Senator calls on Interior Department to significantly increase royalty rates immediately

Washington (June 22, 2016) - A new report released today by the White House Council on Economic Advisers found that American taxpayers are losing billions of dollars a year on the coal being mined from public lands, confirming analysis done by Senator Edward J. Markey (D-Mass.) in 2014 that taxpayers were losing out. By law, coal companies are supposed to pay the American people no less than 12.5 percent to mine this coal that belongs to them. However, the new White House report finds that because of loopholes and industry maneuvers the real share is much lower.

Below is a statement from Senator Markey, a member of the Environment and Public Works Committee.

“For decades, coal companies have tried to dig their way out of paying their fair share to the American people to mine this tremendously valuable national resource. Today's White House report shows that taxpayers truly are giving away this public coal at rock bottom prices and are losing out on billions of dollars a year. The Interior Department has the power to increase royalty rates on public coal without Congressional action. It should take immediate action to significantly raise rates on coal mining on public lands before the end of this administration to ensure that taxpayers stop getting shortchanged and that the climate impacts of burning any public coal are taken into account.”

Senator Markey has introduced legislation with Senators Sheldon Whitehouse (D-R.I.) and Richard Blumenthal (D-Conn.), S. 2339, that would significantly increase royalty rates for federal coal to ensure that taxpayers are protected and that the impacts of carbon pollution are taken into account. Sen. Markey's legislation would increase royalty rates for coal on public lands to not less than 50 percent of the value of the coal. Senator Markey has also introduced the Coal Oversight and Leasing (COAL) Reform Act (S. 1340) to modernize the program to protect taxpayers and end noncompetitive leasing practices and other weaknesses in the leasing program.

Sen. Markey also released a report by the Government Accountability Office in 2014 that found significant flaws in the coal leasing program that were costing taxpayers. Many of the flaws in the program uncovered by Senator Markey's GAO report in 2014 were the same sorts of problems that the lawmaker uncovered in the early 1980s when he first asked the GAO to review coal lease sales by the Reagan Administration in the Powder River Basin. In 1983, the GAO found that the Reagan Administration had sold public coal in the Powder River Basin for $100 million below fair market value.

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