
Office of the White House Press Secretary
(Vail, Colorado)
THE WHITE HOUSE
MEMORANDUM OF DISAPPROVAL
I am withholding my approval from S. 425, the Surface Mining Control
and Reclamation Act of 1974.
S. 425 would establish Federal standards for the environmental protection
and reclamation of surface coal mining operations, including the
reclamation of orphaned lands. Under a complex proecdural frame-
work, the bill would encourage the States to implement and enforce
a program for the regulation of surface coal mining with substitution of
a federally administered program if the ates do not act.
The Executive Branch submitted to both the 92nd and 93rd Congresses
legislation that would have established reasonable and effective reclamation
and environmental protection requirements for mining activities. Through-
out this period, the Administration made every effort in working with the
Congress to produce a bill that would strike the delicate balance between
our desire for reclamation and environmental protection and our need to
increase coal production in the United States.
Unfortunately, S. 425, as enrolled, would have an adverse impact on our
domestic coal production which is unacceptable. By 1977, the first year
after the Act would take full effect, the Federal Energy Administration has
estimated that coal production losses would range from a minimum of 48
million tons to a maximum of 141 million tons. In addition, further losses
which cannot be quantified could result from ambiguities in the bill, forcing
protracted regulatory disputes and litigation. In my judgment, the most
significant reasons why such coal losses cannot be accepted are as follows:
1. Coal is the one abundant energy source over which the United
States has total control. We should not unduly impair our ability
to use it properly.
2. We are engaged in a major review of m tional energy policies.
Unnecessary restrictions on coal production would limit our
Nation's freedom to adopt the best energy options.
3. The United States uses the equivalent of 4 barrels of expensive
foreign oil for every ton of unproduced domestic coal -- a situa-
tion which cannot long be tolerated without continued, serious
economic consequences. This bill would exacerbate this problem.
4. Unemployment would increase in both the coal fields and in those
industries unable to obtain alternative fuel.
In addition, S. 425 provides for excessive Federal expenditures and would
clearly have an inflationary impact on the economy. Moreover, it contains
numerous other deficiencies which have recently-been addressed in Exec-
utive Branch communications to the Congress concerning this legislation.
In sum, I find that the adverse impact of this bill on our domestic coal
production is unacceptable at a time when the Nation can ill afford signi-
ficant losses from this critical energy resource. It would also further
complicate our battle against inflation. Accordingly, I am withholding
my approval from S. 425.
In doing so, I am truly disappointed and sympathetic with those in Congress
who have labored so hard to come up with a good bill. We must continue to
strive diligently to ensure that laws and regulations are in effect which
establish environmental protection and reclamation requirements appropriately
balanced against the Nation's need for increased coal production. This will
continue to be my Administration's goal in the new year.
GERALD R FORD
THE WHITE HOUSE,
December 30, 1974
#
#
DERALE FORD LIBRAR
TAB B
THE WHITE HOUSE
WASHINGTON
February 6, 1975
Dear Mr. Speaker:
Our Nation is faced with the need to find the right
balance among a number of very desirable national
objectives. We must find the right balance because
we simply cannot achieve all desirable objectives
at once.
In the case of legislation governing surface coal
mining activities, we must strike a balance between
our desire for environmental protection and our need
to increase domestic coal production. This consid-
eration has taken on added significance over the past
few months. It has become clear that our abundant
domestic reserves of coal must become a growing part
of our Nation's drive for energy independence.
Last December, I concluded that it would not be in the
Nation's best interests for me to approve the surface
coal mining bill which passed the 93rd Congress as
S. 425. That bill would have:
Caused excessive coal production losses,
including losses that are not necessary
to achieve reasonable environmental pro-
tection and reclamation requirements.
The Federal Energy Administration esti-
mated that the bill, during its first
full year of operation would reduce coal
production between 48 and 141 million
tons, or approximately 6 to 18 percent
of the expected production. Additional
losses could result which cannot be
quantified because of ambiguities in the
bill. Losses of coal production are par-
ticularly important because each lost ton
of coal can mean importing four additional
barrels of foreign oil.
2
Caused inflationary impacts because of
increased coal costs and Federal expen-
ditures for activities which, however
desirable, are not necessary at this
time.
Failed to correct other deficiencies that
had been pointed out in executive branch
communications concerning the bill.
The energy program that I outlined in my State of the
Union Message contemplates the doubling of our Nation's
coal production by 1985. Within the next ten years,
my program envisions opening 250 major new coal mines,
the majority of which must be surface mines, and the
construction of approximately 150 new coal fired elec-
tric generating plants. I believe that we can achieve
these goals and still meet reasonable environmental
protection standards.
I have again reviewed S. 425 as it passed the 93rd
Congress (which has been reintroduced in the 94th
Congress as S. 7 and H.R. 25) to identify those pro-
visions of the bill where changes are critical to
overcome the objections which led to my disapproval
last December. I have also identified a number of
provisions of the bill where changes are needed to
reduce further the potential for unnecessary produc-
tion impact and to make the legislation more workable
and effective. These few but important changes will
go a long way toward achieving precise and balanced
legislation. The changes are summarized in the first
enclosure to this letter and are incorporated in the
enclosed draft bill.
With the exception of the changes described in the first
enclosure, the bill follows S. 425.
3
I believe that surface mining legislation must be
reconsidered in the context of our current national
needs. I urge the Congress to consider the enclosed
bill carefully and pass it promptly.
Sincerely,
Havald R. 'Ind
The Honorable
The Speaker
U.S. House of Representatives
Washington, D.C. 20515
SUMMARY OF PRINCIPAL CHANGES FROM S. 425 (S. 7 and H.R. 25)
INCORPORATED IN THE ADMINISTRATION'S
SURFACE MINING BILL
The Administration bill follows the basic framework of S. 425
in establishing Federal standards for the environmental pro-
tection and reclamation of surface coal mining operations.
Briefly, the Administration bill, like S. 425:
- covers all coal surface mining operations and
surface effects of underground coal mining;
- establishes minimum nationwide reclamation
standards;
- places primary regulatory responsibility with
the States with Federal backup in cases where
the States fail to act;
- creates a reclamation program for previously
mined lands abandoned without reclamation;
- establishes reclamation standards on Federal
lands.
Changes from S. 425 which have been incorporated in the
Administration bill are summarized below.
Critical changes.
1.
Citizen suits. S. 425 would allow citizen suits against
any person for a "violation of the provisions of this
Act." This could undermine the integrity of the bill's
permit mechanism and could lead to mine-by-mine litiga-
tion of virtually every ambiguous aspect of the bill
even if an operation is in full compliance with existing
regulations, standards and permits. This is unnecessary
and could lead to production delays or curtailments.
Citizen suits are retained in the Administration bill,
but are modified (consistent with other environmental
legislation) to provide for suits against (1) the regu-
latory agency to enforce the act, and (2) mine operators
where violations of regulations or permits are alleged.
SERALD
LIBRARY
2
2.
Stream siltation. S. 425 would prohibit increased
stream siltation -- a requirement which would be
extremely difficult or impossible to meet and thus
could preclude mining activities. In the Administration's
bill, this prohibition is modified to require the maxi-
mum practicable limitation on siltation.
3.
