**Statement of**

**Gregory E. Conrad**

**Executive Director**

**Interstate Mining Compact Commission**

**"The Surface Mining Control and Reclamation Act of 1977:**

**Policy Issues Thirty Years Later"**

**Before the**

**Senate Energy and Natural Resources Committee**

**November 13, 2007**

Good afternoon Mr. Chairman and Members of the Committee. My name is
Greg Conrad and I serve as Executive Director of the Interstate Mining
Compact Commission. The Compact is comprised of 24 states throughout the
country that together produce some 90% of our Nation's coal, as well as
important non-fuel minerals. The Compact's purposes are to advance the
protection and restoration of land, water and other resources affected
by mining through the encouragement of programs in each of the member
states that will achieve comparable results in protecting, conserving
and improving the usefulness of natural resources and to assist in
achieving and maintaining an efficient, productive and economically
viable mining industry. Participation in the Compact is gained through
the enactment of legislation by the member states authorizing their
entry into the Compact and their respective Governors serve as
Commissioners. We appreciate the opportunity to participate in the
Committee's oversight hearing on "The Surface Mining Control and
Reclamation Act of 1977: Policy Issues Thirty Years Later".

The Surface Mining Control and Reclamation Act (SMCRA) is one of several
laws passed in the environmental decade of the 1970s that provided for a
unique blend of federal and state authority for implementation of its
provisions. One of the key underpinnings of the law during its formation
was that the primary governmental responsibility for developing,
authorizing, issuing and enforcing regulations for surface mining and
reclamation operations subject to the Act should rest with the states,
due to the diversity of terrain, climate, biologic, chemical and other
physical conditions related to mining operations. We are here to report
on our role and experience as primary regulatory authorities under SMCRA
and to provide our perspective on the various policy issues that attend
the implementation of this important law.

By almost all accounts, the implementation of SMCRA by the states has
been a resounding success. The anticipated purposes of the Act have been
or are being accomplished and the overall goal of establishing a
nationwide program to protect society and the environment from the
adverse effects of past and present surface coal mining operations has
been achieved. Drainage and runoff controls are in place to ensure that
downstream waters are not filled with sediment or otherwise polluted by
mining activity. Blasting operations are controlled to prevent damage to
nearby buildings and other property. Final grading and reshaping of
mined lands are undertaken to ensure that they are stable and
approximate their original contour. Topsoil is preserved and then
replaced on mined lands to accomplish high levels of productivity. Mined
lands are reclaimed to a variety of beneficial uses within a few years
after the completion of mining. Once reclaimed lands are fully bond
released, they are returned to local landowners in equal or better
condition than before mining began. All of these statutory requirements
are being accomplished while maintaining a viable coal mining industry
that is essential for meeting our Nation's energy needs. Examples of
some of the excellent reclamation that is occurring under the Act can be
seen in our two exhibits, which highlight various state, IMCC and OSM
reclamation award winners.

As we reflect back on the past 30 years since the enactment of the
Surface Mining Control and Reclamation Act (SMCRA), much has changed and
yet some things remain the same. In the early years, we were focused on
the development of a comprehensive federal regulatory program that would
serve as the baseline for SMCRA's implementation. Many of these initial
rules faced legal challenges as being arbitrary, capricious or
inconsistent with law, which took many years to resolve. A few, like the
definition of valid existing rights and the procedural rules concerning
ownership and control that underpin the Applicant/Violator System , are
still unsettled. However, the majority of the federal rules are in place
and working effectively. This is not to say that we are out of the woods
with respect to significant future rulemakings. Two examples of rules
currently before the Office of Surface Mining, Reclamation and
Enforcement (OSM) are stream buffer zones and mine placement of coal
combustion by-products. However, in general, the regulatory program is
more stable and certain than it was even 10 years ago, which benefits
both coal operators and citizens.

One of the key components of SMCRA when first enacted was its reliance
on a unique and challenging arrangement of state and federal authority
to accomplish its intended purposes and objectives. Pursuant to the
state primacy approach embodied in SMCRA, the states serve as the
front-line authorities for implementation of the public protection and
environmental conservation provisions of the Act, with a supporting
oversight role accorded to OSM. It has taken a good portion of the past
thirty years to sort out the components of these often competing roles,
but the result has been a balance of authority that generally works.

