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[Senate Hearing 112-467]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 112-467
 
     CONSOLIDATION OF THE OFFICE OF SURFACE MINING RECLAMATION AND 
                              ENFORCEMENT

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                                   TO

RECEIVE TESTIMONY ON THE SECRETARY OF THE INTERIOR'S ORDER NO. 3315 TO 
CONSOLIDATE AND ESTABLISH THE OFFICE OF SURFACE MINING RECLAMATION AND 
            ENFORCEMENT WITHIN THE BUREAU OF LAND MANAGEMENT

                               __________

                           NOVEMBER 17, 2011

                       Printed for the use of the
               Committee on Energy and Natural Resources

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               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                  JEFF BINGAMAN, New Mexico, Chairman

RON WYDEN, Oregon                    LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota            JOHN BARRASSO, Wyoming
MARY L. LANDRIEU, Louisiana          JAMES E. RISCH, Idaho
MARIA CANTWELL, Washington           MIKE LEE, Utah
BERNARD SANDERS, Vermont             RAND PAUL, Kentucky
DEBBIE STABENOW, Michigan            DANIEL COATS, Indiana
MARK UDALL, Colorado                 ROB PORTMAN, Ohio
JEANNE SHAHEEN, New Hampshire        JOHN HOEVEN, North Dakota
AL FRANKEN, Minnesota                DEAN HELLER, Nevada
JOE MANCHIN, III, West Virginia      BOB CORKER, Tennessee
CHRISTOPHER A. COONS, Delaware

                    Robert M. Simon, Staff Director
                      Sam E. Fowler, Chief Counsel
               McKie Campbell, Republican Staff Director
               Karen K. Billups, Republican Chief Counsel

                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Bingaman, Hon. Jeff, U.S. Senator From New Mexico................     1
Corra, John, Director, Wyoming Department of Environmental 
  Quality........................................................    23
Hayes, David, Deputy Secretary, Department of the Interior, 
  Accompanied by Joseph Pizarchik, Director, Office of Surface 
  Mining Reclamation and Enforcement, Department of the Interior, 
  and Robert Abbey, Director, Bureau of Land Management, 
  Department of the Interior.....................................     4
Dunning, Daranne, Western Organization of Resource Councils, 
  Helena, MT.....................................................    45
Lambert, Bradley C. ``Butch'', Deputy Director, Virginia 
  Department of Mines, Minerals and Energy, Testifying on Behalf 
  of the Interstate Mining Compact Commission and the National 
  Association of Abandoned Mine Land Programs....................    17
McGinley, Patrick C., Professor, West Virginia University College 
  of Law, Morgantown, WV.........................................    28
Murkowski, Hon. Lisa, U.S. Senator From Alaska...................     2
Sweeney, Katie, General Counsel, National Mining Association.....    37

                               APPENDIXES
                               Appendix I

Responses to additional questions................................    57

                              Appendix II

Additional material submitted for the record.....................    67

     CONSOLIDATION OF THE OFFICE OF SURFACE MINING RECLAMATION AND 
                              ENFORCEMENT

                              ----------                              

                      THURSDAY, NOVEMBER 17, 2011

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:30 a.m. in room 
SD-366, Dirksen Senate Office Building, Hon. Jeff Bingaman, 
chairman, presiding.

OPENING STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR FROM NEW 
                             MEXICO

    The Chairman. OK. Why don't we get started here. This is a 
hearing of the Senate Energy and Natural Resources Committee to 
receive testimony on the Secretary of the Interior's Order No. 
3315.
    It is an order to consolidate and establish the Office of 
Surface Mining Reclamation and Enforcement within the Bureau of 
Land Management. The order was signed by Secretary Salazar on 
the 26th of October.
    I hope we can all learn more about the purposes and likely 
effects of this reorganization from the witnesses today. I've 
heard concerns expressed regarding this reorganization. Some 
believe that consolidating the Office of Surface Mining within 
the BLM could serve to diminish its role and mission.
    Others have expressed concern that the reorganization 
injects uncertainty as to how the program will be administered.
    The Surface Mining Control and Reclamation Act of 1977, 
which is OSM's organic act, was a product of this committee's 
labors, as well as, of course, the House Committee on Interior 
and Insular Affairs.
    The Surface Mining Act was neither hastily written nor 
lightly considered, according to then Representative Mo Udall, 
the bill's principal author. Here's a quote from his statement, 
``It took 6 years of tenacity and bitter debate to pass the act 
involving 183 days of hearings and legislative consideration, 
18 days of House action, 3 House-Senate conferences and 
reports, 11 conference reports, 2 Presidential vetoes and about 
52 recorded votes in the House and Senate.''
    The Surface Mining Act sets forth provisions particularly 
relevant as we consider the Secretary's order.
    First, that act explicitly establishes an Office of Surface 
Mining Reclamation and Enforcement within the department. The 
statute also requires that the director of OSM be appointed by 
the President and confirmed by the Senate.
    Also note, the Surface Mining Act prohibits the transfer of 
coal-development functions to OSM. Given this provision, it's 
perhaps difficult to believe that Congress intended OSM to be 
an office within the BLM. Indeed the provision that prohibits 
the comingling of coal development and OSM's functions argues 
against this result.
    Again, I look forward to the testimony from our witnesses 
and look forward to gaining a better understanding of the 
Secretary's order, both from a procedural and substantive 
perspective.
    I thank the witnesses for being here and all others who are 
present today.
    Let me call on Senator Murkowski for her comments.

        STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR 
                          FROM ALASKA

    Senator Murkowski. Thank you, Mr. Chairman. Welcome to 
those on both panels here this morning. I thank you, sir, for 
setting this hearing this morning to conduct some oversight on 
the recent order for OSM to be merged into BLM.
    From the outset, I do want to make clear that I do 
appreciate one part of this announcement that was included in 
the memorandum from Secretary Salazar about making the 
government work better. I think that's a goal that we certainly 
all share. We always look for ways to make our agencies more 
efficient, less costly, and we should welcome the participation 
of the people who actually work there.
    Streamlining the Federal Government is something that we 
should all agree to strive for, right now especially, as we're 
grappling with so many of these decisions related to our budget 
and the Federal debt.
    The problem is that not every idea that emerges is going to 
deserve implementation, so we need to be careful to filter the 
good from the bad. From what we've seen so far, the secretarial 
order to merge OSM into BLM, in my opinion, falls into the 
latter of those categories.
    I'm not convinced that the order is legally valid or good 
public policies. The committees of jurisdiction were not 
consulted, but left in the dark, and the department's rollout, 
I think, has created some confusion and uncertainty.
    Now, I initially understood this would be a merger of 
administrative functions, and I think some of us may have 
supported that, but what was publicly announced was far more 
extensive. It seems clear that the plan would first require 
Congress to amend the separate organic acts that are 
establishing BLM and OSM.
    My skepticism deepens when we take a look at what this 
could mean for policy implementation. OSM was specifically 
established as a separate entity reporting directly to the 
interior secretary to protect its independence as a regulatory 
body, and that independence needs to be protected.
    What's more, the proposed merger of BLM, the entity 
responsible for leasing, and OSM, the regulatory body, is 
directly contrary to the arguments that we heard last year when 
the administration sought to separate the leasing and the 
regulatory functions of the former Minerals Management Service.
    Secretary Salazar submitted written testimony to us last 
summer asserting, and I'll quote him here, ``I intend to 
restructure MMS to establish a separate and independent safety 
and environmental enforcement entity. We will responsibly and 
thoughtfully move to establish independence and separation for 
this critical mission, so that the American people know that 
they have a strong and independent organization holding energy 
companies accountable and in compliance with the law of the 
land.'' That was his quote.
    Suffice to say I'm curious to hear why the department 
apparently wants to move in the opposite direction now when it 
comes to OSM.
    Finally, from a process standpoint, it's tough not to be a 
critic. Few details and even fewer justifications have been 
provided about how this order will be carried out or even why 
it's warranted. Neither Congress nor stakeholders were 
consulted or notified that this order was in the works.
    Today, it remains entirely unclear how the department plans 
to consult with Congress, even though the order says that that 
should happen, and whether or not public comments will be 
allowed.
    The reaction to this order, Mr. Chairman, I think you have 
noted, has been virtually unanimous and almost entirely 
unfavorable. It looks for all the world like the decision was 
made to merge OSM into BLM before much thought was given to 
whether those agencies could be merged, whether they should be 
merged and how that would actually be accomplished. So that's 
not a particularly good start here.
    Even before the Secretary signed this order, there were 
obvious problems at OSM where an independent contractor who was 
hired by OSM to analyze new coal regulations was subsequently 
fired for projecting massive job losses as a result of the 
rules. None of us likes to hear bad news, but the proper 
response is not to shoot the messenger.
    So, to me, it makes more sense for this committee and the 
department to get existing agencies operating properly before 
we start talking about combining them.
    So, Mr. Chairman, I'm glad that we have this hearing in 
front of us today. I hope that it provides some insight and 
perhaps some clarity into the Secretary's recent order.
    I'll have some questions, of course, of the witnesses and 
will look forward to their responses. So thank you.
    The Chairman. Thank you.
    We have 2 panels today. The first is the Deputy Secretary 
of the Department of the Interior, David Hayes. We welcome him.
    He is accompanied by the 2 directors of the effected 
agencies here, the Honorable Joseph Pizarchik, who is director 
of the Office of Surface Mining--thank you for being here--and 
the Honorable Robert Abbey, who is the director of the BLM. 
Thank you for being here.
    So, David, why don't you go right ahead and give us your 
thoughts as to this order and anything else you think we ought 
to know, and then we will have some questions.

 STATEMENT OF DEPUTY SECRETARY DAVID HAYES, DEPARTMENT OF THE 
                            INTERIOR

    Mr. Hayes. Thank you, Senator. Thank you, Senator 
Murkowski, and other members of the panel.
    I would just like to make a few opening remarks about the 
Secretary's order. The Secretary, in announcing the order that 
is the subject of today's hearing, asked the leadership of the 
Department of the Interior and the 2 directors on my right and 
my left to evaluate whether we can consolidate some of the 
activities of the Office of Surface Mining and BLM in a way 
that will provide more efficient and cost-effective service.
    This is all about seeing if we can be more efficient in 
dealing with the goals that are required by SMCRA, under the 
Office of Surface Mining, and by FLPMA, under the Bureau of 
Land Management.
    The goal is to make government work better, to build on our 
strengths and to get the most out of the limited resources that 
we have.
    Let me say at the outset that the Secretary's executive 
order makes it clear that the Office of Surface Mining's duties 
and responsibilities, as prescribed by SMCRA, will remain 
intact under the exclusive purview of the Office of Surface 
Mining director who will maintain autonomy over those issues.
    Our hope and expectation is that the consolidation 
evaluation that we're launching will actually strengthen OSM's 
capabilities by making the most of available efficiencies in 
the OSM organization and BLM organization, aligning programs, 
where possible and appropriate, and eliminating duplication and 
optimizing effectiveness.
    The enforcement and regulatory functions of OSM would 
remain separate from BLM's leasing activities. That's required 
under section 201(c) of SMCRA. That will be honored.
    The focus of the consolidation is on those OSM and BLM 
functions that are complementary, including environmental 
restoration activities and administrative support functions.
    Part of the background of this order is the fact that OSM 
is a small organization with a modest operating budget of about 
$160 million and a staff that has been decreasing in number 
steadily over the last 10 years.
    Since 2002, OSM's staff has been reduced by 17 percent. 
There are only approximately 520 employees in all of OSM. We 
need to find a way to make this small agency more efficient. 
That's what this reorganization is all about.
    The areas that we are looking at in terms of the 
consolidation are areas, again, that do not touch upon the 
independent required obligation of OSM. We're looking, for 
example, in particular, at administrative functions.
    Currently, the Office of Surface Mining, although it's a 
very small bureau, has to support a variety of separate 
administrative functions. It has an Office of Communications 
and Legislative Affairs, has an Office of Information 
Resources, has an Office of Equal Opportunity, an Office of 
Planning, Policy and Budget and a Division of Administration. 
All of these administrative services are siloed in OSM.
    We believe that many of them can be consolidated with BLM's 
much larger operation and provide essentially more bang for 
every OSM dollar, so that they don't get essentially put into 
administrative functions that can be done more efficiently by a 
larger organization.
    Similarly, on the revenue side, we have an existing 
independent, skilled, revenue-collection and distribution 
function at the Department of the Interior, the Office of 
Natural Resource Revenues, under the Office of the Assistant 
Secretary for Policy, Management and Budget.
    The ministerial collection of reclamation fees by the 
Office of Surface Mining, and the distribution of those funds 
is extremely similar to the functions that our robust Office of 
Natural Resource Revenues is undertaking right now for the 
Bureau of Land Management and for the Bureau of Ocean Energy 
Management. They collect and distribute more than $10 billion 
per year, which far overshadows the amount that is collected 
and distributed by the Office of Surface Mining.
    We think it makes sense to take the excellent group that 
does that work in the Office of Surface Mining and have them 
part of this operation of the Office of Natural Resource 
Revenue to more efficiently collect and distribute these funds. 
It just makes sense, from our perspective.
    Similarly, both organizations have some expertise when it 
comes to coalmine reclamation efforts. Both of them have 
abandoned mining programs. OSM focuses on coal reclamation 
activities, obviously, and collects money and oversees coal 
reclamation activities, including--some of those funds are used 
for abandoned hard-rock mining activities as well.
    BLM has a similar program dealing with abandoned hard- rock 
mining activities. Both have experts that deal with these 
issues. BLM, in addition, oversees the leasing of current 
coalmining activities and has to review the adequacy of 
reclamation activities associated with current coalmining 
activities.
    You have 2 organizations each with an expertise and 
capability, each modest capability dealing with very similar 
issues.
    We believe that as we go through this process of talking 
with our employees, consulting with you, consulting with 
interest groups, that there may well be some synergies here to 
take advantage of these 2 very parallel programs.
    The point, though, I would like to emphasize and close is 
that we completely honor and respect the requirements of SMCRA. 
The independence of the Office of Surface Mining will be 
retained as required under section 201(c), but just as section 
201(b) of SMCRA anticipates that some of the functions called 
for by SMCRA can be done outside of the Office of Surface 
Mining, that's the area that we want to explore as we look 
through and administer this potential program.
    I close by saying the secretarial order itself, of course, 
does not become effective until December 1. Moreover, what it 
calls for is a plan to be fleshed out by March 1. We are very 
much in the state of evaluation and examination of this.
    We do believe that there are some synergies and some cost 
savings that can be identified and that we need to identify in 
this time of fiscal constraint. We look forward to working with 
you over the coming months to make sure we do so in a way that 
makes sense, that works for the companies that are reliant on 
permits from both the Office of Surface Mining and BLM and that 
will deliver the services that people expect of their 
government.
    Thank you.
    [The prepared statement of Mr. Hayes follows:]

 Prepared Statement of David J. Hayes, Deputy Secretary, Department of 
                              the Interior

                              INTRODUCTION

    Chairman Bingaman, Ranking Member Murkowski, and Members of the 
Committee, thank you for the opportunity to appear before you today to 
discuss the Department of the Interior's consolidation and integration 
of the Office of Surface Mining Reclamation and Enforcement (OSM) into 
the Bureau of Land Management (BLM) as contemplated by Secretarial 
Order No. 3315, dated October 26, 2011.
    As Secretary Salazar stated in announcing the Order, the Secretary 
has asked the leadership in the Department of the Interior to evaluate 
a potential consolidation of OSM and BLM to determine whether the 
Department can advance the Congressionally-mandated missions of both 
bureaus more efficiently and cost-effectively by combining expertise 
and resources of the bureaus in areas that make sense, and reducing the 
drain on OSM resources that is associated with maintaining stand-alone 
support services for a bureau that has a small employee and budget 
base. The Secretary's goal is to make government work better, to build 
on our strengths, and to get the most out of the limited resources we 
have.
    At the outset, I want to emphasize that the Department is fully 
committed to the OSM mission and to continued compliance with the 
Surface Mining Control and Reclamation Act (SMCRA). The Secretary's 
Executive Order makes it clear that the OSM's duties and 
responsibilities prescribed by SMCRA will remain intact, under the 
exclusive purview of the OSM Director, who will retain autonomy over 
those issues. The hope and expectation is that the consolidation 
process that the Department is now launching will strengthen the OSM's 
capabilities by making the most of available efficiencies in 
organizations, aligning programs where possible and appropriate, 
eliminating duplication and optimizing effectiveness. The enforcement 
and regulatory functions of the OSM would remain separate from BLM's 
leasing activities. The focus of the consolidation is on those OSM and 
BLM functions that are complementary, including environmental 
restoration activities and administrative support functions.
    As the Secretary noted in his Order, we look forward to Congress' 
input as we move forward with this process, along with the input of our 
employees, the Office of Management and Budget, and interested 
stakeholders.

                               BACKGROUND

    OSM was established in 1977 as a regulatory agency to oversee state 
surface coal mining regulatory and reclamation programs and to develop 
tools to ensure that states and tribes administer their programs 
effectively. OSM seeks to ensure that coal mining operations are 
conducted in a manner that protects citizens and the environment during 
mining, to ensure that the land is restored to beneficial use after 
mining, and to mitigate the effects of past mining activity by pursuing 
reclamation of abandoned coal mines. OSM also provides support and 
assistance to states in implementing state regulatory programs and 
reclaiming abandoned mine lands.
    The OSM has a modest operating budget of about $160 million and a 
staff that has been decreasing in number steadily over the past ten 
years. Since 2002, the OSM's staff has been reduced by 17 per cent. 
OSM's 525 employees are headquartered in Washington, DC, and throughout 
three coal-producing regions: Appalachia, Mid-Continent, and Western.
    The BLM was established in 1946 and manages more than 245 million 
acres of public land, known as the National System of Public Lands. 
Although the large majority of lands managed by BLM are located in 12 
western states, BLM manages approximately 15,000 surface acres in the 
eastern United States. In addition, BLM manages approximately 40 
million acres of federal mineral estate in the eastern United States, 
including approximately 30 million acres under our National Forests. In 
total, BLM administers 700 million acres of sub-surface mineral estate 
throughout the Nation. As a land manager with responsibility for 
overseeing both surface and sub-surface mining activities on public 
lands, BLM has a number of responsibilities associated with mining-
related activities, including establishing reclamation requirements for 
current mining operations, and administering BLM's Abandoned Mine Lands 
(AML) program, a mining restoration program that was established in 
1997 to address high priority watersheds impacted by abandoned mines.
    The consolidation proposed under the Secretarial Order is intended 
to build on the strengths and expertise of both bureaus, to capture the 
benefit of synergies from integrating BLM and OSM reclamation efforts, 
to strengthen OSM's oversight of surface coal mining and reclamation 
operations, to ensure efficiencies in revenue collection and 
enforcement responsibilities, and provide strong and independent safety 
and environmental oversight of these activities.
    The Department is proceeding with this consolidation exercise under 
the authority of Section 2 of the Reorganization Plan No. 3 of 1950. 
That law gives the Secretary broad reorganization authority across the 
Department subject, of course, to any relevant statutory limitations. 
In this case, any reorganization must accommodate SMCRA's explicit 
requirements that OSM maintain a separate regulatory and enforcement 
function, that it not promote the development of coal or other mineral 
resources, and that it be led by a Director who is appointed by the 
President, with the advice and consent of the Senate. In that regard, 
one of the critical components of our reorganization plan is that OSM's 
enforcement mission will remain independent from the coal leasing 
functions administered by the BLM. Under the reorganization plan, there 
will be no consolidation of those functions.
    As described in the Secretary's Order, which is due to become 
effective on December 1, 2011, we will be evaluating four key areas for 
potential consolidation: (1) administrative functions; (2) revenue 
functions; (3) mine reclamation programs; and (3) inspection and 
enforcement.

Administrative Functions
    We believe that a consolidation of BLM and OSM can avoid 
duplicative administrative support services that currently reduce OSM's 
effective spending power. Although it is a small bureau, OSM currently 
is supporting a variety of separate administrative support functions, 
including a Communications and Legislative Affairs Office, an Office of 
Information Resources, an Office of Equal Opportunity, an Office of 
Planning, Policy and Budget and a Division of Administration. 
Consolidation with BLM would enable OSM to take advantage of existing 
BLM and OSM administrative resources in all of these areas. By taking 
advantage of these efficiencies, a larger portion of the OSM budget 
could be dedicated to accomplishment of its core mission.

Revenue Functions
    The Secretary's consolidation plan anticipates moving OSM's revenue 
collection function to the Department's Office of Natural Resource 
Revenue (ONRR)--an existing office within the Department whose sole 
mission and expertise is the efficient collection of revenue from 
various leasing and permitting activities conducted throughout the 
Department. By way of example, ONRR currently manages the revenue 
collection functions associated with BLM and the Bureau of Ocean Energy 
Management (BOEM). Integration of the OSM's fee collection and 
distribution functions that are ministerial in nature into the ONRR 
would take advantage of ONRR's existing expertise and resources in this 
area. ONRR, in turn, would benefit from incorporating OSM's high 
quality and efficient compliance program, with an established record of 
collection success.

Mine Reclamation Programs
    The BLM and OSM both have resources and expertise devoted to the 
reclamation of current and abandoned mining activities. OSM, for 
example, has significant expertise in the reclamation of ongoing coal 
mining operations, expertise that could augment the BLM's efforts to 
require ongoing reclamation efforts at hard rock mines. The OSM also 
has significant expertise in abandoned coal mine reclamation, including 
its AML grants to states and tribes and the creation and administration 
of its Abandoned Mine Land Inventory System. During the consolidation 
process, the Department will be exploring the potential to merge the 
BLM's AML program into the OSM's abandoned mines program, so as to 
capitalize upon the synergies that would result in increased capability 
and, we expect, improved performance of both programs. We also believe 
that such a consolidation would improve the BLM's mine and surface 
reclamation programs for existing mining operations.

Inspection and Enforcement
    The OSM and the BLM both maintain inspection and enforcement 
programs. As we move forward with developing our plan, we will consider 
consolidation of the BLM's reclamation and inspection and enforcement 
functions related to coal mining with OSM's surface coal mining 
regulation, inspection and enforcement program. Consolidating these two 
functions could result in strengthening what are now two relatively 
small, separate programs, creating a more robust program that would 
operate under the supervision of the OSM and include their extensive 
institutional knowledge.

                               CONCLUSION

    Mr. Chairman, we believe that in these times of limited budgets and 
resources, it is important to fully explore how government services can 
be delivered in the most efficient and effective manner. That is why we 
are considering consolidation of certain functions currently 
administered by OSM and the BLM. We recognize that both bureaus carry 
out important functions, have vital missions, and are staffed by 
tremendous public servants. Our goal is to build on these strengths as 
we consider how we might better deliver the services that the American 
people expect of us.
    We will rely on the ideas and input of employees and many others, 
including the Congress, at every step of the process so that we ensure 
that this integration is successful and consistent with our authorities 
under the law.
    This concludes my statement, and I am happy to answer any questions 
you or other Members of the Committee may have.

