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Philip W. Buchen Files
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The original documents are located in Box 8, folder "Congressional - Strip Mining (1)" of
the Philip Buchen 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 R. 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States of America his copyrights in all of his unpublished writings in National Archives collections.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 8 of the Philip Buchen Files at the Gerald R. Ford Presidential Library
[st/s [st/ser]
STRIP MINING BILL
The President vetoed the Strip Mining Bill H.R. 25 because it:
(1) Reduces production and increases dependence on high-cost
and interruptible oil from abroad;
(2) Increases unemployment;
(3) Results in increased electric bills;
(4) Preempts states from achieving similar objectives.
Additional reasons for the veto could include:
(5) Forces small mines to merge with larger mines and consequently
reduces competition (also small mines are often the source
of immediate expansion - should additional coal be needed
quickly);
(6) Increases the likelihood of disabling injuries and additional
health problems by encouraging deep mining vs. surface mining.
STEPS TAKEN
(1) An interagency task force summarized their analyses of the
bill (attached) and circulated it to all affected agencies.
(2) The Administration's analysis of the bill, including the
assumptions used was requested by Senator Metcalf and delivered
to him last week.
NEXT STEPS
(1) The Administration's analysis should be shared more broadly
than just Senator Metcalf. This could be achieved by:
(a) White House press making the letter to Metcalf and/or
the analyses available, should a press question be raised
on Wednesday, Thursday, or Friday.
FORD is LIBRARY GERALD
-2-
(b) The Administration's analysis could be sent to key
newspapers and key news services (e.g., in appropriate
geographical locations such as Kentucky, West Virginia,
and Virginia, hardest hit by the bill).
(c) Administration could use "handle" of either President's
speech or sworn testimony to announce full, vigorous
compliance and detailed disclosure.
(2) The Administration's analysis should be used for news media
interviews or talk shows between now and the time the testimony
is given.
(3) Prepare the testimony for its submission to the Committee on
Monday, June 2, with a release of the testimony the morning
of the testimony (draft of testimony is underway and will be
available Thursday, c.o.b.).
(4) Post hearing activities
(a) Continue public debate through to vote, to maximize
vote numbers, sharpen differences between Presidential
activity and Congressional inaction ("anti-energy")
(b) One on one with individual members of Congress.
WITNESSES
(1) Frank Zarb has been specifically identified as a witness
under oath to testify on overall issues, Administration
positions, responses to inquiries regarding data.
(2) Dr. Tom Falkie, Director, Bureau of Mines, should provide
support for the production and reserve losses estimates.
(3) Another witness should address the unemployment and economic
(especially price) effects of the bill.
FORD is LIBRARY
ISSUES - QUESTIONS
A. Critical Issues from President's letter remaining unresolved:
(1) Doesn't the bill's accommodation of Administration position
on citizen suits mean that litigation delays will not occur?
(2) Why would the bill's language on siltation prevention remain
a problem?
(3) Aren't the bill's provisions on hydrologic disturbance only
reasonable, prudent protection?
(4) What vagaries and ambiguities remain potential threats to
production?
(5) Has the Administration abandoned opposition to reclamation of
orphan lands?
(6) (a) Why should you object to National Forest prohibition if
you don't intend to mine there anyway?
(b) Are those lands included in your loss figures?
(7) How do you resolve apparent disagreement within Administration
on production and reserve tonnage losses?
B. Presidential Letter - Important Issues
(1) What problems of timing of interim program remain unresolved
for the operator?
(2) How are new vs. existing mines to be handled under the interim
program? Is this a problem?
(3) Why shouldn't Federal Government be involved in interim
program? Wouldn't Administration position be business-as-usual?
(4) Doesn't the bill accommodate the Administration's desire for
protection of surface owner rights and mining of Federal coal?
What else is needed?
ICHD
LIBRARY
2
(5) Why shouldn't Federal lands be subject to state controls?
Aren't other facilities subject to state environmental
programs and standards?
(6) What problems remain with provisions to designate lands
unsuitable for mining?
(7) Why do you feel data gathering process of permit application
procedure is cumbersome? Doesn't bill resolve this problem?
(8) Wouldn't authority for variances requested by the Administra-
tion give away the whole bill and allow unrestricted
development?
C. New Issues
(1) Data Base
(a) Employment loss estimates are higher than employment
itself. How is this explained?
(b) Won't there in fact be a net gain in employment?
(c) How is the states success with their programs explained,
especially Pennsylvania, without production loss?
(d) What higher consumer costs are involved? Can't mine
companies absorb increased cost without further price
rises?
(2) Other
(a) What's wrong with minimum Federal standards to make
state programs more uniform?
(b) What's wrong with forcing underground mining?
[N.B. - health and safety and experience
of subsidence, fires, etc.]
(c) What anti-competitive effects might occur? Who will
suffer more, small or large miners?
FORD
LIBRARY
3
(d) What is the scope of the exception language for
anthracite mines and separate regulations?
FORD LIBRARY STYS
OF
30
United States Department of the Interior
BUREAU OF MINES
2401 E STREET. NW.
IN REPLY REFER TO:
WASHINGTON, D.C. 20241
23 May 1975
Dear Mr. Chairman:
Your Committee's staff asked for further clarification of the Adminis-
tration's estimates of the adverse production and employment impact that
enactment of H.R. 25 would produce.