During the past ten or so years, the working relationship between the
states and OSM has been particularly productive and non-contentious. We
have moved beyond the second-guessing of state decisions that
predominated the early years of state program implementation and instead
are engaged in more cooperative initiatives where OSM strives to support
the states through technical advice and training and where the states
and OSM work together to solve difficult policy and legal questions.
OSM's oversight program is more focused on results, looking at
on-the-ground reclamation success and off-site impacts, which better
reflect the true measure of whether the purposes of SMCRA are being met.
In fact, over the years, both OSM's oversight program, as well as
several state performance-based regulatory programs, have received
national recognition for their effectiveness and efficiency.

This is not to say that there are not several challenges ahead of us as
we look to the future. Perhaps the most crucial at this juncture is
adequate funding for state regulatory programs. Pursuant to section 705
of SMCRA, OSM is authorized to make annual grants to the states of up to
50 percent of the total costs incurred by the states for the purposes of
administering and enforcing their programs. This percentage is increased
for those states that regulate on federal lands. As you know, Mr.
Chairman, these grants are essential to the full and effective operation
of state regulatory programs. For the past several fiscal years, the
amount for state Title V grants has been flat-lined. (See figure 1) What
this graph does not show is that these grants have been stagnant for
over 12 years. The appropriation for state Title V grants in FY 1995 was
\$50.5 million. Essentially, we have attempted to operate effective,
high performance programs with a meager \$6 million increase spread over
12 years. By most standards, this is remarkable, and clearly a bargain
for the federal government. Over this same period of time, coal
production has risen substantially and OSM's own budget for federal
program costs has increased by over \$25 million. Given the fact that it
is the states that operate the programs that address the environmental
impacts of coal mining operations, a similar increase would have been
expected. But instead, state regulatory grants have remained flat-lined.

![](media/image1.wmf){width="4.923611111111111in"
height="2.504861111111111in"}

For Fiscal Year 2008, in an attempt to reverse this trend, OSM has
proposed a modest increase for state Title V grants. However, it may be
too little too late, especially for some states such as Virginia and
Utah. In Virginia, for instance, coal production and operating costs
have increased, while federal funding for state-based coal regulatory
programs has consistently decreased. The rise in costs associated with
wages, employee benefits, and transportation fuels have risen
approximately 15% over the past four years. Due to the loss of federal
funds, Virginia is unable to fill many staff postings, including that of
the critical field inspector. Without a full staff of reclamation
inspectors, Virginia may not meet federal inspection guidelines.
Virginia is also unable to fill technical support staff positions. This
will limit the assistance the Commonwealth can offer to coal companies
and significantly delay the review and approval process for surface
mining permits. Virginia's situation is symptomatic of what other states
are facing -- or will soon face -- if the debilitating trend for Title V
grant funding is not reversed.

It must be kept in mind that state coal regulatory program permitting
and inspection workloads are in large part related to coal mine
production. In general, as coal production increases, the need for
additional permitting and operational inspections also increases. State
programs must be adequately funded and staffed to insure that permitting
and inspection duties are both thorough and timely as states experience
the reality of accelerating coal mine production and expansion
activities. As program funding shortfalls continue, states risk the
possibility of delayed production and negative impacts to the
environment. The situation in Colorado exemplifies this reality. From
2002 to 2006, Colorado production increased approximately 10%. Permit
revision activity increased nearly 50% during the same period. This
reality has stressed existing program resources and caused the delay or
elimination of lower priority program functions.

Just as with the federal government, state regulatory programs are
personnel intensive, with salaries and benefits constituting upwards of
80 percent of total program costs. And, just like the federal
government, state personnel costs are increasing. (See figure 2) States
must have sufficient staff to complete permitting, inspection and
enforcement actions needed to protect citizens of the coalfields. When
funding falls below program needs, states may struggle to keep active
sites free of offsite impacts, reclaim mined areas, and prevent
injuries.