    The Chairman. Thank you very much. Let me start with a few 
questions.
    I guess a sort of threshold question is whether or not what 
you're proposing or what the Secretary is proposing in this 
rule is consistent with the statutes that govern. You're 
persuaded that it is, I gather, from your statement.
    Mr. Hayes. We are, Senator. The solicitor's office has been 
involved in our discussions and will continue to be involved as 
we evaluate exactly how we might undertake this consolidation.
    As I said, we would proceed consistent with both section 
201(c) and section 201 (b) of the act.
    The Chairman. OK. Because there is a lot of legislative 
history in connection with the Surface Mining Control and 
Reclamation Act that seems to imply otherwise to us. There's 
this statement in the Senate report that says, to ensure 
administration of the program by an independent agency with 
neither a resource development or resource preservation bias or 
mission, this title establishes the Office of Reclamation and 
Enforcement in the Department of the Interior. This office will 
be separate from any of the departments, existing bureaus or 
agencies. It's intended that the office exercise independent 
and objective judgment in implementing the act.
    So that seems to us to be contrary to what the order calls 
for, and so I call that to your attention.
    Obviously, I agree with your purpose of trying to find 
synergies and ways to streamline administration of the Federal 
Government. I think, clearly, Senator Murkowski said the same 
thing, I believe.
    The order that the Secretary has issued in section 3(d) 
talks about how you want to integrate the Office of Surface 
Mining's coalmining regulation, inspection and enforcement 
programs and functions and BLM's inspection and enforcement 
program functions related to mining.
    That seems to me to go beyond just streamlining. That seems 
to essentially say we're going to do this all out of the same 
office. I don't know if that accomplishes some greater 
objective, other than just saving on a few personnel. I guess 
the hope is that you can reduce the number of people required 
to perform these functions currently performed by the 2 
agencies if you do it all together. Is that the idea?
    Mr. Hayes. Senator, there is a second purpose there and it 
goes to the point that Senator Murkowski raised in her opening 
statement.
    Let me step back for a minute. I think what SMCRA requires 
in particular is that the Office of Surface Mining not be 
involved in the leasing function, that there be a separation 
between the cop on the beat, if you will, and the agency that 
is actually entering into leases. That's very similar to what 
we were trying to do, what we have done with the division of 
Minerals Management Service between the Bureau of Ocean Energy 
Management and the Bureau of Safety and Environmental 
Enforcement.
    Currently, you have BLM doing both leasing and enforcement. 
We think--and the Office of Surface Mining should have nothing 
to do with leasing. That's clear from SMCRA. That's why it has 
to continue to be an independent organization with a director 
that is appointed and confirmed by the Senate.
    We think it may make sense, frankly, to move the BLM 
enforcement of coal-related activities over to OSM, so that 
you, in fact, honor that separation between enforcement and 
leasing. So that's what we want to explore.
    There may well be some efficiencies there as well. I mean, 
the reality is you have inspectors at OSM. You have inspectors 
at BLM, both of whom are checking on reclamation of coal 
activities. They're doing very, very similar functions.
    In fact, they duplicate functions. After a surface coalmine 
that is leased by BLM closes and there's a question of how you 
administer the reclamation of that, both BLM and OSM 
independently have an obligation to inspect and ensure the 
reclamation activity occurs in an appropriate way. To us, it 
doesn't make sense to have duplicate reviews of that activity.
    The Chairman. Let me just mention I do have a statement 
from the Navajo Nation that I'll submit for the record 
indicating their concern with the lack of any government-to-
government consultation prior to the issuance of this executive 
order. So I'll put that in the record.
    Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman.
    In addition to the concern over lack of consultation, 
whether it's by tribes or others, it seems to me that we're 
dealing with a lot of concerns that have come about because of 
the details. On its face, initially, OK, some efficiency, some 
consolidation, some streamlining, this is all fine, well and 
good.
    But as you get more into the details, more concerns are 
raised. Typically, when you have something of this 
significance, you would have the department conduct some 
briefings, some hearings. It would be part of the annual budget 
request. You would have the public comment and really kind of 
work through the process.
    You've indicated, David, that you anticipate the plan to be 
together by March 1. We need to identify whether or not there's 
going to be cost savings. It sounds like there is still an 
awful lot of exploratory review, and, yet, we're in kind of 
response mode now.
    Is this just a rollout that isn't working very well or has 
it not been thought through to the level that I think a change 
like this should be?
    Mr. Hayes. Senator, I absolutely respect the point of view 
that you have here, and I want to thank you and Senator 
Bingaman for holding this hearing, because the reality is that 
we believe that there are cost savings that can be garnered 
here while increasing efficiencies and taking advantage of 
organizational capabilities we have in our department.
    The reality is, though that this is complicated. Step one 
for us is to talk to our employees in all of the effected units 
and to work through with them what might be possible, what 
might make sense, to sharpen the pencils, to see if the 
expected savings are there and what they might be, and to work 
with you and with interested parties. That's what we are going 
to do.
    This is a 2-page secretarial order. It is brief. It is high 
level, precisely because this is complicated, and it's going to 
require careful review and evaluation. That's our job here over 
the next 4 months, to go about this exercise, to talk with you 
more, and your staffs, to talk with industry more. That's what 
we intend to do.
    The Secretary has no interest in coming out with a plan 
that doesn't make sense. He has asked me to work with these 
gentlemen over the next 4 months to see what we can put 
together, and that's what we intend to do.
    Senator Murkowski. I think we're going to continue to have 
a lot of questions about how it would actually be implemented.
    I want to follow on the chairman's question, though, in 
terms of the authority. Has the solicitor's office provided a 
written opinion as to the legality of this proposal, and, if 
so, can you provide that to us?
    Mr. Hayes. We do have some written documents from the 
solicitor's office that has been the solicitor's office, as I 
testified before, has been involved throughout. I'm happy to 
look into the issue of providing that.
    Senator Murkowski. OK. I would like that, as I'm sure it 
will be helpful for us as we look at this further.
    I've got some other questions that I'll have an opportunity 
to ask you later, but I wanted to bring up something that was 
in yesterday's news.
    This was in the U.S. News and World Report. There was an 
article suggesting that the administration, the President is 
kind of pushing gun owners off of public lands. This relates to 
the ability to use public lands for target practice, something 
that I've got a real concern with, as most of my constituents 
in Alaska clearly do.
    I know that the Secretary was asked about this yesterday at 
a House resources hearing. He indicated that he was not aware 
of the proposal at that time.
    So I'd ask either you, Mr. Hayes, or you, Mr. Abbey, if you 
can provide us a little better insight in terms of what is 
going on with this proposal, please.
    Mr. Hayes. Certainly. Let me take a crack and then ask, why 
don't you go ahead, Bob.
    Mr. Abbey. Senator, again, I appreciate the question. You 
know, the Bureau of Land Management manages 245-million acres 
of land, and most of that land is open to hunting and fishing 
and recreational target shooting.
    The issue that cropped up yesterday was based upon a 
question that was asked of the Bureau of Land Management 
regarding a proposed policy to look at some of the conflicts 
that are currently escalating relative to recreational target 
shooting near communities and residential areas that are being 
developed adjacent to public lands.
    As you may know, we do restrict shooting within developed 
recreation areas. We have closed off a few areas, based upon 
safety concerns regarding shooting that is taking place near 
those type of communities and residential areas.
    Everything that we do relative to restricting uses on 
public lands would be handled through a land-use plan.
    Let me assure this committee that we have nothing in place 
as far as going forward with any kind of rulemaking that would 
close off public lands to hunting or fishing or to even 
recreational target shooting.
    But we do have, and always have had, the discretion of 
looking or using our land-use plans to determine appropriate 
uses that are taking place on public land--by BLM.
    As we see some of these communities continuing to expand 
and build adjacent to some of these public lands, we do have 
some conflicts that do need to be addressed, but they are few 
and we will deal with those through our land- use planning 
process.
    Senator Murkowski. I would just remind everyone that the 
last time the Department of the Interior attempted to regulate 
guns in national parks, we ended up with the guns-in-park 
legislation. So just be aware.
    I mean, I'm hearing your words here, but this is something 
that would cause a great deal of concern and angst.
    Mr. Hayes. We appreciate that and we understand that.
    Senator Murkowski. Thank you, Mr. Chairman.
    The Chairman. Senator Manchin.
    Senator Manchin. Mr. Hayes, I appreciate you being here and 
also to the chairman and the ranking member for calling this 
hearing, because I don't think you all asked for the hearing. 
Did you?
    Mr. Hayes. No----
    Senator Manchin. You were going your way, no matter what.
    Mr. Hayes. Senator, we----
    Senator Manchin. I'm just saying that we asked for the 
hearing because you weren't going to give us the courtesy of 
coming to tell us why you thought you didn't need our approval 
to do it.
    Mr. Hayes. No, that's not true, Senator. The intent of the 
Secretary was to reach out to all of you here----
    Senator Manchin. I think you can carry back and tell him 
that there's great concern on both sides. You know, very few 
things that we all agree on, and I think you're seeing that we 
agree that we think you're wrong.
    So with that being said, you already have oversight--do you 
not, BLM?--over--aren't they part of your----
    Mr. Hayes. Yes. Yes.
    Senator Manchin. So if there's deficiencies, why wouldn't 
you have been helping them already, if you found different ways 
administratively?
    Because one size doesn't fit all. We've never dealt in the 
eastern part of the United States with BLM. That's all they've 
ever dealt with in the western part is BLM. Next of all, the 
way our lands have been separated, it's a whole different 
ballgame than what you all deal with.
    If you think that OSM's inspectors are better and can do a 
better job because you're doing the same thing, why don't you 
already have OSM inspectors doing yours, too?
    I mean, I don't know why you need an order saying you're 
going to merge. Doesn't make any sense.
    You haven't identified any cost savings or haven't told us 
about the money. If you do, I'd like to hear how much money you 
think you're going to save.
    Mr. Hayes. We----
    Senator Manchin. You have a dollar figure, please tell me.
    Mr. Hayes. We've done some preliminary estimates and we 
believe we might save $5 million a year.
    But, most importantly, we are interested in consolidating 
the functions.
    Let me just a couple of clarifications.
    Senator Manchin. You can do that without----
    Mr. Hayes. BLM has 40-million acres in the eastern United 
States under its management. It has a substantial presence in 
the east, including some coalmining requests.
    But the most important thing, Senator, first of all, let me 
just reiterate, as I said to Senator Bingaman and Senator 
Murkowski, we are interested in working closely with you to 
flesh this out and do something that makes----
    Senator Manchin. If you want to work with us, you ought to 
put your order on hold right now and tell the Secretary to hold 
up and let's work together. Don't move forward for December the 
1st, because it's not going to be looked on favorably here. I 
think you're hearing that loud and clear, and I would hope you 
would.
    How about the States that have primacy right now basically 
taking the lead in that? I mean, my little State of West 
Virginia is one that we think has done and worked well with 
OSM, and we're always looking for better ways to do that, but 
we were never consulted about this. Not the least bit were we 
ever contacted and say, Guess what might happen. This is why we 
want to do it, to give us a chance if there's something we were 
doing wrong or we thought OSM was doing and we could do better, 
no one gave us an opportunity to cure it.
    I mean, in running any good office, if you detect that 
there's an inefficiency, you try to improve that. Then if you 
can't improve it and say, I've given all, every best shot I 
had, then you put them together, you consolidate and say, I 
don't need that any longer.
    But I would really agree with both the majority and the 
ranking minority member here that I'm not sure you all have the 
jurisdiction to do that. I mean, it's pretty clear, if you read 
that the office is under 201(a), established in the Department 
of the Interior, the Office of Surface Mining was established 
there; 201(b) requires the OSM have a director who shall be 
appointed by the President.
    I don't know how you can just say, there is an order that 
the President has that--What's the purpose if you're going to 
take it away now and merge it when Congress basically, in 
201(b), says that the President will do the appointment?
    If that's the case, then it says that no legal authority 
program or function in any Federal agency which has its purpose 
promoting the development or use of coal or other mineral shall 
be transferred. I don't know how you read that any differently.
    Mr. Hayes. You know, Senator, 201(b) also says that OSM may 
use, when appropriate, employees of the department and other 
Federal agencies to administer the provisions of this act.
    Senator Manchin. That's fine. We're saying you already have 
that right. Why do you want to merge it?
    Mr. Hayes. We don't----
    Senator Manchin. So you're going to leave a director at OSM 
appointed by the President for the sake of face value and 
that's it?
    Mr. Hayes. No.
    Senator Manchin. There's not going to be anything else for 
them to work with if----
    Mr. Hayes. No, they will--The director will administer all 
the required obligations under section 201(c). What we're 
looking at are only the administrative functions, potentially 
some of the reclamation, backend issues and potentially the 
revenue-collection capability and distribution capability that 
we have an outstanding centralized function for under the 
Office of Natural Resources Revenue.
    Senator Manchin. Mr. Hayes, with all due respect, I would 
encourage you to take back to the Secretary the request to put 
this on hold, to pull this order until we can all work together 
on it and see if there is more efficiencies to be gained.
    Mr. Hayes. I'll take that back. Thank you, Senator.
    The Chairman. Senator Paul.
    Senator Paul. Thank you, and thank you to the panel for 
coming.
    I think we're all concerned, Republican and Democrat, with 
clean water. The Clean Water Act talked about regulating 
navigable waters, and in the Rapanos decision, Scalia actually 
defines what a navigable water is. What Scalia says is that a 
navigable water would be relatively permanent, standing or 
continuously flowing bodies of water forming geographic 
features, such as oceans, rivers and lakes.
    I think that's what the regular folks around the country 
would think we would be regulating, and that would be fine with 
most people, be fine even with myself.
    I think the concern is is that some people have not agreed 
with that definition and they think the definition of a stream 
is or navigable water is any low area of land anywhere that 
collects water or where water runs off of, and I think that's a 
real problem.
    Scalia goes on to say that it does not include channels 
through which water intermittently or ephemerally or channels 
that periodically provide drainage or rainfall.
    My question is for Mr. Pizarchik. How do you define a 
stream?
    Mr. Pizarchik. Steams, in the definitions or appeared in 
our regulations, do not follow the waters of the United States 
provisions that have been litigated, debated over the years. 
It's based--there's a couple of different definitions. There's 
a definition for perennial stream. There's a definition for 
intermittent stream and for ephemeral stream.
    Senator Paul. So you disagree with Justice Scalia's 
definition of navigable waters?
    Mr. Pizarchik. The Surface Mining Act doesn't provide for 
us to conduct our activities in the context of the navigable 
waters. The Surface Mining Act explicitly reserves water-
quality standards for EPA, and the corps also deals with 
navigable waters. What we have----
    Senator Paul. So your jurisdiction doesn't come from the 
Clean Water Act?
    Mr. Pizarchik. No, sir, it does not. It comes from the 
Surface Mining Control and Reclamation Act.
    Senator Paul. OK. How many ephemeral streams are there in 
Kentucky?
    Mr. Pizarchik. I don't know that anybody's ever counted 
that, but I'm sure there are very many.
    Senator Paul. So there's no list.
    Mr. Pizarchik. I don't know.
    Senator Paul. It'd be pretty important if you're going to 
propose a stream rule and then you're going to tell me I can't 
do any mining activity within 100 feet of an area that 
sometimes has water when it rains.
    Have you ever been into the mountains of eastern Kentucky?
    Mr. Pizarchik. Yes.
    Senator Paul. When it rains and water runs off of high 
places and goes to low places every place that it runs off is 
not a stream. This is the ridiculous notion that has allowed 
government to overreach, and this is what annoys us in our 
State. You come down here from Washington, you want to tell us 
every area where the water runs off the mountain is a stream 
and it is not a stream, and I think it defies the intent of the 
law.
    That is the danger of you going, once again, into a law 
that took 5 years for a lot of people--Republicans, Democrats, 
industry, environmentalists, everybody--to develop, and you're 
going to do a new stream rule, and yet you're really, really 
not talking about babbling brooks or rivers. You're talking 
about some low area in the land that sometimes has some water 
in it when it rains hard.
    Mr. Pizarchik. We are in the process of examining and 
making a determination as to how we should modernize our 
regulations, take advantage of the existing science and 
knowledge that we've gained over the past decades to do a 
better job of protecting our resources----
    Senator Paul. If I had a mine, how would I know where I can 
build my mine? I can't, if you don't have a list of the 
ephemeral streams.
    Mr. Pizarchik. You have to look at the basis, as far as the 
definitions, and apply that. There are determinations that are 
made with the regulatory authorities on what constitutes an 
ephemeral stream----
    Senator Paul. So you're going to let every inspector all 
across America decide, at that moment, whether something is a 
stream, whether some low area or some crevice that runs off the 
top of a mountain is a stream?
    I mean, that, to me, when you're developing multimillion-
dollar projects--You know, we have 50,000 workers in Kentucky 
who depend--their livelihood depends on this, another couple of 
hundred thousand who are indirectly related to mining, and 
you're going to tell a company that's going to put millions of 
dollars into opening a mine that, Just depends on which 
regulator you get and they'll tell you at the time. You know, 
they'll know a stream when they see it, basically.
    Mr. Pizarchik. No, that's not at all what we're going to 
do. We're looking to use the science to modernize our stream 
definition.
    Senator Paul. You'd have to have a list of streams, then. 
You'd have to have a GPS. We've got a GPS there. You'd have to 
list every stream in the world. That's the grotesque nature of 
this is that, you know, we're talking about an infinite amount 
of places where water runs off.
    You hear this ridiculous notion from people saying we've 
destroyed 2,000 miles of stream. People think that, Oh, they're 
polluting the Ohio River and we've disrupted the Ohio River or 
some major creeks or rivers. We're not talking about that at 
all.
    These people, through these exaggerated claims, have 
distorted this, but you're furthering this by allowing 
something ephemeral to be regulated. There is a danger to what 
you're doing. I will tell you that we, in Kentucky, don't like 
it. We will oppose you. We will make Congress vote on these 
things, and this will work across aisles.
    But it gets back to not whether we're for clean water or 
we're for clean streams. It is to do and has to do with the 
definition of streams.
    Mr. Pizarchik. The definition of streams that we're working 
on is to give further effect to the Surface Mining Control and 
Reclamation Act. It is replete with provisions about protecting 
the public, about protecting the natural resources, about 
protecting streams and the environmental resources out there.
    This is not something that's new. We're still in the 
process of developing. We don't have anything out there for 
folks to oppose yet, because we haven't proposed anything. We 
expect to be able to propose the rule in the spring.
    Senator Paul. I would suggest that everybody in your office 
read the Scalia definition of what a navigable water is, and 
that we get some clarification from the Supreme Court.
    We will continue to fight this. This is going to come up 
again, but we do need to define what a stream is, and any area 
where water runs off should not be considered to be a stream.
    The Chairman. Senator Risch.
    Senator Risch. Thank you, Mr. Chairman.
    Gentlemen, how many of you are attorneys?
    Mr. Pizarchik. I'm an attorney.
    Senator Risch. One, 2. No? You did take civics, I assume.
    Mr. Abbey. I did.
    Senator Risch. OK. Good.
    You know, I could almost overlook this whole thing if you 
guys were just run-of-the-mill bureaucrats, but, you know, this 
country has gotten to the point where the constitutional 
provision, which is a foundation of this country, that 
establishes 3 branches of government has just been totally 
ignored by the bureaucracy.
    So far this year, Congress has passed about 1,000 pages of 
legislation. The bureaucracy's passed about 70,000 pages of 
rules and regulations, which have the force of law. The line of 
who is legislating here has just gone out the window.
    But when you do something like this that is so blatant, 
that is so clearly a violation of a congressional law, you've 
got to say, What are we doing here? Why bother have a Congress? 
Why not just have the judicial branch and the executive branch?
    In 1970, Title 30 U.S.C. 1201 et sequens was passed by the 
U.S. Congress. Now, with the stroke of a pen, what you're doing 
is you're saying, yes, Congress set this office up and created 
for this organization within the BLM, but you know what? It's 
only Congress. It's only a law. We'll just, with the stroke of 
a pen, change it, because, after all, this was done back under 
the Carter administration and who's going to notice? Besides 
that, who cares, other than Congress?
    Gentlemen, we care. We really, really believe that the 
legislative branch is in charge of legislating and that you 
guys are in charge of executing what the legislative branch 
legislates. You're not in charge of legislating.
    So we don't have any coal in Idaho, and I understand that 
that's primarily what OSM does. But we do have other forms of 
mining in Idaho, and, frankly, this has worked since 1977 
relatively well.
    If you wanted to change it, this is really, really simple. 
You come up here with a bill, and you say, This is what we want 
to do. These are the reasons we want to do it. Congress, we 
know you created our agency. Congress, we know we are subject 
to the laws that you pass, so would you consider changing the 
way that we're doing things at the BLM?
    But you didn't do that, and, frankly, I'm as disgusted as 
anybody is on this committee with what you've done.
    Thank you, Mr. Chairman.
    The Chairman. As you can tell, there's a certain level of 
angst around the committee about the proposal.
    Senator Murkowski, did you have additional questions? If 
not, we can go to Panel 2.
    Thank you all very much for being here, and I hope you'll 
stay in close touch with us as to future developments with 
this.
    Mr. Hayes. We will. Thank you.
    The Chairman. Why don't we call Panel 2 forward. Let me 
just introduce the panel members. Mr. Butch Lambert is the 
Deputy Director with the Virginia Department of Mines, Minerals 
and Energy. He will be testifying on behalf of the Interstate 
Mining Compact Commission and the National Association of 
Abandoned Mine Land Programs.
    Mr. John Corra--Senator Barrasso, I gather, was going to 
make an introduction of him, but he is not here at this point.
    Any rate, he is the Director of the Wyoming Department of 
Environmental Quality, testifying on behalf of the State of 
Wyoming and the Reclamation Committee of the Western Interstate 
Energy Board.
    Mr. Patrick McGinley is Professor with West Virginia 
University College of Law in Morgantown, West Virginia.
    Ms. Katie Sweeney is General Counsel with Legal and 
Regulatory Affairs in the National Mining Association here in 
Washington.
    Ms. DarAnne Dunning is with the Western Organization of 
Resource Councils in Helena, Montana.
    Thank you all very much for being here. I think what we'll 
do is to follow our normal practice of each of you take 5 
minutes and tell us the main points you think we need to 
understand from your perspective and then we will have some 
questions.
    Mr. Lambert.

