STATEMENT FOR THE RECORD

U.S. SENATE COMMITTEE ON ENERGY AND NATURAL RESOURCES

HEARING ON

# THE SURFACE MINING CONTROL AND RECLAMATION ACT OF 1977:

**POLICY ISSUES THIRTY YEARS LATER**

NOVEMBER 13, 2007

STATE OF NEW MEXICO

JOANNA PRUKOP

Secretary, Energy, Minerals and Natural Resources Department

Good afternoon, Mr. Chairman and Members of the Committee. Thank you for
inviting the State of New Mexico to testify today. I am Joanna Prukop,
Cabinet Secretary for the New Mexico Energy, Minerals and Natural
Resources Department.

Today I will speak about the implementation of the Surface Mining
Control and Reclamation Act of 1977, or SMCRA, and focus on the
experience New Mexico had implementing it. I will also discuss issues
shared by other Western coal mining states and the Western Interstate
Energy Board of the Western Governors Association.

New Mexico brings an important perspective to the discussion on the
past, present and future of SMCRA. As a state with significant coal
production but with a small regulatory program, we look for ways to
utilize our limited resources to achieve SMCRA's goals. Our state has a
long history of both coal and hard rock mining. We struggle with using
our limited abandoned mine funds to effectively protect the public and
the environment from the hazards of coal and non-coal abandoned mines.
And with other Western states, we see that expanding populations and
recreational use are increasing both the exposure to abandoned mine
dangers and the public interest in new mine development.

New Mexico has an extensive mining history. Native Americans mined
turquoise, lead, coal and copper hundreds of years before Europeans
arrived in North America. In the 1820s, the discovery of gold near
Cerrillos triggered a rush decades before the California Gold Rush. Coal
mining expanded in the nineteenth century driven by demand from the
military, the railroads and non-coal mines across the Southwest. New
Mexico enacted its own coal surface mining law in 1972. New Mexico's
version of SMCRA was adopted by its Legislature in 1979.

New Mexico has had a largely positive experience under SMCRA. Prior to
its enactment, coal production in New Mexico had never exceeded 10
million tons in a year. Today, there are four large active mines in New
Mexico, three surface and one underground, producing between 25 and 30
million tons per year. As coal mining expanded, mine reclamation
proceeded and proved successful despite our arid environment. Thanks to
funding for abandoned mine reclamation under SMCRA, threats to public
safety and the environment have been reduced\...

The lesson we have learned from three decades of working under SMCRA is
that success is gained when we apply innovative and flexible approaches
to new problems. Our relationship with the Office of Surface Mining
(OSM) has evolved over the years to give the State greater
responsibility, and freedom, to implement SMCRA. Today, our relationship
with OSM works best when they give us the flexibility to be innovative
and provide support for our successful new approaches.

Coal mine reclamation in the arid Southwest faces significant
challenges. Our limited rainfall, which often occurs in torrents, causes
problems with both revegetation success and erosion control. Our staff
has worked with mine operators to develop approaches to overcome these
challenges and achieve reclamation success.

We are especially proud of the geomorphic reclamation strategy adopted
by several mines in New Mexico. This strategy recreates the natural
drainage patterns in the reclaimed land and results in greater long term
stability and erosion resistance. The San Juan and La Plata Mines have
won several national and state awards for their implementation of this
pioneering strategy. Geomorphic reclamation in New Mexico is so
innovative that OSM held a national forum on the topic one year ago
including a tour of these mines. We have also worked on standards for
revegetation success that take into account the variability in results
due to drought years. These standards have now been incorporated into
OSM national rules.

Success can also be seen in the overall numbers. Of 26,146 acres
disturbed by coal mining in New Mexico during the life of SMCRA, over
75% have been regraded to an approved final surface configuration,
covered with topsoil and reseeded. Over 50% of the mines permitted since
the implementation of the New Mexico Coal Program have achieved final
bond release and have been returned to the land owners. New Mexico has
also returned over \$40 million dollars of bonds to operators associated
with documentation of successful reclamation.

We have also embraced new technologies that allow for more effective
oversight and communication. We use mobile computing technology and
geographic information system tools to assist field inspections and more
effectively monitor ongoing disturbances and reclamation at the large
mines in New Mexico. We also now require coal operators to submit permit
documents electronically, thereby reducing paperwork and facilitating
both analysis and communication.

These projects are examples of the evolving relationship between New
Mexico and OSM. We consulted with OSM as we embarked on new approaches,
and they provided us flexibility and support by providing the State with
equipment and training. OSM has also promoted some of our successful
approaches to other regulatory authorities, including sharing knowledge
and experience with the Navajo Nation and Hopi Tribe as they move
towards developing their tribal programs.

The states, and several tribes, are primarily responsible for the
implementation of SMCRA Title IV - the Abandoned Mine Land program
(AML). SMCRA includes provisions for the safeguarding of abandoned coal
mines and high priority non-coal mines. Funding from the fees collected
on coal production has helped New Mexico address some of our most
hazardous abandoned mines. In New Mexico, we estimate that there are
over 15,000 unreclaimed mine hazards across the State. Since the
inception of the SMCRA AML program, New Mexico has addressed
approximately 4,000 mine features and reclaimed over 700 acres of
mine-disturbed land.