![](media/image2.png){width="4.3493055555555555in"
height="2.4805555555555556in"}

Looking again at figure 1, another disturbing trend is evident. The gap
between the states' requests, which are based on anticipated
expenditures, and what states are receiving in annual grants, is
widening. The numbers in this chart are taken from OSM budget
justification documents, OSM's website, and estimates provided to OSM
from the states. Please note that these numbers have not been adjusted
for inflation -- which means the situation is actually more bleak. There
is no disagreement about the need demonstrated by the states. In fact,
in OSM's own budget justification document, OSM states that: "the states
have the unique capabilities and knowledge to regulate the lands within
their borders. Providing a 50 percent match of Federal funds to primacy
States in the form of grants results is the highest benefit and the
lowest cost to the Federal government. If a state were to relinquish
primacy, OSM would have to hire sufficient numbers and types of Federal
employees to implement the program. The cost to the Federal government
would be significantly higher." (Page 71 of OSM's Budget Justification)

The enormity of this funding challenge will become increasingly clear as
the federal government is faced with the dilemma of either securing the
necessary funding for state programs or implementing those programs (or
portions thereof) themselves -- at significantly higher costs. In
Virginia alone, for instance, the cost of OSM running the program would
likely amount to \$ 8 -- 10 million based on what it currently costs OSM
to run the comparable federal program in Tennessee. For perspective, in
Fiscal Year 2007, Virginia has been offered \$3.175 million in federal
funding to operate its program (although actual needs amount to \$3.6
million -- an overall shortfall of nearly \$1 million when the state
match is factored in). If this analysis was expanded to all of the 24
state programs, the overall impacts to the federal government would be
dramatic. In addition, as anticipated by SMCRA's framers, the states are
closer to the action, are able to account for local conditions and
circumstances and can be more responsive.

In the end, the increasing gap between the states' anticipated
expenditures and actual Federal funding is compounding the problem
caused by inflation and uncontrollable costs, undermines our efforts to
realize needed program improvements and enhancements, and jeopardizes
our efforts to minimize the impact of coal extraction operations on
people and the environment. For all these reasons, we have urged
Congress to increase funding for state Title V regulatory grants in
OSM's FY 2008 budget to \$67 million, as fully documented in the states'
estimates for actual program operating costs. A resolution adopted by
IMCC at its recent annual meeting addressing this matter is attached to
our testimony (Attachment No. 1). At this point, the House has approved
an additional \$2 million over the Administration's request of \$60.2
million and the Senate Appropriations Committee has approved a \$6
million increase over that request. This is very encouraging and we
trust that in the end, Congress will approve the full \$66.2 million for
state Title V grants.

It must be kept in mind that where there is inadequate funding to
support state programs, some states will be faced with turning all or
portions of their programs back to OSM (as in the case of Virginia) or,
in other cases, will face potential lawsuits for failing to fulfill
mandatory duties in an effective manner (as has occurred in Kentucky and
West Virginia in the past). Of course, where a state does, in fact, turn
all or part of its Title V program back to OSM (or if OSM forces this
issue based on an OSM determination of ineffective state program
implementation), the state would be ineligible for Title IV funds to
reclaim abandoned mine lands. This would be the height of irony given
the recent reauthorization and revitalization of the AML program.

Speaking of the Title IV AML program, the states were greatly encouraged
by the passage of the 2006 Amendments to SMCRA, which culminated over 12
years of work by the states and others to reauthorize this vital
program. The AML program has been one of the hallmarks of SMCRA and has
accomplished much over the years, as further articulated in the
statement submitted by the National Association of Abandoned Mine Land
Programs (NAAMLP). With the infusion of new life and funding, the
program holds out great promise for the future. The states have been
working closely with OSM to design rules that will appropriately
implement the provisions of the 2006 amendments and allow the states to
put money into projects that meet the purposes and objectives of the new
law. Among the key issues we have addressed in our discussions with OSM
are the following:

-   Use of the grant mechanism to distribute payments from the U.S.
    Treasury

-   Funding for minimum program states

-   Use of unappropriated state share balances for noncoal reclamation
    and the acid mine drainage set aside

-   The effective date of certain payments under the new law

-   Adjustments to the current grants process

We look forward to pursuing these issues in greater detail with OSM over
the coming months. Should the Committee desire a copy of our more
detailed comments on the draft proposed rules, please let us know.

