Coal Royalty Fairness Act of 2015

Summary: Coal Royalty Fairness Act of 2015 Amends the Mineral Leasing Act to require the coal lease royalty to be at least 12.5% of the assessment value of federal coal (currently, 12.5% of the value of coal as defined by regulation), which value shall be established by the Secretary of the Interior within one year after enactment of this Act.  Defines "assessment value" as: (1) the price of federal coal paid by the purchaser at final sale, or (2) a price imputed by the Secretary based on the coal price index. Defines "coal price index" as the schedule of average market prices of federal coal paid by the purchaser at final sale, based on the quality and type of the federal coal, as determined by the Secretary. Directs the purchaser of federal coal to annually submit a report containing such information as the Secretary determines necessary to carry out this Act. Authorizes the Secretary to examine the records of any person engaged in the purchase, sale, transportation, or marketing of federal coal. Directs the Secretary to: (1) compile the assessment values of coal by type and quality of coal in the coal price index, and (2) publish such index at least quarterly.  Sets forth provisions regarding: (1) determining and assessing royalties for the export of federal coal, (2) compiling in a transportation cost index the average costs of transporting coal, and (3) determining the amount of any applicable transportation cost deduction on the basis of such index. Requires the Secretary to publish such index at least twice annually. Requires the Comptroller General to report to Congress every 3 years over a 15-year period on a review of the federal coal program.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Coal Royalty Fairness Act of 2015''.

SEC. 2. VALUATION OF COAL ROYALTIES.