Our annual AML funding in recent years has been about \$1,500,000. With
these funds, New Mexico successfully completed a number of innovative
projects that were recognized by OSM over the past five years. At
Sugarite Canyon near Raton, we used a variety of materials and
techniques to complete a stable reclamation of very steep and eroding
coal mine waste piles that were impacting streams within a state park In
the Cerrillos Hills between Santa Fe and Albuquerque, we closed dozens
of mines along trails in an historic park using techniques that allowed
wildlife access and preserved the historical integrity of the sites.
Both of these projects received awards from OSM. Last month, we received
the highest national award for the Real de Delores project in the Ortiz
Mountains which safeguarded mine openings within one of the oldest
mining districts in America.

We're quite proud of the work we achieved under SMCRA to mitigate the
effects of coal mining in New Mexico.

However, New Mexico and Western states face challenges due to the growth
of population and the expansion of Western coal mining. These two growth
areas can conflict with each other. As population grows and development
expands into previously unsettled areas, concerns develop when new coal
mines are proposed. Our newest residents along with our oldest have
issues over new coal mining. Years of conflict transpired over the
proposed Fence Lake Coal Mine, and our State's Native American
communities have concerns about coal mining impacting sacred areas and
causing environmental impacts.

The lesson learned over the Fence Lake Coal Mine conflict is that
procedures for public participation are insufficient to the expectations
of citizens. SMCRA only requires a notice published in the legal section
of a newspaper for a new mine -- even if that mine could exceed 10,000
acres. Two weeks ago, New Mexico's Coal Surface Mining Commission
enacted new rules that significantly expand the types and numbers of
public notice provided for any new mine or major permit revision. We now
provide for radio announcements, postings in the community, large
newspaper ads, mailings to nearby residents as well as postings on
websites. New Mexico will also hold a public informational meeting for
all new permit applications. We are hopeful that OSM will support these
changes.

Another critical issue for New Mexico and for other Western states is
the failure of federal grants to keep pace with the rising demand for
coal production. A report issued last year by the Western Interstate
Energy Board of the Western Governors Association documented that, as
coal production in the West has steadily grown (and now exceeds the rest
of the country combined), grants to Western states for SMCRA regulatory
programs have actually decreased in inflation-adjusted dollars. Most
Western states have been faced with difficult choices to either cover
coal program costs with other state funds or to reduce their programs in
the face of growing demands.

New Mexico maintains a lean regulatory program with generally one
specialist for each needed area: geology, hydrology, engineering, soil
science and plant science. We have kept costs low through the use of
technology. Over the past five years, our grant funding has decreased
while costs have risen for such things as salaries, benefits, fuel, and
travel. Now we are planning to transfer two full-time employee positions
in the next month because the coal grant can no longer support them.

Another issue that negatively impacts New Mexico and Western states is
the shift in OSM's position on use of SMCRA AML funds for high priority
abandoned non-coal mines. Section 409 of SMCRA allows the States to use
AML funds to address high priority non-coal mines. Since the beginning
of the AML program, New Mexico, Utah and Colorado have balanced the need
to reclaim abandoned coal mines with the need to address the significant
health and safety threats posed by numerous non-coal mines. OSM has
recognized this need for flexibility and supported it in the past.

Last December, Congress passed the reauthorization of the AML fee, which
provided that the distribution of funds to States equal the amount
previously allocated under SMCRA but never appropriated. For New Mexico,
this amounts to approximately \$20 million in additional AML funds
distributed over the next 7 years. However, while Section 409 was not
changed or amended in any way, OSM has suddenly shifted course and now
indicates to the States that this "return of state share balances"
funding cannot be used for non-coal mine projects.

This loss of flexibility comes at a particularly significant time for
New Mexico. After years of discussions, our AML program has reached an
understanding with the Navajo Nation to jointly work on abandoned
uranium mines in areas of questionable jurisdiction near the Navajo
Indian Reservation. The impacts of these uranium mines on the nearby
residents, particularly the Navajo people, are finally receiving the
necessary national attention as evidenced by the hearing before the
House Oversight and Government Reform Committee three weeks ago. With
the new AML money available, we have a unique opportunity to finally
address these sites which have caused great harm to the Navajo
communities. For OSM to suddenly reverse course and deny our ability to
expend these new AML funds on this high priority problem is difficult to
comprehend.

Mr. Chairman and members of the Committee, I thank you for this
opportunity to share New Mexico's perspective on the Surface Mining
Control and Reclamation Act. The first 30 years of SMCRA brought
significant challenges to the States and the federal government. Today,
we can point to many successes under this law. We look forward to the
next 30 years and hope that Congress and the federal government will
continue to provide the States with the flexibility and support
necessary for continued and further success under SMCRA. We appreciate
the opportunity to present this testimony, and look forward to working
with the Committee in the future.