Hydrologic disturbances. S. 425 would establish absolute
requirements to preserve the hydrologic integrity of
alluvial valley floors -- and prevent offsite hydrologic
disturbances. Both requirements would be impossible to
meet, are unnecessary for reasonable environmental pro-
tection and could preclude most mining activities. In
the Administration's bill, this provision is modified
to require that any such disturbances be prevented to
the maximum extent practicable so that there will be a
balance between environmental protection and the need
for coal production.
4.
Ambiguous terms. In the case of S. 425, there is great
potential for court interpretations of ambiguous pro-
visions which could lead to unnecessary or unanticipated
adverse production impact. The Administration's bill
provides explicit authority for the Secretary to define
ambiguous terms so as to clarify the regulatory process
and minimize delays due to litigation.
5.
Abandoned land reçlamation fund. S. 425 would establish
a tax of 35¢ per ton for underground mined coal and 25¢
per ton for surface mined coal to create a fund for re-
claiming previously mined lands that have been abandoned
without being reclaimed, and for other purposes. This
tax is unnecessarily high to finance needed reclamation.
The Administration bill would set the tax at 10¢ per ton
for all coal, providing over $1 billion over ten years
which should be ample to reclaim that abandoned coal
mined land in need of reclamation.
Under S. 425 funds accrued from the tax on coal could be
used by the Federal government (1) for financing construc-
tion of roads, utilities, and public buildings on reclaimed
mined lands, and (2) for distribution to States to finance
roads, utilities and public buildings in any area where
coal mining activity is expanding. This provision need-
lessly duplicates other Federal, State and local programs,
and establishes eligibility for Federal grant funding in
a situation where facilities are normally financed by
local or State borrowing. The need for such funding,
including the new grant program, has not been established.
The Administration bill does not provide authority for
funding facilities.
3
6.
Impoundments. S. 425 could prohibit or unduly restrict
the use of most new or existing impoundments, even though
constructed to adequate safety standards. In the
Administration's bill, the provisions on location of im-
poundments have been modified to permit their use where
safety standards are met.
7.
National forests. S. 425 would prohibit mining in the
national forests -- a prohibition which is inconsistent
with multiple use principles and which could unnecessarily
lock up 7 billion tons of coal reserves (approximately 30%
of the uncommitted Federal surface-minable coal in the
contiguous States). In the Administration bill, this
provision is modified to permit the Agriculture Secretary
to waive the restriction in specific areas when multiple
resource analysis indicates that such mining would be in
the public interest.
8.
Special unemployment provisions. The unemployment provision
of S. 425 (1) would cause unfair discrimination among
classes of unemployed persons, (2) would be difficult to
administer, and (3) would set unacceptable precedents in-
cluding unlimited benefit terms, and weak labor force
attachment requirements. This provision of S. 425 is
inconsistent with P.L. 93-567 and P.L. 93-572 which were
signed into law on December 31, 1974, and which signifi-
cantly broaden and lengthen general unemployment assistance.
The Administration's bill does not include a special
unemployment provision.
Other Important Changes. In addition to the critical changes
from S. 425, listed above, there are a number of provisions
which should be modified to reduce adverse production impact,
establish a more workable reclamation and enforcement program,
eliminate uncertainties, avoid unnecessary Federal expenditures
and Federal displacement of State enforcement activity, and
solve selected other problems.
1.
Antidegradation. S. 425 contains a provision which, if
literally interpreted by the courts, could lead to a non-
degradation standard (similar to that experienced with
the Clean Air Act) far beyond the environmental and
reclamation requirements of the bill. This could lead
to production delays and disruption. Changes are in-
cluded in the Administration bill to overcome this
problem.
GL8810 FORD LIBRARY
4
2.
Reclamation fund. S. 425 would authorize the use of
funds to assist private landowners in reclaiming their
lands mined in past years. Such a program would result
in windfall gains to the private landowners who would
maintain title to their lands while having them reclaimed
at Federal expense. The Administration bill deletes
this provision.
3.
Interim program timing. Under S. 425, mining operations
could be forced to close down simply because the regula-
tory authority had not completed action on a mining permit,
through no fault of the operator. The Administration bill
modifies the timing requirements of the interim program to
minimize unnecessary delays and production losses.
4.
Federal preemption. The Federal interim program role
provided in S. 425 could (1) lead to unnecessary Federal
preemption, displacement or duplication of State regula-
tory activities, and (2) discourage States from assuming
an active permanent regulatory role, thus leaving such
functions to the Federal government. During the past
few years, nearly all major coal mining States have
improved their surface mining laws, regulations and
enforcement activities. In the Administration bill,
this requirement is revised to limit the Federal enforce-
ment role during the interim program to situations where
a violation creates an imminent danger to public health
and safety or significant environmental harm.
5.
Surface owner consent. The requirement in S. 425 for
surface owner's consent would substantially modify
existing law by transferring to the surface owner coal
rights that presently reside with the Federal government.
S. 425 would give the surface owner the right to "veto"
the mining of Federally owned coal or possibly enable
him to realize a substantial windfall. In addition,
S. 425 leaves unclear the rights of prospectors under
existing law. The Administration is opposed to any
provision which could (1) result in a lock up of coal
reserves through surface owner veto or (2) lead to
windfalls. In the Administration's bill surface owner
and prospector rights would continue as provided in
existing law.
6.
Federal lands. S. 425 would set an undesirable precedent
by providing for State control over mining of Federally
owned coal on Federal lands. In the Administration's bill,
Federal regulations governing such activities would not be
preempted by State regulations.
5
7.
Research centers. S. 425 would provide additional funding
authorization for mining research centers through a formula
grant program for existing schools of mining. This pro-
vision establishes an unnecessary new spending program,
duplicates existing authorities for conduct of research,
and could fragment existing research efforts already
supported by the Federal government. The provision is
deleted in the Administration bill.
8.
Prohibition on mining in alluvial valley floors. S. 425
would extend the prohibition on surface mining involving
alluvial valley floors to areas that have the potential
for farming or ranching. This is an unnecessary prohibi-
tion which could close some existing mines and which would
lock up significant coal reserves. In the Administration's
bill reclamation of such areas would be required, making
the prohibition unnecessary.
9.
Potential moratorium on issuing mining permits. S. 425
provides for (1) a ban on the mining of lands under study
for designation as unsuitable for coal mining, and (2) an
automatic ban whenever such a study is requested by anyone.
The Administration's bill modifies these provisions to
insure expeditious consideration of proposals for designating
lands unsuitable for surface coal mining and to insure that
the requirement for review of Federal lands will not trigger
such a ban.
10.
Hydrologic data. Under S. 425, an applicant would have
to provide hydrologic data even where the data are already
available -- a potentially serious and unnecessary workload
for small miners. The Administration's bill authorizes the
regulatory authority to waive the requirement, in whole or
in part, when the data are already available.
11.
Variances. S. 425 would not give the regulatory authority
adequate flexibility to grant variances from the lengthy
and detailed performance specifications. The Administration's
bill would allow limited variances -- with strict environ-
mental safeguards ---- to achieve specific post-mining land
uses and to accommodate equipment shortages during the
interim program.
12.
Permit fee. The requirement in S. 425 for payment of the
mining fee before operations begin could impose a large
"front end" cost which could unnecessarily prevent some
mine openings or force some operators out of business. In
the Administration's bill, the regulatory authority would
have the authority to extend the fee over several years.
6
13. Preferential contracting. S. 425 would require that special
preference be given in reclamation contracts to operators
who lose their jobs because of the bill. Such hiring should
be based solely on an operators reclamation capability. The
provision does not appear in the Administration's bill.