Our estimates of the adverse impacts on production, reserves, and
employment, and how they were derived, are attached. The estimates
reflect the analysis of the various agencies of the executive branch,
including the Bureau of Mines. A copy of the attachments has already
been given to your Committee's staff assistant.
Interpretations of specific sections of the legislation by regulatory
authorities or the courts can materially affect many of the estimates.
The low range of estimates reflects the least restrictive interpreta-
tions of the bill's provisions which we consider possible under the
specific statutory language and the related legislative history. The
higher range indicates the best estimates of the adverse impacts if the
language of the bill were to be interpreted strictly, and vigorously
enforced by regulatory authorities or the courts.
There will be additional but presently unquantifiable adverse effects
resulting from delays in production and other inhibiting factors that
will develop as the bill is implemented. These include, for instance,
litigation delays, restrictive interpretations of other ambiguous
language, the costs of obtaining surface owner consent or of complying
with water replacement requirements, possible actions by the states
with respect to Federal lands, and administrative designations of land
as unsuitable for mining.
It should also be noted that this analysis is primarily directed toward
domestic impacts of the vetoed legislation. To the extent that
domestic coal production is reduced, there will be increased reliance
on interruptible and high-priced supplies of imported petroleum. This
will not only work against reaching the goals of Project Independence,
REVOLUTION
TOTALO R. FORD LIBRARY
AMERICAN
BICENTENNIAL
1776-1976
-2-
but will tend to support higher price levels currently being maintained
by foreign producers. Inflationary pressures and national security
aspects of this legislation are, therefore, serious.
Sincerely,
Tavitallare
Thomas V. Falkie
Director
Honorable Lee Metcalf
Chairman, Subcommittee on Minerals,
Materials, and Fuels
Committee on Interior and Insular Affairs
United States Senate
Washington, D.C. 20510
Attachments
FORD LIBRARY
ATTACHMENT I
IMPACT OF H.R. 25 (AS ENROLLED AND VETOES)
1. Loss of coal production during first full year of
application -- based on expectation of 350 million
tons of strip production and 685 million tons of
total production if there were no bill. *
In millions of tons:
small mines
22-52
restrictions on steep slopes, siltation,
aquifers
7-44
alluvial valley floor restrictions
11-66
Total -- first full year of application*
40-162
(% of production -- estimated at 685 million tons)
6-24%
2. Increased oil imports and dollar outflow
assuming 90% replacement by imported oil
million barrels per year (4.3 barrels per ton
of coal)
154-627
dollar vallue ($12.50 per barrel) -- billions
1.9-7.8
3. Job losses -- assuming 36 tons per man-day, 225 work days
per year, and 0.8 additional non-mining jobs lost per
mining job lost.
direct job losses
5,000-20,000
indirect job losses
4,000-16,000
Total
9,000-36,000
4. Fee for reclamation fund (in millions)
$109 to $158
In addition to the reclamation fee, other cost
increases would be incurred as a result of operator
compliance with provisions of the Act.
*/ Figures shown include no duplication of loss estimates among the
categories set forth.
-2-
5. Lockup of coal reserves
Estimated reserve losses (billion tons) are:
alluvial valley floor provisions (includes
losses from National Forest provisions of
6.3 billion tons and surface owner
provisions of 0-14.2 billion tons)
17.0-66.0
National Forest (outside alluvial valleys)
0.9- 0.9
Other provisions (e.g. steep slopes)
0 - 6.5
17.9-73.4
Total -- billion tons
FORD LIBRARY
ATTACHMENT II
ADVERSE IMPACTS OF H.R. 25
A. General Assumptions
In estimating the impact of H.R. 25 the following general assumptions
have been made:
1. Losses are short falls from projected production
levels. Indicated production losses are set forth as
amounts by which national coal production will fall
short of the projected production. Thus, for the first
full year of implementation (1977) production without
this bill is estimated to reach a level of 685 million
tons. This compares with the 1974 total production of
601 million tons.
2. Time factors will affect the ultimate impact of any
regulatory measure such as H.R. 25. Thus, short term
impacts will be most severe while at some future date
long range adjustments could ameliorate some of the
impacts projected for the first full year of
implementation.
B. Specific Impacts
1. Production losses. In our judgment an assessment of the
final language of H.R. 25 indicates estimated potential
production loss figures of from 40 to 162 million tons for
the first full year of implementation. These losses occur
as a result of the bill's impact in three major areas for
which the impacts are shown as follows (million tons):
small mines
22-52
steep slopes, siltation, and
aquifer provisions
7-44
°alluvial valley floor provisions
11-66
Total
40-162
Additional unquantifiable losses could result
from other provisions, including those relating to
FORD
the designation of lands unsuitable for mining,
surface owner protection, and various ambiguous
terms.
LIBRARY
-2-
Any subsequent shifts of mining to other locations or to
underground mining methods would in our opinion be negligible
during the short term, but some such shifts could be expected
to take place over the longer term.
The following methodology was employed in the analysis of
the major categories of anticipated potential losses.
a. Small Mines:
An examination of surface coal mines producing less than
50,000 tons per year and located principally in the East
resulted in a determination that their ability to comply
with the provisions of the bill relating to bonding and permit
application was inherently limited. Specifically, the require-
ments for the collection of extensive hydrologic data, for
preparing detailed underground maps, for strata cross-section
and test boring, for the preparation and presentation of highly
detailed mining and reclamation plans and for the assessment
of mine impact on hydrologic balance, are beyond the present
capability of many of these small mines.