With regard to funding for state Title IV Abandoned Mine Land (AML)
program grants, recent Congressional action to reauthorize Title IV of
SMCRA has significantly changed the method by which state reclamation
grants are funded. Beginning with FY 2008, state Title IV grants are to
be funded primarily by permanent appropriations. The only programs that
continue to be funded through discretionary appropriations are
high-priority federal reclamation programs, state and federal emergency
programs, and OSM operations. As a result, the states will receive
mandatory funding in FY 2008 of \$288.4 million for AML reclamation
work. OSM also proposes to continue its support of the Watershed
Cooperative Agreement program in the amount of \$1.6 million, a program
we strongly endorse.

Assuming that permanent appropriations for state AML grants do, in fact,
become a reality (and we trust they will), there are three remaining
discretionary funding priorities for the states: minimum program
funding; federal emergency programs; and Clean Streams funding. With
respect to minimum program states, under the new funding formula
provided to us by OSM, all of the states and tribes will receive
immediate funding increases except for minimum program states. Under
OSM's interpretation of the 2006 Amendments, those programs remain
stagnant for the next two fiscal years at \$1.5 million, a level of
funding that greatly inhibits the ability of these states to accomplish
much in the way of substantive AML work. Many of these states have
pending high priority AML projects "on the shelf" that cost several
million dollars. The challenge for these states is putting together
enough moneys to address these larger projects given minimum funding. It
is both unfair and inappropriate for these states to have to wait
another two years to receive any funding increases when they are the
states most in need of AML moneys. We have therefore urged Congress to
fund these states at the statutorily authorized level of \$ 3million in
FY 2008 so as to level the playing field and allow these states to get
on with the critical AML projects that are awaiting funding.

We have also urged Congress to approve continued funding for emergency
programs in those states that have not assumed these programs. Funding
the OSM emergency program should be a top priority for OSM's
discretionary spending. This funding has allowed OSM to address the
unanticipated AML emergencies that inevitably occur each year in states
without state-administered emergency programs. Without this funding, it
will be up to the states to address the emergencies that occur. In
states that have federally-operated emergency programs, the state AML
programs are not structured or staffed to move quickly to address these
dangers and safeguard the coalfield citizens whose lives and property
are threatened by these unforeseen and often debilitating events.
Finally, we have urged Congress to approve continued funding for the
Clean Streams Initiative. OSM has chosen to eliminate funding for this
worthwhile program in FY 2008. We believe this is a mistake. Significant
environmental restoration of impacted streams and rivers has been
accomplished pursuant to this program, to say nothing of the goodwill
that the program has engendered among local communities and watershed
groups. For the small investment of money that is appropriated for this
program each year (approximately \$ 3 million), the return is huge.

Future challenges for the AML program include the perpetual operation
and maintenance costs associated with acid mine drainage treatment;
assuring that maximum flexibility is provided to the states to determine
their respective AML project priorities; and enhancing opportunities for
economic development (including recreation and tourism) in depressed
areas of the coalfields.

Number range CHAPTER As mentioned earlier, one of OSM's primary missions
under the Surface Mining Act is evaluating the states' administration of
their programs, otherwise known as oversight. This process has undergone
a significant metamorphosis, the result of which has been a more
credible and useful program for informing Congress and others about the
status of state program administration. The first attempt at designing a
meaningful oversight program in the mid-1980\'s was merely an exercise
in data gathering or output measurement. We were concerned then with
numbers of inspections, numbers of permit reviews and numbers of
enforcement actions. OSM also tended to look behind state permitting
decisions to determine whether OSM would have handled them the same way
as the states. This type of "second guessing" generated significant
conflict and even resentment between the states and OSM. In addition,
the numbers that were collected into oversight reports told us little or
nothing about whether the objectives of SMCRA were being met (i.e. what
was happening on the ground? how effectively were state programs
actually protecting the environment? how well was the public being
protected and how effectively were citizens being served? how well were
we working together as state and federal governments in implementing the
purposes of SMCRA?).