14. Any Class of buyer. S. 425 would require that lessees
of Federal coal not refuse to sell coal to any class of
buyer. This could interfere unnecessarily with both
planned and existing coal mining operations, particularly
in integrated facilities. This provision is not included
in the Administration's bill.
15. Contract authority. S. 425 would provide contract
authority rather than authorizing appropriations for
Federal costs in administering the legislation. This
is unnecessary and inconsistent with the thrust of the
Congressional Budget Reform and Impoundment Control Act.
In the Administration's bill, such costs would be
financed through appropriations.
16. Indian lands. S. 425 could be construed to require the
Secretary of the Interior to regulate coal mining on
non-Federal Indian lands. In the Administration bill,
the definition of Indian lands is modified to eliminate
this possibility.
17. Interest charge. S. 425 would not provide a reasonable
level of interest charged on unpaid penalties. The
Administration's bill provides for an interest charge
based on Treasury rates so as to assure a sufficient
incentive for prompt payment of penalties.
18. Prohibition on mining within 500 feet of an active mine.
This prohibition in S. 425 would unnecessarily restrict
recovery of substantial coal resources even when mining
of the areas would be the best possible use of the areas
involved. Under the Administration's bill, mining would
be allowed in such areas as long as it can be done safely.
19. Haul roads. Requirements of S. 425 could preclude some
mine operators from moving their coal to market by
preventing the connection of haul roads to public roads.
The Administration's bill would modify this provision.
The attached listing shows the sections of S. 425 (or S. 7 and
H.R. 25) which are affected by the above changes.
7
LISTING OF PRINCIPAL PROVISIONS IN S. 425 (S. 7 and H.R. 25)
THAT ARE CHANGED IN THE ADMINISTRATION'S BILL
Title or Section Administration
Subject
S.425,S.7,H.R.25
Bill
Critical Changes
I. Clarify and limit the scope
of citizens suits
520
420
2. Modify prohibition against
515 (b) (10) (B)
415 (b) (10) (B)
stream siltation
516 (b) (9) (B)
416 (b) (9) (B)
3. Modify prohibition against
510 (b) (3)
410 (b) (3)
hydrological disturbances
515 (b) (10) (E)
415 (b) (10) (E)
4. Provide express authority
to define ambiguous terms in
the act
None
601 (b)
5.
Reduce the tax on coal to
conform more nearly with
reclamation needs and
401 (d)
301 (d)
eliminate funding for
facilities
6.
Modify the provisions on
515 (b) (13)
415 (b) (13)
impoundments
516 (b) (5)
416 (b) (5)
7. Modify the prohibition
against mining in national
forests
522 (e) (2)
422 (e) (2)
8.
Delete special unemployment
provisions
708
None
Other Important Changes
1.
Delete or clarify language
102 (a) and (d)
102 (a) and (c)
which could lead to unin-
tended "antidegradation"
interpretations
2.
Modify the abandoned land
Title IV
Title III
reclamation program to
(1) provide both Federal
and State acquisition and
reclamation with 50/50 cost
sharing, and (2) eliminate
cost sharing for private
land owners
8
Subject
S.7,H.R.25
New Bill
3. Revise timing requirements
502 (a) thru (c)
402 (a) and (b)
for interim program to
506 (a)
406 (a)
minimize unanticipated
delays
4. Reduce Federal preemption
502 (f)
402 (c)
of State role during
521 (a) (4)
421 (a) (4)
interim program
5. Eliminate surface owner
716
613
consent requirement; con-
tinue existing surface and
mineral rights
6.
Eliminate requirement that
523 (a)
423 (a)
Federal lands adhere to
requirements of State
programs
7. Delete funding for
Title III
None
research centers
8. Revise the prohibition
510 (b) (5)
410 (b) (5)
on mining in alluvial
valley floors
9.
Eliminate possible delays
510 (b) (4)
410 (b) (4)
relating to designations
522 (c)
422 (c)
as unsuitable for mining
10. Provide authority to waive
507 (b) (11)
407 (b) (11)
hydrologic data require-
ments when data already
available
11. Modify variance provisions
515 (c)
402 (d)
for certain post-mining
415 (c)
uses and equipment
shortages
12. Clarify that payment of
507 (a)
407 (a)
permit fee can be spread
over time
13. Delete preferential con-
707
None
tracting on orphaned land
reclamation
9
Subject
S.425,S.7,H.R.25
New Bill
14. Delete requirement on
sales of coal by Federal
lessees
523 (e)
None
15. Provide authority for
appropriations rather than
contracting authority for
administrative costs
714
612
16. Clarify definition of Indian
lands to assure that the
Secretary of the Interior
does not control non-Federal
Indian lands
701 (9)
601 (a) (9)
17. Establish an adequate
interest charge on unpaid
penalties to minimize
518 (d)
418 (d)
incentive to delay
payments
18. Permit mining with 500'
515 (b) (12)
415 (b) (12)
of an active mine where
this can be done safely
19. Clarify the restriction
522 (e) (4)
422 (e) (4)
on haul roads from mines
connecting with public
roads
TAB C
SUMMARY RESULTS - ENROLLED BILL
A.
Action on changes from vetoed bill identified as "critical to
overcome objections"
Subject & Proposed Change
Conference Bill
1. Citizen Suits
Narrow the scope
Adopted
2.
Stream Siltation
Remove prohibition against
increased siltation
Partially adopted
3. Hydrologic Balance
Remove prohibition against
disturbances
Partially adopted
4.
Ambiguous Terms
Not adopted but other
Specific authority for
changes make this muc
Secretary to define
less important
5.
Abandoned Mine Reclamation Fund
Reduce 35¢-25¢ to 10¢
Fee reduced on some C
Limit use of fund to reclamation
Uses broadened
6.
Impoundments (Dams)
Modify virtual prohibition
Changed enough to be
on impoundments
acceptable
7. National Forests
Allow mining in certain
circumstances
Rejected
8.
Special Unemployment Provisions
Delete as unnecessary and
precedent setting
Adopted
-2-
B. Two new problems created in this year's bill
1. Senate floor debate indicates that the language of the bill
can be constructed to permit states to ban surface coal
mining on Federal lands. The House took the opposite view
in floor debate. Not dealt with in the Conference report.
Believed to be a major problem.
2. The Conference adopted a provision prohibiting location
of a mining operation in an alluvial valley floor which
may prevent expected. production and lock up major coal
reserves in the West.
3.
Requirements to compensate for interrupted water supplies
off-site may make it difficult or impossible for mining
operators to obtan bonds at reasonable costs.
C. Action on changes from vetoed bill identifies as "needed to
reduce further the potential for unnecessary production
impact and to make the legislation more workable and effective".
Subject & Proposed Change
Conference Bill
1.
Antidegredation
Delete requirements
Adopted
2. Abandoned Mine Reclamation Fund
Require 50/50 cost sharing
Rejected
Eliminate grants for privately
owned lands
Broadened
3. Interim Program Timing
Reduce potential for
mining delays
Rejected
Allow operations under interim
permit if regulatory agency
acts slowly
Adopted
4. Federal Preemption
Encourage states to take up
regulatory role
Rejected
5.
Surface Owner Consent
Rely on existing law
Rejected
-3-
Subject & Proposed Change
Conference Bill
6.
