Ohio Coal Mine Permitting Process Fails to Protect Rural Communities and Taxpayers: Westmoreland Bankruptcy Leaves Future of Ohio Mines Uncertain

Columbus, OH—The Ohio Ecological Food and Farm Association (OEFFA), a statewide organization promoting sustainable and organic agriculture, is raising serious questions about the state of Ohio’s coal mine permitting and remediation funding processes, following news that Westmoreland Coal Company, which has 64 mines in Ohio, has filed for bankruptcy.

“It’s unbelievable that the state could issue permits to a mining company currently in bankruptcy proceedings,” said OEFFA Policy Program Coordinator Amalie Lipstreu. “We shouldn’t be gambling Ohio taxpayer money and our rural communities on a collapsing industry.”

Westmoreland, and its local subsidiary Oxford Mining Company, filed for Chapter 11 bankruptcy on October 9. Despite being financially insolvent, the company has sought permission from a Texas bankruptcy court to continue operations and seek new permits in Ohio, including a 554 acre proposed coal mine in the Perry State Forest. Permit applications for the project are pending with the Ohio Department of Natural Resources (ODNR) and the Ohio Environmental Protection Agency (OEPA).

While Westmoreland seeks to auction its current Ohio mines by the spring, it’s unclear if any companies will be interested in acquiring Oxford’s mines and the company has no sales contracts beyond 2019.

Currently, a company’s financial health is not usually considered as part of the state’s permitting process. If a company posts $2,500 per acre to Ohio’s bond pool, the Reclamation Forfeiture Fund (RFF), and they meet other requirements, ODNR and OEPA will issue the required permits.

The bond payment is designed to ensure that mine sites are reclaimed if a company should forfeit its obligations, but the actual costs of reclamation between 2000-2016 averaged more than $7,000 per acre. Last summer, Ohio transferred $5 million out of the RFF, further underfunding this emergency reserve, and leaving it up to $130 million short to cover Westmoreland’s outstanding reclamation costs, according to a 2018 analysis by the Sierra Club and the Ohio Environmental Council. As a direct result of the transfer, the federal government has called into question Ohio’s ability to meet its obligations under the Surface Mining Control and Reclamation Act. Adding to concerns about abandoned coal mines, in its bankruptcy filing, Westmoreland described its obligations for reclamation and restoration of sites and protection of water quality as “burdensome regulations.”

“For mines that are no longer producing, it will be difficult for Westmoreland to find buyers and there is great risk that the company will forfeit its bonds and not reclaim the land, leaving Ohio’s rural communities with nothing but empty promises and degraded lands,” said Lipstreu. “It’s unclear what steps are being taken to ensure Ohio receives funds for reclamation costs from Westmoreland and the bankruptcy court.”

“Public lands are a solid investment, generating economic and social returns for the state and local communities. In the case of the Perry State Forest proposal, the farmers adjacent to the land operate in a way that protects natural resources, provides nutrient-dense food to their community, and contributes to the social and economic viability of the region. In addition to being a net economic loss to Ohioans, the lack of fiscal and social responsibility epitomized by this project will lead to a considerable loss of social and economic capital.”

With $1.4 billion in debt and only $770 million in assets, Westmoreland’s bankruptcy has been long-anticipated. The announcement came as local farmers and community members fight a proposed Oxford coal mine in the Perry State Forest, which would impact thousands of local residents and recreational visitors. OEPA held a hearing in New Lexington, Ohio earlier this month which drew more than 100 community members who universally expressed opposition to the project. Under pressure from the community, Oxford withdrew its plans for its Johnson Run mine in Athens County earlier this summer.

“State legislators must protect Ohioans and our public lands from projects that leave taxpayers and local residents holding the bag. We can and should invest in clean energy solutions that contribute to strong local and regional economies,” Lipstreu concluded.

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The Ohio Ecological Food and Farm Association (OEFFA) is a non-profit organization founded in 1979 by farmers, gardeners, and conscientious eaters who committed to work together to create and promote a sustainable and healthful food and farming system. For more information, go to www.oeffa.org.