Following an effort by OSM and the states in the late 1980\'s to fashion
a more effective state program evaluation process based on a
goal-oriented or results-oriented oversight policy and another review of
the process in the mid-1990\'s, a performance measurement approach was
adopted, based in large part on the requirements of the Government
Performance and Results Act (GPRA). The new outcome indicators now focus
on the following: the percentage of coal mining sites free of off-site
impacts; the percentage of mined acreage that is reclaimed (i.e. that
meets the bond release requirements for the various phases of
reclamation); and the number of federal, private and tribal land and
surface water acres reclaimed or mitigated from the effects of natural
resource degradation from past coal mining, including stream
restoration, water quality improvement, and correction of conditions
threatening public health or safety. These new measurements are intended
to provide Congress and others with a better picture of how well SMCRA
is working and how well the states are doing in protecting the public
and the environment pursuant to their federally approved programs. Much
of this can also be told in pictures of reclaimed mined areas like those
shown in our exhibits, many of which reflect winners of IMCC's and OSM's
national reclamation awards. Effective program implementation by the
states and compliance by the coal industry are resulting in the
reclamation and restoration of both active and abandoned sites that meet
the objectives of SMCRA and benefit both people and the environment.

Over the past twenty years, state regulatory programs have improved to
the point that implementation is highly successful. Due to this success,
the overall programmatic emphasis under SMCRA has shifted from
structural and administrative issues to specific technical issues that
are encountered as reclamation technology and science are advanced.
These issues tend to manifest themselves as environmental challenges
unique to particular regions or states, many of which must be resolved
during the permitting process. They may also arise as a result of state
inspections at mining sites. In any event, due to constraints on
existing state resources, states may be unable to undertake the type of
technical analyses that attend these issues. This is where OSM serves a
valuable support mechanism for the states (as anticipated by Section 705
of SMCRA) by providing technical assistance. In addition to meaningful
and properly focused assistance, the states also look to OSM's Technical
Innovation and Professional Services (TIPS) program. This has been one
of OSM's most valuable and effective initiatives and serves as the
cornerstone of the states' computer capability, particularly now that
many states are utilizing electronic permitting. We trust that OSM and
Congress will continue their support for TIPS and for the hardware and
software upgrades that are required to assure the system's integrity and
usefulness. TIPS training is also critical.

One of the key successes of SMCRA over the years has been its training
program. Through a combination of both state and federal agency
instructors, OSM's National Technical Training Program (NTTP) assures
that newly hired state and federal employees, especially inspectors and
permit writers, receive adequate and credible training both on basic
elements of program implementation and on cutting-edge technical and
policy subjects. The NTTP has also allowed more seasoned employees to
fine tune their skills and update their knowledge on important topics.
OSM's training program is especially important for smaller states that
do not otherwise have access to such resources. In addition to NTTP
classes, IMCC (working in cooperation with NTTP) has developed and
facilitated a series of benchmarking workshops for both state and
federal agency personnel that has allowed them to improve and enhance
their respective regulatory programs and skills in such areas as
blasting, subsidence, bonding, underground mine mapping, and permitting
related to hydrologic balance. OSM has also sponsored several
interactive forums on a variety of subjects of mutual interest to the
states and we urge the agency to continue this practice, again with
state input. All of these training components will become increasingly
more critical as OSM and the states face a retiring workforce and the
attendant succession planning that follows.

There have been other notable successes in SMCRA's implementation, in
both the regulatory and policy areas. The states have worked
cooperatively with OSM and others to address acid mine drainage issues
through the Acid Drainage Technology Initiative, which focuses on
prediction, prevention, avoidance, remediation and treatment. Again
working cooperatively with OSM, the states have made significant strides
in advancing reforestation efforts on reclaimed lands, particularly
through the Appalachian Regional Reforestation Initiative. Through a
partnership among the states, OSM and the Environmental Protection
Agency (EPA), we have also seen major advances in the remining arena,
where thousands of acres of abandoned mine lands have been restored as
part of active mining operations, thereby saving valuable AML Trust Fund
dollars and returning the land to productive use. We have also been
working with EPA and OSM to revisit the current effluent limitation for
manganese so as to reduce or prevent the adverse effects and potential
hazards arising from some of the treatment technologies related to
control of manganese.