State Control over Federal lands
(Now a serious problem - discussed
in B.1, above)
7. Funding for Research Centers
Delete as unnecessary
Rejected
8. Alluvial Valley Floors
(Now a serious problem - discussed
in B.2, above)
9. Designation of areas as
unsuitable for mining
Expedite review and avoid
frivilous petitions
Partially adopted
10. Hydrologic Data
Authorize waiver in some case where
unnecessarily burdensome
Rejected
11. Variances
Broaden variances for certain
post-mining uses and equipment
shortages
Rejected
12. Permit Fee
Permit paying over time rather
than pre-mining
Adopted
13. Contracting for reclamation
Delete requirement that contracts
go to those put out of work by bill
Adopted
14. Coal Sales by Federal Lessee
Delete requirement that lessee must
not deny sale of coal to any class
of purchaser
Requirement softened
15. Appropriations Authority
Use regular appropriations authority
rather than contract authority
Rejected
16. Indian Lands
Clarify to assure no Federal control
over non-Federal Indian land
Adopted
-4- -
Subject & Proposed Change
Conference Bill
17. Interest charge on civil Penalties
Adopt sliding scale to minimize
incentive for delaying payments
Adopted
18. Mining within 500 feet of active mines
Permit where it can be done safely
Rejected
19. Haul Roads
Clarify restriction on connections
with public roads
Adopted
TAB D
IMPACT OF THE ENROLLED BILL ON COAL PRODUCTION,
RESERVES, OIL IMPORTS, DOLLAR OUTFLOW,
JOBS AND HIGHER COSTS
Enrolled
Bill
1. Loss of coal production during first full
year of application --- based on expectation
of 330 million tons of strip production and
685 million tons of total production if there
were no bill. (does not cover potential
losses from delays due to litigation or
restrictive interpretation of ambiguous
provisions) :
In millions of tons:
Small Mines
22-52
Restrictions on steep slopes,
siltation, aquifers
7-44
Alluvial valley floor restrictions
11-66
Total - 1st full year of application
40-162
(% of production-estimated at
685 million tons.)
⁶-24%
(Note: Administration bill would also have impacted coal
production - in the range of 33-80 million tons.) By way
of contrast, the vetoed bill involved a potential production
loss of 48-141 million tons and the Administration's bill
could reduce expected production by 33-80 million tons.
2. Lock up of coal reserves.* The U.S. demonstrated
reserve base which are potentially mineable by
surface methods is 137 billion tons. Estimate
reserve losses are (billion tons) :
Alluvial valley floor provisions (includes
losses from national forest provisions of
6.3 billion and surface owners provisions
of 0-14.2 billion)
22.0-66.0
National forest (outside alluvial valleys)
.9-.9
Other provisions (e.g., steep slopes)
0-6.5
Total - billion tons
22.9-73.4
*Note: Remaining strippable reserves would be many times
expected annual production.
- 2 -
Bill
3. Increased oil imports and dollar outflow -
assuming 80% of lost coal production was
replaced by oil. (20% by underground mining.)
million barrels per year (4.3 barrels
per ton of coal)
139-559
dollar value ($11 per barrel) - billions
1.5-6.1
4. Job losses* (assuming 36 tons per day per
miner and 225 work days per year; and .8
non-mining jobs per miner)
direct job losses -
to
20,000
indirect job losses -
to
16,000
Total
to
36,000
5. Inflationary Impact - In addition to higher
cost foreign oil ----- would include
(in millions) Assumes 60 million tons
strip mining loss.
Fee for reclamation fund
$145 to
$155
Higher strip mining production and
reclamation costs (estimated at
$162 to
60-80¢ per ton)
$216
Costs of Federal and State program
administration (not including unem-
ployment compensation)
$90
*Does not reflect possible offset for job increases due to
(a) reclamation work or lower productivity per man in strip
mining, or (b) possible increases in underground mining
which probably will occur to offset part of the strip
mining production loss. Employment gains for underground
mining will be some years off due to time required to open
mines.
TAB E
Will more coal be produced with the bill or with no bill?
The answer is necessarily speculative but the answer seems
to be that more coal will be produced with no bill. Data
and arguments supporting this contention include:
1. Coal producers really are not holding up on the
expansion or production while awaiting a bill.
Nearly all of the leading coal producing states
already have strip mining controls in affect so
the question for the big operators is merely
whether (a) the restrictions are made even
tighter, (b) the standards and requirements
apply nationwide, (c) whether the regulatory
procedures are changed, and (d) whether federal
enforcement is put in place to back up state
enforcement.
2. Manufacturers of equipment for large surface mining
operations (e.g., drag lines) have all the business
they can handle. Supposedly Bucyrus-Erie has five-
years or more in backorders.
3. Small independent strip mining operators are expected
to feel the pinch of any federal legislation. Our
Interior and FEA people expect many of them to go
out of business because they can't afford to do all
the preparatory work for getting a permit and/or
afford the extra equipment costs. These smaller
operators have accounted for much of the surge
capacity in coal products. In 1974, small
operators produced about 58 million tons of coal
out of the total of about 500 million tons. Small
operators in Central Pennsylvania and Eastern Kentucky
accounted for 60% of the increased coal production
that occurred last fall when the demand for coal
was high as users stockpiled for the coal strike.
TAB F
I have today returned to the Congress, H.R. 25, the proposed
Surface Mining Control and Reclamation Act of 1975, without
my approval.
I have concluded that this bill is not acceptable in light
of our National needs because it would:
reduce coal production.
increase considerably our dependence on foreign oil
imports.
increase the outflow of dollars and jobs to other nations.
increase unemployment, particularly in Appalachia.
increase consumer costs, particularly for electricity.
have other harmful effects.
It is with a sense of deep regret that I find it necessary
to reject this legislation. The Executive Branch and the Congress
have worked long and hard to try to develop an acceptable bill.
The Exeuctive Branch proposed bills in 1971 and 1973. In February
of this year, I submitted a bill which was designed to strike
a balance between our desire to improve the environment and
our need to increase domestic energy production and maintain a
strong economy. Unforutnately, the bill does not strike an
acceptable balance. Several examples will illustrate the
problems.
First, with respect to coal production, Interior Department
and the Federal Energy Administration have estimated that the
lost coal production in the first full year of the bill's
application will total between 40 and 162 million tons or
to
% of the 685 million tons of coal production expected
in 1977 This range of estimated loss includes only those
- 2 -
provisions for which an estimate can be developed. It does
not include the potential impact of the many ambiguous provisions
of the bill for which estimates can not be developed or the
impact of delays that would be encountered while the provisions
of the complex but vague
page bill is tested in the courts.
Second, lost coal production means greater oil imports and
outflow of U.S. dollars and jobs. Even if only 50 million tons
of lost coal. production had to be replaced by foreign oil, this
would mean another 215 million barrels of oil imports per year
and more than $2.3 billion in dollar outflows (and more than
10,000 jobs lost). Greater imports mean greater vulnerability
to another oil embargo.
Third, in addition to the national job losses associated
with dollar outflows, there would be job losses from coal
production cutbacks. These job losses would be particularly
severe in the Appalachian region which has been struggling
to improve its economic welfare without increased reliance
on Federal welfare programs.