  STATEMENT OF BRADLEY C. ``BUTCH'' LAMBERT, DEPUTY DIRECTOR, 
 VIRGINIA DEPARTMENT OF MINES, MINERALS AND ENERGY, TESTIFYING 
 ON BEHALF OF THE INTERSTATE MINING COMPACT COMMISSION AND THE 
      NATIONAL ASSOCIATOIN OF ABANDONED MINE LAND PROGRAMS

    Mr. Lambert. Good morning. My name is Butch Lambert, and I 
serve as the Deputy Director of the Virginia Department of 
Mines, Minerals and Energy.
    I'm appearing today on behalf of the Interstate Mining 
Compact Commission and the National Association of Abandoned 
Mine Land Programs.
    Our member states implement regulatory programs under the 
Surface Mining Control and Reclamation Act and work closely and 
cooperatively with the Federal Government under the Federal 
Land Policy and Management Act.
    We are intimately familiar with and work in close 
partnership with the Office of Surface Mining and the Bureau of 
Land Management.
    We appreciate the opportunity to weigh in on a 
consolidation of these 2 Federal agencies and on the potential 
impacts this action will have for State governments.
    As you know, Mr. Chairman, the State plays a central role 
in implementation and administration of SMCRA. Congress 
specifically provided for a primacy approach under the law, 
whereby the States were to be the front-line, exclusive 
regulatory authorities upon approval of State program by OSM.
    The States also implement programs for the reclamation of 
lands impacted by pre-1977 mining operations that were 
abandoned or inadequately reclaimed.
    Secretarial Order No. 3315 would consolidate the OSM within 
the BLM. This secretarial order will have a significant 
implication for State governments who implement regulatory 
programs under SMCRA.
    Given that the States were never informed, much less 
consulted about this consolidation, the Secretary's order 
raises more questions than it answers for us. Among the most 
important of these are the following:
    How will the consolidation impact the role of the States 
under SMCRA, especially in terms of grant funding?
    How will the consolidation affect the current chain of 
command within the Interior, especially with regard to the 
Federal oversight of State programs?
    How does Interior intend to reconcile the differing 
missions of BLM and OSM under the various organic laws affected 
by this consolidation?
    How will this consolidation save money and achieve 
government efficiency?
    Without answers to these most basic of questions, the 
States are at a significant disadvantage in commenting on the 
consolidation.
    Given the recent departmental decisions on other mining-
related issues, we also have serious concerns about the 
motivations behind this consolidation.
    Beginning with the signing of the June 2009 Memorandum of 
Understanding between the Interior Department, the 
Environmental Protection Agency and the U.S. Army Corps of 
Engineers regarding the Appalachian coal surface-mining 
operations, and extending to the recent budget and deficit-
reduction proposals to completely reform the AML program, the 
States have been unable to ascertain the reason and the basis 
for their departmental actions that directly impact the State 
and Federal relationship under SMCRA.
    Our desire, as partners with OSM and BLM, is to work 
cooperatively with these agencies to accomplish our respective 
roles and responsibilities under national, environmental and 
land-management laws.
    However, if we are cut out of the process from the very 
outset, it is difficult to fully engage, especially once 
decisions like this consolidation are a done deal.
    The reorganization is particularly troublesome in terms of 
what it may mean for the operation of several key provisions 
under SMCRA, including inspection, enforcement and the AML 
program.
    Even if OSM continues in some sort of independent role, we 
are uncertain what the lines of authority will be, especially 
in the field. The States have enjoyed and benefited from a good 
working relationship with OSM regional and field offices and we 
are hopeful that this can be maintained.
    Given the complexities associated with the regulation of 
active mining operations, a comprehensive understanding of 
State programs and the nuances are each critical.
    With regard to the AML program, we are even more 
circumspect about the potential impacts from the consolidation. 
Already, this program has been under attack by the 
administration as a recent budget deficit proposal.
    I would like to submit for the record this morning a copy 
of the letter that the IMCC and the AML Association recently 
sent to the Super Committee regarding the implications of this 
proposal for the State AML programs.
    The Chairman. We will include that in the record.
    Mr. Lambert. Thank you, sir.
    We are concerned that this consolidation would be a further 
attempt to implement all or part of the proposal under the 
banner of government efficiency.
    An area of particular concern under this consolidation is 
the impact it would have on training and technical assistance. 
This is one of OSM's key responsibilities under SMCRA.
    Given the increasing number of retirements at both the 
State and the Federal levels and the need to train new 
employees who may have limited knowledge of SMCRA and its 
regulatory framework, the OSM training program is a critical 
link to effective regulation. We would not want to see this or 
the OSM TIPS program eliminated or unduly constrained under the 
consolidation.
    Mr. Chairman, as we learn more details about the 
consolidation, we look forward to working jointly with OSM and 
BLM to ascertain the appropriate programs and administrative 
efficiencies that can be gained without undermining the 
separate and distinct regulatory and statutory responsibilities 
under these 2 laws.
    Thank you for this opportunity. I'll be happy to answer any 
questions or provide further information.
    [The prepared statement of Mr. Lambert follows:]

 Prepared Statement of Bradley C. ``Butch'' Lambert, Deputy Director, 
Virginia Department of Mines, Minerals and Energy, Testifying on Behalf 
                                   of

    Good morning. My name is Butch Lambert and I serve as Deputy 
Director of the Virginia Department of Mine, Minerals and Energy. I am 
appearing today on behalf of the Interstate Mining Compact Commission 
(IMCC) and the National Association of Abandoned Mine Land Programs 
(NAAMLP).
    The Interstate Mining Compact Commission (IMCC) is an organization 
of 24 states located throughout the country that together produce some 
95% of the Nation's coal, as well as important hardrock and other 
noncoal minerals. Each IMCC member state has active mining operations 
as well as numerous abandoned mine lands within its borders and is 
responsible for regulating those operations and addressing mining-
related environmental issues, including the reclamation of abandoned 
mines.
    The NAAMLP is a tax-exempt organization consisting of 30 states and 
Indian tribes with a history of coal mining and coal mine related 
hazards. These states and tribes are responsible for 99.5% of the 
Nation's coal production. All of the states and tribes within the 
NAAMLP administer abandoned mine land (AML) reclamation programs funded 
and overseen by the Office of Surface Mining (OSM) pursuant to Title IV 
of the Surface Mining Control and Reclamation Act (SMCRA, P.L. 95-87).
    IMCC and NAAMLP member states represent a cross section of the 
country and many implement regulatory programs under SMCRA and work 
closely and cooperatively with the federal government under the Federal 
Land Policy and Management Act (FLPMA). As such we are intimately 
familiar with and generally work in partnership with the Office of 
Surface Mining Reclamation and Enforcement (OSM) and the Bureau of Land 
Management (BLM). We therefore appreciate the opportunity to weigh in 
on the consolidation of these two federal agencies and the potential 
impacts that this action will have for state governments.
    As you know, Mr. Chairman, the states play a central role in the 
implementation and administration of SMCRA. Congress specifically 
provided for a ``primacy'' approach under the law, whereby states were 
to be the front line, exclusive regulatory authorities upon approval of 
a regulatory program by OSM. To date, 24 states have received primacy 
under SMCRA and continue to operate first-class regulatory programs 
that protect the public and the environment from the impacts of coal 
mining operations. The states also implement programs for the 
reclamation of lands impacted by pre-1977 mining operations that were 
abandoned or inadequately reclaimed.
    OSM was established as an independent federal agency charged with 
implementing and administering several distinct responsibilities under 
SMCRA, as specifically delineated in Section 201 of the Act. Among 
those are reviewing and approving or disapproving state programs and 
assisting the states in the development of those programs. Section 705 
also authorizes OSM to make annual grants to states for the purpose of 
administering and enforcing state programs and to cooperate with and 
provide assistance to states for the purpose of assisting them in the 
development, administration and enforcement of their programs, 
including technical assistance and training. Significantly, for 
purposes of this hearing, Section 201 (b) of SMCRA provides that no 
legal authority, program or function in any federal agency which has as 
its purpose promoting the development or use of coal or other mineral 
resources or regulating the health and safety of miners shall be 
transferred to OSM.
    Secretarial Order No. 3315, issued on October 26 and which is the 
subject of this hearing, would consolidate the OSM within the BLM in an 
effort to ``integrate the management, oversight, and accountability of 
activities associated with mining regulation and abandoned mine land 
reclamation, ensure efficiencies in revenue collection and enforcement 
responsibilities, and provide independent safety and environmental 
oversight of these activities.'' Clearly, by its own terms, this 
secretarial order will have significant implications for state 
governments who implement regulatory programs under SMCRA. Given that 
the states were never informed, much less consulted, about this 
``consolidation'', the Secretary's order raises more questions than it 
answers for us. Among them are the following:

   Why were the states not consulted about this matter since 
        they are the primary stakeholders under the various organic 
        laws affected by this consolidation? How and when does Interior 
        plan to consult with the states and tribes to receive their 
        input on the consolidation and what it may mean for state/
        federal interaction under both SMCRA and the federal land 
        management laws?
   How will the consolidation impact the role of the states 
        under SMCRA, especially in terms of funding for state Title V 
        (regulatory grants) and Title IV (AML grants)? How will it 
        specifically impact the administration of the AML program under 
        Title IV of SMCRA? Does it reflect a further attempt to 
        accomplish by Secretarial order what the President has proposed 
        for the AML program as part of his deficit reduction plan?
   How will the consolidation affect the current chain of 
        command within the Interior Department, especially with regard 
        to federal oversight of state programs? How could this 
        consolidation impact the cooperative working relationship that 
        has generally attended the implementation of SMCRA and FLPMA? 
        Who will have primary lead responsibility for the new 
        organization--BLM or OSM? How can a ``consolidation'' result in 
        the continued viability of two separate agencies, as suggested 
        by some of the press materials distributed by Interior?
   How does Interior intend to reconcile the differing missions 
        of BLM and OSM under the various organic laws affected by the 
        consolidation?
   How will this consolidation save money and achieve 
        governmental efficiency, other than the potential for combining 
        some administration functions? Will the combination of other 
        functions (inspection, enforcement, oversight) actually result 
        in the expenditure of more money, especially if the federal 
        government assumes responsibilities that were formally 
        entrusted to the states?
   Does Interior anticipate that changes will be needed to the 
        organic acts affected by the consolidation?
   What is the legal basis for the consolidation? Has the 
        Solicitor's Office rendered an opinion on the matter?
   BLM's primary mandate for its entire existence has been on 
        the management of public lands in western states. How can the 
        agency effectively shift to managing mining operations on state 
        and private lands in the central and eastern portions of the 
        country? How will this save money?

    Without answers to these most basic of questions, the states are at 
a significant disadvantage in commenting on the consolidation. We hope 
in the near future to receive answers to these questions and thereafter 
to provide more detailed, specific input. We have been told that the 
states will be consulted some time after December 1 (the effective date 
of the Secretarial Order). However, given recent Departmental decisions 
on other mining-related issues, we have serious concerns about the 
motivations behind this consolidation. Beginning with the signing of 
the June 2009 Memorandum of Understanding between the Department, the 
Environmental Protection Agency and the U.S. Army Corps of Engineers 
regarding Appalachian surface coal mining operations and extending to 
the recent budget and deficit reduction proposals to completely reform 
the AML program, the states have been unable to ascertain the reason 
and basis for Departmental actions that directly impact the state/
federal relationship under SMCRA. On several occasions we have 
requested opportunities to discuss the motivation behind these critical 
decisions and actions so that we can better respond to the policies and 
rules that have grown out of the MOU--especially the significant 
revisions to federal oversight of state programs under SMCRA and OSM's 
anticipated proposed rule on stream protection. At every turn, we have 
been ignored and our input has been restricted to the formal commenting 
process that attends the actions.
    Our desire as state partners with OSM and BLM is to work 
cooperatively with these agencies, as we have on many occasions in the 
past, to accomplish our respective roles and responsibilities under 
national environmental and land management laws. However, if we are cut 
out of the process from the very outset, it is difficult to fully 
engage--especially once decisions, like the consolidation, are a fete 
accompli. We are at a loss to understand why the Department, and OSM in 
particular, is loathe to bring the states into the early decision-
making process on initiatives that directly impact the state/federal 
partnership. We are not just another set of stakeholders under laws 
like SMCRA--we are the primary regulatory authorities. Without us, the 
laws do not work. We have proven time and again that when we work 
cooperatively together as partners, we can accomplish much--and do so 
effectively and efficiently.
    The consolidation is particularly troublesome in terms of what it 
may mean for the operation of several key provisions under SMCRA, 
including inspection, enforcement, and the AML program. BLM is not 
solely a regulatory agency, like OSM. Even if OSM continues in some 
sort of independent role (yet to be articulated), we are uncertain what 
the lines of authority will be--especially in the field. The states 
have enjoyed and benefited from a fairly good working relationship with 
OSM regional and field offices and we are hopeful this can be 
maintained. Given the complexities associated with the regulation of 
active mining operations, especially in various geographical regions 
across the country, a comprehensive understanding of state programs and 
the nuances of each is critical. In some respects, it has taken the 
better part of 30 years to achieve the working relationship we 
currently have with OSM field and regional offices. BLM is not likely 
to possess this level of experience or expertise.
    With regard to the AML program, we are even more circumspect about 
the potential impacts from the consolidation. Already, this program has 
been under attack by the Administration, as evidenced by the recent 
deficit reduction proposal and the FY 2012 proposed budget. I would 
like to submit for the record a copy of a letter that IMCC and the AML 
Association recently sent to the Supercommittee regarding the 
implications of this proposal for state AML programs. We are concerned 
that this consolidation would be a further attempt to implement all or 
part of this proposal under the banner of ``government efficiency''. As 
we note in our letter, the changes to the AML program being proposed by 
the Administration amount to a wholesale revision of Title IV of SMCRA 
and those decisions are best made by your Committee and others in 
Congress.
    We are concerned that the consolidation could also serve as a 
mechanism for diluting the AML program under SMCRA, including a 
diversion of funding from the Trust Fund for other priorities. Even 
though this appears to be precluded by the language of SMCRA, there are 
ways in which funding can be diverted along the way, or lost due to 
additional bureaucratic complexities that do not exist at the present 
time. While BLM has administered a limited hardrock AML program, which 
in many ways has been dependent on the states for its effectiveness, 
the size and complexity of the AML program under SMCRA dwarfs the BLM 
program. Bringing it under the BLM banner, even for administrative 
efficiencies, could undermine the overall quality of the program. 
Again, we need to know more about what the Department has in mind with 
respect to how this program would be incorporated into the BLM before 
we can comment on the specifics. There is the potential for combining 
and administering the two programs in a way that would preserve the 
coal AML program under SMCRA while enhancing BLM's hardrock AML 
program, both in the way of administrative efficiencies and funding 
allocations. But this will take considerable planning and discussion 
and hence the need for expanded consultation with the states and 
tribes.
    An area of particular concern under the consolidation is the impact 
it would have on training and technical assistance. This is one of 
OSM's key responsibilities under SMCRA and it has paid significant 
dividends over the years in terms of support for the states and tribes. 
Given the increasing number of retirements at both the state and 
federal levels and the need to train new employees who may have limited 
knowledge of SMCRA and its regulatory framework, the OSM training 
program is a critical link to effective regulation. And as we move into 
more complex technical issues surrounding the implementation of SMCRA, 
the assistance OSM provides to the states, particularly through its 
Technical Innovation and Professional Services (TIPS) program, is also 
of great importance. We would not want to see any of these program 
activities eliminated or unduly constrained under the consolidation.
    One of the hallmarks of both SMCRA and FLPMA over the years has 
been the ability of the states and the federal government to work well 
together, especially at the field/state and regional levels. We are 
hopeful that this can continue and that as we learn more about the 
details of the consolidation, we can work jointly to ascertain where 
program and administrative efficiencies can be gained without 
undermining the separate and distinct statutory responsibilities under 
these two laws. We doubt that this can be accomplished without 
maintaining an independent role for OSM that preserves the 
congressionally mandated relationship between OSM and the states. Given 
our experience with past reorganizations that have led to some Interior 
agencies being completely subsumed by others, as occurred with the U.S. 
Bureau of Mines, we have serious reservations about the current 
process. As a result, we encourage your close oversight of this 
reorganization to insure that the purposes, objectives and mandates of 
SMCRA and FLPMA are not lost in the shuffle.
    One of the stated goals of the consolidation is to save money for 
the American taxpayer through administrative and programmatic 
efficiencies. We see this as a worthy goal, and one that the states not 
only share, but have consistently worked toward in the context of their 
own program operations. This is one of the reasons that we have opposed 
a recent revision to OSM's directive regarding the use of Ten-Day 
Notices (TDNs) in primacy states. Directive INE-35 authorizes the use 
of TDNs to communicate alleged defects in state-issued permits, 
contrary to the intent of SMCRA. Each time OSM utilizes a TDN in this 
fashion to second-guess a state permitting decision, it results in the 
considerable expenditure of state resources to respond to the TDN (as 
well as federal resources to review the state response). Given that 
states already have formal mechanisms in place for the appeal of their 
permitting decisions by state courts and administrative bodies, this 
federal process results in a duplicative, wasteful expenditure of 
valuable state and federal resources.
    OSM's oversight directive (REG-8) also results in a duplication of 
effort by requiring independent inspections of surface coal mining 
operations in primacy states, rather than engaging in joint inspections 
with the states. OSM has recently re-assigned at least 18 FTEs to this 
effort, resulting in unnecessary expense with little to show in the way 
of programmatic benefit. The House Interior Appropriations 
Subcommittee, in its report on the FY 2012 budget proposal, recently 
chastised OSM for this wasteful spending, noting that: ``The Committee 
also rejects the proposal to increase inspections and enhanced Federal 
oversight of State regulatory programs. Delegation of the authority to 
the States is the cornerstone of the surface mining regulatory program. 
The Committee believes the President's proposal to increase Federal 
inspections would not only be a redundant activity, but also 
duplicative and wasteful spending. The State regulatory programs do not 
need enhanced Federal oversight to ensure continued implementation of a 
protective regulatory framework.'' If Interior is serious about saving 
money, this would be a good place to start.
    Finally, the importance of maintaining OSM as an independent agency 
cannot be overlooked. At the time that SMCRA was being debated in 1977, 
Congress was well aware of the importance of maintaining distinct roles 
and responsibilities among and between agencies that had as their 
mission the development of mineral resources, as compared to the 
protection of the public and the environment from mineral development, 
as well as those who mine those resources. FLPMA, SMCRA and the Mine 
Safety and Health Act were all passed within about a 12 month period of 
time by the 94th and 95th Congresses. The framers of these statutes 
were clearly concerned about the separation of the sometimes competing 
interests that attended mineral development.
    In addressing the creation of OSM under Title II of the Surface 
Mining Act, the Senate had this to say: ``The Office will be separate 
from any of the Department's existing bureaus or agencies. It is 
intended that the Office exercise independent and objective judgment in 
implementing the Act. . . . The Act specifically states that there 
cannot be transferred to the Office any legal authority which has as 
its purpose promoting the development or use of coal or other 
minerals.'' (S. Report No. 95-128 at pages 63-64). At about this same 
time, the Senate also reported out the Mine Safety and Health Act and 
in its report the Senate stated: ``The history of the Interior 
Department's enforcement of [the Coal Act and the Metal Act], either by 
the Bureau of Mines or by the Mining Enforcement and Safety 
Administration (MESA), demonstrated a basic conflict in the missions of 
the Department. In past years, the Department has pursued the goal of 
maximizing production in the extractive industries, which was not 
wholly compatible with the need to interrupt production, which is the 
necessary adjunct of the enforcement scheme under the Metal and Coal 
Acts. . . . On the other hand, no conflict could exist if the 
responsibility for enforcing and administering the mine safety and 
health laws was assigned to the Department of Labor, since that 
Department has as its sole duty the protection of workers and the 
insuring of safe and healthful working conditions.'' (S. Report No. 95-
181 at page 5).
    The importance of separating out the respective missions, duties 
and roles of OSM and BLM continues today. From the states' perspective, 
to ignore the original intent of Congress for establishing these 
independent agencies would potentially undermine the carefully crafted 
statutory design and unduly upset the balance of powers and authorities 
between those agencies. It would also impact the state/federal 
relationship envisioned by SMCRA. We believe there are ways that 
Interior can accomplish the administrative efficiencies that it desires 
without running afoul of the statutory purposes of SMCRA and FLPMA and 
compromising the roles of OSM, BLM and the states under those statutes. 
We stand ready to work cooperatively with both OSM and BLM to further 
discuss the appropriate mechanisms to accomplish this objective.
    Thanks again for the opportunity to appear before you today. I 
would be happy to answer any questions you may have or to provide 
further information.

    The Chairman. Thank you very much.
    Before you go ahead, Mr. Corra, let me just call on Senator 
Barrasso if he wanted to make any introductory comment.
    Senator Barrasso. Thank you, Mr. Chairman, I would. I want 
to thank you again for inviting John Corra, the Director of the 
Wyoming Department of Environmental Quality, to be with us and 
to testify here today.
    John Corra is a trusted and highly esteemed public servant. 
He's also a good friend. We were classmates in something called 
Leadership Wyoming about a decade ago.
    John was originally appointed as the Director of Wyoming's 
DEQ in 2003 by Governor Dave Freudenthal, a Democrat, and he 
served during the entire 8 years, the 2 terms, for Governor 
Freudenthal.
    Subsequently, John was reappointed as the Director by 
Wyoming's current Governor, Matt Mead, a Republican. So John is 
an individual with vast experience in regulating mineral 
development. He's also someone who knows how to strike the 
right balance between environmental protection and mineral 
production.
    Under John's leadership and stewardship, the Wyoming 
Department of Environmental Quality has shown how States can be 
effective regulators. Frankly, I wish we had more people like 
John here in Washington.
    John, it's a pleasure to have you here today, and I look 
forward to your testimony.
    Thank you, Mr. Chairman.
    The Chairman. Mr. Corra, you come very well recommended. Go 
ahead.

   STATEMENT OF JOHN CORRA, DIRECTOR, WYOMING DEPARTMENT OF 
                     ENVIRONMENTAL QUALITY

    Mr. Corra. Thank you, Mr. Chairman. Senator Barrasso, very 
kind words.
    I want to start by thanking the committee for inviting the 
State of Wyoming to testify today. I'm also here to represent 
the views of the Reclamation Committee of the Western 
Interstate Energy Board, which includes Utah, Colorado, New 
Mexico and Montana, who, along with Wyoming, produce over half 
of the nation's coal supply.
    Wyoming is a unique State in that we are the nation's 
leading exporter of energy. Mineral development accounts for 
about two-thirds of our State's economic well being.
    We have outstanding natural-resource values, both in terms 
of mineral development and in terms of scenic beauty. Our 
challenge, then, is to manage the development and use of these 
racehorses in wise ways.
    Now, an inextricable part of this challenge is the 
relationship with our Federal partners who own 48 percent of 
the land surface and 67 percent of the mineral estate in 
Wyoming.
    Thus, we have a keen interest in the recent announcement by 
Secretary Salazar to combine 2 Federal agencies that play a key 
role in the development and preservation of the natural 
resources in our State.
    This consolidation is a significant reorganization effort 
that has greater potential for failure than success unless 
serious consideration is given to the crucial role that States 
play in the accomplishment of the very diverse missions of the 
Bureau of Land Management and the Office of Surface Mining. 
Consultation with the States is essential to achieve positive 
outcomes that meet the goals of Secretary Salazar's recent 
order.
    We've got a long history working very well with our local 
counterparts in both the BLM and the OSM. Our expertise in 
wildlife, agriculture and environmental management are critical 
to quality decisionmaking on their part. Our relationship with 
local management in the Federal Government is professional and 
it's collaborative.
    Effective mining regulation and reclamation is achieved at 
a significant savings to the Federal Government as States 
provide nearly all the staff required to administer SMCRA at 
coalmining operations, and we provide staff to assist the OSM 
to regulate non-coalmining and the management of reclamation of 
abandoned mines in the State, both coal and non-coal.
    This arrangement has been highly successful. In fact, OSM 
agrees, as can be seen in annual OSM evaluations of the State 
programs.
    OSM's role must be viewed in contrast with our interactions 
with the BLM, whose mission is to manage the public lands in a 
manner that recognizes the nation's need for domestic 
resources.
    BLM's statutory mandate under the Federal Land Policy and 
Management Act relates to multiple use and sustained yield 
through resource management and land planning. They do have 
some limited regulatory functions and they collect royalties 
and other fees.
    Regarding coalmining, their primary role is one of assuring 
resource recovery and maximizing revenue. While they conduct 
environmental assessments in this process, their role is much 
different than a regulatory review of an application for a 
permit to mine.
    Not the least of our many questions concerning the proposed 
merger is how this obvious conflict of interest with the role 
of OSM can be reconciled.
    Additionally, under FLPMA, the States are not allowed the 
opportunity for primacy and are left to negotiate memoranda of 
understanding that outline the role we play in managing 
minerals.
    We have questions about whether the merger can be completed 
without changes to the organic acts that govern both agencies. 
If this merger is intended to only simplify certain 
administrative procedures, we might be less interested in the 
outcome.
    However, if it is about implementing what we believe to be 
poorly thought-out ideas, such as consolidating abandoned mine 
land reclamation at the Federal level and taking away fees from 
certified States and tribes, we will be in serious and 
substantial disagreement.
    If the merger is also intended to change the way the States 
obtain authority to regulate--for example, from one that is 
spelled out clearly in rules to one that is really the best 
deal we can negotiate through an MOU--the States will be 
severely impacted.
    Our concerns are further heightened by the many attempted 
unilateral impositions by OSM over the past year or 2. To name 
just a few, the expansion of the 10-day notices to apply to 
permits that are issued by the States, a nationwide expansion 
of a negotiated settlement with other Federal agencies on the 
stream protection rule and what appears to be a push to require 
States to charge fees to recover the costs associated with 
regulatory programs.
    We are on record with our concerns over the development of 
the environmental impact statement for the stream protection 
rule, and many of these concerns are directly related to our 
anxiety over how this merger process will proceed.
    This includes the fact that the purpose and need for the 
stream protection rule was never clearly articulated, nor was 
it vetted with the States. The action was so hurried that a 
careful consideration of how the rulemaking would interfere 
with other Federal and State authorities was totally lacking.
    So we really ask what is the vision for the merger? We 
would also like to see the business case. No consolidation 
should occur until these and other issues affecting the States 
have been resolved.
    In closing, we understand that there is a need to 
streamline the way Federal Government does business and achieve 
economies of scale wherever possible. We just simply want to 
avoid the law of unintended consequences and any further 
burdens and unfunded mandates that might be placed on the 
States.
    There is great potential for damage to be done to the 
states with no rationale presented to date on how we might gain 
from this merger.
    Again, thank you very much, Mr. Chairman, for the 
opportunity to speak today.
    [The prepared statement of Mr. Corra follows:]

   Prepared Statement of John Corra, Director, Wyoming Department of 
                         Environmental Quality