Our best estimates of potential losses which could result
range from approximately 40 percent minimum to virtually all
production from small mines for the first full year of
implementation. Applying these percentages to the projected
production figures if no bill were enacted results in a range
of annual production losses from 22 million tons minimum to a
52 million ton maximum. The maximum loss stated is the total
loss of production from all mines producing less than 50,000
tons per year with none of this production being otherwise
replaced.
b. Steep slopes, siltation and aquifers
It is estimated that the losses arising from provisions relating
to slopes, siltation and aquifers would range from 7-44 million
tons. This figure can be broken down as follows: Steep slopes
(7-25 million tons), aquifers (0-9 million tons) and siltation
(0-10 million tons).
In estimating potential production losses from steep slope
restrictions, the total amount of surface production derived
from slopes over 20°, updated from calculations made by the
Council on Environmental Quality in 1973, was examined. Our
best estimates are that 6 percent to 23 percent of the projected
steep slope production would be affected during the first full
year of complete implementation, due to some loss of productivity
from nearly every steep slope operation.
FORD
-3-
In assessing possible production losses from aquifer protection
provisions, our estimates are that at worst up to 9 million
tons of planned production near an aquifer-fed water source
would be abandoned because of an adverse opinion by a regulatory
authority or court. At best, regulatory authorities and courts
would allow mining to continue as planned.
In estimating potential production losses from siltation
inhibitions, it was estimated that up to 10 million tons of
production could be lost because of operator's inability to
construct the additional diversion ditches, sedimentation
structures and water treatment facilities required by the Act.
In addition some areas might be mined only if permanent large
siltation structures were built. Under the bill large siltation
structures must be removed after mining. Such removal could
lead to unacceptable sedimentation. Under favorable conditions
and interpretation by regulatory authorities no losses would be
incurred as a result of siltation provisions, but increases in
the cost of production will result and could be substantial.
C. Alluvial Valley Floors
Losses resulting from provisions relating to alluvial valley
floors would range from 11 to 66 million tons during the first
full year of implementation. To arrive at a possible loss of
66 million tons, surface mine production data were collected
for 1974 production west of the 100th meridian west longitude.
This amounted to 63 million tons. Based on a mine-by-mine
analysis it was judged that approximately 45 million tons of
this production was mined from alluvial valley floors as defined
in the bill or was being mined in areas that could adversely
affect alluvial valley floors. In our view, many undeveloped
rangelands could still be considered to be potential farming or
ranching lands and could thereby be excluded from mining. By
projecting the ratio of 1974 production from such areas to
projected production for the first full year, a resulting potential
loss of 66 million tons was derived.
The possible minimum loss figure of 11 million tons attributable to
the alluvial valley floor provision was determined by examination
of actual mining operations and application of three key factors in
the language of the Act: (1) the area that is now under intensive
agricultural usage (including farming and hay meadows) (2) the
amount of undeveloped rangeland and (3) potential farming and ranching
as defined in H.R. 25. Each of these factors involves some
uncertainty and cannot be clearly determimed on a national basis,
but based on our assessment and our best professional judgment FORD
-4-
of the mining activities in areas of current and potential
operations as described in H.R. 25, it is estimated that
a loss of approximately 11 million tons could be considered
a minimum for the first full year of implementation. This
assumes the most favorable possible interpretation of the Act
and legislative history.
From an engineering viewpoint, there are contained within this
language many ambiguous or difficult-to-define terms such as
"significant," "substantial," and "potential," and it is
impossible to develop a precise minimum figure.
2. Oil imports and dollar outflow. Lost coal production from
surface mines will require increased oil imports. To replace
one ton of lost coal production will require 4.3 barrels of
imported crude oil. The calculation is based on the most recent
cost figures for which data are available, which is $12.50 per
barrel.
The major proportion of lost coal production will require
substitution of such imported oil. Exact proportions are diffi-
cult to predict; our estimates assume 90 percent petroleum
replacement.
3. Employment impacts. The estimates for employment losses are based
upon the estimates for lost coal production (40 to 162 million
tons) in the first year after enactment, and the national industry
average of 36 tons of strippable coal per man-day and 225 work
days per year.
Thus, we estimate that a loss of 5,000 jobs related to mining
would be directly attributable to a 40 million ton loss in
production, and 20,000 workers would be so affected by a 160
million ton production loss.
Based on analyses conducted by the Department of Commerce, it is
also assumed that non-mining job losses will occur at the rate
of 0.8 per mine job lost. Thus, we estimate that a loss of from
4,000 to 16,000 such jobs would result from the above production
loss estimates.
Several additional factors apply with respect to any unemployment
analysis.
First, unemployment impacts will be geographically specific and occur
most heavily in Anpalachia. To a great extent individual mobility
of the unemployed is limited by financial, social, or other
factors.
is
-5-
Second, it has been suggested that unemployment will
be offset by increased employment opportunities
resulting from the reclamation activities to be funded
by the Act. On a national scale, however, such reclam-
ation activities will produce no net increase in
employment, since the funding for such activities will
be derived from the reclamation fees, which will draw
money and thus jobs out of the national economy.