Fourth, the bill would increase consumer costs, particularly
for electricity. In addition, to the higher costs of using
foreign oil instead of domestic coal, there would be added
costs of the bill that must be paid in consumer costs
or taxes, including the taxes on coal which will be about
$150 million annually, higher production and reclamation
costs in the range of $160 to 210 million annually, and Federal
and State Government costs of administering the bill of $90
- 3 -
million a year. The higher cost of electricity will vary
from utility to utility depending upon the extent of reliance
on coal. In some cases, imported oil will cost more than
times the current costs of coal to produce electricity.
Fifth, the bill is sharply inconsistent with our goals
of increasing domestic energy production. We are running out
of domestic oil and gas supplies. New energy sources are not
available soon enough to take up the slack and supply new
demands. We must increase coal to fill this gap. I have called
for doubling coal production --- to 1.2 billion tons annually
by 1985. The Democratic Congressional leadership's energy
program called for 1.37 billion tons annually by 1985, but this
bill would reduce coal production. Coal is the one abundant
energy source over which the United States has total control.
We should not impose unnecessary restrictions on the production
and use of that coal.
I favor action to protect the environment and reclaim land
disturbed by surface mining of coal and to prevent abuses that
have accompanied such surface mining in the past. We can achieve
those goals without imposing further restrains on our ability
to achieve energy independence, without imposing unnecessary
costs, creating unnecessary unemployment and without locking up
our domestic energy resources.
The need to veto this bill is especially disappointing because
of the extensive effort that has been made to obtain a bill
that would achieve a balance among our various objectives that
is in the Nation's best interests. Bills were proposed by the
- 4 -
Executive branch in 1971 and 1973. I proposed a new compromise
bill in February of this year. Hundreds of hours have been
spent in working with the Congress in an attempt to obtain a
balanced bill.
The action that I have had to take on this bill does not
resolve the issue of surface mining controls to my satisfaction
nor to the satisfaction of the Nation. We must return to this
issue and find the right answers--the best possible balance
among our various national objectives that are involved, including
environmental protection, energy, employment, consumer prices
and reduced dependence on foreign oil. Since the Executive
Branch and the Congress began work on this issue in 1971, there
have been fundamental changes in the circumstances that must be
taken into account, including new mining and reclamation practices,
improved state laws, regulations and enforcement activities, and
new objectives that must be balanced. In order that we may all
have a better basis for addressing this issue, I have today
directed the Chairman of the Energy Resources Council to
organize a thorough review of today's circumstances that
bear upon the need for surface mining legislation and to report
back to me with his findings and recommendations by September
30, 1975. That study will involve the participation of the
Environmental Protection Agency, the Council on Environmental
Quality, Departments of the Interior, Commerce and Agriculture,
the Federal Energy Administration and other agencies concerned.
[5/9/75]
ROBERT HARTMANN's COMMENTS:
1.
Recommend veto
2.
The veto message needs considerable reworking.
Should be tied to Congress. Failure to date
to enact energy program to reduce oil and
increase other resources.
[5/9/75]
BUCHEN
Option 2 - Veto of Surface Mining
[Many A75]
THE WHITE HOUSE
WASHINGTON
TO: Jim Cannon
FROM: MIKE DUVAL
For your information
Comments:
Latest on strip
Mining. I'll palish
up the OMB chatt
signing Message. Clenn
+I did the
White
vetu message
THE WHITE HOUSE
WASHINGTON
MEMORANDUM FOR:
THE PRESIDENT
FROM:
JIM CANNON
SUBJECT:
STRIP MINING BILL
H.R. 25, the Surface Mining Control and Reclamation Act
passed the Senate on Monday by voice vote and the House
on Wednesday by a vote of 293-115.
This memorandum briefly describes the bill, compares it
to the one you proposed on February 6, identifies the
impacts on coal production and other economic considera-
tions, lists arguments for and against approval, and
presents recommendations of your advisers as to signing
or vetoing the bill.
Jim Lynn will soon be providing an enrolled bill memorandum
which will provide more detail on the bill and agency
positions.
The Bill
Briefly, the principal features of the bill:
Establish environmental protection and reclamation
standards for surface mining activities.
Establish immediate Federal regulatory programs in
all states as an interim measure.
Call for State regulatory and enforcement activities,
with permanent Federal regulation and enforcement if
States do not act.
Places an excise tax of 15-35¢ on each ton of coal to
create a trust fund for use in reclaiming public and
privately owned abandoned mined lands, and paying
other facility and service costs in areas affected
by energy development.
Provides funds for state mining and mineral institutes.
Background
The Executive Branch proposed bills in 1971 and 1973 to
establish environmental and reclamation standards for
- 2 -
surface and subsurface mining of coal and other minerals.
The Congress passed a tough bill covering surface coal
mining in December 1974. Your Memorandum of Disapproval
announcing the pocket veto of that bill in January 1975
is enclosed at Tab A.
On February 6, 1975, you transmitted a new bill which
followed the wording of the vetoed bill except for eight
changes identified in your letter (Tab B) as critical
to overcome the problems that led to your veto and 19
other changes which were designed to reduce the coal
production losses and make the bill more workable.
In order to place in context many of the objections that
are now being voiced against the Enrolled Bill, it is
important to note that your February proposal represented
a substantial compromise. For example, the Executive
Branch gave up after numerous attempts to obtain less
rigorous restrictions on steep slope mining and post-mining
uses. The Appalachian states' ojbections to the bill are
due to these restrictions which they claim would put small
mine operators out of business and generally restrict
mining activities.
Actions Already Taken by States
Eleven of the twelve leading surface mining states -- which
account for about 87% of 1973 surface coal mining in the
Nation --- now have their own surface mining laws. Since
1971, when Federal legislation began to be considered, 21
states -- including eleven of the twelve leading surface
coal producers -- have enacted or strengthened their sur-
face mining laws. In addition, a survey conducted by
CEQ indicates that most leading coal producing states have
tightened up their regulations and increased their regu-
latory staffs. However, except for Montana, the programs
are not as rigorous as H.R. 25 would require.
These developments are significant because they indicate that
our concerns for the environment do not depend solely on
Federal legislation.
Enrolled Bill Compared to Your February
Compromise Bill and The Vetoed Bill
In assessing the adverse impact of the Enrolled Bill, you
may find it useful to compare it to your February compromise
bill and to the one you pocket-vetoed. Rough estimates of
production and job losses are:
- 3 -
Coal Production Losses Job Losses
(million tons)
Vetoed bill
-
48-141
11-31,000
Your bill
-
33-80
7-18,000
Enrolled bill
-
40-162
9-36,000
Tab C summarizes the progress made in the Enrolled Bill
on specific changes requested in your compromise position.
Briefly, the Enrolled Bill makes changes in six of the
eight areas you identified as critical in your February
letter to Congress letter, including the narrowing of
citizen suits and eliminating special unemployment pro-
visions.
However, the Enrolled Bill also creates three important new
problems, involving State control over Federal coal lands,
restrictions on mining in alluvial valleys and a change in
water rights.
Arguments in Favor of the Enrolled Bill
An environmentally sound solution to the problem of
strip mining. Furthermore, it will reclaim the acres
of abandoned lands that now exist.
A reasonable compromise between the position you took
when you vetoed last year's bill and the position of
the bill's sponsors. This argument is especially
pursuasive because you are clearly on record as
supporting an environmentally sound strip mining
bill as long as it does not unnecessarily impact your
energy independence goals.