    My name is John Corra. I am the Director of the Wyoming Department 
of Environmental Quality. I wish to thank the Committee for inviting 
the State of Wyoming to testify at this hearing today. Wyoming coal 
mines produced 442 million tons of coal in 2010, over 40% of the 
nation's total production. I am also here to present the views of the 
Reclamation Committee of the Western Interstate Energy Board, which 
includes Utah, Colorado, New Mexico and Montana, who along with Wyoming 
are produce over half of the nations coal supply.
    Wyoming is a unique state in that we are the nation's leading 
exporter of energy, and stand to increase this position as renewable 
energy resources such as wind power are developed. We have outstanding 
natural resource values, both in terms of mineral development and in 
terms of scenic beauty. Our natural resources largely define both the 
``why'' and the ``how'' we live in Wyoming. Mineral development 
accounts for two thirds of the state's economic well-being. It is 
critical that we manage the development and use of these resources in a 
way that serves our various interests.
    An inextricable part of this challenge is the relationship with our 
federal partners, as evidenced by an ownership situation where the 
federal government owns 48% of the land surface and 67% of the mineral 
estate in Wyoming. We do not control all of the elements of energy 
development yet we believe in our inherent right to control our 
destiny. Thus we have a keen interest in the recent announcement by 
Secretary Salazar to combine two federal agencies that play a key role 
in the development and preservation of the natural resources in our 
state. This consolidation is a significant reorganization effort that 
has greater potential for failure than success unless serious 
consideration is given to the crucial role that states play in the 
accomplishment of the very diverse missions of the Bureau of Land 
Management (BLM) and the Office of Surface Mining (OSM).
    Communication, collaboration and consultation with the states are 
not only crucial, but are also essential to achieving positive outcomes 
that meet Secretary Salazar's goals articulated in his Order. We have a 
long history of working very well with our local counterparts in both 
the BLM and the OSM. I can't stress that enough. Over the past few 
years, and continuing today, the BLM has been updating their Resource 
Management Plans and conducting environmental assessments on a number 
of large energy development projects. The quality of these assessments 
is high, and a direct result of working closely with the state. Our OSM 
point of contact serves the state very well while also fulfilling the 
mission of the Surface Mining Control and Reclamation Act (SMCRA).
    The relationship we have with the OSM personnel who are on the 
ground in Wyoming and in other western states is based on the policy 
and purposes of SMCRA including the federal responsibility to assist 
States in developing and implementing a program that will achieve the 
goals and purposes of SMCRA, which are to protect society and the 
environment from the adverse effects of surface and underground coal 
mining operations. The federal entity retains oversight and the terms 
and conditions of the relationship have been well refined over thirty 
years. Examples of highly valuable contributions from OSM are the 
Technical Information and Professional Services program, training, and 
the facilitation of sharing best practices across the nation. The value 
of the states and the critical role played by States and Tribes is 
acknowledged and highlighted even by OSM. The OSM mission statement 
includes the statement that ``Our mission is to carry out the 
requirements of the Surface Mining Control and Reclamation Act (SMCRA) 
in cooperation with States and Tribes.'' OSM also highlights this 
relationship in their Vision Statement: ``In cooperating with State 
regulatory authorities, the primary enforcers of SMCRA, and with 
Tribes, we will promote a shared commitment to the goals of the Act.'' 
Of interest are the positive references to the relationship between 
States and Tribes as noted prominently on the OSM website. One 
reference reads: ``The Bureau, usually referred to simply as the Office 
of Surface Mining or OSM, was created in 1977 when Congress enacted the 
Surface Mining Control and Reclamation Act. OSM works with State and 
Indian Tribes to assure that citizens and the environment are protected 
during coal mining and that the land is restored to beneficial use when 
mining is finished. OSM and its partners are also responsible for 
reclaiming and restoring lands and water degraded by mining operations 
before 1977.'' Another reference highlights the successes that have 
been achieved: ``Although a small Bureau, OSM has achieved big results 
by working closely with those closest to the problem: the States, 
Tribes, local groups, the coal industry and communities.'' The States 
and Tribes have had the overwhelming share of SMCRA Title IV and Title 
V implementation duties for many years and that fact must be central to 
any discussion of consolidation. The leadership role played by States 
and Tribes in partnership with the OSM has resulted in a very 
successful record of implementing and managing mining regulatory 
programs associated with both active mining operations and abandoned 
mine lands.
    OSM's role must be viewed in contrast with our interactions with 
the BLM, whose mission is to manage the public lands in a manner that 
recognizes the Nation's need for domestic sources of minerals, food, 
timber and fiber. BLM's statutory mandate under the Federal Land Policy 
and Management Act (FLPMA) relates to multiple use and sustained yield 
through resource management and land planning. They have some limited 
regulatory functions and they collect royalties and other fees. 
Regarding coal mining, their primary role is one of assuring resource 
recovery and maximizing revenue. While they conduct environmental 
assessments in this process, their role is much different than the 
regulatory review of an application for a permit to mine. Not the least 
of our many questions concerning the proposed merger is how this 
obvious conflict of interest with the role of OSM can be reconciled. 
Additionally, under FLPMA the states are not allowed the opportunity 
for ``primacy'', and are left to negotiate Memoranda of Understanding 
(MOU) that outline the role we play in managing minerals in Wyoming. We 
regulate the mining and reclamation of non-coal minerals while the BLM 
handles the mineral claims and royalties. We also provide the 
management and technical assistance necessary for BLM to conduct its 
non-coal abandoned mine reclamation efforts. Another question is under 
which model, that of an MOU or that of a primacy arrangement would best 
ensure that the intent of SMCRA is preserved.
    The current organization model appears to serve this purpose and 
avoids the types of conflict of interest issues that have been raised 
over the Deepwater Horizon oil spill in the Gulf of Mexico.\1\ While it 
is true that OSM collects fees, these are unrelated to both mine 
permitting and the sale of coal leases. If this merger was intended to 
simply consolidate the collection of fees and royalties, we might be 
less interested in the outcome. If it is about implementing what we 
believe to be poorly thought out ideas such as consolidating Abandoned 
Mine Land reclamation at the federal level and taking away fees from 
certified states and tribes, we would be speaking out in more 
affirmative ways. And, if the merger is also intended to change the way 
the states obtain authority to regulate, i.e. from one that is spelled 
out clearly in rules to one that is the best deal we can negotiate 
through an MOU, the states are severely impacted by the merger. Our 
concerns are further heightened by the many attempted unilateral 
impositions by OSM over the past year or two. To name just a few: the 
expanded use of ``Ten Day Notices'' to apply to permits issued by 
States; the nation-wide expansion of a negotiated settlement with other 
federal agencies on a stream protection rule; and what appears to be a 
push to require states to charge fees to recover the costs associated 
with their regulatory programs because OSM wants to reduce federal 
funding for the administration of Title V of SMCRA.
---------------------------------------------------------------------------
    \1\ Interestingly, in a recent description of the reorganization of 
the former Minerals Management Service, pursuant to which Interior has 
created three independent entities to better carry out the three 
missions of MMS, Interior stated that: ``In place of the former MMS, we 
are creating three strong, independent agencies with clearly defined 
roles and missions. MMS--with its conflicting missions of promoting 
resource development, enforcing safety regulations, and maximizing 
revenues from offshore operations and lack of resources--could not keep 
pace with the challenges of overseeing industry operating in U.S. 
waters. The reorganization of the former MMS is designed to remove 
those conflicts by clarifying and separating missions across three 
agencies and providing each of the new agencies with clear missions and 
additional resources necessary to fulfill those missions.'' We assert 
that this is exactly the type of thinking and analysis that attended 
the creation of OSM in 1977 and that it continues to hold true today.
---------------------------------------------------------------------------
    The States are thankful for the existence of very clear legal 
rights spelled out in SMCRA. While we have questions about whether the 
merger can be completed without changes to the organic acts that govern 
both the OSM and the BLM, we are clearly the ``stakeholder'' with the 
most to lose. In this regard, we note that President Clinton's 
Executive Order No. 13132 on Federalism, in referring to legislation, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government requires consultation with the States 
early in the process. It also requires a federalism impact statement be 
provided to the Office of Management and Budget consisting of a 
description of the extent of the agency's prior consultation with the 
States, a summary of the nature of State concerns and the extent to 
which those concerns have been met. Will this mandate be honored in a 
meaningful way?
    We also have tremendous expertise and experience that would inform 
the merger process, but have serious concerns about whether the OSM and 
BLM will take our ideas and input into consideration. We are on record 
with our concerns over the development of the Environmental Impact 
Statement (EIS) for the stream protection rule, but I must repeat the 
issues because they are directly related to our anxiety over how this 
merger process will proceed.

   The purpose and need for the SPR was never clearly 
        articulated nor was it vetted with the states.
   The process for gathering public input was flawed, as 
        witnessed in Wyoming where the public meeting was held the 
        night before the comment period ended, and the public was not 
        allowed to speak.
   Consultation with the states consisted of sending voluminous 
        sections of the EIS while allowing the states only days to 
        review and comment. Not once did the consultant meet with us to 
        seek our input and understand the differences between the East 
        and West.
   Most importantly, the action was so hurried that careful 
        consideration of how the rule making would interfere with other 
        federal and state authorities was totally lacking.

    We understand that there is a need to streamline the way the 
federal government does business, and achieve economies of scale 
wherever possible. A recent Memorandum of Agreement between the BLM and 
EPA regarding air impacts analysis purports to do this, and is an 
example of how the affected states were ignored until the negotiations 
were final.
    We simply want to avoid the law of unintended consequences and any 
further burdens and unfunded mandates being placed on our states. It is 
unfortunate that the order to consolidate the OSM and BLM has been 
issued without a thorough vetting with the affected states prior to any 
final decisions. In addition to the questions posed above, we also have 
the following concerns:

   How will the consolidation affect the existing productive 
        working relationship between OSM field personnel and state 
        program personnel?
   Will the consolidation affect the allocation of funds for 
        state coal mine regulatory programs?
   Will the consolidation affect the allocation of funds to 
        state abandoned mine land programs?
   Will the consolidation change the oversight of state 
        regulatory and AML programs?
   Are there better ways to improve government operations than 
        shuffling boxes on the Interior Department's organization 
        chart? For example, could actions be taken to enable the BLM to 
        benefit from the OSM's high successful TIPS program and 
        technology transfer programs with states?
   How much money could be saved by reducing waste at the OSM 
        caused by a management decision to turn regional or local 
        issues (e.g., mountaintop mining and revised stream protection 
        rules) into national issues which are not germane to most parts 
        of the country?
   How will the inevitable change in culture that follows a 
        consolidation of agencies with maximizing functions) affect 
        western state regulatory programs? The culture of the OSM out 
        West is for a single regional field office, overseeing several 
        states whereas the BLM culture is one where each state has not 
        only a state office but also many regional and local offices. 
        The hierarchical differences alone warrant a close look at how 
        work is done in each agency.
   Would a consolidation affect existing cooperative agreements 
        under which states regulate coal mining on federal lands? Would 
        a consolidation affect other agreements between western states 
        and DOI, such as agreements on the regulation of non-coal 
        mining on federal lands?
   Where will the ``savings'' from the consolidation be 
        realized?

    No consolidation should occur until these and other issues 
affecting states have been resolved through robust consultations 
between the Department of Interior (DOI) and Western states.
    In closing, OSM has stated the hope that we will offer constructive 
ideas. We look forward to the opportunity and hope it is not a rehash 
of our recent experience. Perhaps the consolidation process ultimately 
chosen by DOI will be guided by well known key steps to transforming 
organizations. These are well documented, but I cite here those 
presented by Mr. John P. Kotter in his 1995 Harvard Business review 
article, Why Transformation Efforts Fail and his 1996 book, Leading 
Change. Essentially these are establishing a sense of urgency, forming 
a powerful coalition, creating a vision, communicating the vision, 
empowering others to act on the vision, planning for and creating short 
term wins, consolidating improvements and institutionalizing the new 
approaches.
    We ask: What is the vision for this merger? What is the business 
case? And lastly, who is part of the guiding coalition? There is great 
potential for damage to be done to the states with no rationale 
presented to date on how we might gain from the merger. In one sense, 
the two agencies are already ``merged'' within the DOI. We would be 
greatly surprised if there were not already targeted areas for 
improvement. We ask that you urge the Secretary to immediately engage 
the states in his planning process.

    The Chairman. Thank you very much.
    Mr. McGinley, go right ahead.

  STATEMENT OF PATRICK C. MCGINLEY, PROFESSOR, WEST VIRGINIA 
           UNIVERSITY COLLEGE OF LAW, MORGANTOWN, WV

    Mr. McGinley. Thank you, Chairman Bingaman, Senator 
Murkowski, members of the committee, thank you for inviting me 
to participate in this hearing.
    Today, I have the privilege of appearing here to speak on 
behalf of coalfield citizens who were surprised--indeed, 
shocked--by the Secretary's proposal to bury the OSM within the 
huge Bureau of Land Management bureaucracy.
    I come here representing more than 30 groups, most of them 
grassroots organizations scattered throughout the coalfields. 
They include--I can't list them all--the Citizens Coal Council, 
the Foundation for Pennsylvania Watersheds, the Waterkeeper 
Alliance, West Virginia Highlands Conservancy, the National 
Wildlife Federation, the Environmental Integrity Project, the 
Powder River Basin Resource Council and the Cook Inlet Keeper.
    In the short time I have available, I'm going to truncate 
my remarks and summarize the objections to the Secretary's 
order and touch on just a few points that are elaborated on in 
my written remarks.
    I also want to address a few of the things that have been 
said here today in the hearing.
    Suffice it to say, and I think the committee, in asking its 
questions, the responses have focused on the fundamental 
problem with this order, which is that it is an attempt by the 
Secretary, through administrative action, to change the clear 
mandate of the organic statute, the Surface Mining Control and 
Reclamation Act of 1977. It is ultra vires. It raises serious 
separation-of-powers issues.
    Senator Risch, you alluded to that. I think that's really 
the core of the legislative history.
    Senator Bingaman, as you indicated, and Senator Murkowski, 
it is clear the integration or the comingling or the merger of 
OSM with BLM, with BLM's resource production and coal-leasing 
component is certainly problematic, given the clear legislative 
history in which the Senate report said that this office will 
be separate from any of the departments, existing bureaus or 
agencies. What could be more clear than that?
    I'll also briefly allude to the lessons learned with regard 
to the Minerals Management Service, also been mentioned briefly 
here.
    In May 2010, Secretary Salazar said the Minerals Management 
Service has 3 distinct and conflicting missions that must be 
divided for the benefit of effective enforcement, energy 
development and revenue collection.
    While the Secretary found it imperative to divide MMS, 
because of its conflicting responsibilities, Order 3315 tells 
us that consolidating OSM with a coal-leasing and royalty-
collection agency will ``ensure efficiencies and revenue 
collection and enforcement.'' The contradiction is obvious and 
inexplicable.
    The Secretary's order was conceived in a vacuum. That's 
clear from the questions and the responses the committee has 
heard today. I would point to some of the answers that 
Secretary Hayes gave:
    We are going to require careful analysis in planning. We 
believe there are cost savings. BLM has substantial interest in 
east of the Mississippi.
    If you look at the BLM website, you will see no reference 
to that.
    We want to explore putting BLM duties within OSM.
    There may well be synergies, but no study? No analysis of 
cost savings was done. It defies explanation how a move of this 
sort, effecting stakeholders, effecting an industry that 
produces coal that powers--provides 50 percent of the power in 
the United States, that no thought was given. All of the study 
and analysis, apparently, will occur between--or is beginning 
to occur between now and March 1.
    Finally, I noticed in Secretary Hayes' promise that DOI 
will, going forward, consult with Congress and with the 
industry. I note the absence of any reference to coalfield 
citizens, and, indeed, that is historically a problem with the 
Department of Interior and the Office of Secretary. This 
particular move to merge OSM with BLM is really beyond any 
point in terms of marginalization of OSM that has occurred in 
the past.
    We believe that the Secretary's order represents a failure 
to recognize and appreciate the mission Congress designed for 
OSM in America's coalfield communities.
    While we may all have differences at this table and in 
Congress with regard to the performance of OSM's 
responsibilities, it is clear from the long history that led up 
through 2 Presidential vetoes to the enactment of the 1977 act 
that the coalfield citizens who are coalminers, families of 
coalfield communities, they were a primary focus, as well as 
ensuring the Nation's coal production.
    A message the Congress, the 95th Congress sent in the 
enactment of the 1977 act appears not to have sunk in at the 
secretarial level. No communications. No consultation, and, as 
you notice, the rationalization for the consolidation of OSM 
into the Bureau of Land Management is justified totally on 
financial grounds, with no consideration of the impact of this 
merger on coalfield citizens, both in the east and in the west.
    Perhaps at the highest levels of the Department of the 
Interior, the controversy triggered by this ill-considered 
administrative action will give rise to a new understanding and 
appreciation of OSM's mission and a renewed respect for 
coalfield citizens.
    The Secretary should withdraw Order 3315.
    I would be glad to answer any questions or provide 
additional information that may be helpful to the committee.
    Thank you very much.
    [The prepared statement of Mr. McGinley follows:]

  Prepared Statement of Patrick C. McGinley, Professor, West Virginia 
               University College of Law, Morgantown, WV

    Chairman Bingaman, Senator Murkowski, and members of the Committee, 
thank you for inviting me to participate in this hearing on the 
Secretary of the Interior's Order No. 3315 to Consolidate and Establish 
the Office of Surface Mining Reclamation and Enforcement within the 
Bureau of Land Management.
    Since 1975, I have been a member of the West Virginia University 
College of Law faculty where I am presently the Judge Charles H. Haden 
II Professor of Law. Prior to this, I served as a Special Assistant 
Attorney General with Pennsylvania's Environmental Strike Force where I 
enforced laws regulating coal mining and mine safety prior to enactment 
of SMCRA.
    I grew up in the Western Pennsylvania coalfields as the grandson of 
a coal miner who worked in West Virginia and Alabama coal mines a 
century ago. My mother was born in Piper, a coal company town in the 
Cahaba coalfield of Bibb County, Alabama. From the time I joined the 
WVU faculty until the present, I have represented coalfield families 
and organizations in matters relating to SMCRA. I was honored to have 
served on then-Governor Manchin's Independent Investigation teams that 
reported on the Sago and Upper Big Branch mine disasters.
    Today, I have the privilege of appearing before the Committee to 
speak on behalf of coalfield citizens who were surprised and shocked by 
the Secretary's proposal to bury the Office of Surface Mining (``OSM'') 
within the behemoth bureaucracy of the Bureau of Land Management 
(``BLM'').\1\ Their opposition to Order No. 3315 is based upon the 
following:
---------------------------------------------------------------------------
    \1\ See Appendix ``A'' for list of those represented.

   Order No. 3315 violates SMCRA and contravenes Congress's 
        carefully crafted structure for regulating the adverse impacts 
        of surface and underground coal mining; it also conflicts with 
        the Department's long-standing interpretation of OSM's 
        relationship with the Office of the Secretary;
   The Secretary's action is precluded by the specific language 
        of the statute barring the Secretary from co-mingling employees 
        of any federal agency that ``promotes the development or use of 
        coal'' with OSM--a prohibition that clearly applies to the BLM;
   The Secretary's Order was conceived in a vacuum with no 
        prior notice or consultation with Congress, the coal industry 
        or coalfield citizens; rather than saving money and making both 
        agencies more efficient, the Order would create additional 
        costs and inefficiencies as well administrative chaos;
   Underlying Order No. 3315 is the Office of the Secretary's 
        profound miscomprehension of the role Congress designed for the 
        Secretary and OSM within SMCRA's structure.
   secretarial order no. 3315 violates the letter and spirit of smcra
    Congress carefully designed SMCRA to insure OSM would act as an 
independent entity within the Department of the Interior under the 
direct supervision of the Secretary. To accomplish this purpose, SMCRA 
Sec. 201 (b), 30 U.S.C. Sec. 1211(b) provides:

          The Office shall have a Director who shall be appointed by 
        the President, by and with the advice and consent of the 
        Senate, . . . The Director shall have the responsibilities 
        provided under subsection (c) of this section and those duties 
        and responsibilities relating to the functions of the Office 
        which the Secretary may assign, consistent with this Act.

    SMCRA subsection Sec. 201 (c), 30 U.S.C. Sec. 1211(c) mandates 
that:

          The Secretary, acting through the Office, shall

          (1) administer the programs for controlling surface coal 
        mining operations which are required by this Act; review and 
        approve or disapprove State programs for controlling surface 
        coal mining operations and reclaiming abandoned mined lands; 
        [and] make those investigations and inspections necessary to 
        insure compliance with this Act[ .] (emphasis added).

    The legislative history of SMCRA explicitly describes Congress's 
purpose in creating and placing OSM in the Department of the Interior:

          To insure administration of the program by an independent 
        agency with neither a resource development (the promotion of 
        mining, marketing, or use of minerals) or resource preservation 
        (pollution control, wilderness, or wildlife management) bias or 
        mission, this title establishes the Office of Reclamation and 
        Enforcement in the Department of the Interior. This Office will 
        be separate from any of the Department's existing bureaus or 
        agencies. It is intended that the Office exercise independent 
        judgment in implementing the Act.\2\ (emphasis added).
---------------------------------------------------------------------------
    \2\ See COMMITTEE ON ENERGY AND NATURAL RESOURCES; SENATE REPORT 
NO. 95-128; 95TH CONGRESS 1st Session; S. 7, at 63-64. (emphasis 
added)(Hereafter ``Senate Report 95-128''). See also, H.R. CONF. REP. 
95-493, H.R. Conf. Rep. No. 493, 95TH Cong., 1ST Sess. 1977, 1977 
U.S.C.C.A.N. 728, at----, 1977 WL 16021 (Leg.Hist.) (Senate and House 
Bills substantially similar).

    Thus, Congress mandated that the Secretary act through OSM in 
administering and enforcing SMCRA. Then Secretary Andrus recognized 
this direct relationship between the Secretary and an OSM exercising 
independent judgment when the permanent regulatory program regulations 
were promulgated in 1979.\3\ Importantly, every subsequent Secretary of 
the Interior for more than three decades through both Republican and 
Democratic administrations has accepted this interpretation of SMCRA 
without question. Order No. 3315 is clearly contrary to, and conflicts 
with, the Department of Interior's long-standing interpretation of the 
Act.
---------------------------------------------------------------------------
    \3\ See 44 F.R. 15313 Mar. 13, 1979 and 44 F.R. 49684 (Aug. 24, 
1979), 30 C.F.R Sec.  700.1--Sec. 700.4.
---------------------------------------------------------------------------
    An administrative agency may be authorized to change its original 
interpretation of ambiguous provisions of an organic statute, but it 
cannot amend the statute by administrative fiat. Nor may an agency 
camouflage a major policy decision under the guise of making minor 
adjustments of personnel and assignments within an agency.\4\ In this 
regard, it must be noted that the Secretary's proposal to restructure 
SMCRA's abandoned mine lands (AML) program and fee collection system 
has major policy implications. The 2006 AML program reauthorization by 
Congress was carefully crafted and should not and cannot be altered 
through a Secretarial Order that is both inappropriate and unlawful.
---------------------------------------------------------------------------
    \4\ See 5 U.S.C. Sec. 553 (a)(2) (Excepted from the Administrative 
procedure Act's informal rulemaking requirements are ``matter[s] 
relating to agency management or personnel or to public property, 
loans, grants, benefits, or contracts'').
---------------------------------------------------------------------------
    Secretarial Order No.3315 would alter the clearly delineated 
unambiguous long-standing relationship of the Secretary to OSM and 
impact statutorily-mandated functions without the express grant of such 
authority by Congress. The Secretary may not restructure SMCRA by such 
an order and his attempt to do so is ultra vires--that is, beyond the 
constitutional and executive powers of the Secretary.

    COMINGLING EMPLOYEES OF OSM WITH THOSE OF AGENCIES THAT PROMOTE 
      DEVELOPMENT OR USE OF COAL IS EXPLICITLY PROHIBITED BY SMCRA

    The Secretary's action in seeking to ``integrate'' OSM into BLM is 
precluded by the specific language of the SMCRA, which bars co-mingling 
employees of OSM with those of any federal agency that ``promotes the 
development or use of coal'' with OSM. Section 201 of SMCRA created OSM 
and assigned its responsibility. Congress intended to provide some 
flexibility in staffing OSM and utilizing, where appropriate, the 
skills and expertise of employees of other federal agencies:

          The Office shall have a Director who shall be appointed by 
        the President, by and with the advice and consent of the 
        Senate, . . . The Director shall have the responsibilities 
        provided under subsection (c) of this section and those duties 
        and responsibilities relating to the functions of the Office 
        which the Secretary may assign, consistent with this Act . . . 
        The Office may use, on a reimbursable basis when appropriate, 
        employees of the Department and other Federal agencies to 
        administer the provisions of this Act, providing that no legal 
        authority, program, or function in any Federal agency which has 
        as its purpose promoting the development or use of coal or 
        other mineral resources . . . shall be transferred to the 
        Office. (emphasis added).