    Section 7 of the Mineral Leasing Act (30 U.S.C. 207) is amended--
            (1) in subsection (a), by striking the fourth sentence; and
            (2) by adding at the end the following:
    ``(d) Royalties.--
            ``(1) Definitions.--In this subsection:
                    ``(A) Assessment value.--
                            ``(i) In general.--The term `assessment 
                        value', with respect to Federal coal, means--
                                    ``(I) the price of Federal coal 
                                paid by the purchaser at final sale; or
                                    ``(II) a price imputed by the 
                                Secretary based on the coal price 
                                index.
                            ``(ii) Exclusions.--The term `assessment 
                        value' does not include, as determined and to 
                        the extent determined to be appropriate by the 
                        Secretary--
                                    ``(I) transportation costs, as 
                                determined in accordance with the 
                                transportation cost index; or
                                    ``(II) the cost of coal washing.
                    ``(B) Broker.--The term `broker' means a person 
                that resells Federal coal.
                    ``(C) Coal price index.--The term `coal price 
                index' means the schedule of average market prices of 
                Federal coal (in United States dollars) paid by the 
                purchaser at final sale, based on the quality and type 
                of the Federal coal, as determined by the Secretary, in 
                consultation with the Administrator of the Energy 
                Information Administration.
                    ``(D) Purchaser.--
                            ``(i) In general.--The term `purchaser' 
                        means a person that--
                                    ``(I) purchases or contracts to 
                                purchase Federal coal--
                                            ``(aa) directly from a coal 
                                        mine operator; or
                                            ``(bb) indirectly from a 
                                        broker; and
                                    ``(II) uses that Federal coal in 
                                any industrial or energy conversion 
                                process.
                            ``(ii) Exclusion.--The term `purchaser' 
                        does not include--
                                    ``(I) a coal broker; or
                                    ``(II) any other third-party 
                                intermediary.
                    ``(E) Quality.--The term `quality', with respect to 
                Federal coal, means the quality of Federal coal 
                measured in British thermal units, sulfur, moisture, 
                and other criteria determined to be appropriate by the 
                Secretary.
                    ``(F) Secretary.--The term `Secretary' means the 
                Secretary of the Interior.
                    ``(G) Transportation cost index.--The term 
                `transportation cost index' means the transportation 
                cost index established under paragraph (7).
                    ``(H) Type.--The term `type', with respect to 
                Federal coal, means a general category of coal, such as 
                metallurgical coal or steam coal, as determined by the 
                Secretary.
            ``(2) Payment rate.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), a lease shall require payment of a 
                royalty in such amount as the Secretary shall determine 
                of not less than 12.5 percent of the assessment value 
                of Federal coal, as determined under paragraph (3).
                    ``(B) Exception.--In lieu of the royalty payment 
                rate described in subparagraph (A), the Secretary may 
                establish such lower royalty payment rate as the 
                Secretary determines to be appropriate in the case of 
                Federal coal recovered by an underground mining 
                operation.
            ``(3) Valuation for royalties.--Not later than 1 year after 
        the date of enactment of this subsection, the Secretary shall 
        establish, as the valuation for Federal coal royalties, the 
        assessment value of Federal coal.
            ``(4) Administration.--
                    ``(A) Reporting.--The purchaser of Federal coal 
                shall annually submit to the Secretary a report 
                containing such information as the Secretary determines 
                to be necessary to carry out this subsection.
                    ``(B) Audits.--To carry out this subsection, the 
                Secretary may examine the records of any person engaged 
                in the purchase, sale, transportation, or marketing of 
                Federal coal.
            ``(5) Coal price index.--
                    ``(A) In general.--The Secretary shall compile the 
                assessment values of coal by type and quality of coal 
                in a coal price index.
                    ``(B) Publication.--Not less frequently than 
                quarterly, the Secretary shall publish the coal price 
                index, along with a methodological description, 
                including--
                            ``(i) the method of calculation;
                            ``(ii) the data used to calculate the coal 
                        price index in an aggregate manner that does 
                        not reveal proprietary information; and
                            ``(iii) any other information the Secretary 
                        considers appropriate to ensure transparency.
                    ``(C) Other information.--If a person believes that 
                the coal price index significantly deviates from the 
                assessment value of the coal produced by the person, 
                the person may petition the Secretary to use 
                information supplied by the person in lieu of the coal 
                price index, including all information the Secretary 
                requires to accurately determine the assessment value 
                and audit the records of the person.
            ``(6) Exports.--
                    ``(A) In general.--In assessing royalties for the 
                export of Federal coal under this subsection, the 
                Secretary may obtain from the exporter of the Federal 
                coal such information as the Secretary determines to be 
                necessary to carry out this subsection.
                    ``(B) Assessment value of exported coal.--Subject 
                to subparagraph (C), in determining the assessment 
                value of Federal coal that is exported, the Secretary 
                shall--
                            ``(i) use the price of coal free on board 
                        the marine vessel used to transport the coal 
                        overseas at the port of origin; and
                            ``(ii) limit any deductions that apply to 
                        the assessment value of the Federal coal to 
                        costs incurred prior to being free onboard the 
                        vessel.
                    ``(C) Uncertain export price.--If the Secretary 
                cannot determine the value of exported coal in 
                accordance with subparagraph (B), the Secretary shall--
                            ``(i) assess royalties under this 
                        subsection based on the coal price index for 
                        coal of a similar quantity and type; and
                            ``(ii) limit any deductions that apply to 
                        the assessment value of the Federal coal to 
                        costs incurred within the contiguous United 
                        States.
            ``(7) Transportation cost index.--
                    ``(A) In general.--Subject to the other provisions 
                of this paragraph, the Secretary, in consultation with 
                the Secretary of Energy and the Secretary of 
                Transportation (in consultation with the Surface 
                Transportation Board and others), shall--
                            ``(i) compile in a transportation cost 
                        index the average costs of transporting coal; 
                        and
                            ``(ii) determine the amount of any 
                        transportation cost deduction under this 
                        subsection, on the basis of the transportation 
                        cost index.
                    ``(B) Unit of measurement.--The transportation cost 
                index shall be based on the average transportation 
                costs per ton of coal or another unit of measurement 
                determined by the Secretary.
                    ``(C) Differences in transportation costs.--The 
                transportation cost index shall take into consideration 
                differences in the costs of transportation, as 
                determined by the Secretary, based on--
                            ``(i) the mode of transportation;
                            ``(ii) the geographic region, and
                            ``(iii) other characteristics of the 
                        transportation industry that the Secretary 
                        considers to be necessary to calculate a fair, 
                        transparent, and accurate transportation cost 
                        index.
                    ``(D) Exclusions.--The transportation cost index 
                shall not include costs associated with, as determined 
                by the Secretary--
                            ``(i) take-or-pay contract penalties;
                            ``(ii) liquidated damages;
                            ``(iii) the speculative aspects of 
                        transportation transactions; or
                            ``(iv) any other costs that are not 
                        directly associated with moving Federal coal 
                        from 1 location to another location.
                    ``(E) Publication.--Not less than twice annually, 
                the Secretary shall publish the transportation cost 
                index, along with a methodological description, 
                including--
                            ``(i) the method of calculation;
                            ``(ii) the data used to calculate the 
                        transportation cost index, in an aggregate 
                        manner that does not reveal proprietary 
                        information; and
                            ``(iii) any other information the Secretary 
                        considers to be appropriate to ensure 
                        transparency.
                    ``(F) Other information.--If a person believes that 
                the transportation cost index significantly deviates 
                from the transportation costs of the person, the person 
                may petition the Secretary to use information supplied 
                by the person (other than costs descried in 
                subparagraph (D)) in lieu of the transportation cost 
                index, including all information the Secretary requires 
                to accurately determine cost and audit the records of 
                the person.
            ``(8) Reviews.--
                    ``(A) In general.--To ensure a transparent, fair, 
                and efficient administration of the Federal coal 
                program, and to ensure that citizens of the United 
                States receive a fair return on Federal coal, not later 
                than 3 years after the date of enactment of this 
                subsection and every 3 years thereafter during the 15-
                year period beginning on that date of enactment, the 
                Comptroller General of the United States shall submit 
                to Congress a report that describes a review of the 
                Federal coal program, including the administration of 
                this subsection.
                    ``(B) Consultation.--In conducting a review under 
                this paragraph, the Comptroller General shall consult 
                with--
                            ``(i) the Secretary;
                            ``(ii) the Director of the Bureau of Land 
                        Management;
                            ``(iii) the Secretary of Transportation; 
                        and
                            ``(iv) the Secretary of Energy.
                    ``(C) Inclusions.--A review under this paragraph 
                shall include a review of--
                            ``(i) the total volume of coal production 
                        from Federal land;
                            ``(ii) the total volume of remaining coal 
                        reserves on Federal land;
                            ``(iii) the total revenues generated from 
                        the Federal coal program, itemized by type of 
                        revenue, including lease bonus payments and 
                        royalties;
                            ``(iv) market prices for coal;
                            ``(v) market prices for transportation 
                        costs and any other deductible costs; and
                            ``(vi) the appropriateness of royalty 
                        rates.
                    ``(D) Format.--The Comptroller General shall report 
                information in a review under this paragraph--
                            ``(i) in the aggregate for the United 
                        States; and
                            ``(ii) categorized by State for at least 
                        the top 10 Federal coal-producing States, as 
                        determined by the Comptroller General.
            ``(9) Application.--This subsection--
                    ``(A) applies to coal mined from Federal land; and
                    ``(B) does not apply to coal mined from tribal 
                land.''.