Your Administration is beginning to develop a negative
environmental record due to your previous pocket-veto
of the strip mine bill, your proposed Clean Air Act
Amendments in connection with your Energy Independence
Act, your decision not to propose a land use bill this
year and your nomination of Governor Hathaway.
For additional arguments in favor, see memorandum from
Russ Train at Tab D.
- 4 -
Arguments Against the Enrolled Bill
This is a badly drafted bill which goes way beyond its
laudable environmental goals and creates an unnecessary
Federal and state regulatory system and bureaucracy, and
because of ambiguities, it will invite years of litigation
thus unnecessarily constraining coal production.
It results in unnecessary loss of coal production,
will increase oil imports and dollar and job outflow,
and will increase electricity prices. (Details at
Tab E)
Coal Production Losses. Between 40 to 162 million
tons (6 to 24% of expected 1977 production) This
does not include losses for other reasons which
cannot be quantified, such as court challenges and
surface owner rights. The range cannot be narrowed
because of ambiguities in the bill.
These levels of production losses will likely
result in an increase in oil imports of between
139 and 559 million barrels in 1977 involving
dollar outflows from $1.5 to 6.1 billion.
Job Losses. In addition to the job losses associated
with the dollar outflows, Interior and FEA have
extimated that direct and indirect job losses will
range between 11,000 and 36,000. These will be
partially offset by lower productivity due to
tighter restrictions and after some years, expanded
underground mining.
Inflation. The bill is very inflationary. The
excise taxes amount to about $150 million a year;
strip mining production costs will increase by %;
;
and the bill will cost $90 million for Federal and
state government implementation.
In addition, electric bills will increase because
coal costs increase and becasue some utilities will
use more oil which costs
more than coal on
a BTU equivalency basis.
States have already taken effective action, therefore
all that is required at the Federal level is assistance
with reclamation funding.
- 5 -
Legislative Outlook
Last day for your action on the Enrolled Bill is May 20.
Max Fridersdorf and Jack Marsh believe that you could
possibly sustain a veto in the House but it would be an
uphill fight with less a 50-50 chance of success.
Recommendations (Note: Official agency positions will be in
OMB's Enrolled Bill memorandum.)
1. Sign
2. Allow to become law without signature.
3. Veto
Decision
I recommend that you defer final decision until you receive
the Enrolled Bill memorandum from Jim Lynn6 and the
House rotes on your Farm 13111 veto.
DRAFT VETO
Draft 5/9/75 - 430pm pm
Today I have returned to Congress, without my approval,
the proposed Surface Mining Control and Reclamation Act
of 1975, H.R. 25.
I cannot sign this bill into law because it would
unnecessarily make it more difficult for this Nation
to achieve its goal of energy independence by 1985. Also,
while meeting valid environmental objectives which I
continue to fully endorse, the bill would impose an
unexceptable burden on our Nation's economy by needlessly
increasing consumers' electricity bills and adding to
unemployment.
I have supported responsible legislation to control surface
mining and reclaim damaged land. I understood that this
would result in making coal production more difficult and
would add to the cost of the coal we did produce. The bill
I submitted to Congress on February 6, 1975, struck a proper
balance between our energy and economic goals on the one
hand with the important environmental objectives on the
other. Unfortunately, H.R. 25 does not strike such a balance.
2
Congress has not acted on my proposed comprehensive energy
plan and thus I have nothing against which to judge the
negative energy impact of this bill. Without Congressional
action on my energy proposals I do not know how much
additional leeway the Nation might have in balancing our
energy and environmental objectives. We need immediate
Congressional action on my energy conservation and
accelerated production proposals. H.R. 25 only makes
the goal of energy independence more elusive and this
will ultimately increase the sacrifices required of all
Americans.
Certainly, I cannot now accept more burdensome obstacles
in the path of our energy objectives than I was willing
to accept at the beginning of the year. The absence of
Congressional action on a comprehensive energy program
requires that I be more prudent and careful than ever.
Although I still believe that the Nation can have
environmental safeguards for strip mining comparable
to the proposal I submitted in February, it is clear
that we cannot accept stricter penalties on production
of this critical energy resource.
It is with a deep sense of regret that I find it necessary
to reject this legislation. My Administration has worked
hard with the Congress to try to develop an acceptable
bill. Unfortunately, the Congress did not accept the
compromise measure I proposed even though it satisfied all
3
the key environmental objectives of the bill passed by
the Congress last session. A fair and objective evaluation
of the record will show that my Administration went more
than half way towards the objectives of those who sponsored
H.R. 25.
The following are my key objections to this bill.
First, with respect to coal production, H.R. 25 will result
in a substantial loss in coal production above and beyond
the loss that I felt was acceptable under the legislation
I proposed. The Department of Interior and the Federal
Energy Administration advise me that H.R. 25 would result
in lost production of 40 to 162 million tons a year.
The bill that I urged the Congress to pass in February
would have also had production losses. I am told by the
experts that my proposal would have ranged in production
losses between 33 up to 80 million tons a year. That's
as far as I could go at a time when I could assume that
Congress would speedily enact my energy program. But
because of the delay on my energy program, I know now
that it will be more difficult to achieve our energy
objectives and therefore I cannot accept additional coal
production losses.
4
These production loss numbers are only based upon those
provisions for which an estimate can be developed. I
understand that H.R. 25, in fact, will probably result
in losses on the high end of this range. Furthermore,
this analysis does not include the potential impact of
many ambiguous provisions of the bill for which estimates
cannot be developed. This estimate is, therefore, conservative.
Second, the reduction in coal production will mean that the
Nation will have to import more foreign oil. This will
mean our dependency will be increased and we will loose
more U.S. dollars and thus jobs. To demonstrate how serious
this problem can be, if every 50 million tons of loss coal
is replaced be foreign oil, we will increase our imports
by 215 million barrels of oil a year at a cost of $2.3
billion. The lack of Congressional action on my comprehensive
energy program is reason enough for alarm at our growing
energy dependency. I believe it would be irresponsible
to further increase this dependency by signing into law
H.R. 25.
Third, H.R. 25 will result in an increase in unemployment
and costs to American consumers. Job losses because of
coal production cut back cannot be offset in increases
of reclamation and other activities financed under this
bill. The simple fact is that there would be a major
increase in unemployment because of H.R. 25 and this could
not come at a worse time. Furthermore, the bill would increase
5
consumer costs particularly for electricity. In addition
to the higher costs of using foreign oil instead of
domestic coal, there would be added costs because of
the taxes imposed on coal and the higher coal production
costs imposed by H.R. 25.
I favor action to protect the environment and reclaim land
disturbed by surface mining of coal and to prevent abuses that
have accompanied such surface mining in the past. We can
achieve those goals without imposing further restrains
on
our ability to achieve energy independence, without imposing
unnecessary costs, creating unnecessary unemployment and
without locking up our domestic energy resources.
The need to veto this bill is especially disappointing because
of the extensive effort that has been made to obtain a bill
that would achieve a balance among our various objectives that
is in the Nation's best interests. Bills were proposed by the
6
Executive branch in 1971 and 1973. I proposed a new compromise
bill in February of this year. Hundreds of hours have been
spent in working with the Congress in an attempt to obtain a
balanced bill.