Third, it has been suggested that lost jobs for workers
in surface mine activities will be offset by increased
employment in underground mining. In the short term,
this is unlikely to occur because of the long lead
times required for opening or expanding deep mines.
4. Reclamation Fee. The amount of the reclamation fees
expected in the first full year of implementation has
been based upon estimates of production under the Act.
Other costs would include additional reclamation costs
to the operator and administration costs.
5. Estimated Reserve Loss. Estimated reduction in coal
reserves under H.R. 25 are based upon the lost
production indicated in item B(1), above.
Reserves in National Forest lands were included in
this calculation. Such reserves were not included in
calculating production losses, because of the negligible
coal mining activities now in National Forests.
is
FORD
LIBRARY
Interior Paper to Pres on cost sy estimates
- Enrolled bill process
restrip.,Ming bill
Metcolf has copy of ano ther paper
JimFrey OMB
Crabill /
Don Firabillo OMB.
John HiM (FEA)
Raymond Pock (Interior)
Tom Falko
DERALS & FORD NIBRARY
5:15 p.m.
Friday, April 18
(The call was from Glen Schleede) Schleede has talked with
With regard to the Strip Mining Legislation, I just
Lazarus.
received a call from the Domestic Council suggesting
a fourth option. This option would be to first have
a meeting with the President, followed by a public
statement (or letter to the conferees) by Frank Zarb
which expresses serious concerns about the strip mining
legislation. He would cite the kinds of problems and data
reflected in Tab D of the memo. This would be intended
to put additional public pressure on the conference.
This action would be followed on Tuesday or Wednesday
but a Zarb visit with the conferees and an attempt to
negotiate a more acceptable bill. The attempt would be
to keep the President's options open to either veto or sign the
bill.
He's under the gun to get this in to the President by the
time he returns tomorrow.
Called Schleede
9 cencurred in 4th sptron 4/19
FORD is LIBRARY 076839
Return with P. this the T. note to Ken
THE WHITE HOUSE
WASHINGTON
April 17, 1975
MEMORANDUM FOR:
PHIL BUCHEN
MAX FRIEDERSDORF
ALAN GREENSPAN
JACK MARSH
BILL SEIDMAN
FROM:
SUBJECT:
JIM STRIP CANNON MINING Jun
LEGISLATION
We believe it is important to bring the President up to
date on the status of this legislation and to obtain his
decision on possible additional steps to influence the
legislation.
May we have by noon on Friday, April 18, your comments
on the attached draft memorandum and your choice among
the alternatives.
We are also obtaining comments and votes from Rog Morton,
Frank Zarb, Russ Train, Bill Simon and Russ Peterson.
Attachment
CC: Jim Lynn
Bucken in favor
of atternation 2
FORD is LIBRARY GERALD
LIBRARY
GERALD
asot
j
H
4/16/75 (2)
SUBJECT:
Strip Mining Legislation
House-Senate Conferees began meeting on the strip
mining bills on Wednesday, April 16, with attention to
major issues expected on April 23. Agreement on a bill
now appears likely during the week of April 28.
This memorandum is to: (a) report on the House and Senate
bills, (b) comment on the outlook for Conference actions,
and (c) seek your decision as to whether additional steps
should be taken to influence the Conference or to posture
the Administration for acceptance or veto of the bill.
THE BILLS PASSED BY THE SENATE (84-13) AND HOUSE (333-86)
Changes from last year's bill. Your February 6, 1975,
letter (copy at Tab A) which transmitted the Administration's
bill indicated that eight changes were "critical to overcome
objections" which led to your veto, and that additional
changes were needed to reduce unnecessary production impact
and make the bill more effective and workable.
The table at Tab B shows the results of House and Senate
action. Briefly, it shows that:
Three serious new problems were created in one house
or the other. All three affect the potential for
Western coal development by locking up reserves and
reducing expected production. They involve:
- Making Federal coal lands subject to State law and
regulation, including bans on mining.
- Restrictions on mining of alluvial valley floors.
- Establishing a precedent in Federal law with respect
to water rights by requiring that a mining permit
applicant demonstrate ability to replace interrupted
water supplies.
GERALD FORD LIBRART
4
Of the eight critical changes:
- None were fully adopted by both houses.
- Two were partially adopted by both houses:
Partial lifting of prohibition on sediment increases.
Modified restrictions on location of impoundments
(dams)
- Two were fully adopted by one house:
Narrowing of citizen suits.
Eliminating special unemployment provisions.
- Three were partially adopted or partially covered in
report language in one house:
Restriction on impacting hydrologic balance.
Authority to define ambiguous terms.
Reducing the tax on coal for a reclamation
fund -- (but the permissible uses of the fund
were broadened).
- One change -- to permit mining on national forest
lands under certain conditions -- was specifically
rejected by both houses.
Of the nineteen other changes requested, (a) four were
fully accepted and one partially accepted in both houses,
(c) three were partially accepted in one house, (d)
seven were rejected in both houses, and (e) two were made
worse in one house.