    The legislative history of SMCRA explains that ``[t]he Act 
specifically states that there cannot be transferred to the office any 
legal authority which has as its purpose promoting the development or 
use of coal . . .''\5\ As noted above, Senate Report 95-128 made it 
very clear that SMCRA was not to be administered by a resource 
development agency whose duties included either ``the promotion of 
mining, marketing, or use of minerals'' or ``a resource preservation 
(pollution control, wilderness, or wildlife management) . . . 
mission.'' BLM is both a resource development agency and resource 
preservation agency.\6\ It is odd, indeed, that the prohibition 
contained in Sec. 201 (b) and the legislative history was ignored when 
Secretarial Order No. 3315 was issued.
---------------------------------------------------------------------------
    \5\ Senate Report 95-128 at 64.
    \6\ The scope of BLM's authority is described by the agency as 
managing ``public land resources for . . . energy development, 
livestock grazing, recreation, and timber harvesting, while protecting 
a wide array of natural, cultural, and historical resources . . . 
include[ing] 221 Wilderness Areas totaling 8.7 million acres, as well 
as 16 National Monuments comprising 4.8 million acres.'' http://
www.blm.gov/wo/st/en/info/About_BLM.html
---------------------------------------------------------------------------
    Curiously, the Office of the Secretary has quickly forgotten the 
lessons of the combination of enforcement and mineral development in 
the Minerals Management Service (``MMS''). In May 2010, Secretary 
Salazar properly recognized that combining mineral marketing with 
environmental protection and enforcement responsibilities created a 
destructive conflict within the MMS:

          The Minerals Management Service has three distinct and 
        conflicting missions that--for the benefit of effective 
        enforcement, energy development, and revenue collection--must 
        be divided,'' said Secretary Salazar. ``The reorganization I am 
        ordering today is the next step in our reform agenda and will 
        enable us to carry out these three separate and equally-
        important missions with greater effectiveness and transparency. 
        These reforms will strengthen oversight of offshore energy 
        operations, improve the structure for revenue and royalty 
        collections on behalf of the American people, and help our 
        country build the clean energy future we need.\7\
---------------------------------------------------------------------------
    \7\ Interior Dept. Press Release, Salazar Divides MMS's Three 
Conflicting Missions, (May 15, 2010), http://www.doi.gov/news/
pressreleases/Salazar-Divides-MMSs-Three-Conflicting-Missions.cfm

    The combination of conflicting missions of the MMS was intolerable. 
The Secretary found that separation of those conflicting 
responsibilities into separate and independent administrative entities 
will enable the Department to carry out its mission with ``greater 
effectiveness and transparency,'' and the reforms will ``strengthen 
oversight'' and improve ``revenue and royalty collections.'' 
Contradicting the analysis leading to the separation of conflicting 
functions in the MMS, Order No. 3315 tells us that doing the opposite--
``consolidating''--OSM within BLM--will ``integrate the management, 
oversight, and accountability of activities associated with mining 
regulation . . . ensure efficiencies in revenue collection and 
enforcement responsibilities and provide independent safety and 
environmental oversight of these activities.''\8\ These contradictory 
messages and the underlying logic of DOI decision-makers are difficult 
to decipher.
---------------------------------------------------------------------------
    \8\ Section 1, Purpose, Secretarial Order No. 3315 (October 26, 
2011).
---------------------------------------------------------------------------
    What is clear, however, is that the decision to combine the mission 
of OSM within BLM violates both the letter and the spirit of SMCRA. 
Moreover, Order No. 3315 pursues a policy that the Secretary himself 
rejected as unworkable in the context of the Mineral Management 
Service. While OSM has had its strong critics among the constituency I 
represent, and among state programs and the coal industry, OSM has 
never experienced a scandal of the magnitude of what occurred at the 
MMS. Moreover, the nation's coal production has increased and 
environmental protection as well as mine land reclamation have improved 
significantly in the thirty plus years of OSM's existence. Coalfield 
citizens I represent are at a loss to understand the motivations 
underlying Secretarial Order No. 3315.
    In supporting the Secretary's order, a BLM news release emphasized 
that its mission includes managing ``over 245 million acres . . . 
primarily located in 12 Western states, including Alaska . . . with a 
budget of about $1 billion'' and that it ``administers 700 million 
acres of sub-surface mineral estate throughout the nation.'' Moreover, 
the release stated, ``BLM's multiple-use mission is to sustain the 
health and productivity of the public lands for the use and enjoyment 
of present and future generations . . . by managing such activities as 
outdoor recreation, livestock grazing, mineral development, and energy 
production, and by conserving natural, historical, cultural, and other 
resources on public lands.''\9\
---------------------------------------------------------------------------
    \9\ BLM News Release, Interior to Examine Integration of Interior's 
Mining Regulation and Mine Reclamation Programs (October 26, 2011).
---------------------------------------------------------------------------
    In contrast, since its creation, OSM's focus has been exclusively 
on coal mining regulation, reclamation of coal mines and enforcement of 
SMCRA. The experience and expertise of the giant agency and the small, 
specialized agency are complimentary only at the extreme margins. 
Surely, the merger of an agency with 525 employees into BLM's huge 
10,000-employee workforce with its billion-dollar-plus budget would 
bring scant efficiencies and economies of scale.
    Troubling as well is a message given in support of the proposed 
merger: An OSM official reportedly told a House of Representatives 
Committee last week that ``[f]or the past decade, the agency has 
consistently been underfunded . . . consolidation could bolster our 
ability to get the resources we need to maintain oversight''.\10\
---------------------------------------------------------------------------
    \10\ Platts Energy Week, Lawmakers question OSM merger impact on 
coal (Nov. 2011), http://www.plattsenergyweektv.com/
story.aspx?storyid=173876&catid=293 Given the importance of coal mining 
to our nation, the strict but fair regulation of mining and 
reclamation, and the protection of the nation's waters should compel 
the Secretary of Interior to personally make a powerful case for fully 
funding OSM so that it may ``maintain needed oversight.'' Burying the 
agency in BLM and hoping that the move ``could bolster our ability to 
get the resources we need to maintain oversight'' would seem an odd way 
for the Secretary to administer SMCRA's mandate to protect coalfield 
communities and their environments.
---------------------------------------------------------------------------
    Experience suggests that the proposed consolidation is likely to 
produce administrative chaos and bureaucratic turf wars as an agency 
with expertise and experience in regulating coal mining is buried deep 
within an agency whose multiple missions include the promotion of 
mining, marketing, of minerals and resource preservation. Common sense 
facilitates sound decision-making. Common sense suggests ``if it ain't 
broke--don't fix it.'' Secretary Salazar should withdraw the unlawful, 
ill-conceived and illogical Order 3315.

  A SUGGESTION FOR A BROADER APPLICATION OF SMCRA'S BAN ON COMINGLING 
         RESOURCE PRODUCTION AND ENFORCEMENT WITHIN ONE AGENCY

    A statement must also be made relating to Senator Murkowski's 
excellent observations about the integrity of the Interior Department's 
regulatory programs. Occasionally, irresponsible coal operators cause 
catastrophic death in our coal mines; similarly irresponsible companies 
have caused environmental devastation in the diverse coalfield 
communities across the nation where coal is mined. Like negligent 
lapses in mine safety that kill miners one by one, the adverse impacts 
of irresponsible coal mine operations play out almost unnoticed by the 
larger world and the media: one damaged coalfield community; one lost 
forest; one polluted stream; and one polluted or destroyed water 
supply.
    A poignant article in the Charleston Gazette newspaper explained 
the depth of the loss of coal miners in ``accidents'' that claim one or 
two coal miners at a time.\11\ Each coal miner's death, the article 
found, was caused by a violation of mine safety law and rules. 
Similarly, a steady, widespread, degradation of Appalachian communities 
occurs as a result of mining operations that violate the law.
---------------------------------------------------------------------------
    \11\ Ken Ward Jr., Beyond Sago: One by One Disasters make 
headlines, but most miners killed on the job die alone, THE CHARLESTON 
GAZETTE (Nov. 5, 2006). http://wvgazette.com/News/BeyondSago/
200611050006
---------------------------------------------------------------------------
    Coalfield citizens are left to feel that they are unimportant to 
this Administration and that they are not entitled to the same 
consideration that underlies the Secretary's correct decision to 
isolate offshore oil and gas regulation from the DOI's oil development 
activities. Coalfield citizens are astonished that the Secretary and 
the President believe that inserting coal mining regulatory enforcement 
inside the very Interior agency that promotes and profits from coal 
development is a prudent idea. They wonder how BLM can decide to lease 
a tract of coal on public land and then expect the ``integrated'' OSM 
permitting staff to feel independent enough to deny a permit if the 
mining is found to violate SMCRA and cause adverse externalities.
    If the Administration is serious about preserving and enhancing the 
integrity of the Interior Department's environmental enforcement 
programs, a very different approach would emerge. OSM would be joined, 
in reporting directly to the Secretary, not just by the offshore oil 
and gas regulatory agency, but also by a new agency, the Office of 
Public Lands Protection and Enforcement. BLM could continue its mission 
to promote heavily subsidized mining, timber, and oil and gas 
production from public lands and turn designated public lands into 
sites for private developers of energy facilities. But the BLM staff 
regulating those industries, charged with enforcing the laws and 
regulations and supposedly protecting public lands, would, like the 
regulators of offshore energy development and the regulators of coal 
mining environmental impacts, be in a separate regulatory agency 
independent of BLM's resource development function.
    Not only is there no public interest, economic or efficiency 
justification for the Administration's proposal to place an independent 
regulatory agency inside the Interior Department's resource development 
agency, the Administration's plan to do this indicates that the only 
way to truly safeguard the integrity of environmental regulation within 
the Interior Department is to take BLM's regulators and enforcers and 
place them in an independent public lands protection agency, as was 
appropriately done in the case of the Mineral Management Service.

   LACK OF TRANSPARENCY ERODES CONFIDENCE IN OSM'S REGULATORY MISSION

    The Secretary's Order appears to have been conceived in a vacuum 
with no prior notice or consultation with Congress, the coal industry, 
coalfield citizens or the sovereign Native American nations. This 
failure to consult, discuss and explore the implications of a major 
decision altering the statutory structure of enforcement within the 
Department of the Interior is inexplicable given the President Obama's 
endorsement of transparency in government.
    Apparently, someone at the Department of the Interior decided that 
burying OSM within the enormous BLM bureaucracy would, as mentioned 
earlier, ``integrate the management, oversight, and accountability of 
activities associated with mining regulation and abandoned mine 
reclamation; ensure efficiencies in revenue collection and enforcement 
responsibilities; and provide independent safety and environmental 
oversight of these activities.''
    Ordinarily the impact of such an important decision as evinced by 
Secretarial Order 3315 would be fully evaluated and all those with an 
interest in the success of the agency's mission would be consulted in 
advance. There is no evidence, however, that the DOI studied or 
otherwise analyzed the impact of merging the smaller agency into the 
huge entity. The purported savings and efficiencies that would accrue 
from the implementation of Secretarial Order 3315 are based on pure 
conjecture. Statements by BLM and OSM spokesmen confirm this.
    BLM Director Robert Abbey's is quoted in a BLM news release: ``OSM 
and the BLM have many complementary responsibilities with respect to 
mining and the reclamation of mine lands, and it makes sense to explore 
how we can bring the best out of the two bureaus as they carry out 
their statutory responsibilities.'' (emphasis added). Interior 
spokesman Chris Holmes, told a media interviewer that ``it's too early 
in this process to identify precisely where those savings will come 
from and how much we can save . . .'' (emphasis added).
    In short, these statements confirm that ``exploring'' how to 
integrate OSM into BLM is something that will be done between now and 
March 1, 2012. How and when DOI will determine if there are, in fact, 
``savings'' that will accrue is not apparent; plainly, such a 
calculation was not performed by DOI in advance of the issuance of 
Order 3315. It is not surprising that those responsible for the 
issuance of the Order failed to consult with OSM's stakeholders in 
advance.
    Looking and listening can avoid a train wreck. That simple logic 
apparently was not considered in DOI's rush to bury OSM inside BLM. The 
coalfield citizens I represent before you hope that this Committee will 
inquire and identify how and why such a decision was made without 
serious study or analysis of its impact on those affected.

 THE SECRETARY FAILS TO COMPREHEND OSM'S ROLE IN PROTECTING COALFIELD 
                              COMMUNITIES

    Finally, but importantly, those whom I represent today believe that 
Secretarial Order No. 3315 represents a profound failure to comprehend 
the role Congress designed for the Secretary and OSM, and the 
importance of OSM to coalfield communities and to the Nation. At the 
very heart of Congress' enactment of the SMCRA and of OSM's mission, is 
an overarching concern for the people of America's coalfield 
communities and for the environment that sustains them.
    In 1976, coal supplied eighteen percent of America's electricity. 
Today, coal powers fifty percent of our electricity and in significant 
degree because of SMCRA and OSM's supervision of state coal regulatory 
programs. Recognizing this fact is not to suggest that SMCRA is 
currently being administered and enforced as intended. As with regard 
to coal mine safety, much progress has been made--but much more can and 
should be done to protect the environment of the coalfields and the 
people who live there. But that is an issue for another day. Suffice it 
to point out that many in this Congress have argued that coal is 
crucial to America's energy future. I submit that robust and fair 
enforcement of SMCRA is equally crucial; burying OSM in BLM would 
impede accomplishment of both goals.
    The 95th Congress understood this simple point when it enacted the 
SMCRA. The Act contains more public participation rights than any other 
federal environmental regulatory statute--for a reason. That Congress 
understood that a key to public acceptance of coal mining is to prevent 
externalization of harm to families, communities and the environment 
caused by unlawful coal mining activities. The legislative history of 
SMCRA is replete with this message as is the statute itself.
    Historically Secretaries of the Interior have treated OSM as a poor 
stepchild of the Department--an agency with a narrow focus on only one 
mineral and on enforcement rather than federal public land management. 
The agency has long been significantly underfunded, as Director 
Pizarchik recently conceded. However, the burial of an underfunded 
half-alive OSM in the behemoth bureaucracy of BLM is beyond any prior 
marginalization of the agency.
    Many coalfield citizens who understand the role of OSM under SMCRA 
feel that Secretary Salazar's issuance of Order 3315 shows a 
fundamental disrespect for them and their communities. I suspect, 
however, that the decision to issue this Order was grounded in a 
failure to recognize and appreciate the mission of the long beleaguered 
OSM.
    Let me briefly explain. Over the years since enactment of SMCRA 
those whom I represent have at times been very critical of regulatory 
and policy decisions made by OSM political appointees. Nevertheless, 
the field personnel and technical experts within OSM have frequently 
taken citizen complaints and concerns seriously. These front-line OSM 
inspectors, geologists and mining engineers have been crucial in OSM's 
efforts to implement SMCRA's mandate to protect those who live over and 
near coal mines from environmental and socio-economic injuries that 
accompany violations of SMCRA.
    There are numerous examples of OSM's field inspectors and technical 
experts using their expertise to prevent mining operations that would 
have harmed coalfield communities and families. These professional OSM 
staffers also have, in some situations, been permitted to use their 
expertise to develop facts that allow coalfield families who have 
suffered injuries to have their rights vindicated through SMCRA-created 
administrative or judicial remedies. These efforts of front-line men 
and women of OSM are accomplished using their skills, expertise and 
savvy garnered from years of working cooperatively with coal operators 
and state program regulators.
    Sadly, one can examine Secretarial Order 3315, DOI news releases 
and the statements of agency officials without finding a reference to 
the OSM mission regarding coalfield communities. Whether grounded in 
disrespect of coalfield citizens or ignorance of OSM's mission and its' 
impact in the coalfields, Order No. 3315 dishonors the letter and 
spirit of the SMCRA and should be withdrawn. Perhaps, at the highest 
levels of the Department of the Interior the controversy triggered by 
this ill-considered and cavalier administrative decision will give rise 
to a new understanding and appreciation of OSM's mission--and renewed 
respect for coalfield citizens.
    I would be glad to answer any questions and to provide any 
additional information that may be helpful to the Committee. Thank you.

                               APPENDIX A

    The following organizations are represented by Professor Patrick C. 
McGinley's testimony at the Senate Committee on Energy and Natural 
Resources Hearing on November 17, 2011 regarding the Secretary of the 
Interior's Order: 3315.

Citizens Coal Council--Bridgeville, PA
8th Day Center for Justice--Chicago, IL
Appalachian Citizens' Law Center--Whitesburg, KY
Black Mesa Water Coalition--Flagstaff, AZ
Black Warrior Riverkeeper--Birmingham, AL
Buffalo Creek Watershed Association--Claysville, PA
Cahaba Riverkeeper--Birmingham, AL
Center for Coalfield Justice--Washington, PA
Citizens Against Longwall Mining--Hillsboro, IL
Citizens Against Ruining the Environment--Lockport, IL
Citizens for Pennsylvania's Future (PennFuture)--Harrisburg, PA
Citizens Organizing Project--Knox County, IL
Coal River Mountain Watch--Whitesville, WV
Cook Inletkeeper--Homer, AK
Delaware Riverkeeper Network--Bristol, PA
Environmental Integrity Project--Washington, DC
Faith in Place and the Illinois Interfaith Power and Light Campaign--
Chicago, IL
Friends of Bell Smith Springs--Stonefort, IL
Friends of Hurricane Creek--Tuscaloosa, AL
Friends of the Earth--Washington, DC
GASP--Birmingham, AL
Greene County Watershed Alliance--Greene County, PA
Kentucky Resources Council--Frankfort, KY
Mountain Watershed Association--Melcroft, PA
National Wildlife Federation--Washington, DC
Nizhoni Ani--Kykotsmovi, AZ
Ohio Environmental Council--Columbus, OH
Ohio Valley Environmental Coalition--Huntington, WV
Powder River Basin Resource Council--Sheridan, WY
Prairie Rivers Network--Champaign, IL
Residents Against the Power Plant--Bulger, PA
Statewide Organizing for Community eMpowerment--Knoxville, TN
The Foundation for Pennsylvania Watersheds--Alexandria, PA
Upper Wheeling Creek Watershed Association--East Finley, PA
Vermont Law School Environmental and Natural Resource Law Clinic--South 
Royalton, VT
Waterkeeper Alliance--New York, NY
West Virginia Highlands Conservancy--Rock Cave, WV
Wheeling Creek Watershed Conservancy--Nineveh, PA
Wild South--Asheville, NC

    The Chairman. Thank you very much.
    Ms. Sweeney, go right ahead.

 STATEMENT OF KATIE SWEENEY, GENERAL COUNSEL, NATIONAL MINING 
                          ASSOCIATION

    Ms. Sweeney. Good morning, Chairman Bingaman, Ranking 
Member Murkowski and members of the committee. Thank you for 
inviting me to discuss our concerns regarding the consolidation 
of OSM within BLM.
    Without repeating the legal arguments already raised by 
members of the committee and other panel members, I agree that, 
as a threshold matter, the order raises a serious legal 
question: Can this consolidation be accomplished without 
specific authorization from Congress, especially given that on 
its face, SMCRA appears to prohibit this merger?
    In these difficult fiscal times, National Mining 
Association appreciates the need for agencies to look at 
conserving resources. Perhaps there may be some merit to the 
proposal to consolidate some of the non-policy administrative 
functions of BLM and LSM, though couldn't that be accomplished 
by some sort of agreement rather than a merger?
    But this proposal should also be examined from the broader 
economic standpoint of what the department can do to grow our 
economy and put people back to work. As President Obama 
recently declared, ultimately, our recovery will be driven, not 
by Washington, but by our businesses and our workers.
    I'd like to highlight that the mining industry was among 
the few sectors of our economy that substantively increased 
jobs over the last decade. But we could have done much more if 
the U.S. had policies that encourage rather than impede 
domestic mining, and these are the issues that we think the 
secretary should address. We are skeptical that the 
consolidation of BLM and OSM will achieve these goals.
    In particular, we recommend that Department of Interior 
review its permitting processes for mining activities. The 
length, complexity and uncertainty of the process places high 
hurdles in the path of mine operators. It can take between 7 
and 10 years to get all the permits necessary to mine on BLM 
lands.
    There are many causes of delays for BLM permits, but one 
key, primarily administrative, chokepoint is the Department of 
Interior's clearance process for NEPA Federal Register notices 
sent from State BLM offices. These administrative notices 
require 14 levels of review at Department of Interior.
    This policy adds approximately 1 year to the already 
lengthy permitting process and has never, in our experience, 
resulted in a final product that differed substantively from 
that submitted by the State BLM.
    We appreciate the legislation introduced by Senator Heller 
and others on this committee to place a 45-day time limit on 
these DOI reviews.
    We also applaud the efforts of Senator Murkowski and other 
committee members to pass critical minerals legislation that 
includes a review of the permitting system to determine how to 
make it more efficient while maintaining our current 
environmental standards.
    Another way the department can marshal scarce resources, 
absent a consolidation, is to ensure agencies focus on mission-
essential activities. OSM has strayed from that path with its 
recent policy of reviewing and second-guessing State permitting 
decisions in primacy States. The increases in the oversight of 
State programs has proven to be unnecessary, duplicative and a 
waste of taxpayer dollars.
    Nor is this approach justified by some alleged failure of 
the primacy States to properly implement the SMCRA program, as 
OSM's own annual evaluation reports demonstrate that the States 
have done an excellent job in regulating coalmines.
    There is much OSM and BLM could do to better utilize 
diminishing resources without resorting to a merger, and 
additional specific recommendations are contained in the 
Appendix A to this testimony, but to highlight one example, OSM 
has squandered millions of taxpayer dollars with respect to 
developing the wholly unnecessary stream protection rule.
    Despite the fact that the Federal Government had already 
spent 5 years and more than $5 million on developing a stream 
buffer zone rule, OSM decided early in this administration to 
abandon that rulemaking and commission a new EIS.
    OSM has already spent more than $4.4 million on this 
project and is now pouring in an additional $900,000 because it 
did not agree with its own contractor's report, which showed 
that the agency's rewrite of existing regulations would likely 
cost tens of thousands of jobs.
    We also note that the merger is not likely to accomplish 
the substantive aims laid out in the order. For example, is 
integration of the OSM abandoned mine land programs and BLM's 
reclamation programs feasible, given the agency's different 
regulations, reclamation standards and funding mechanisms?
    Similarly, it's difficult to comprehend how the 2 agencies' 
regulation, inspection and enforcement programs can be 
consolidated. For instance, it would be nonsensical to mix and 
match OSM and BLM inspectors, because they are trained to look 
for different things at different types of mines, coal and hard 
rock.
    NMA looks forward to a continuing dialog with the agencies, 
the department and Congress about ways to conserve agency 
resources while promoting efficient utilization of our abundant 
domestic resources to meet the Nation's needs for affordable 
electricity and minerals vital to innovation and a strong 
economy.
    Thank you.
    [The prepared statement of Ms. Sweeney follows:]

 Prepared Statement of Katie Sweeney, General Counsel, National Mining 
                              Association