In its 1990 monograph on "Environmental Regulation of Coal Mining:
SMCRA's Second Decade", the Environmental Policy Institute identified
and commented on several challenges facing the states and OSM, as
follows:

The issues facing regulators today are more difficult than they were in
1977. Many of the easier and more blatant problems have been addressed
\[such as the two acre exemption\] . . . . The regulatory issues today
include the prevention of hydrologic damage, the control of subsidence
and subsidence damage, the establishment of adequate reclamation bond
amounts, the use of permit-based enforcement, and the improvement of
federal oversight. Also of concern is the massive shortfall in the
federal fund meant to reclaim areas abandoned prior to 1977 without
reclamation. \[Page3\]

Throughout SMCRA's third decade, many of these issues have been
addressed and resolved. Congress has addressed the shortfall of moneys
in the AML Trust Fund with the 2006 Amendments to SMCRA and OSM and the
states are well on their way to implementing those adjustments and
putting more money on the ground to restore AML sites. Federal oversight
(and the attendant state/federal relationship under SMCRA) has advanced
by significant degrees and is no longer the flashpoint that it once was.
Through advances in electronic permitting and the use of tools available
through OSM's TIPS program, state permitting actions are timely,
comprehensive and accurate, thereby insuring more effective compliance
with the law.

That being said, given the nature and scope of today's mining and
reclamation operations and attendant environmental impacts, we continue
to face challenges as regulatory authorities under SMCRA. A few examples
follow:

-   Bonding -- one of the larger challenges concerning the bonding
    provisions of SMCRA is with regard to post closure issues. While
    SMCRA originally envisioned the bond as a guarantee of performance
    during mining, it did not anticipate the challenges associated with
    postmining concerns such as long-term treatment associated with acid
    mine drainage or long-term impacts from subsidence. For instance,
    OSM's current rules on bonding require that the bond amount be
    adjusted for potential subsidence damage repairs. However, nothing
    is said about how the bond release procedure will apply in these
    situations. The result is that surety companies are reluctant to
    write bonds for reclamation because of the long term nature and
    unknown extent of the liability. The states have been working with
    OSM to address this matter through the use of other financial
    assurance mechanisms, such as trust funds. There are also issues
    associated with bond release in general. Given that the procedures
    attending release are so cumbersome and expensive, coal operators
    simply choose not to apply for them. This further impacts the
    availability of bond capacity in the market and results in
    unnecessary expenses for states related to continued inspection and
    enforcement on these essentially completed reclamation sites.

-   Prime farmland -- the requirements related to proof of productivity
    (five year minimum) prior to termination of jurisdiction and before
    the land can be returned to the owner are cumbersome. The
    mid-continent states are currently undertaking research through a
    major Midwestern agronomy/soil science university to determine
    proper testing techniques to ensure soil capabilities are present,
    in the hope that an alternative method for demonstrating
    productivity can be attained, thus returning land much sooner back
    to the owner of record.

-   AVS -- over the past twenty years, the states have worked diligently
    with OSM to develop the Applicant/Violator System (AVS), which
    assists us in implementing section 510(c) of SMCRA, particularly the
    issuance of permits. Early in the development of AVS, the states
    focused on designing a system that would allow them to identify and
    block violators and other scofflaws without bogging down the
    database with useless or unproductive information. While we have
    made progress in this regard, we continue to examine ways to improve
    and enhance overall system effectiveness. For example, a critical
    aspect of AVS is the rules that define ownership and control; permit
    and application information requirements; and the transfer,
    assignment or sale of permit rights. These rules have been under a
    constant state of flux since their original promulgation in 1988 and
    a recent OSM rulemaking attempts to bring closure to several key
    issues that remain unresolved or problematic.

-   Underground mine mapping -- another continuing challenge that we
    face concerns accurate and readily available underground mine maps,
    which are essential for protecting the public, the environment and
    infrastructure from the threats posed by unknown underground mines.
    Events such as the Quecreek incident in Pennsylvania and the Martin
    County Coal Company impoundment failure in Kentucky were high
    profile demonstrations of the kinds of incidents that can occur when
    mine maps are inaccurate or unavailable. IMCC has sponsored a series
    of national and regional benchmarking workshops that have focused on
    the collection, handling, scanning, georeferencing and validation of
    mine maps. While the expertise and technology is available to tackle
    this issue and accomplish these tasks, our biggest challenge is the
    lack of funding for personnel, hardware, software upgrades and
    database development to move the initiative forward.