Impact of the bills on coal production and reserves,
unemployment, inflation. Your February 8, 1975, letter
indicated that changes from last year's bill were necessary
to avoid unnecessary loss of coal production (and the
resulting need to rely on oil imports), reduce ambiguities
in the bill, avoid inflationary impact, and correct other
deficiencies. Accessibility of reserves also requires
attention because of House changes with respect to alluvial
valley floors. Interior and FEA have estimated the impact
on these factors which are summarized below and provided
in more detail at Tab C:
S.7
H.R.25
Loss of coal production in the
1st full year of application, not
including potential impact of
delays from litigation or
restrictive interpretations of
ambiguous provisions:
- in millions of tons - - - -
40-162
62-162
- as % of expected 1977 production 5% to 22% 8% to 22%
By way of contrast, the vetoed bill involved a potential
production loss of 48-141 million tons and the Adminis-
tration's bill could reduce expected production by
33-80 million tons.
Lock-up of Coal Reserves,
principally because of restrictions
on mining in alluvial valley
floors:
- in billions of tons - - - -
12-72
GERALD F. 3-72 FORD LIBRARY
- as % of demonstrated surface-
mineable reserve of 137
billion tons
9% to 53%
24% to 53%
- 3 -
Increased Oil Imports, assuming
80% of lost coal production is
replaced by oil.
- millions of barrels per year
138-559
215-559
- dollar value - billions
$1.5 to $6.1
$2.4 to $6.1
Job Losses - direct and
9,000 to
14,000 to
indirect
36,000
36,000
Inflationary Impact - in
addition to higher cost foreign
oil would include (in millions)
- Fee for reclamation fund
$130
$204
- Higher production and
reclamation costs
$171
$171
- Federal & State Program
Administration
$100
$135
$110 to
$100 to
$ 160
160
$160
THE CONFERENCE
Schedule and Actions Taken by the Administration.
Work on controversial issues is expected to begin on April 23.
Committee minority staff believe that Democratic conferees
have already reached essential agreement and the Conference
will be completed quickly. A number of the changes requested
in your letter will not be subject to Conference. Detailed
position papers outlining Administration position and
rationale have been prepared for 29 specific issues which
will be subject to Conference action. These papers have
been provided to Senator Fannin, Congressman Steiger and
other minority conferees. If the positions in these papers
are adopted, the estimated adverse effects will be reduced.
Prediction. It is too early to predict the outcome
with any certainty, but our current estimate with respect
to "critical" changes and new problems are that:
Problems involving alluvial valley floors, State
control over Federal lands, and water rights will be
mitigated somewhat but will remain serious.
The Administration position probably will not be
adopted with respect to citizen suits or special
unemployment provisions.
Changes or report language will be adopted to (a) reduce
the effect of restrictions on siltation, hydrologic
impact, and impoundments; (b) reduce somewhat the
excise tax on coal; and (c) indicate that current
law permits defining ambiguous terms in regulations.
The Administration position has been rejected with
respect to mining in, national forests.
- 4 -
The net result probably will be a bill that is very similar
in acceptability to last year's bill. However, the conferees
could vote out a bill that would be either significantly
better or worse.
IMPACT OF THE MINERS' DEMONSTRATION
The miners' demonstration last week apparently had several
objectives, including (a) highlighting the impact* on small
mine operators in Appalachia of steep slope restrictions
and permit applications, (b) emphasize expected unemployment,
(c) point out that most States have adopted strip mining
controls since the bill was first proposed in 1971,
(d) urge you to veto the bill, and (e) urge those favoring
the bill in the past to vote to sustain a veto. The
Congressional relations staff believe it is too early to
assess the impact of the demonstration but they note that
it apparently has impressed some members from Appalachian
states. The demonstration was sponsored by small mine
operators and was neither supported nor opposed by large
coal mining companies.
OVERALL OUTLOOK FOR THE BILL
There continues to be strong national sympathy for the bill
particularly among environmentalists and among people who
are not directly affected. Supporters of the bill are
contending that its impacts on production, unemployment,
etc., are grossly overstated. The inconsistency between
the bill and the goal for increased coal production is not
widely perceived.
Congressman Burton is a strong proponent of the bill and it
is likely that the Democratic caucus will continue to
support passage of a rigorous, environmentally oriented bill.
At present, the Congressional Relations staff believes it
will be very difficult to sustain a veto.
CUMULATIVE EFFECT OF NEGATIVE ENVIRONMENTAL DECISIONS
In reaching your position on surface mining legislation, you
may want to consider a cumulative impact of a number of
your decisions affecting environmental concerns that have
been offensive to the large number of people in the country
who want to improve the environment. These include last
year's surface mining bill,clean air amendments, the Interior
Secretary appointment, the land use legislation issue, and
moves involving leasing and development of oil and gas on the
OCS and coal in the West.
FORD
*which would be essentially the same under the Administration's
bill.
- 5 -
ISSUE FOR DECISION
Should additional actions be taken by the Administration to
try to improve the bill in conference or to posture the
Administration for acceptance or veto?
Alt. #1: A conciliatory attempt now to influence the
Conference. Review the bills personally with Morton,
Zarb and Train and obtain agreement on a very small
number of desirable changes that would be sought in
a"last ditch" attempt to influence the bill and cut
losses. Approach conferees either through:
A. Personal contact by the three principals; or
B. A Presidential letter with a concilliatory tone.
Either approach should be followed with detailed
negotiations--preferably by a principal who is auth-
orized to commit you to accept a bill if the conferees
make concessions.
Pro
Best approach for taking advtage of any flexibility
that the conferees may be willing to exercise (e.g.,
small changes in report language).
Positions the Administration to accept a bill that
it probably will get anyway.
Con
May be construed as caving in, thus weakening
further chances of getting changes in undesirable
features of the bill.