    Good morning. Thank you for inviting me to testify before you 
today. My name is Katie Sweeney and I am speaking today on behalf of 
the National Mining Association (NMA). NMA is a national trade 
association that includes the producers of most of the nation's coal, 
metals, industrial and agricultural minerals; the manufacturers of 
mining and mineral processing machinery, equipment and supplies; and 
the engineering and consulting firms, financial institutions and other 
firms serving the mining industry.
    The Secretary of the Interior, Ken Salazar, issued secretarial 
order number 3315 on October 26 directing the consolidation of the 
Office of Surface Mining, Reclamation and Enforcement (OSM) within the 
Bureau of Land Management (BLM). The proposal raises more questions 
than it answers. Obviously, the different statutory authority and 
clearly divergent mandates of the two agencies raises issues about how 
they can be merged but as a threshold matter, the order raises a 
serious legal question--can this consolidation be accomplished without 
specific authorization from Congress?
    On its face, the Surface Mining Control and Reclamation Act (SMCRA) 
Sec.  201 establishes OSM as an independent agency within the 
Department of the Interior, and directs the Secretary to ``act through 
the Office. . . '' (referring to OSM). It does not tell the Secretary 
to ``act through the BLM.'' The same section creates a firewall 
prohibiting the transfer of any legal authority, program, or function 
from any federal agency that promotes development or use of coal or 
regulating the health and safety of coal to OSM. the Federal Land 
Management and Policy Act (FLPMA), which guides BLM's management of 
federal lands, clearly promotes the development of coal and other 
minerals on federal lands. Included in FLPMA's congressional 
declaration of policy is the statement that ``the public lands be 
managed in a manner that recognizes the Nation's need for domestic 
sources of minerals . . . from the public lands.''
    In these difficult fiscal times, NMA appreciates the need for 
federal agencies to investigate ways to conserve resources. Perhaps 
there may be some merit to the Secretary's proposal to consolidate some 
of the non-policy administrative functions of OSM and BLM. But this 
proposal should also be examined from the broader economic standpoint 
of what the Department can do to grow our economy and put people back 
to work. As President Obama recently declared, ``ultimately, our 
recovery will be driven not by Washington, but by our businesses and 
our workers.''
    I'd like to highlight the fact that metal and coal mining were 
among the few sectors of our economy that substantially increased jobs 
over the last decade--when the overall economy experienced the first 
job-loss decade in 75 years. Such success is bittersweet, not only 
because we still have millions of unemployed Americans, but also 
because mining could have done so much more if the United States had 
policies that encourage--rather than impede--domestic mining. And these 
are the issues we think the Secretary should address. We are skeptical 
that the consolidation of OSM and BLM will achieve these goals.
    In particular, we recommend that DOI review its permitting 
processes as they relate to mining activities. As the burden of 
regulations increases so does the complexity and time it requires to 
obtain permits and authorizations necessary to commence job-creating 
enterprises. The length, complexity and uncertainty of the permitting 
process place high hurdles in the path of mine operators. It can 
already take between 7 and 10 years to get all the permits necessary to 
mine on BLM lands.
    There are many causes of delays for BLM permits but one key, 
primarily administrative, choke-point in that process is DOI's policy 
for processing certain administrative notices for mining operations and 
other commercial enterprises on public lands. The current ``clearance 
process'' for National Environmental Policy Act (NEPA) Federal Register 
notices sent from Bureau of Land Management state offices requires 14 
levels of review at the Department of the Interior's Washington, D.C., 
office. This policy adds approximately one year to the already lengthy 
permitting process and has never, in our experience, resulted in a 
final notice that differed substantively from the product submitted by 
the state. And the costs of the delays are substantial, impacting the 
net present values of projects and putting new jobs on hold. We 
appreciate the legislation introduced by Sen. Dean Heller (R-Nev.) and 
co-sponsored by many on this committee to place a 45-day time limit on 
the reviews of these notices by DOI. And we also applaud the efforts of 
Senator Murkowski and other committee members to pass critical minerals 
legislation that includes a review of the permitting system to 
determine how to make it more efficient while maintaining our current 
environmental standards.
    Merging OSM and BLM has the potential to create uncertainty and 
even further delays in mine permitting as staff become accustomed to 
their new roles and responsibilities. In addition, NMA has generally 
found that when multiple agencies are involved, the permitting process, 
far from being more streamlined, more often than not leads to greater 
delays.
    Another way the department can marshal scare resources absent 
consolidation is to ensure agencies truly focus on mission-essential 
activities. OSM has strayed from that path with its recent policy of 
reviewing state-issued mining permits in primacy states and second 
guessing state permitting decisions. This emphasis on massive increases 
in the oversight of state programs has proven to be unnecessary, 
duplicative, and a waste of millions of taxpayer dollars. OSM's own 
annual evaluation reports demonstrate that the states have consistently 
done an excellent job in regulating coal mines. Yet the agency has 
increased inspections by 46 percent with no reprieve in sight even 
though the increased inspections have resulted in very few enforcement 
actions. For example, OSM took no enforcement actions in the country's 
top coal-producing state, Wyoming. Paradoxically, the agency has funded 
these unnecessary and wasteful policies at the expense of the very 
states that are doing such an excellent job in regulating mining.
    As part of the agency's state program oversight mantra, OSM has 
also asserted the authority to issue ``ten day notices'' in situations 
where the agency disagrees with permitting decisions by primacy states. 
This is yet another example of OSM misusing its existing authority and 
limited resources, and, is being done without proper authority from 
Congress.
    There is much OSM and BLM could do to reflect the new reality that 
agencies will have fewer resources without the need for a total 
consolidation of the two agencies. Additional specific recommendations 
for improvements are contained in Appendix A to this testimony, the 
comments NMA submitted to DOI in response to the required retrospective 
review of regulations and policies under Executive Order 13563. But to 
highlight one example, just look at how OSM has squandered millions of 
taxpayer dollars with respect to developing unnecessary new rules and 
regulations. Despite the fact that the federal government has already 
(and recently) spent 5 years and more than $5 million on developing a 
stream buffer zone rule, OSM decided on the first day of the new 
Administration to change this rulemaking and commission a new EIS 
before the rule was even given an opportunity to go into effect.
    By its own admission and testimony, OSM has already wasted more 
than $4.4 million on this project, and even its staunchest 
environmentalist supporters describe it as ``an expensive fiasco.'' Now 
OSM is pouring another $900,000 into the project because it does not 
agree with its own contractor's report, which showed that the agency's 
rewrite of existing regulations would likely cost tens of thousands of 
jobs.
    Instead of looking to integrate these two agencies to address 
budget problems and cover up mistakes, OSM should put to better use the 
resources that have already been provided by Congress. Instead of 
conducting unnecessary and redundant inspections that produce no 
results, illegally second-guessing state permitting decisions, and 
rewriting hundreds of pages of settled rules that will put tens of 
thousands of Americans out of work, OSM should be using its resources 
to do more research, to improve technology and to provide training for 
its State partners so they can do a more effective job of being the 
primary regulators of surface coal mining operations, as SMCRA 
intended.
    While the Secretarial Order may result in cost savings due to 
consolidation of administrative functions, the merger is not likely to 
accomplish the other substantive aims laid out in the order. For 
example, the order will integrate ``OSM's abandoned mine land programs 
and functions . . . and BLM's mine and surface reclamation programs. `` 
Is integration of these programs feasible given the agencies have 
different regulations, reclamation standards and funding mechanisms. 
BLM, unlike OSM, currently has no authority to collect monies from 
active mining operations to fund AML cleanup, and while NMA supports 
funding of AML cleanup through a reasonable future royalty as part of 
broader changes to the Mining Law, OSM's AML program should not be that 
model. According to OSM's own 2012 budget justification, while the AML 
program has taxed the coal industry more than $10 billion since its 
inception, and Congress has appropriated more than $7.5 billion to the 
agency for this purpose, OSM has managed to complete only about $2 
billion in the actual clean-up of abandoned mine lands. This type of 
inefficient program should not be exported to another Interior agency.
    Similarly, it is difficult to comprehend how the two agencies' 
regulation, inspection and enforcement programs can be consolidated. 
Again, the agencies have different statutory and regulatory mandates. 
As such, agency personnel gain expertise that does not transfer 
automatically to another program. For instance, it would be nonsensical 
to mix and match OSM and BLM inspectors as they are trained to look for 
different issues at coal and hardrock mines.
    Lastly, it is unclear how the states' roles will be impacted by 
such a merger. While SMCRA contemplates states being the exclusive 
regulatory authorities within their borders once they have an approved 
program, BLM operates differently. The state-run programs under SMCRA 
are significantly more efficient than either OSM or BLM-run programs. 
Will the merger complicate state permitting, and would a BLM-run agency 
likewise attempt to interfere with and second guess state permitting 
decisions the same way that OSM has recently done?
    NMA looks forward to a continuing dialog with the agencies, with 
the Department, and with the Congress about the best way to conserve 
agency resources while promoting more efficient utilization of our 
abundant domestic resources to meet the nation's needs for affordable 
electricity and minerals vital to innovation and a strong economy. We 
believe that regulating our activities can be done in an efficient 
manner while ensuring that our members receive permits in a fair and 
timely manner, and taxpayer dollars are used effectively.
    Thank you for the opportunity to share our views.
                               appendix a
                               National Mining Association,
                                    Washington, DC, March 28, 2011.
Regulatory Review,
Office of the Executive Secretariat and Regulatory Affairs, U.S. 
        Department of Interior, 1849 C Street, NW, Washington, DC.
    Dear Sir/Madam:

RE: Comments on improving DOI's regulations--Docket Number DOI--2011--
0001; Department of the Interior Retrospective Review under E.O. 13563

    The National Mining Association (NMA) appreciates the opportunity 
to respond to your request for information to help shape the Department 
of the Interior's (DOI) plan to review existing regulations and 
identify opportunities for improvement through modifications, 
streamlining, expansion or repeal. 76 Fed. Reg. 10526 (Feb. 25, 2011).
    NMA is the national trade association representing the producers of 
most of America's coal, metals, industrial and agricultural minerals; 
the manufacturers of mining and mineral processing machinery, equipment 
and supplies; and engineering, transportation, financial and other 
businesses that serve the mining industry. Since many NMA members 
conduct mining operations on federal lands, we have a fundamental 
interest in the adoption of principles and policies that foster the 
prudent management and stewardship of the nation's natural resources. 
Because DOI manages much of the lands with our nation's critical 
mineral resources and administers programs that directly impact many 
mining operations, NMA offers the following comments regarding the 
regulations and policies that should be included in the retrospective 
review under Executive Order (E.O.) 13563.

                            GENERAL COMMENTS

    DOI requests comments regarding how, generally, it can best review 
its existing rules in a way that will identify rules that should be 
changed, streamlined, consolidated or removed. NMA believes that DOI's 
engagement of affected parties and other stakeholders is the most 
appropriate way to identify such rules. As DOI moves forward with its 
review, NMA urges the department to ensure that its regulations are 
consistent with DOI's mission, including its resource use mission. As 
identified in DOI's strategic plan, a key component of the resource use 
mission is to provide America with access to energy and minerals to 
promote responsible use and sustain a dynamic economy. The importance 
of the federal lands for coal, hardrock and other minerals cannot be 
understated. See Fact Sheet: The BLM--A Sound Investment for America 
for discussion of the $112 billion contribution of BLM public lands to 
the economy.

                RULES, POLICIES AND GUIDANCE FOR REVIEW

    NMA has identified below several rules, policies and guidance that 
should be reconsidered during the retrospective review. These rules, 
policies and guidance impose substantial and unjustifiable burdens on 
the mining industry that are simply not necessary for DOI to achieve 
its regulatory or statutory objectives.

   Secretarial Order 3310 on Wild Lands and related guidance

    In issuing Secretarial Order 3310, DOI is creating a confusing and 
duplicative system to protect federal lands with wilderness 
characteristics. The announcement of the policy has already halted 
several planned mining projects as Bureau of Land Management staff are 
commandeered to conduct the new wilderness inventories required by the 
order. The order fails to acknowledge the existing federal laws in 
place to protect ``wild lands'' such as the Federal Lands Policy and 
Management Act (FLMPA), National Environmental Protection Act and the 
Endangered Species Act. Instead, the Wild Lands Policy ignores FLPMA's 
``multiple use'' mandate and favors very limited passive recreational 
uses.
    Essentially, the policy subverts BLM's FLPMA obligations by 
establishing a new regulatory program that re-initiates and expands a 
Wilderness identification procedure that sunset on October 21, 1993 
with the submittal of Presidential Wilderness recommendations to the 
Congress. The Wild Lands Order requires BLM to identify lands that 
qualify for management as though they are Wilderness, even though they 
did not so qualify under the Wilderness Inventory mandated by Congress.
    The order will put into place an onerous system that could delay 
decisions regarding uses of federal lands for a decade or longer. 
Consider that pursuant to the order, BLM has indicated it will 
inventory 220 million acres of land in the context of the fact that it 
is not uncommon for a single Resource Management Plan to take 10 or 
more years to complete. Pursuant to the retrospective review required 
by E.O. 13563, DOI should rescind the Secretarial Order on Wild Lands 
and the related changes to it manuals and guidance documents.

   Federal Register Reviews

    DOI should also review the policy enunciated in Instruction 
Memorandum 2010-043, ``Guidance on Preparing Federal Register 
Notices.'' This ``clearance process'' for NEPA Federal Register notices 
needlessly adds months to the permit process for minerals mining and 
coal projects on federal lands as it requires 14 separate layers of 
departmental review of notices developed by State BLM offices. (See 
attached chart.)
    The impact of these delays is significant as most mining operations 
require at least three of these notices per project. As the clearance 
process routinely takes 3-4 months per notice, this policy adds 
approximately a year of review time for project approvals. These delays 
also result in lost federal, state and local revenues, fewer jobs and 
lost opportunities. For example, one mining company indicated that the 
delays are preventing the hiring of more than 1,000 new employees, and 
another stated that for each month of delay the company loses more than 
$1 million in net present value. Furthermore, the uncertainties 
regarding length of time for approval of mining activities has 
contributed to an all-time low amount of mineral exploration dollars 
being invested in the United States and to increased reliance on 
foreign supplies of minerals.
    This clearance process is in addition to the existing thorough 
environmental review process undertaken by BLM for mining projects on 
federal lands. A typical environmental impact statement undertaken 
pursuant to NEPA takes over three years to prepare. DOI has never 
adequately explained the need for this review process and it does not 
appear to result in substantive changes to the submitted documents. In 
fact, in the mining industry's experience, the review process has never 
resulted in a final product that differed substantively from what was 
submitted by the state BLM offices. DOI should rescind IM 2010-043 and 
return to the previous process where Federal Register notices could be 
submitted directly by BLM state offices without stopping at DOI for 
additional reviews.

   General Review of NEPA Guidance

    DOI should also review its guidance on NEPA to determine if there 
are ways to better integrate NEPA reviews with permitting of mining 
operations. DOI should recognize that since NEPA's enactment, Congress 
has passed numerous laws that prescribe substantive goals and 
procedures to prevent or minimize adverse impacts to environmental 
resources. These laws include those that provide the authority to 
promulgate standards for mining operations, such as the Federal Land 
Policy and Management Act (FLPMA), the Surface Mining Control and 
Reclamation Act (SMCRA) and the Forest Service Organic Act, as well as 
specific environmental laws such as the Clean Air Act (CAA), Clean 
Water Act (CWA), Endangered Species Act (ESA) and the Safe Drinking 
Water Act (SDWA). These laws and their corresponding regulations 
require a thorough analysis of the possible environmental effects of 
mining operations. NMA believes that the functional equivalent of a 
NEPA review occurs during the permitting of mining operations on 
federal lands, and therefore a completely separate NEPA review is 
unnecessary, duplicative and results in significant delays. Please see 
the attached NMA concept paper on exemptions for mining operations 
based on this ``functional equivalence doctrine'' that has been 
developed by federal courts'' to exempt federal agencies from complying 
with NEPA's environmental review process when other ``substantive and 
procedural standards ensure full and adequate consideration of 
environmental issues.''

   Financial Guarantees Under 43 CFR 3809

    The retrospective review that DOI is conducting provides a perfect 
opportunity to rectify a problem created when the 43 CFR 3809 surface 
management regulations were revised in 2001. Given developments since 
that time, DOI should review the decision to prohibit new corporate 
guarantees and increases of any existing corporate guarantees under 
BLM's revised section 3809.500 et. seq.
    Commercial surety capacity is frequently constrained and leads to 
questions as to whether the capacity required by the mining industry 
will be available even at substantially higher direct and indirect 
costs. Given the constraints on the availability of surety, BLM needs 
to ensure a wider variety of financial assurance mechanisms, such as 
corporate guarantees, are allowed to fulfill obligations under the 3809 
regulations. The wholesale jettisoning of corporate guarantees is not 
necessary to eliminate the problems that BLM and the states had with 
that form of financial assurance. Past problems with corporate 
guarantees can be solved by establishing reasonable qualification 
criteria followed by periodic evaluation to verify that companies 
remain qualified to self-bond.
    Other federal agencies such as the U.S. Environmental Protection 
Agency (EPA), U.S. Nuclear Regulatory Commission (NRC) and BLM's sister 
agency, the Office of Surface Mining (OSM), recognize corporate 
guarantees as an acceptable financial assurance instrument. EPA allows 
for corporate guarantees for waste disposal sites upon satisfaction of 
certain criteria, including tangible net worth, a ratio of total 
liabilities to new worth, a ratio of current assets to current 
liabilities or total fixed assets in the United States. See 40 CFR 
264.143. NRC has a regulatory guidance document, Reg. Guide 3.66 (DG-
3002), that provides qualification mechanisms for corporate guarantees. 
BLM has accepted NRC-approved corporate guarantees for uranium projects 
on BLM-managed lands in Wyoming, Utah and New Mexico. OSM provisions 
allow self-bonding based on bond-rating, tangible net worth, a ratio of 
total liabilities to net worth, a ratio of current assets to current 
liabilities or total fixed assets in the United States. See 30 CFR 
800.23. BLM should consider a corporate guarantee program for the 
hardrock mining sector based upon sound qualification criteria, just as 
EPA, NRC and OSM programs have done in order to afford other mechanisms 
to satisfy bond requirements.

   OSM Policy Directives Relating to State Oversight

    In late 2009, OSM proposed major changes to oversight of state 
programs, including additional federal inspections and significant 
potential for second guessing of state permitting decisions. OSM's own 
evaluations of the state programs do not reveal any problems that 
necessitate these changes. In fact, NMA questions OSM's legal authority 
to make such changes under the Surface Mining Control and Reclamation 
Act (SMCRA). OSM's new policy of interfering with state permitting 
decisions is also inconsistent with a number of court decisions 
interpreting the federal-state relationship under the Act. Yet OSM 
ignored these concerns and finalized several directives, including 
Directive REG-8 ``Oversight of State and Tribal Regulatory Programs,'' 
Directive REG-23 ``Corrective Actions for Regulatory Program Problems 
with Action Plans'' and Inspection and Enforcement Directive INE-35 on 
``Ten Day Notices.'' These directives should be rescinded as a part of 
DOI's retrospective review.

   OSM Stream Protection Rule

    While not yet promulgated, DOI should use this review opportunity 
to reconsider whether it should move forward with the rulemaking OSM is 
developing on ``stream protection.'' This rulemaking is inconsistent 
with the President's new executive order. The anticipated stream 
protection rule is intended to displace a 2008 regulation that was the 
product of a five-year comprehensive rulemaking process that provided 
the members of the public and state regulators clarity and certainty, 
while at the same time requiring improved environmental performance. 
OSM had not even implemented the 2008 rule before deciding to change 
it. The agency has not identified any basis or need for these 
significant regulatory changes, most of which will only add burdens on 
companies and states through complex and duplicative standards that 
recreate the uncertainty that was corrected by the 2008 rule.
    The rulemaking options under consideration would cost thousands of 
mining jobs, sterilize millions of tons of coal reserves and impair the 
coal supply essential to the nation's energy requirements, without any 
demonstrated environmental benefit over the current rules they are 
trying to rewrite. Additional sampling and monitoring requirements will 
add enormous information collection burdens while essentially 
duplicating the sampling and monitoring requirements already in place 
in the project's associated NPDES permits. Prohibitions on mining near 
streams could sterilize millions of tons of coal reserves and render 
many mines uneconomical. Requiring full restoration of stream form and 
function before any additional mining can take place could paralyze 
many mining operations, and establishing corrective action thresholds 
could interfere with legitimate mining operations that have not 
violated any water quality standards. Also, requiring condition 
precedent sequencing of the mining activities and limitations on mining 
areas not only conflicts with what activities have been permitted but 
also may prevent compliance with the terms and conditions, more 
specifically the reclamation requirements, of the permit. Dictating 
certain post-mining land uses would be contrary to goals of wildlife 
managers and/or landowners who desire more flexible uses for reclaimed 
mine lands. The new so-called coordination procedures will add months 
and even years of delay to critically needed mining permits. Many of 
OSM's proposals would also duplicate or contradict authorities under 
the Clean Water Act that are reserved for the states, in violation of 
SMCRA. Not only do the proposed rules duplicate authorities, but the 
rules also duplicate sampling, monitoring, avoidance and minimization 
processes, and the selection of least damaging alternative analyses. 
DOI should direct OSM to discontinue this rulemaking effort.

   DOI Should Preserve the 1996 Biological Opinion

    Since 1996, OSM and the U.S. Fish and Wildlife Service (FWS) have 
successfully relied on a biological opinion used to address the effects 
of surface coal mining and reclamation operations on threatened and 
endangered species. The opinion correctly concludes that such 
operations conducted in accordance with properly implemented federal 
and State regulatory programs under SMCRA are not likely to jeopardize 
the continued existence of listed or proposed species, and are not 
likely to result in the destruction or adverse modification of 
designated or proposed critical habitats. However, certain FWS offices 
have recently attempted to circumvent the opinion by requiring section 
7 consultations or by providing comments through the Army Corps of 
Engineers' Sec.  404 process rather than through the SMCRA process. DOI 
should ensure that the longstanding terms of the 1996 biological 
opinion between OSM and FWS are followed by both agencies.

   DOI Should Not Allow Abuse of Citizen Suit Provisions

    OSM, along with some other agencies, have allowed certain groups to 
exploit the citizen suit provisions of the implementing laws. They are 
settling lawsuits with plaintiff's lawyers rather than vigorously 
defending regulations from legal challenge, and are further using the 
litigation as an excuse to change longstanding polices of the agency. 
In addition, DOI has paid attorneys' fees to plaintiffs who have not 
even been successful on the merits of the issue being litigated. DOI 
should demand that its agencies vigorously defend duly promulgated 
regulations and findings, and should not pay attorneys' fees to 
litigants except when warranted under the law.

   Energy Policy Act Amendments to the Minerals Leasing Act

    DOI should extend its regulatory review to include rules or 
policies that, if implemented, would achieve the goals enunciated in 
the Executive Order to promote economic growth, innovation, 
competitiveness and job creation. For example, the BLM needs to move 
forward with its long-planned regulations to implement the Energy 
Policy Act of 2005's amendments to the Minerals Leasing Act. The 6 year 
delay in promulgating the rules has created confusion and delays. BLM 
needs to move forward with the regulations to implement the Minerals 
Leasing Act amendments. Congress determined that such amendments were 
necessary to promote efficient production, encourage maximum recovery 
of coal resources and optimize federal and state royalties. Therefore, 
BLM should move forward to implement the following EPAct amendments and 
corresponding BLM regulations:

   EPAct Section 432: allows lease modifications greater than 
        160 acres under certain circumstances (requires changes to 43 
        CFR 3432.1)
   EPAct Section 433: extends the current requirement that all 
        reserves be mined within 40 years (requires changes to 43 CFR 
        3487)
   EPAct Section 434: changes the method for computing advance 
        royalties (requires changes to 43 CFR 3483.4)
   EPAct Section 435: deletes the requirement that a lessee 
        submit a coal lease operation and reclamation plan within three 
        years of lease issuance (requires changes to 43 CFR 3482.1)
   EPAct Section 436: eliminates the financial assurance 
        requirement to guarantee payment of deferred bonus bid 
        installments by a licensee with a history of timely payments 
        (requires changes to 43 CFR 3422.4)

                               CONCLUSION

    It is NMA's sincere hope that DOI's retrospective review will 
result in more efficient regulations consistent with the goals of E.O. 
13563. This nation needs a rational and systematic approach to managing 
the wealth of natural resources in and on our federal lands. If you 
have any questions about this submission, please contact me at (202) 
463-2627 or [email protected].
            Sincerely yours,
                                             Katie Sweeney,
                                                   General Counsel.

    The Chairman. Thank you.
    Ms. Dunning, why don't you go right ahead?