In each of these instances, and in others such as subsidence control,
blasting and hydrologic protection, the states are actively engaged in
seeking technical solutions, as well as regulatory program enhancements,
that will fully and adequately address concerns associated with these
issues. As an example, over the past several years, IMCC has sponsored
benchmarking workshops on subsidence impacts, blasting, financial
assurance, electronic permitting and hydrologic balance, all of which
have provided state and federal regulators with an opportunity to
examine these issues in detail with an eye toward regulatory program
improvements. IMCC is currently preparing for its next workshop on
surface and ground water database development and use as part of the
permitting process. The overall goal is to continually assess and
enhance our performance as regulatory authorities in an effort to
achieve ever higher levels of program effectiveness.

Much progress has been made over the past 30 years to accomplish the
purposes and objectives of SMCRA. Number range CHAPTERFrom our
perspective, the basic organization of OSM is working well. At this
point of SMCRA's implementation, neither the states nor OSM are dealing
with the same types of issues or problems that attended the early years
of program formation and administration. We have moved away from
questions of adequate state program components and state implementation
techniques to more substantive issues associated with technical,
on-the-ground problems or with thorny legal and policy questions
associated with interpretation of our programs. We therefore believe
that it is most relevant for OSM to focus its energies and resources on
assisting and supporting the states through adequate funding for state
grants, sound technical and legal assistance, and opportunities for the
states to actively participate in the agency's excellent training
program. The overall result will be less federal intrusion in the
states' administration of their programs, a concomitant enhancement of
the federal/state partnership, and better on-the-ground performance by
the regulated industry.

We appreciate the opportunity to present this testimony and welcome the
opportunity to work with your Committee, Mr. Chairman, to insure the
effective implementation of SMCRA in the 21^st^ century.

Attachment No. 1

**Resolution**

**Interstate Mining Compact Commission**

***BE IT KNOWN THAT:***

***WHEREAS***, the Surface Mining Control and Reclamation Act (SMCRA)
provides for the assumption of authority by state governments to
regulate surface coal mining and reclamation operations within their
borders following approval by the federal Office of Surface Mining (OSM)
of state programs; and

***WHEREAS***, section 705 of SMCRA requires the federal government to
provide annual grants up to 50 percent for costs incurred by the states
for the purpose of administering and enforcing their approved regulatory
programs; and

***WHEREAS***, over the past 25 years the states have been led to
believe, based on actual practice and OSM policy, that the federal
government would base annual grants on the states= estimated costs for
implementing their regulatory programs, pursuant to the principles of
primacy and partnership embedded in SMCRA; and

***WHEREAS***, in recent years federal funding for state regulatory
grants has stagnated, resulting in a \$10 million gap between the
states= estimated program costs and actual grant funding; and

***WHEREAS***, this debilitating funding trend is severely impacting the
states= ability to run efficient and effective regulatory programs that
meet the purposes and objectives of SMCRA, with some states having to
overmatch federal grants dollars and other states being forced to
seriously consider turning all or portions of their programs back to the
federal government; and

***WHEREAS***, the costs for the federal government to operate
regulatory programs in primacy states will, by OSM=s own admission, be
significantly higher than what the states currently spend; and

***WHEREAS***, there is strong, widespread support for increases in
state regulatory grants from both the regulated industry and citizen
groups so as to preserve the quality and integrity of state programs;

***NOW THEREFORE BE IT RESOLVED:***

That the Interstate Mining Compact Commission (IMCC) strongly urges
Congress, the Office of Management and Budget, the Department of the
Interior and OSM to shore up and support state regulatory programs
through full funding of state grants so that states can effectively meet
the objectives and mandates of SMCRA; and

***BE IT FURTHER RESOLVED:***

That IMCC specifically requests that funding for state regulatory grants
in OSM=s proposed FY 2008 budget be increased by \$ 7 million for a
total of \$67 million.

Issued this 2^nd^ day of May, 2007

ATTEST:

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Executive Director

Figure No. 1

![](media/image3.wmf){width="6.873611111111111in"
height="7.303472222222222in"}