To the extent changes are accepted, narrows the basis
for veto.
Alt. #2: A hard line attempt now to influence the Conference.
Dispatch a Presidential letter to the Conferees which
(a) continues position in February 6 letter; (b)
reiterates changes needed to avoid a veto; and (c)
lays out the best possible case for concerns about
the bill. A draft letter is enclosed at Tab D.
(This draft should give the basis for evaluating
the strength of the opposition case--in terms of
impact on the public and Congress--if a veto FORD is decided.
GENALD
- 6 -
Pro
Makes clear your resolve to continue pushing for
a better bill.
Attracts attention to issues and may influence
some conferees to improve the bill.
Provides a rallying point for opponents of
undesirable features of the bill.
Con
Unlikely to have much impact on the bill.
Reduces options for accepting the bill when it passes.
Using argumentsagainst the bill now may weaken
their impact later if a veto is decided, and provide
more time for counterarguments.
Alt. #3: Make no significant moves now. Continue current
work with Conferees, maintaining position in February
6 letter. Immediately assess results of conference
and decide then whether to:
A. begin posturing to accept or veto the bill through
an announcement of your intentions before floor
votes; or
B.
wait for final Congressional action before
deciding acceptance or veto.
Pro
Additional action now is unlikely to affect the
Conference bill.
Keeps options open to accept or veto the bill.
Con
Passes up the last opportunity to influence
contents of the bill -- short of a sustained veto.
Passes up an opportunity to begin positioning
to accept the bill or to sway marginal votes
against undesirable features of the bill.
RECOMMENDATIONS AND DECISION
Alt. #1. A concilliatory attempt now to influence
the Conference.
Alt. #2. A. hard line attempt now to influence the
Conference.
Alt. #3. Make no significant moves now.
FORD
LIBRARY
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.
FORD
LIBRARY
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.
is
FORD
LIBRARY
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,
Hould R. That
The Honorable
The Speaker
U.S. House of Representatives
Washington, D.C. 20515
FORD it LIBRARY
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.
FORD
BERALD
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 reclamation 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.
LIBRARY
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.
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.
GERALD
LIBRARY
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
7080d
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
FORD
reclamation with 50/50 cost
sharing, and (2) eliminate
cost sharing for private
land owners
8
Subject
425, 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
GENALD FORD
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
FORD is LIBRARY 078330
TAB B
SUMMARY OF RESULTS OF HOUSE AND SENATE ACTION
A. Action on changes from the vetoed bill identified as "critical
to overcome objections"
Subject & Proposed Change
Senate
House
1. Citizen suits
Narrow the scope
Adopted
Rejected
2. Stream Siltation
Remove prohibition against
Partially
Partially
increased siltation
Adopted
Adopted
3. Hydrdogic balance
Remove prohibition against
Partially
Rejected
disturbances
Adopted
4. Ambiguous Terms
Partially
Specific authority for
Covered in
Rejected
Secretary to define
Senate report
5. Abandoned Mine Reclamation Fund
Reduce 35¢-25¢ fee to 10¢
Rejected
Fee Reduced
on some coal
Limit use of fund to
Uses
Uses
reclamation
Broadened
Broadened
6. Impoundments (dams)
Modify virtual prohibition
Adopted
Rewritten to
on impoundments
Provide Corps of
Engrs. authority
and standards
7. National Forests
Allow mining in certain
Rejected
Rejected
circumstances
8. Special Unemployment Provisions
Delete as unnecessary and
Rejected
Adopted
precedent setting
B. Three significant new problems -- not previously on the
"critical" list.
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 takes the
opposite view.
2.
The House adopted a provision prohibiting location of
FORD
a mining operation in an alluvial valley floor which
is expected to prevent expected production and lock up
major coal reserves in the West.
LIBRARY
B. New Problems (Continued)
3. In addition to a tough provision requiring replacement of
water affected by a mining operation, the House added a
new provision requiring either (a) written consent to
mining by offsite owners of water rights, or (b) ability
and willingness to provide substitute water. Agency experts
believe provision is inconsistent with state law, would be
difficult to handle administratively, and would involve
burden of proof problems.
C. Action on changes from vetoed bill identified as "needed to
reduce further the potential for unnecessary production impact
and to make the legislation more workable and effective".