STATEMENT OF DARANNE DUNNING, WESTERN ORGANIZATION OF RESOURCE 
                      COUNCILS, HELENA, MT

    Ms. Dunning. Thank you, Chairman Bingaman, Vice Chairwoman 
Murkowski and other members of the Senate Energy and Natural 
Resources Committee.
    My name is DarAnne Dunning, and I'm here today representing 
the Western Organization of Resource Councils, which is a 7-
State grassroots organization that's made up of landowners and 
citizens who live and work in and near the coalfields in the 
Western U.S., including the States of Montana, Wyoming, North 
Dakota and Colorado.
    I'd like to thank you for the opportunity to testify and 
for including our citizen voices in this discussion today.
    I grew up in southeastern Montana where my family has been 
ranching since the 1880s, originally raising horses and now 
cattle. Our family ranch is just a few miles south of the 
proposed coal tract development at Otter Creek, which is the 
largest new coalmine proposed in the lower 48. We're also quite 
close to existing coalmines in southern Montana and northern 
Wyoming in the Powder River Basin.
    Our engagement with this topic goes back to the very 
inception of SMCRA, and, today, I bring with me in spirit the 
ranchers and farmers who traveled from the Northern Plains and 
the Powder River region throughout the 1970s to come to 
Washington, DC, to enlist the help of Congress in achieving 
important reforms in the regulation and oversight of coalmining 
in the United States.
    Those farmers and ranchers from the West joined with the 
citizens from the Appalachian region and coalfields in eastern 
States who had seen the coal industry overwhelm State and local 
government regulators and operate with impunity.
    They worked with Congress to ensure that OSM became an 
independent Federal enforcement agency that was intentionally 
designed to be transparent and accessible to those citizens who 
were so affected by the dramatic disturbance of coalmining in 
their communities.
    Secretary Salazar's order raises 3 main concerns that go to 
the very heart of the functioning and workability of SMCRA.
    The first is the fundamental conflict in the mission and 
purpose of the 2 agencies, which could be severely compromised 
if they're rolled into one agency.
    Second, the concern of burying OSM into a large, 
bureaucratic layer of government like BLM that could compromise 
OSM's functionality, insulate it and make it less responsive to 
citizen involvement.
    Third, as has been well addressed, whether the Department 
of Interior can legally integrate OSM into BLM without amending 
SMCRA.
    BLM is responsible for the leasing of the vast majority of 
the West's coal reserves, while OSM is fundamentally a 
regulatory and enforcement agency. Separating these functions 
into 2 distinct agencies is important for avoiding conflicts of 
interest, such as what we've seen recently in the leasing of 
offshore oil reserves.
    The Deepwater Horizon oil spill is an example of how the 
Federal Government's role in promoting the leasing and 
development of Federal natural resources sublimated its 
regulatory responsibilities.
    In response, the Minerals Management Service was divided 
into 3 separate agencies and actually created 2 new independent 
bureaus. Yet, Secretary Salazar's order now proposes to combine 
the separate leasing and regulatory functions of coalmining 
into one bureau, the Bureau of Land Management.
    At this time, BLM's in a process of an aggressive push to 
dispose of approximately 6-billion tons of the public's coal in 
Montana and Wyoming alone to private companies.
    I'd like to discuss some issues with BLM's handling of coal 
in the West that might shed light on why it might not be 
appropriate to place mine leasing oversight, regulation and 
enforcement all within BLM.
    First, BLM decertified the Powder River Basin in the late 
1980s as a coal-producing region, and it remains decertified 
despite the massive increase in leasing and the fact that the 
Powder River Basin is the largest source of coal in the United 
States.
    As a result, the leases in the Powder River Basin are being 
leased almost entirely on a lease-by-application, piecemeal 
process, which is not mindful of the cumulative impacts in the 
area.
    This lease-by-application process also undermines the 
agency's ability to determine the fair market value for the 
coal, because when the applicant and the bidder is one and the 
same, it's next to impossible to have a competitive bid process 
that actually results in a fair market value.
    BLM is additionally pushing forward with even more coal 
leases despite a clear record that mines seeking even more 
Federal coal have not complied with the contemporaneous 
reclamation as required under SMCRA.
    For instance, in Wyoming, only 3.5 percent of disturbed 
acres have reached Phase III bond release, yet, BLM has 
proposed leases in Wyoming totaling an additional 50,000 acres.
    The dominant culture within the Bureau of Land Management 
has been as a promoter of coal in the region, and, for that 
reason, it's singularly unsuitable to absorb OSM.
    Specifically, section 201 of SMCRA prohibits integrating 
OSM within a Federal agency such as BLM whose purpose is 
promoting the development or use of coal.
    In conclusion, I urge the members of the committee to look 
at the many questions raised by the proposal. We oppose moving 
forward with this order until those questions can be addressed 
and a much greater investigation of the proposal and 
consultation with all of the affected stakeholders, including 
the citizens of the coalfields, can take place.
    So thank you very much for your time and for the 
opportunity to comment on this important matter.
    [The prepared statement of Ms. Dunning follows:]

Prepared Statement of DarAnne Dunning, Western Organization of Resource 
                          Councils, Helena, MT

    Chairman Bingaman, Vice Chairwoman Murkowski, and members of the 
Senate Energy and Natural Resources Committee, my name is DarAnne 
Dunning. I am representing today the members of the Western 
Organization of Resource Councils, a seven-state grassroots 
organization made up of landowners and citizens who live and work in 
and near the coal fields in the western U.S. Thank you for the 
opportunity to testify and for including our voices in this important 
discussion today.
    The members of the Western Organization of Resource Councils live 
in and around the coal mining regions of Wyoming, North Dakota and 
western Colorado, as well as in Montana, and we would be profoundly 
affected by Secretary Salazar's proposal which is before you for 
consideration today, to integrate the Office of Surface Mining into the 
Bureau of Land Management.
    I grew up in southeastern Montana where my family has been ranching 
since the 1880s, originally raising horses and now cattle. Our family 
ranch is a few miles south of the proposed coal tract development on 
Otter Creek, which is the largest new proposed mine in the lower 48. 
The area is also close to the existing coal mines at Colstrip and 
Decker and in northern Wyoming. I currently reside in Helena, Montana, 
where I am in private practice as an attorney and part of my practice 
focuses on energy and natural resources issues in the Northern Plains 
and Powder River Basin in Montana. I am a member of Northern Plains 
Resource Council, one of the 7 statewide groups that make up WORC.
    Our engagement with this topic goes to the inception of the Surface 
Mine Control and Reclamation Act (SMCRA). I bring with me in spirit the 
ranchers and farmers--some of them neighbors and dear family friends--
who traveled from the Northern Plains and Powder River region to 
Washington, DC, throughout the1970s and walked the halls of this 
beautiful capitol enlisting the support of first our Western 
delegations and then the wider assembly of Congressmen and women from 
all regions to achieve important reforms in the regulation and 
oversight of surface mining in the United States. Several of them stood 
in the Rose Garden of the White House in August 1977 when President 
Jimmy Carter signed SMCRA into law, along side citizens from the coal 
fields of Kentucky, Tennessee, and West Virginia. The adoption of the 
SMCRA was a landmark achievement where ordinary people could take their 
case and make a difference in whether mining would continue to 
devastate their homes and farms or the coal industry would be held to a 
rigorous and fair standard across the nation. SMCRA gave unprecedented 
powers to citizens in implementing and enforcing the law.
    Our members had a significant impact on how the law was written to 
ensure that surface mining reclamation west of the Mississippi would 
reflect the unique distinctions of our semi-arid climate where water is 
precious and the native grasslands and rare prairie forests have 
evolved uniquely over time to withstand our harsh, dry and brittle 
climate.
    They also joined with citizens from the Appalachian region who had 
seen the coal industry overwhelm state and local government regulators 
and operate with impunity as they polluted waters and left gaping holes 
and spoil piles across the landscape. These citizens voices rose 
together to insist on a regulatory framework that was open to the 
ongoing presence and engagement of people who live near and are 
affected by coal surface mining operations. They worked with Congress 
to craft legislation that ensured an independent federal enforcement 
agency and one that was intentionally ordained by Congress to be 
transparent and accessible to the citizens who are so affected by the 
dramatic disturbance of surface mines in their communities.
    Secretary Salazar's proposed integration of the Office of Surface 
Mining into the Bureau of Land Management raises a number of red flags 
that caution us against this move. These concerns go to the heart of 
the effective functioning and workability of SMCRA.
    Three immediate and compelling concerns raised by this proposal are

          (1) the fundamental conflicts in mission and purpose of the 
        two agencies which could be severely compromised if they are 
        rolled into one agency,
          (2) the addition of a large and inflexible bureaucratic layer 
        of government that would compromise OSM's functionality, 
        insulate it and make it less responsive to citizen involvement, 
        and
          (3) whether the Department of Interior can integrate OSM into 
        the Bureau of Land Management without amending SMCRA.

    BLM and OSM have distinct and, to some degree, conflicting 
missions. BLM's mission is to manage the use of public land resources 
primarily in the West, including coal, and get fair market value for 
them. BLM is responsible for the leasing of the vast majority of the 
West's coal reserves. OSM regulates coal mining on both public and 
private lands, although most active with private lands in the East. It 
is charged with ensuring that reclamation of all coal-mined lands 
occurs and that it is done under rigorous and strict standards with 
full transparency and oversight by states and the public at large. OSM 
is fundamentally a regulatory agency, while BLM's role in part is to 
manage federal coal reserves, which includes leasing activities that 
bring revenue to the federal government. Both are necessary functions, 
but separating them in two distinct agencies is important for avoiding 
conflicts of interest, such as those that have arisen in leasing high-
risk off-shore oil reserves. We need to ensure that OSM's regulatory 
functions, which include ensuring realistic mining and reclamation 
plans that do not compromise the welfare of citizens or the protection 
of the environment, are not compromised by similar conflicts of 
interest.
    One lesson of the Deepwater Horizon oil spill in the Gulf of Mexico 
is that the federal government failed in its mission to enforce public 
safety in its oversight of oil well drilling because its role in 
promoting the leasing and development of federal oil in the Gulf 
sublimated its regulatory responsibilities. In response, the Minerals 
Management Service has been divided into three sections, including two, 
independent bureaus. Yet, Secretary Salazar now proposes to combine the 
separate leasing and regulatory functions of coal mining into one 
bureau in BLM. BLM is 20 times the size of the Office of Surface 
Mining. The sheer mass of this agency and its employees and distinctive 
mission threatens to enmesh OSM in an impenetrable and difficult to 
navigate bureaucracy that poses enormous challenges to citizen 
participation. Our experience in the West is that the path for a 
citizen to reach a responsible official within the Office of Surface 
Mining is relatively straightforward. In contrast, because of its size 
and broad portfolio of responsibilities and many sub-divisions, both 
geographic and topical, BLM presents a complicated challenge to 
citizens wanting to the engage the agency on vital decisions that 
affect them, their property, health and livelihoods.
    At this time, BLM is in the process of an aggressive push to 
dispose of approximately 6 billion tons of the public's coal in Montana 
and Wyoming. This massive disbursal of the public's reserves to private 
companies raises several important questions that shed light on why it 
might not be appropriate to place mine oversight, regulation and 
enforcement within the BLM.

   The leases are being offered on a lease by application 
        piecemeal process, despite the clear directives of the Federal 
        Coal Leasing Amendments Act and federal court rulings to manage 
        federal coal leases regionally, mindful of cumulative impacts.
   The lease by application process undermines the agency's 
        ability to gauge the market for federal coal, as competition at 
        these lease sales is almost unheard of. Two recent sales this 
        past summer in the Southern Powder River Basin underscore this 
        point. Two nearby mining companies (Alpha and Peabody) bid 
        against each other, resulting in significantly higher bonus 
        bids. (Belle Ayr North, July, 2011 .95/ton and West Caballo, 
        August, 2011, $1.016/ton)
   BLM decertified the Powder River Basin in the late 1980s 
        and, despite the massive increased activity in leasing 
        applications and the fact that the Powder River Basin is the 
        largest source of coal in the US, has not re-certified the area 
        as a coal producing region.
   BLM's coal leasing program has not undergone any serious 
        independent scrutiny since the 1980s and is ripe for review, 
        particularly in the area of how it determines what constitutes 
        fair market value for the public's coal.
   BLM is pushing forward with coal leases despite a clear 
        record that mines seeking more federal coal have not complied 
        with the contemporaneous reclamation as required under SMCRA. 
        OSM has identified in recent years the increasing gap between 
        acres disturbed and acres released from Phase III bonds, which 
        is the determinative measure that the land has met the 
        standards of the act. Phase III bond release indicates that a 
        viable sustainable vegetative community has stood the test of 
        time in the harsh climate conditions of our region. For 
        instance, in Wyoming only 3.5% of disturbed acres have reached 
        Phase III bond release.

    The dominant culture within the Bureau of Land Management has been 
as a promoter of coal in the region and its consistent stance in this 
respect makes it singularly unsuitable to absorb OSM which is charged 
with regulation and enforcement and must be independent and 
transparent.
    For example, a recently proposed coal exchange in Montana (Nance-
Brown AVF Coal Exchange) approved by the BLM ignores the rights of 
surface owners to withhold consent to surface mining of their privately 
owned, deeded land where it overlies federal coal. BLM is explicitly 
mandated under Sec. 714 of SMCRA to consult with private surface owners 
in split estate federal coal and may convey that coal for surface 
mining purposes. While the federal government was obliged by a court 
order to exchange federal coal with the coal owned by Nance-Brown 
deemed unsuitable for surface mining, the idea that this exchange could 
take place under privately held surface without consent is outrageous. 
Such arrogance on the part of BLM in regard to its obligations under 
the law ignores Congress clear intent and disrespects private property 
rights.
    Finally, there are potential issues with integrating OSM into BLM 
without amending SMCRA. OSM was specifically established as a separate 
entity to protect its regulatory function. In addition, Section 201 of 
SMCRA prohibits integrating OSM within and federal agency ``whose 
purpose is promoting the development or use of coal or other mineral 
resources.'' Yet, one of BLM's purposes is the development of coal 
through leasing.
    I urge you to look into the many questions raised by the proposal. 
We oppose moving forward with the order until these questions can be 
addressed and much greater investigation of the proposal and 
consultation with all of the affected stakeholders, including the 
citizens of the coalfields, can take place.
    Thank you for your time and the opportunity to comment on this 
important matter.

    The Chairman. Thank you all for your testimony.
    Senator Shaheen has not had a chance to ask questions, so 
why don't I go to her first and have her ask her questions?
    Senator Shaheen. Thank you very much, Mr. Chairman, and I 
would reassure all of the people testifying that I share many 
of the concerns that you've all raised about the effort to 
combine these 2 agencies.
    I spent a fair amount of time living in West Virginia and 
going to--living in Pennsylvania near the coalfields. So I 
appreciate the challenges that people living near those fields 
often experience. So I do appreciate the concerns that folks 
are raising today.
    Ms. Sweeney, I would actually like to address some of the 
hard-rock mining issues. You expressed concern about the 
difficult financial times that we're in, and I agree with that. 
I understand that that may be the motivation behind this 
legislation, even though I think it may be ill-conceived.
    But you talk about the importance of encouraging rather 
than impeding domestic mining. One concern that I have is that 
the mining law of 1872 provided the opportunity for federally 
owned gold, silver, copper, uranium and other hard-rock 
minerals to be mined without paying anything to the government, 
and I think that has put in place a pretty good deal for the 
mining industry, but something that I think we ought to 
reexamine, and I wonder how you would respond to that.
    Ms. Sweeney. Thank you for the question.
    Obviously, you know, we are concerned about, you know, 
having policies that promote domestic mining, and the mining 
law has been one of those policies that has promoted domestic 
mining.
    But there are a lot of barriers and hurdles to mining, one 
of which is, you know, the minerals may be difficult to find. 
They are difficult to find, and that's why the mining law does 
have--allows the public to go out and explore for mining 
operations.
    But I do understand your point. You think that mining isn't 
paying a fair return to the public. You know, obviously, there 
are many other contributions that mining makes besides royalty, 
but I can tell you that National Mining Association has been 
supportive of changes to the mining law, which do include a 
royalty to give a fair return to the public.
    Senator Shaheen. I guess I'm less concerned over that fair 
return to the public, because I would agree that the public 
does benefit from those minerals that are mined, but my concern 
is that we have actually an overly generous form of 
depreciation, known as percentage depletion, that mining 
companies are able to take advantage of that really results in 
a double subsidy for those hard-rock mining companies.
    That is the piece that I really think we ought to take a 
look at, because, in these times of austerity, I do think 
looking at those subsidies that may no longer make sense in 
today's world that may have made sense in 1872, when that law 
was passed, really ought to be looked at, so that we're not 
providing double subsidies to mining companies to encourage 
them to do their exploration.
    Mr. McGinley, I wonder if you could describe for me the 
importance of the stream protection rule with respect to 
regulating valley fills and mountaintop mining removal?
    Mr. McGinley. I can briefly describe what I understand to 
be the impact.
    Also, earlier in the hearing, Senator Paul asked some 
questions with regard to the prospective application of a new 
rule. He mentioned Justice Scalia's opinion, but Justice 
Scalia's opinion was not the controlling law of the Rapanos 
case. It was Justice Kennedy's opinion.
    The question of ephemeral streams, ephemeral streams have 
never been regulated under SMCRA, but they are locatable on any 
topographic map. They're used by mining engineers in the 
permitting process, so just to make that clear.
    I believe that the proposals, in the past, the buffer zone 
rule that was in effect from--I believe it was 1981 or 1982 
until late in the Bush administration, the second Bush 
administration, prohibited mine activities within 100 feet of 
an intermittent or perennial stream. Intermittent is defined. 
It is somewhat nebulous.
    But, in any event, mountaintop removal mining went on for 
several decades with that rule in place, and, in fact, expanded 
to an extraordinary extent, to the extent that people of the 
coalfields are concerned about the impacts of this large--much 
larger, growing, larger-scale mountaintop removal operations.
    The impacts on communities are attendant the large- scale 
mining--blasting, damage to structures, flooding and health 
problems.
    Recent studies, peer-reviewed studies, have indicated that 
there may be health-related impacts to coalfield communities 
that are impacted by large-scale mining, as well as 
environmental impacts, not--certainly with regard to the 
headwater streams, but the scientific studies, including the 
environmental impact statement done by EPA, indicate downstream 
serious water-quality impacts as a result of the valley fills.
    Finally, these valley fills are some of the biggest 
structures that exist east of the Mississippi. Coalfield 
residents, especially in Appalachia, who live, really in the 
shadow of these enormous fills--some of them are 2 or 3 miles 
long filling the heads of hollows, 200-, 300-, 400-feet deep 
with mine spoil--they live there with a memory of the Buffalo 
Creek Disaster that occurred in Logan County, West Virginia, in 
1972 that killed 129 West Virginians and made thousands 
homeless.
    So there are concerns about the growing stability of--or 
the stability of these very large valley fills and also the 
large coal-waste, liquid-waste impoundments that loom over 
communities. So there are very serious concerns among coalfield 
communities, especially in Appalachia. That's where mountaintop 
removal operations occur.
    Senator Shaheen. Thank you.
    The Chairman. Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman.
    I want to thank all of you who have appeared before us 
today for your testimony.
    It's not too often, Mr. Chairman, that all of us that are 
up here on the dais are in agreement, and then to have a full 
panel that has expressed the same concerns, perhaps for 
differing reasons, I think it is a clear signal to us that 
there is much, much work that needs to be done, if, in fact, 
this can even move forward.
    I've heard from each of you the request, if you will, that 
there needs to be the stakeholder input. There needs to be that 
consultation that clearly did not take place.
    Perhaps the Secretary will take the advice of Senator 
Manchin here and pull this down, but if he should not, I would 
certainly hope that, at a bare minimum, there is a level of 
consultation not only with the committees, the Congress, but, 
clearly, with those that are involved in mining operations, 
whether it's coal or hard rock, from the concerns that we've 
heard here this morning.
    I do want to ask a question, because both Mr. Corra and Mr. 
Lambert spoke to it, and I think just about everybody had some 
issues as they related to state primacy over the coal programs.
    Mr. Corra, you mentioned that there are differences between 
the coal programs in the Powder River Basin and what Mr. 
Lambert sees in the mountains of Virginia there.
    Can you speak to perhaps some of the differences and 
provide us with what would happen if this merger were to move 
forward and the programs that you have had in place, would they 
be significantly impacted by the order that we're looking at? 
How would the States be able to continue with the level of 
operations that you have had respecting the differences that we 
see in a place like Wyoming, as opposed to Virginia or West 
Virginia?
    Mr. Corra. Mr. Chairman, to the first question, the arid 
west is much different than Appalachia, and the mining 
techniques are different. In Wyoming, our mines, on a somewhat 
regular basis, do mine through intermittent streams and 
perennial streams, and they restore those streams.
    I presented some testimony before another committee a while 
back that showed some pretty good examples of that where we've 
even won reclamation awards from the Office of Surface Mining 
for that work.
    So the terrain is flatter. The climate is much more arid, 
and, in fact, the Clean Water Act even recognizes differences 
between the east and the west.
    One of our issues with that particular stream protection 
rule is that we felt that OSM might actually be intruding on 
authorities that were given to us through the Clean Water Act 
in the USEPA. So I hope that answers the questions about the 
differences.
    With regards to what will happen in the future, we simply 
don't know, and that is what is causing us some great concern. 
It has taken 30 years to build the professional relationships 
that exist out there. With regards to the BLM, I think the 
working relationship inside the State is very good. So, as 
senior management in those organizations implement the merger 
in whatever form or fashion it might take, we're quite anxious 
about how that will upset that balance.
    We're pretty proud of the fact that we provide input, a lot 
of input and a lot of technical assistance to both Federal 
agencies in Wyoming all the time.
    Senator Murkowski. I appreciate that.
    Mr. Lambert.
    Mr. Lambert. Yes, ma'am, thank you. I agree with Mr. Corra. 
At this point, with the limited information that we've been 
provided, I don't think we can even second guess what that 
might look like if those 2 departments are merged.
    Agreeing with Mr. McGinley, you know, the Appalachian 
region is a very different region from the arid West, and we do 
have distinct, separate mining operations using valley fills.
    I would kind of disagree to a point that they are impacting 
to the point that we are destroying the environment. We have 
several studies that also says that this is being done in a 
respective manner.
    We have built a 30-year relationship working with OSM, and 
if this merger takes place, with the limited information that 
we have and the limited involvement that we have had to this 
point, will that destroy our 30-year relationship in 
implementing SMCRA? As a State primacy, how would we be 
affected with our primacy programs? We just don't know that at 
this point.
    That's why we encourage OSM, BLM, if this moves forward, to 
engage the States as well as the industry and other parties to 
be involved in this integration.
    Senator Murkowski. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Senator Franken.
    Senator Franken. Thank you, Mr. Chairman.
    Mr. McGinley, Mr. Hayes stated in his testimony that the 
revenue collection operations of OSM will be transferred to the 
Office of Natural Resource Revenue. Mr. Hayes also stated that 
enforcement in regulatory functions would remain separate from 
leasing activities. Does that alleviate your concerns about the 
combination of the 2 offices? Because, from your testimony, it 
sounds like Mr. Hayes might be missing the point.
    Mr. McGinley: I think the Office of the Secretary is 
missing the point.
    I took the liberty of looking at the structure of--the 
hierarchy structure within the Department of Interior, the 
bureaus and the offices that's available on line, and it has a 
place from the Assistant Secretary level to OSM, Bureau of Land 
Management and other offices and bureaus.
    I haven't heard anything from the secretary's office where 
exactly the Presidential appointee, the director of OSM, would 
fit in that structure. Would the director of OSM be reporting 
to someone in BLM?
    I agree with my colleagues here what is unknown about this 
proposal and the fact that it wasn't vetted at all is 
extraordinarily troubling. I would submit that that is a reason 
that we find those of us who may disagree on many issues with 
regard to coalmining and coalmining enforcement and 
reclamation, we all come here astounded that this proposal has 
been made with so little forethought. How this would work, the 
process that would be involved is totally unclear.
    There are some administrative functions, I'm sure, that 
could be accomplished, and savings accomplished with 
arrangements that fall far short of tampering with the 
structure--the command of the organic statute, the Surface 
Mining Control and Reclamation Act.
    Senator Franken. Thank you.
    Mr. Lambert, I'm member of the Senate Indian Affairs 
Committee, and I take the concerns raised by Indian tribes 
especially seriously.
    The U.S. Government has an agreement with tribes to consult 
with them before making policy changes that affect tribal 
lands. To your knowledge, did any such consultations like this 
take place before this decision was made?
    Mr. Lambert. Senator, I think Mr. Corra would be better to 
answer that question.
    Senator Franken. OK. Mr. Corra.
    Mr. Corra. Mr. Chairman and Senator Franken, I am not aware 
that any of those consultations took place, would not know. All 
I can say is that as far as the State of Wyoming is concerned, 
no one has talked to us.
    Senator Franken. OK. The Navajo Nation released a statement 
saying that they had not been consulted, and, at this point, I 
would not--If that's the case, they were not keeping up with 
their obligations to the tribes.
    Ms. Sweeney, the Interior Secretary issued this order on 
October 26 with an effective date of December 1 . That seems 
like a pretty short timeline, since it sounds like very little 
consultation was done beforehand. We've already heard that the 
States weren't consulted.
    Did the National Mining Association know anything about 
this before the decision was made? Also, do you feel like a 
month isn't an adequate timeline for this implementation?
    Ms. Sweeney. The mining industry was just as surprised and 
shocked as everybody else. Yes, the very, very short timeframe, 
given the legal questions, the fact that they don't seem to 
have looked at what exactly the cost savings will be, seems 
like cart before the horse.
    Senator Franken. OK. Thank you. Thank you, Mr. Chairman.
    The Chairman. Senator Barrasso.
    Senator Barrasso. Thank you very much, Mr. Chairman, and 
just to follow up along that same line of questioning, and I 
agree with my colleague, Senator Franken, for his concerns, 
because I think we all share those concerns.
    I'm just kind of thinking of the written testimony from Mr. 
Corra, Mr. Lambert. You both expressed concerns. Secretary 
didn't consult the States prior to issuing Order No. 3315, and 
do you really think that it's possible to have meaningful 
consultation after the fact, after the issuance of the order? 
If so, you know, what would meaningful consultation look like 
after you know what they're already planning to do?
    Mr. Lambert. Senator, this proposal of the integration of 
those 2 agencies in the short timeframe makes me think back to 
the procedure of the stream buffer zone rule when States were 
not contacted until the last minute. To me, this seems like an 
effort that we have defined a problem and we don't even--or we 
have defined a solution and we don't even know what the problem 
is as of yet.
    So, at this point, given this short timeframe, my answer 
would be no. I don't think no meaningful consultations could be 
conducted, given that we're looking at the first of December.
    Senator Barrasso. Mr. Corra.
    Mr. Corra. Mr. Chairman, Senator Barrasso, I think I would 
echo my colleague. I think that we've seen 2 examples. One is 
the stream protection rule and the other is a recent memorandum 
of agreement that was reached between the BLM and the EPA and 
others with regards to how they do environmental analyses ahead 
of their resource management plans and their impact statements 
on projects--and those have a definite impact on the States. 
That was completely negotiated right at the end. Just before 
signature we were notified of that.
    So, so far, consultation has not taken place, and part of 
what we want to do today is to seek some way in which we can.
    Our view is that, you know, once we understand what the 
work is, then we can put an organizational structure around it. 
This seems to be the other way.
    Senator Barrasso. In your testimony, you had some concerns 
also about the merger's impact on abandoned mine land, the AML 
program. I wonder if you could just elaborate a little bit on 
those concerns and what steps should the department be taking 
to ensure that the AML program is not affected.
    Mr. Corra. Mr. Chairman, Senator Barrasso, the way in which 
abandoned mine lands are reclaimed in the State of Wyoming, 
because we're a certified State, we are able to take care of 
the non-coal reclamation as well as coal, and we work very 
closely--the BLM recognizes the infrastructure that we have in 
place for reclamation. So we actually augment a lot of their 
work, and we have a memorandum of agreement with them that 
governs how we regulate non-coalmines and reclaim non-coalmines 
as well.
    So as it stands right now, we've been very effective at 
doing that. Wyoming being the largest coal producer in the 
country, it has most at risk, if you will, as the agency begins 
to look at that subject.
    Senator Barrasso. Additionally, not just that, let's talk 
about a couple of other things. The written testimony, you both 
expressed--you and Mr. Lambert both expressed concern about the 
OSM's recent practice of second guessing the State permitting 
decisions. I wonder if you could tell the committee how long 
this has been taking place and what might be the reason for it?
    Mr. Lambert. Thank you for the question, senator.
    This just recently took place, beginning the first of the 
year, when the new directives came out from OSM that they would 
start second guessing our permitting decisions.
    Senator Barrasso. How about the proposed stream protection 
regulations? You just specifically mentioned that a little bit, 
Mr. Corra. You think that that--that the OSM has faithfully 
followed the current national environmental protection or the 
National Environmental Policy Act during the rulemaking 
process? What do you think is happening there?
    Mr. Corra. Mr. Chairman, Senator Barrasso, it appears on 
the surface that they are following the basic tenants of the 
National Environmental Policy Act. However, the way in which 
they the States, by the way, were signed up as cooperating 
agencies. However, we were given massive volumes of data to 
review in like a limited number of days.
    The way in which they sought public input was also flawed, 
in my opinion, very cursory, if you will.
    Senator Barrasso. With regard to the OSM's proposed stream 
protection regulations, if this goes on, the regulations are 
finalized, do you think there's going to be an impact on jobs 
in our home State?
    Mr. Corra. Mr. Chairman, Senator Barrasso, I think it's too 
early to tell. The way in which the information has been 
presented to us as they have gone through--is rather 
complicated. They talk about a smorgasbord. I think it will 
have an impact on the industry, but I'm not sure exactly what 
it is.
    I think some of the original assumptions they made about 
just simple fuel switching are probably too simplified. I think 
when utilities begin to make choices on fuel, those choices 
take on way many different dimensions than just where the coal 
comes from.
    Senator Barrasso. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Unless there's additional questions from any 
panel member, I want to thank this group of witnesses. I think 
it's been useful testimony and we appreciate it. We will take 
your testimony to heart and hope to learn something from it.
    Thank you very much.
    [Whereupon, at 11:12 a.m., the hearing was adjourned.]

