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A years-long push by lawmakers to help revive Tennessee’s nearly dormant coal mining industry is going to cost taxpayers. It’s a new challenge that could complicate an already tenuous process.

Since losing the ability regulate its own coal mining industry in the 1980s, state lawmakers have been working through federal and state red tape to bring it back. Among the promises made was that the effort to get regulations in place, overseen by the state, would cost “not one cent.”

But that’s not the case.

Added to this are critics and environmentalists who say paying any amount of money and spending any effort fighting for state control is pointless given the scant amount of coal actually being pulled out of the hills of East Tennessee.

The work to get the state to the point where it can regulate its own mines has been happening for a few years, and it will take even more time to come to fruition.

In 2018, lawmakers passed the Primacy and Reclamation Act of Tennessee, which directs the Tennessee Department of Environment and Conservation to develop its own surface mining regulatory program. The U.S. Office of Surface Mining Reclamation and Enforcement has managed Tennessee’s industry since the state lost the privilege in the 1980s due to poor management.

Sen. Ken Yager, R-Kingston, sponsored the 2018 legislation and is co-sponsoring a bill this year aimed at cleaning up bits and pieces of the previous legislation, something required by the federal government in order for the state to take back its own regulation efforts.

Yager wants the state back in charge because he says the federal government has a burdensome permitting process. It can take years for a mine to get up and running.

The 2018 law had no fiscal impact and Yager, with advice from the state Fiscal Review Committee, guaranteed the switch to state control wouldn’t cost anything either, going as far to say “not one cent” of general fund dollars would go towards the startup or operational costs for the program.

But leaders now say the effort will cost the state $871,000 every year.

In a Senate committee meeting March 10, TDEC Commissioner David Salyers listed the cost as part of a short list of new budget requests for the department.

“Even when drawing down all the federal money made available for a state operated program, we’re still going to need $871,000 in recurring funds to run this program,” he said.

An abandoned mine in Campbell County on Monday, November 18, 2019.
An abandoned mine in Campbell County on Monday, November 18, 2019.
TDEC spokesman Eric Ward said the money is needed to hire additional staff including hydrologists, geologists and field inspectors, obtain office space and purchase equipment. All of these things are currently provided by the federal government.

Last week the new bill hit a snag and was sent to a subcommittee where it’s not expected to be taken back up again this year.

“It appears that amendments to correct the shortcomings of the 2018 Primacy and Reclamation Act of Tennessee were not filed in time to be acted upon this year,” Scott Banbury, lobbyist for the Tennessee Chapter of the Sierra Club, wrote in an email to Knox News. “This surprised us since TDEC won’t be able to resubmit their application to assume primacy without significant changes to the law passed in 2018.”

New costs

In 2017, a year before the original bill’s passage, Yager said it was his promise to then-Gov. Bill Haslam that it wouldn’t cost the state anything to take over the regulatory role. When asked in a committee hearing about federal funding that March, he was confident.

“If we don’t find that funding then I think this would have a very difficult time getting through finance committee,” he said.

In that same committee meeting, Tennessee Clean Water Network’s then spokesperson Craig Griffiths pushed back because, he said, the state would have to hire a hydrologist, geologist and other engineers, something the federal government currently pays for.

“We think that we can use the resources of the federal office of surface management to continue to manage the coal permitting process,” Griffiths said. “Coal mining unfortunately is not a significant industry anymore. It’s at its lowest level in many decades.”

State Sen. Ken Yager offers remarks as the senate debates SB-7009 on education during a special session of the Senate at the State Capitol Thursday, Jan. 21, 2021 in Nashville, Tenn.
State Sen. Ken Yager is working to put regulation of Tennessee’s coal mines back in state control.
Yager disagreed “totally and completely” with Griffiths’ read of the state’s coal market in the meeting and proceeded to blame the Tennessee Clean Water Network in part for the slowdown in the state’s coal production.

In 2018, as the bill was making its way through the Senate, Yager again said he promised the governor he wouldn’t pass a bill that takes money from the general fund.