The action that I have had to take on this bill does not
resolve the issue of surface mining controls to my satisfaction
nor to the satisfaction of the Nation. We must return to this
issue and find the right answers--the best possible balance
among our various national objectives that are involved, including
environmental protection, energy, employment, consumer prices
and reduced dependence on foreign oil. Since the Executive
Branch and the Congress began work on this issue in 1971, there
have been fundamental changes in the circumstances that must be
taken into account, including new mining and reclamation practices,
improved state laws, regulations and enforcement activities, and
new objectives that must be balanced. In order that we may all
have a better basis for addressing this issue, I have today
directed the Chairman of the Energy Resources Council to
organize a thorough review of today's circumstances that
bear upon the need for surface mining legislation and to report
back to me with his findings and recommendations by September
30, 1975. That study will involve the participation of the
Environmental Protection Agency, the Council on Environmental
Quality, Departments of the Interior, Commerce and Agriculture,
the Federal Energy Administration and other agencies concerned.
DRAFT SIGNING
OMB DRAFT
5/9/75
SURFACE MINING CONTROL
AND RECLAMATION ACT OF 1975
SIGNING STATEMENT
On December 30, 1974, I issued a Memorandum of Disapproval
which explained the reasons for my veto of S. 425, the Surface
Mining Control and Reclamation Act of 1974. Briefly stated,
I vetoed S. 425 on the grounds that it would have (a) had an
unacceptable impact on our domestic coal production resulting in
significantly increased unemployment and our reliance on
expensive foreign oil; (b) lead to protracted regulatory dis-
putes and litigation because of its ambiguous language;
(c) produced excessive Federal expenditures and inflationary
impact on the economy; and, (d) contained numerous other
deficiencies.
My Memorandum of Disapproval of S. 425 noted that:
"
I am truly disappointed and sympathetic with those
in Congress who have labored so hard to come up
with a good bill. We must continue to strive
diligently to ensure that laws and regulations are
in effect which establish environmental protection
and reclamation requirements appropriately balanced
against the Nation's need for increased coal production.
This will continue to be my Administration's goal in
the new year."
On February 6, 1975, in accordance with those considerations,
I proposed a coal surface mining bill which followed the basic
framework of the vetoed legislation changed only (a) to over-
come the critical objections which lead to the veto, and
(b) to reduce further the potential for unnecessary pro-
duction impact, and (c) to make the legislation more effective
and workable. In transmitting the bill, I reiterated that my
energy program contemplates the doubling of our Nation's coal
- 2 -
production by 1985. I further noted that this will require
the opening of 250 major new coal mines, the majority of which
must be surface mines.
Following submission of my bill, the Administration
continued to work in every possible way with the Congress
in an effort to produce surface coal mining legislation which
strikes the necessary balance between our desire for environ-
mental protection and our clear need to increase domestic
coal production.
I am pleased to report that these efforts have proven
successful --- I am today signing H.R. 25, the Surface Mining
Control and Reclamation Act of 1975. It is gratifying that
Congress has reacted favorably on a number of the critical and
other substantive changes which I requested from last year's
bill. It is my hope that H.R. 25 can now serve as the basis
for assuring that the Nation's environmental protection and
reclamation requirements are appropriately balanced against
our need for increased coal production.
However, I must also note that H.R. 25 contains several
provisions which could have an unacceptable impact on
domestic coal production. I am signing the enrolled bill with
the clear understanding that should significant coal production
losses develop, Congress will act immediately on corrective
legislation to remedy the problem.
THE WHITE HOUSE
WASHINGTON
May 9, 1975
TO:
PAUL THEIS
FROM:
GLENN Glenn SCHLEEDE
Attached is a more extensive
veto message on the surface
mining bill drafted by OMB
which should be useful to
you.
Attachment
CC: Mike Duval
Iim Cavanaugh
May 9, 1975
John Davis - Council of Economic Advisors
Subject; Strip Mining Bill
The President shoudl sign (Option 1) or agree
the bill become law without a signature (Option 3)
From an economic view there is nothing to be gained
by a veto.
Greenspan has no strong feelings on this
I
Changed hisposition somewhat with Dual Comments
during meeting in Reasevelt Room oh Monday
May 12, Gave Zauls his proxy.
FORD LIBRARY a
1
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
THE ADMINISTRATOR
Jim:
Attached is my letter to the President on
the strip mine bill. I would appreciate
it if you would bring it to the President's
attention.
As a courtesy, I have had a copy hand
delivered to Frank Zarb. No other
copies have been made
Ann R.E.T.
are VIVA a VII ID 22
FORD LIBRARY & GERALD
UNITED
STATES
WINSWNOMIANS
AGENCY
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
PROTECTION
WASHINGTON, D.C. 20460
MAY 9 1975
OFFICE OF THE
ADMINISTRATOR
Dear Mr. President:
Ten years ago, in March of 1965, Congress recognized the
mounting adverse environmental and social impacts of strip mining
when it enacted the Appalachian Regional Development Act. A
national study resulted which concluded that the adverse impacts
are serious and growing and recommended to the Congress a
national regulatory program to control all surface mining.
During years of debate the Congress has never seriously ques -
tioned the need for strip mining legislation. However, the require-
ments have been, as you are very much aware, the subject of
heated debate. Throughout this period these requirements have
been thoroughly analyzed and in almost every instance workable
solutions have been found. We have worked hard for further im-
provements to the bill that you vetoed last December. These
efforts have been successful in improving most of the critical issues
and many other less significant ones. The bill before you, in my
opinion, now represents an effective balance between the Nation's
need to develop our vast coal energy resources while assuring the
necessary protection to our environment and maintaining a strong
economy.
While it is difficult for me to question the estimated impacts
that this bill would have on coal production and employment, I must
point out that there has been considerable challenge and debate
both within the Administration and by the Congress and the public
on the accuracy of the estimates. More important, however, is the
clear fact that in the State of Pennsylvania, which has reclamation
requirements similar to the proposed bill, production continues to
increase along with the number of mines and employment. I am
also encouraged by yesterday's announcement by the Tennessee
Valley Authority, the largest single purchaser of coal in the United
States, that they support the legislation and will recommend that
you sign the bill.
FORD i LIBRARY GERALD
The environmental problems associated with the mining of coal
continue to grow at an unacceptable pace. More than two million
acres of land and 11, 000 miles of streams have already been de-
spoiled by exploitative strip mining. The impending surface mining
of 1, 700 acres and more every week to meet the present demand
for coal is greatly compounding the problem. This pace will
rapidly intensify with the Nation's increasing dependence on coal as
the dominant source of energy. The need for Federal legislation
at this time is great.
Mr. President, I would not argue that the bill before you is
perfect. But I strongly believe that there comes a time when one
must resolve an issue and move on to other concerns. The bill
before you goes a long way towards meeting the objection you artic-
ulated in December. Its merits far outweigh its deficiencies. I
strongly recommend that you sign it into law.
Respectfully,
Russell E. Train
Administrator
The President
The White House
Washington, D.C. 20500
FORD j LIBRARY GERALD
2
UNITED
STATES:
AGENCY
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
PROTECTION
WASHINGTON, D.C. 20460
MAY 9 1975
OFFICE OF THE
ADMINISTRATOR
Dear Mr. President:
Ten years ago, in March of 1965, Congress recognized the
mounting adverse environmental and social impacts of strip mining
when it enacted the Appalachian Regional Development Act. A
national study resulted which concluded that the adverse impacts
are serious and growing and recommended to the Congress a
national regulatory program to control all surface mining.