Subject & Proposed Change
Senate
House
1. Antidegredation
Delete requirement
Adopted
Adopted
2. Abandoned Mine Reclamation Fund
Require 50/50 cost sharing
Rejected
Rejected
Eliminate grants for privately
owned lands
Broadened
Broadened
3. Interim Program Timing
Reduce potential for mining
delays
Rejected
Rejected
Allow operations under
interim permit if regu-
latory agency acts slowly
Adopted
Adopted
4. Federal Preemption
Encourage states to take up
regulatory role
Rejected
Not adopted but
report supports
concept
5. Surface Owner Consent
Rely on existing law
Rejected
Rejected (water
rights provision
added; Sec.B.3,
above)
6. State Control over Federal
lands
(Now a serious problem - discussed in B. 1, above)
7. Funding for Research Centers
Delete as unnecessary
Rejected
Rejected
8. Alluvial Valley Floors
(Now a serious problem - discussed in B. 2, above)
TALO R. FORD LIBRAS
$
C. Other changes (continued)
Subject and Proposed Change
Senate
House
9. Designation of areas as
Unsuitable for Mining
Expedite review and avoid
Partially
frivilous petitions
Adopted
Rejected
10. Hydrologic Data
Authorize waiver in some
case where unnecessarily
burdensome
Rejected
Rejected
11. Variances
Broaden variances for
certain post-mining uses
and equipment shortages
Rejected
Rejected
12. Permit Fee
Permit paying over time
rather than pre-mining
Adopted
Adopted
13. Contracting for reclamation
Delete requirement that
contracts go to those put
out of work by bill
Rejected
Adopted
14. Coal Sales by Federal
Lessee
Delete requirement that
lessee must not deny sale
of coal to any class of
Requirement
purchaser
Rejected
Softened
15. Appropriations Authority
Use regular appropriations
authority rather than
contract authority
Rejected
Rejected
16. Indian Lands
Rejected. Also,
Clarify to assure no Federal
new Indian lands
control over non-Federal
Program
Indian land
Adopted
Adopted
17. Interest charge on civil
Penalties
Adopt sliding scale to
minimize incentive for
delaying payments
Adopted
Adoptedford
LIBRA GIVE
C. Other changes (continued)
Subject and Proposed Change
Senate
House
18. Mining within 500 feet
of active mines
Permit where it can be
done safely
Rejected
Rejected
19. Haul Roads
Clarify restriction on
connections with public
roads
Adopted
Adopted
FORD or LIBRARY STUDED
TAB C
IMPACT OF THE HOUSE AND SENATE PASSED BILLS
ON COAL PRODUCTION, RESERVES, OIL IMPORTS,
DOLLAR OUTFLOW AND JOBS
S. 7
H.R. 25
1. Loss of coal production in the
first full year of the bills'
application (covers only those
features for which estimates
can be made; does not cover
potential losses from delays
due to litigation or restric-
tive interpretation of
ambiguous provisions) :
In millions of tons:
Small Mines
22-52
22-52
Restrictions on steep slopes,
siltation, aquifers
7-44
7-44
Alluvial valley floor
restrictions
11-66
33-66
Total
40-162
62-162
(% of 1977 production-
estimated at 750 million
tons.)
5-22%
8-22%
(Note: Administration bill would also have impacted
coal production -- in the range of 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 provi-
sions of 6.3 billion and
surface owners provisions
of 0-14.2 billion)
10.8-65.0
32.5-65.0
National forest (outside
alluvial valleys)
.9
.9
Other provisions
(e.g., steep slopes)
0-6.5
0-6.5
Total
FORD
11.7-72.4
33.4-12.4
GERALD
LIBRARY
S. 7
H.R. 25
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)
138-559
215-559
dollar value ($11 per
barrel) - billions
1.5-6.1
2.4-6.1
4. Job losses (assuming
36 tons per day per miner
and 225 work days per year;
and .8 non-mining jobs per
miner) - in thousands
direct job losses -
5,000 to
8,000 to
20,000
20,000
indirect job losses -
4,000 to
6,000 to
16,000
16,000
Total
9,000 to
14,000 to
36,000
36,000
5. Inflationary Impact - In
addition to higher cost
foreign oil -- would
include:
Fee for Reclamation fund
$130
$204
Higher production and
reclamation costs
$171
$171
Costs of Federal and State
program administration
$100
$135
$110 to
#100 to
4160
$160
FORD is LIBRAR CARD
TAB D
DRAFT
4/16/75
Dear Mr. Chairman:
On February 5, 1975, I transmitted to the Congress a
proposed surface mining bill which was designed to strike
a balance between our objective of improving environmental
quality and other national objectives including increased
energy independence and a strong economy. I am pleased
that some of the changes from last year's bill that I have
recommended have been adopted by one or both Houses and
are now being considered by the Conference Committee
However, I want to take this opportunity to reiterate my
concern about the bills before the Committee, stress the
importance of the Committee's action for all the people of
the Nation, and identify. changes that are needed to produce
an acceptable bill.
The problem facing us would be small if the only objective
was environmental protection and reclamation because I, too,
support strongly those objectives. The bills also involve
other fundamental national issues including (a) our chances
of achieving energy independence, (b) outflow of dollars to
other nations, (c) unemployment, (c) higher consumer costs,
particularly for electricity, and (e) expanding the role of
the Federal Government in some areas where it is not necessary
to achieve national objectives.
I recommend strongly that the Conference weigh carefully the
developments affecting these important issues that have
occurred since the Congress began considering this legis-
lation.
1. Energy Requirements. The Nation must take steps
through energy conservation and increased domestic energy
production to stem our growing dependence on foreign oil
which is (a) increasing our vulnerability to serious
disruption from another oil embargo, and (b) increasing
the outflow of dollars (and jobs) for oil imports.
Increased domestic coal production is essential. I
have called for doubling coal production by 1985
which is roughly 1.2 billion tons. The energy plan
advanced by the Congressional democratic leadership
calls for 1985 production of 1.37 billion tons. The
serious risk is that the Conference could adopt a
i
FORD
bill that is totally inconsistent with those goals
LIBRAKI
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Interior and FEA estimate that the Senate-passed
bill (S.7) would reduce expected coal production
by 40 to 162 million tons (5 to 22%) in the first
full year of its application; and that the House-
passed bill would reduce production by 62-162 million
tons (8 to 22%) These estimates do not include
potential delays from litigation or stringent inter-
pretation of ambiguous provisions of the bill.