When asked last week whether Yager was aware of the additional positions, office space and equipment needs the push for state regulation would require, he confirmed he was, but said he thought the program could be self-sufficient, paid for with coal mining permit fees and federal dollars. This was the original position of the Fiscal Review Committee.

“It was in the fiscal note and was discussed in the committee, but we were confident that the two components identified in the bill, both state and federal, would take care of the costs,” he said in an emailed statement through a spokesperson. “The number of permit fees and acreage fees underperformed projections due to the onerous federal permitting process.”

More coal reporting: Trump administration explores opening protected Cumberland Plateau to strip mining

When asked to clarify whether he thought permit and acreage fees would cover the newly announced $871,000 yearly cost, he demurred.

“I am awaiting the bill language on which Fiscal Review Committee bases its cost analysis,” he said. “We will rely on the projections of the economists on the committee, just as we did with the original bill.”

David Salyers
David Salyers
TDEC

The current bill has no fiscal note and may not have a fiscal note for the foreseeable future. However, if it were approved, it would put the state on a path towards independence and TDEC has said that will cost $871,000 a year.

Ward, the TDEC spokesperson, said the budget for a state-run program could increase or decrease depending on circumstances. A separate TDEC spokesperson said the department could not say whether the state expected fees to cover the $871,000 annual cost.

State Sen. Frank Nicely, R-Strawberry Plains, has a district that covers six Upper East Tennessee counties. He called Salyers’ $871,000 projection ridiculous and said the state should paddle its own canoe.

“Markets come and go and we’ll need it again and we don’t be able to wait four or five years on a permit when it comes,” he said.

State Rep. Gloria Johnson, D-Knoxville, sponsored legislation pushing back against state control this session, though as the bill was paused so was hers. She said mining jobs would mostly come from hauling coal away and wouldn’t be the jobs boon some lawmakers predict.

“We always knew it was going to cost a lot of money and for whatever reason they kept saying it wouldn’t … there’s no question, a million bucks is different than zero,” Johnson said.

Don Barger is a career environmentalist who founded the southeast regional office of the National Parks Conservation Association nearly three decades ago before recently retiring. He worked as a community organizer against coal mining across East Tennessee in the 1980s. He said the push for state regulation is lawmakers’ hope that regulation and permitting won’t be as strict as the federal government’s.

“I think the best way to say it is by asking a question … what is the interest to the citizens of the state of Tennessee to pick up the cost of regulating a dying industry that’s already regulated?” he said.

A dwindling industry

In 2001, some 3.3 million tons of coal was pulled out of Tennessee’s hills. The drop since than has been shocking.

In 2018, the number fell to 232,000 tons and even with a slight uptick in to 435,000 in 2019, the state still mined less than all but two of 23 states with the industry, according to U.S. Energy Information Administration records.

Last year, the amount of mined coal dropped again to just 92,000 tons through September, a 71% drop over the same period in 2019. By comparison, Kentucky mined 24 million tons of coal during the same period.

There were over 30 active mines at one time or another in the early 2000s. Currently there are only a handful of active mines and none are producing coal, according to OSMRE.

An October 2006 photograph of the Zeb Mountain coal mine in Campbell County.
An October 2006 photograph of the Zeb Mountain coal mine in Campbell County.
CAT MCCUE/SELC

The industry used to employ hundreds of workers, but now OpenSourceCoal.org – a product of Appalachian Voices – estimates the number is only in the dozens.

What’s more, most experts don’t expect coal to have a revival. Across the region, the Tennessee Valley Authority, the nation’s largest public utility, is gearing its future to natural gas, solar power and nuclear energy production.

In recent years, TVA has shut down more than half of the 59 coal-fired plants it once operated. The authority projects up to 14 gigawatts of new solar generation by 2038 alone, though how much of that gets developed could vary, depending on economic winds. By comparison, the TVA plans to operate just four coal-burning plants in 2023 with a capacity of 6 gigawatts.

“The current state of demand for coal and the status of the coal industry in Tennessee does not change the fact that the industry still needs fair, effective, responsive and efficient oversight,” Ward, the TDEC spokesperson, said. “Tennessee is the only active coal-mining state without primacy over its own industry, so this effort will effectively bring Tennessee in line with other coal-mining states.”