During years of debate the Congress has never seriously ques-
tioned the need for strip mining legislation. However, the require-
ments have been, as you are very much aware, the subject of
heated debate. Throughout this period these requirements have
been thoroughly analyzed and in almost every instance workable
solutions have been found. We have worked hard for further im-
provements to the bill that you vetoed last December. These
efforts have been successful in improving most of the critical issues
and many other less significant ones. The bill before you, in my
opinion, now represents an effective balance between the Nation's
need to develop our vast coal energy resources while assuring the
necessary protection to our environment and maintaining a strong
economy.
While it is difficult for me to question the estimated impacts
that this bill would have on coal production and employment, I must
point out that there has been considerable challenge and debate
both within the Administration and by the Congress and the public
on the accuracy of the estimates. More important, however, is the
clear fact that in the State of Pennsylvania, which has reclamation
requirements similar to the proposed bill, production continues to
increase along with the number of mines and employment. I am
also encouraged by yesterday's announcement by the Tennessee
Valley Authority, the largest single purchaser of coal in the United
States, that they support the legislation and will recommend that
you sign the bill.
FORD & LIBRARY CERALD
The environmental problems associated with the mining of coal
continue to grow at an unacceptable pace, More than two million
acres of land and 11, 000 miles of streams have already been de-
spoiled by expleitative strip mining. The impending surface mining
of 1,700 acres and more every week to meet the present demand
for coal is greatly compounding the problem. This pace will
rapidly intensify with the Nation's increasing dependence on coal as
the dominant source of energy. The need for Federal legislation
at this time is great.
Mr. President, I would not argue that the bill before you is
perfect. But I strongly believe that there comes a time when one
must resolve an issue and move on to other concerns. The bill
before you goes a long way towards meeting the objection you artic-
ulated in December. Its merits far outweigh its deficiencies. I
strongly recommend that you sign it into law.
Respectfully,
Russell E. Train
Administrator
The President
The White House
Washington, D. C. 20500
GERALD FORD LIBRARY
2
UNITED
STATES.
AGENCY
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
PROTECTION
WASHINGTON, D.C. 20460
MAY 9 1975
OFFICE OF THE
ADMINISTRATOR
GERALD
Dear Mr. President:
LIBRARY
Ten years ago, in March of 1965, Congress recognized the
mounting adverse environmental and social impacts of strip mining
when it enacted the Appalachian Regional Development Act. A
national study resulted which concluded that the adverse impacts
are serious and growing and recommended to the Congress a
national regulatory program to control all surface mining.
During years of debate the Congress has never seriously ques-
tioned the need for strip mining legislation. However, the require-
ments have been, as you are very much aware, the subject of
heated debate. Throughout this period these requirements have
been thoroughly analyzed and in almost every instance workable
solutions have been found. We have worked hard for further im-
provements to the bill that you vetoed last December. These
efforts have been successful in improving most of the critical issues
and many other less significant ones. The bill before you, in my
opinion, now represents an effective balance between the Nation's
need to develop our vast coal energy resources while assuring the
necessary protection to our environment and maintaining a strong
economy.
While it is difficult for me to question the estimated impacts
that this bill would have on coal production and employment, I must
point out that there has been considerable challenge and debate
both within the Administration and by the Congress and the public
on the accuracy of the estimates. More important, however, is the
clear fact that in the State of Pennsylvania, which has reclamation
requirements similar to the proposed bill, production continues to
increase along with the number of mines and employment. I am
also encouraged by yesterday's announcement by the Tennessee
Valley Authority, the largest single purchaser of coal in the United
States, that they support the legislation and will recommend that
you sign the bill.
The environmental problems associated with the mining of coal
continue to grow at an unacceptable pace. More than two million
acres of land and 11, 000 miles of streams have already been de-
spoiled by exploitative strip mining. The impending surface mining
of 1, 700 acres and more every week to meet the present demand
for coal is greatly compounding the problem. This pace will
rapidly intensify with the Nation's increasing dependence on coal as
the dominant source of energy. The need for Federal legislation
at this time is great.
Mr. President, I would not argue that the bill before you is
perfect. But I strongly believe that there comes a time when one
must resolve an issue and move on to other concerns. The bill
before you goes a long way towards meeting the objection you artic-
ulated in December. Its merits far outweigh its deficiencies. I
strongly recommend that you sign it into law.
Respectfully,
Russell E. Train
Administrator
The President
The White House
Washington, D.C. 20500
2
FORD LIBRARY &
MAY 9 1975
THE WHITE HOUSE
due:5/9
WASHINGTON
AMOON.
May 9, 1975
MEMORANDUM FOR :
PHIL BUCHEN
MAX FRIEDERSDORF
ALAN GREENSPAN
BOB HARTMANN
JIM LYNN
JACK MARSH
BILL SEIDMAN
PAUL THEIS
FROM :
JIM CANNON
SUBJECT :
DECISION MEMORANDUM ON H.R. 25,
SURFACE MINING BILL
The President has asked for a decision memorandum by
close of business today on the strip mining bill.
The first draft of such a memorandum is enclosed, along
with a draft statement of disapproval in the event that
he decides to veto the bill.
May we have your comments and corrections as soon as
possible but not later than noon today so that we can
revise the memorandum and get it to the President.
May we also have your recommendation on the bill.
We will also be checking the memorandum with Frank Zarb,
Russ Train, Russ Peterson, Kent Frizzell and Rog Morton.
Thanks for your help.
Enclosure.
GERALD FORD LIBRARY
Jun We - have a chance
to sustain a veto, but it
will require great effort and
then only in a close margin,
if success ful, in my opinion gon
THE WHITE HOUSE
WASHINGTON
May 9, 1975
MEMORANDUM FOR
JIM CANNON
FROM:
MAX FRIEDERSDORF m.6. 6.
SUBJECT:
Surface Mining Bill
I recommend the President veto the bill on the grounds of
job loss, higher utility rates due to loss of coal production
and to be consistent with his former action on this legislation.
Your memo is incorrect insofar as Congressional Relations staff
belief that a veto can be sustained. (page 5) We were 30 votes
short in the House on the conference report. The situation has
improved, but sustaining a veto in either body will be extremely
difficult. Not impossible, but uphill and less than 50-50.
GERALD R. LIBRARY FORD
eccined 5/9/75
9:05am
gall
THE WHITE HOUSE
WASHINGTON
May 9, 1975
MEMORANDUM FOR :
PHIL BUCHEN
MAX FRIEDERSDORF
ALAN GREENSPAN
BOB HARTMANN
JIM LYNN
JACK MARSH
BILL SEIDMAN
BERALD FORD VIBRARY
PAUL THEIS AND
FROM :
JIM CANNON
SUBJECT :
DECISION MEMORANDUM ON H.R. 25,
SURFACE MINING BILL
The President has asked for a decision memorandum by
close of business today on the strip mining bill.
The first draft of such a memorandum is enclosed, along
with a draft statement of disapproval in the event that
he decides to veto the bill.
May we have your comments and corrections as soon as
possible but not later than noon today so that we can
revise the memorandum and get it to the President.
May we also have your recommendation on the bill.
We will also be checking the memorandum with Frank Zarb,
Russ Train, Russ Peterson, Kent Frizzell and Rog Morton.
Thanks for your help.
Enclosure.
Veto, If 5/9 9.15Am
called THE 1:25 gail m 75 2. Veto message veto be needs tied considerable to Congress
reworking - date should to enact other energy sources, program
failure to reduce to oil of increase RTA