Each ton of coal is equivalent in energy value to
roughly 4.3 barrels of oil. If the legislation
were to result in loss of only 50 million tons of
coal year, alternative energy equivalent to 215
million barrels of oil would have to be obtained
from other sources. Importing that amount of oil
will increase dollar outflow by more than $2.3 billion
dollars and cost more than 10,000 jobs. This domestic
energy loss could more than offset the results of our
energy conservation actions.
2. Inflationary Impact. Consumers have already been
subjected to higher costs because of our heavy reliance on
expensive foreign oil. If domestic coal, which is used
primarily in producing electricity, must be replaced by
foreign oil consumer costs will be forced still higher.
In addition, consumer prices or taxes would reflect the
added cost of $130 to $204 million in taxes on coal,
$171 million in increased coal production and reclamation
costs, and $100 to $135 million for Federal and State
government activities to carry out requirements of the bills.
Unnecessary burdens of the legislation will fall most heavily
on small mining operations and probably put many out of
business. This runs the risk of lessening competition in the
coal industry and could contribute to higher prices.
3. Unemployment. As indicated above, greater outflow
of dollars means loss of jobs in the Unted States. In
addition, Interior and EPA estimate that jobs lost as a
result of legislation would range from 9,000 to 36,000
in the case of the Senate bill and 14,000 to 36,000 in the
case of the House bill. These employment losses would hit
hard in those areas such as Appalachia that have been
struggling to improve their economic conditions. It is
true that some jobs would be created by the requirements
to reclaim areas abandoned in the past but this would
involve dislocation of employees and fewer job gains than
losses.
FORD LIBRARY
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4. Actions already taken by States. All of the twelve
leading surface mining states -- which account for about
98% 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
the 12 leading surface coal producers -- have enacted or
strengthened their surface mining laws. In addition, a
survey conducted by the staff of the Council on Environ-
mental Quality indicates that the leading coal producing states
have tightened up their regulations and increased their
regulatory staff.
These developments are significant because they indicate
that our concerns for the environment do not depend solely
on Federal legislation.
The states should have the freedom to adopt standards which
reflect the desires of their citizens. We should avoid to the
maximum extent possible setting national requirements that
do not take state differences into account or which
unnecessarily superimpose Federal requirements and Federal
enforcement activities.
5. Locking up domestic coal. In addition to new term
reduction in expected coal production, Interior and FEA have
estimated that the Senate passed bill has the potential of
preventing mining of 12 to 72 billion tons of coal and
the House passed bill from 33 to 72 billion tons. These
amounts constitute 9 to 53% of the total 137 billion tons
of coal in the Nation's demonstrated reserve base which are
potentially mineable by surface methods.
I urge the Conferees to take these developments into account
and to report a bill which achieves a balance among our
national objectives.
My February 6, 1975, letter identifies changes in the
legislation which are needed to reduce unnecessary impact
and to achieve a workable and effective bill. I would call
your attention particularly to the need to:
Modify citizen suit provisions to avoid unnecessary
and unacceptable production delays or curtailments.
Reduce hydrologic distrubance provisions concerned
with alluvial valley floors so as to avoid requirements,
which would be impossible to meet are unnecessary
to provide reasonable environmental protection and
which would preclude most mining activities.
FORD
LIBRARY
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Reduce the excise tax on coal to 10¢ per ton which
would be adequate to provide a fund for reclamation
of abandoned surface mined lands.
Remove the special unemployment provisions which
unfairly discriminate among classes of unemployed
persons, set undesirable precedent, and are
inconsistent with modifications to unemployment
which were signed into law on December 31, 1974.
Make clear that State laws and regulations do not cover
Federal coal lands.
Avoid a requirement that precludes mining in alluvial
valley floors which could lock up more than 50% of
the nation's 173 billion tons of surface mineable coal
reserves.
Avoid setting a new precedent with respect to water
rights.
Permit surface mining on national forest lands when
this is found to be in the national interest.
Administration officials stand ready to work with you to
discuss these and other changes, with the objective of
developing legislation that is in the overall best interest
of the nation.
Sincerely,
is
FORD
GERALD
LIBRARY
4/30 TO GAIL
AGE2L
FEDERAL ENERGY ADMINISTRATION
WASHINGTON, D.C. 20461
At
MAY 1 1975
OFFICE OF THE ADMINISTRATOR
Honorable Henry M. Jackson
Chairman, Committee on Interior
and Insular Affairs
United States Senate
Washington, D.C. 20510
Dear Mr. Chairman:
The President has asked me to respond to your letter of
April 24. At the outset I wish to make it clear that
my letter to Congressman Udall was prepared in FEA under
the direction of Deputy Administrator John Hill, who had
the assistance of personnel from other concerned
Executive Branch agencies.
I am enclosing a set of memoranda on Interior Department
stationery. The estimates presented in those memoranda
and reflected in my April 22 letter were prepared by FEA
and Interior Department personnel. The figures and
projections represent the agreed estimates of both
agencies.
I regret that your staff either misinterpreted, or was
given incorrect and incomplete information by FEA
personnel, and I hope that the enclosed information
will meet your needs. If I can be of further assistance,
please do not hesitate to let me know.
Sincerely,
/s/
Frank
Frank G. Zarb
Administrator
Enclosure
FORD :- LIBRARY