                               APPENDIXES

                              ----------                              

                               Appendix I

                   Responses to Additional Questions

                              ----------                              

      Responses of David Hayes to Questions From Senator Bingaman

    Question 1. Please provide for the record any analyses, opinions, 
memoranda, or other documents, including those from the Office of the 
Solicitor, regarding the legality of Secretarial Order 3315 providing 
for the consolidation of the Office of Surface Mining Reclamation and 
Enforcement into the Bureau of Land Management.
    Answer. Any written product prepared by the Solicitor's Office 
entails the provision of legal advice to the Department of the Interior 
and thus is confidential attorney-client and predecisional material. It 
should be noted that the report issued to the Secretary on February 15, 
2012, titled Report for the Secretary on the Proposed BLM/OSM 
Consolidation (Report), which can be found at: http://www.doi.gov/news/
pressreleases/loader.cfm?csModule=security/getfile&pageid=283745, 
recommended that the Office of Surface Mining continue to operate as an 
independent bureau within the Department and that the Director of the 
Office of Surface Mining continue to report to the Secretary through 
the Assistant Secretary for Land and Minerals Management. Secretarial 
Order No. 3320, issued on April 13, directs implementation of the 
recommendations made in the Report.
    Question 2. Please provide for the record any analyses, opinions, 
memoranda, or other documents regarding the pros and cons of 
consolidating the Office of Surface Mining Reclamation and Enforcement 
into the Bureau of Land Management. Please include any documents 
regarding budgetary savings from such a consolidation.
    Answer. Documents associated with this process reflect internal, 
pre-decisional deliberations. Regarding budgetary savings, actual 
savings will depend on the successful consolidation of various shared 
support services between the two bureaus, in accordance with the 
recommendations set forth in the February 15 Report.
    Question 3. To whom will the OSM Director report within the 
Department?
    Answer. As noted above, the February 15, 2012, Report recommends 
that the Office of Surface Mining continue to operate as an independent 
bureau within the Department and that the Director of the Office of 
Surface Mining continue to report to the Secretary through the 
Assistant Secretary for Land and Minerals Management. Secretarial Order 
No. 3320, issued on April 13, directs implementation of the 
recommendations made in the Report.
    Question 4. Please describe the federal-state-tribal relationship--
the so-called ``primacy model'' contemplated by the Surface Mining Act? 
What are OSM's ongoing responsibilities under the Surface Mining 
Control and Reclamation Act once a State or Tribe attains primacy?
    Answer. Congress recognized the unique needs of states and tribes 
and the unique environmental conditions within state and tribal 
boundaries. Thus, the Surface Mining Control and Reclamation Act 
encourages states and tribes to enact and administer their own 
regulatory programs--that is, to attain ``primacy''--within federal 
minimum standards contained in SMCRA and OSM's implementing 
regulations. Once OSM approves a state or tribal regulatory program, 
the state or tribe becomes the primary regulator, with respect to the 
approved program, within its boundaries, while OSM provides guidance 
and technical assistance to the state or tribe, conducts oversight of 
approved programs, and provides backup federal enforcement as 
necessary.
    Question 5. One of the witnesses on the second panel stated that it 
can take 7 to 10 years to get all the permits necessary to mine on BLM 
lands. The same witness indicated that there are 14 levels of review in 
the Department's Washington, D.C, office for NEPA Federal Register 
notices. Is this correct? If not, please provide the correct 
information for the record.
    Answer. Each year, the Bureau of Land Management's State Offices 
send from 300 to 500 Federal Register notices to the BLM Washington 
Office for review, which is designed to improve the overall quality and 
consistency of the BLM's Federal Register notices. Errors are 
identified and corrected in about 90 percent of notices submitted for 
review. Generally speaking, larger mine projects involve longer 
permitting timeframes. Such projects typically require more analysis 
under the National Environmental Policy Act or may entail more 
controversy than a smaller mine project. Larger projects can also be 
more complicated for mine operators, who may have to amend their plans 
after submission. Litigation can also contribute to the length of 
permitting timeframes. The agency is continuing its efforts to review 
and process permits and to prepare Federal Register notices in 
accordance with applicable laws.
    Question 6. There has been controversy surrounding OSM's efforts to 
review and revise the stream buffer zone rule. This issue is raised in 
the statements of some of the witnesses on the second panel. Please 
provide for the record an explanation of the process being undertaken 
by the agency and why the regulation is being reviewed.
    Answer. Congress specified several purposes for SMCRA, intending 
that the Department strike a balance between protection of the 
environment and agricultural productivity and the Nation's need for 
coal. OSM must ensure not only the coal supply essential to the 
Nation's energy requirements is provided but also that American coal 
mines operate in a manner that protects people and the environment and 
that the land is restored to beneficial use following mining.
    As OSM proceeds with development of its proposed Stream Protection 
Rule, it will consider the extensive comments it has already received 
from the public and state and federal agencies. It will also consider 
the benefits, as well as the costs, of the agency's regulatory 
alternatives. OSM began seeking comments very early in the rulemaking 
process.
    The Environmental Impact Statement (EIS) that OSM is developing in 
support of the rule will examine a range of alternatives. In addition 
to analyzing the significant environmental impacts of the proposed 
Stream Protection Rule and its alternatives, the EIS will evaluate the 
economic impacts of each alternative and will provide OSM with critical 
information needed to inform decisionmakers and the public. OSM will 
take the time necessary to make informed decisions on the rulemaking, 
taking into account the EIS analysis, and will provide ample 
opportunity for public input on both the proposed rule and the 
associated Draft EIS.

      Responses of David Hayes to Questions From Senator Murkowski

    Question 1. In response to a question regarding written materials 
from the Solicitor's Office at the Department of the Interior related 
to the Secretary's Order #3315, you agreed to provide the Committee 
with copies of such materials. I respectfully ask that you do so.
    Answer. As reflected in the transcript of the hearing, the Deputy 
Secretary agreed during the hearing to look into the question of 
whether written materials from the Solicitor's Office could be 
released. Any written product prepared by the Solicitor's Office 
entails the provision of legal advice to the Department and thus is 
confidential attorney-client and predecisional material. It should be 
noted that the report issued to the Secretary on February 15, 2012, 
titled Report for the Secretary on the Proposed BLM/OSM Consolidation 
(Report), which can be found at: http://www.doi.gov/news/pressreleases/
loader.cfm?csModule=security/getfile&pageid=283745, recommended that 
the Office of Surface Mining continue to operate as an independent 
bureau within the Department and that the Director of the Office of 
Surface Mining continue to report to the Secretary through the 
Assistant Secretary for Land and Minerals Management. Secretarial Order 
No. 3320, issued on April 13, directs implementation of the 
recommendations made in the Report.
    Question 2. President Clinton's Executive Order No. 13132 on 
Federalism requires a federalism impact statement be provided to the 
Office of Management and Budget--containing a description of the 
agency's consultation with the States, a summary of the nature of State 
concerns and the extent to which those concerns have been met--when 
policy actions that have a substantial impact on the States are taken. 
In relation to Order #3315, will this mandate be honored?
    Answer. The Department has been clear that OSM's core duties and 
responsibilities prescribed by SMCRA would remain intact and under the 
purview of the OSM Director, and the recommendations contained in the 
February 15 report are consistent with this position. As such, the 
Department does not anticipate that any proposed consolidations will 
have a substantial impact on State SMCRA programs. While the provisions 
of the Executive Order No. 13132, referenced in this question, pertain 
specifically to the issuance of regulations, significant consultations 
and meetings with Departmental employees, tribes, state agencies and 
local communities, industry representatives, and congressional staff 
have taken place as the Department has developed an implementation plan 
for the original order.
    Question 3. How will Order #3315 affect the existing productive 
working relationship between OSM field personnel and state program 
personnel?
    Answer. We do not intend to alter the productive working 
relationships in place between OSM field personnel and state program 
personnel. From the beginning of this process, the goal has been to 
evaluate how the Department might be able to more efficiently and cost-
effectively combine expertise and resources of the two bureaus in areas 
that make sense, reducing the drain on OSM resources associated with 
maintaining stand-alone support services for a bureau that has a small 
employee and budget base.
    Question 4. Will Order #3315 affect the allocation of funds for 
state coal mine regulatory programs?
    Answer. While the Department cannot comment on budget allocations 
that are yet to be made, the goal has been to make government work 
better by increasing efficiencies, building upon existing strengths, 
and getting the most out of limited resources. As recommended in the 
February 15 report, the allocation of grant monies will continue to be 
made in accordance with existing OSM practices, and we do not 
anticipate that any proposed consolidations will affect how these funds 
for state coal mine regulatory programs are allocated.
    Question 5. Will Order #3315 affect the allocation of funds to 
state abandoned mine land programs?
    Answer. As noted in response to the previous question, while the 
Department cannot comment on budget allocations that are yet to be 
made, the intent of any proposed consolidations is to make government 
work better by increasing efficiencies, building upon existing 
strengths, and getting the most out of limited resources. As 
recommended in the February 15 report, the allocation of funds to 
states for SMCRA Title IV abandoned mine land programs will continue to 
be made in accordance with existing practices, and we do not anticipate 
that any proposed consolidations will affect the amount or allocation 
of such funds.
    Question 6. Will Order #3315 change the oversight of state 
regulatory and AML programs?
    Answer. The February 15 report recommended that OSM's core duties 
and responsibilities, including oversight of state regulatory and AML 
programs, will remain intact and under the purview of the OSM Director, 
and once a state or tribe attains primacy to administer its own 
approved SMCRA regulatory and AML programs, OSM retains oversight 
authority to assure compliance with SMCRA and the approved programs.
    Question 7. Are there better ways to improve government operations 
than shuffling boxes on the Interior Department's organization chart? 
For example, could actions be taken to enable the BLM to benefit from 
the OSM's high successful TIPS program and technology transfer programs 
with states?
    Answer. The Department and its bureaus are always searching for 
opportunities to improve program performance, and this effort is a 
positive, substantive attempt to make government work better, to build 
on our strengths, and to get the most out of available resources.
    Question 8. How much money could be saved by reducing waste at the 
OSM caused by a management decision to turn regional or local issues 
(e.g., mountaintop mining and revised stream protection rules) into 
national issues which are not germane to most parts of the country?
    Answer. Congress specified several purposes in SMCRA, intending 
that we strike a balance between protection of the environment and 
agricultural productivity and the Nation's need for coal. OSM must 
ensure not only the coal supply essential to the Nation's energy 
requirements is provided but also that American coal mines operate in a 
manner that protects people and the environment and that the land is 
restored to beneficial use following mining. Mountaintop mining and the 
protection of streams from the potential adverse effects of coal mining 
are critical issues of national importance. Such national issues are 
traditionally coordinated at OSM headquarters, with appropriate input 
from regional and field offices. This time-honored and effective 
approach does not constitute waste.
    Question 9. How will the inevitable change in culture that follows 
a consolidation of agencies affect state regulatory programs?
    Answer. The Department has been clear that OSM will continue to 
fulfill the core missions assigned to it by statute, including approval 
of state and tribal regulatory programs and subsequent program 
amendments and oversight of those programs. Thus, we anticipate that 
the OSM-state/tribal relationships will remain largely the same. As 
discussed in the February 15 report, the goal is to improve OSM's 
ability to perform core functions by leveraging the existing expertise 
and resources of BLM and OSM in areas that make sense, and reducing the 
drain on OSM resources that is associated with maintaining stand-alone 
support services for a bureau that has a small employee and budget 
base.
    Question 10. Would Order #3315 affect existing cooperative 
agreements under which states regulate coal mining on federal lands? 
Would a consolidation affect other agreements between western states 
and DOI, such as agreements on the regulation of non-coal mining on 
federal lands?
    Answer. We do not anticipate that any of the recommendations 
contained in the February 15 report will result in changes to these 
cooperative agreements.
    Question 11. Where will the cost savings from the consolidation be 
realized and in what exact amounts, over time?
    Answer. One of the goals is to create efficiency in administrative 
functions in order to maximize the resources available to perform core 
agency functions. Actual savings will depend on the successful 
consolidation of various shared support services between the two 
bureaus, in accordance with the recommendations set forth in the 
February 15 Report.
    Question 12. Why were the states not consulted about this matter 
since they are the primary stakeholders under the various organic laws 
affected by this consolidation? How and when does Interior plan to 
consult with the states and tribes to receive their input on the 
consolidation and what it may mean for interaction between the federal 
government and state governments under both SMCRA and the federal land 
management laws?
    Answer. Significant consultations and meetings with Departmental 
employees, tribes, state agencies and local communities, industry 
representatives, and congressional staff have taken place as the 
Department has moved forward with its review.
    Question 13. How will Order #3315 impact the role of the states 
under SMCRA, especially in terms of funding for state Title V 
(regulatory grants) and Title IV (AML grants)? How will it specifically 
impact the administration of the AML program under Title IV of SMCRA? 
Does it reflect a further attempt to accomplish by Secretarial order 
what the President has proposed for the AML program as part of his 
deficit reduction plan?
    Answer. OSM's core duties and responsibilities, including oversight 
of state regulatory and AML programs, will remain intact and under the 
purview of the OSM Director, and once a state or tribe attains primacy 
to administer its own approved SMCRA regulatory and AML programs, OSM 
retains oversight authority to assure compliance with SMCRA and the 
approved programs. Moreover, while the Department cannot comment on 
budget allocations that are yet to be made, the allocation of grant 
monies and funds for SMCRA Title IV abandoned mine land programs will 
continue to be made in accordance with existing practices.
    Question 14. How will the consolidation affect the current chain of 
command within the Interior Department, especially with regard to 
federal oversight of state programs? How could this consolidation 
impact the cooperative working relationship that has generally attended 
the implementation of SMCRA and FLPMA? Who will have primary lead 
responsibility for the new organization--BLM or OSM? How can a 
``consolidation'' result in the continued viability of two separate 
agencies, as suggested by some of the press materials distributed by 
the Department of the Interior?
    Answer. The February 15 report recommends that the Office of 
Surface Mining continue to operate as an independent bureau within the 
Department and that the Director of the Office of Surface Mining 
continue to report to the Secretary through the Assistant Secretary for 
Land and Minerals Management.
    Question 15. Does the Department of the Interior anticipate that 
changes will be needed to the organic acts affected by the 
consolidation? How does the Department of the Interior intend to 
reconcile the differing missions of BLM and OSM under the various 
organic laws affected by the consolidation?
    Answer. As discussed in the February 15 report, the focus of the 
proposal is on those functions in the two bureaus that are 
complementary, including environmental restoration activities and 
administrative support functions. As a result, no changes to the 
organic acts are needed to implement the recommendations contained in 
the February 15 report.
    Question 16. How will this consolidation save money and achieve 
governmental efficiency, other than the potential for combining some 
administration functions? Will the combination of other functions 
(inspection, enforcement, oversight) actually result in the expenditure 
of more money, especially if the federal government assumes 
responsibilities that were formally entrusted to the states?
    Answer. As discussed in the February 15 report, efficiencies will 
be gained through a consolidation of some functions, though there may 
be transition costs in the early stages of implementation. The 
Department can advance the congressionally-mandated missions of both 
bureaus more efficiently and cost-effectively by combining the 
expertise and resources of BLM and OSM in areas that make sense. We do 
not anticipate that the federal government will assume responsibilities 
that are currently entrusted to the states.
    Question 17. Historically, BLM's primary mandate has been on the 
management of public lands in western states. Under Order #3315, how 
would the agency effectively shift to managing mining operations on 
state and private lands in the central and eastern portions of the 
country? How will this save money?
    Answer. The February 15 report recommended that OSM continue to 
perform the core duties and responsibilities assigned to it under 
SMCRA. The focus of the proposal is on those functions in the two 
bureaus that are complementary, including environmental restoration 
activities and administrative support functions.
    Question 18. SMCRA specifically states that OSM cannot merge with 
any legal authority, program, or function of an agency that promotes 
the leasing of coal or regulates the health and safety of miners in 30 
USC 1211(b). Are you aware of this provision?

          30 USC 1211(b)

          The Office may use, on a reimbursable basis when appropriate, 
        employees of the Department and other Federal agencies to 
        administer the provisions of this chapter, providing that no 
        legal authority, program, or function in any Federal agency 
        which has as its purpose promoting the development or use of 
        coal or other mineral resources or regulating the health and 
        safety of miners under provisions of the Federal Coal Mine 
        Health and Safety Act of 1969 (83 Stat. 742) [30 U.S.C. 801 et 
        seq.], shall be transferred to the Office.

    Answer. The Department is aware of this provision and any proposed 
reorganization would be implemented in compliance with this provision 
and any other applicable laws.
    Question 19. In Order #3315, you propose integration of core OSM 
and BLM functions, including regulation, inspection and enforcement, 
state program oversight, and fee collection. But as noted above, SMCRA 
specifically prohibits the transfer of such legal authority to OSM. 
Isn't this proposed integration prohibited by law?
    Answer. We continue to be mindful of all provisions of SMCRA, and 
intend to continue compliance with the law, as we move forward.
    Question 20. Does Reorganization Plan #3 give full discretion to 
the Secretary to organize the department as he sees fit?
    Answer. Reorganization Plan No. 3 of 1950 gives the Secretary broad 
reorganization authority, subject to other express statutory language, 
such as 30 U.S.C. 1211(b), as cited above.
    Question 21. Is that authority not limited by subsequent 
Congressional action that specifically addresses the organization of 
the Department?
    Answer. As noted in response to the previous question, the broad 
reorganization authority under Reorganization Plan No. 3 of 1950 may be 
exercised subject to other express statutory provisions.

      Responses of David Hayes to Questions From Senator Barrasso

    Question 1. A number of witnesses at the Committee's hearing 
questioned whether the Secretary has the legal authority to merge the 
Bureau of Land Management (BLM) and the Office of Surface Mining 
Reclamation and Enforcement (OSM).

   Has the Solicitor issued a written legal opinion on the 
        proposed merger?
   If so, would you make the written legal opinion available to 
        the Committee?

    Answer. Any written product prepared by the Solicitor's Office 
entails the provision of legal advice to the Department and thus is 
confidential attorney-client and predecisional material. It should be 
noted that the report issued to the Secretary on February 15, 2012, 
titled Report for the Secretary on the Proposed BLM/OSM Consolidation 
(Report), which can be found at: http://www.doi.gov/news/pressreleases/
loader.cfm?csModule=security/getfile&pageid=283745, recommended that 
the Office of Surface Mining continue to operate as an independent 
bureau within the Department and that the Director of the Office of 
Surface Mining continue to report to the Secretary through the 
Assistant Secretary for Land and Minerals Management. Secretarial Order 
No. 3320, issued on April 13, directs implementation of the 
recommendations made in the Report.
    Question 2. Why did the Secretary fail to consult with the States 
and Indian tribes before issuing Order No. 3315?
    Answer. As indicated in the February 15 report, significant 
consultations and meetings with Departmental employees, tribes, state 
agencies and local communities, industry representatives, and 
congressional staff have taken place as the Department has moved 
forward with its review.
    Question 3. It is my understanding that the Secretary plans to 
consult with the States and tribes sometime in the future.

   When will the Secretary consult with the States and tribes?
   How will the Secretary ensure that such consultation is 
        meaningful given that it will take place after the effective 
        date of Order No. 3315?

    Answer. As indicated in the response to the previous question, 
significant consultations and meetings with Departmental employees, 
tribes, state agencies and local communities, industry representatives, 
and congressional staff have taken place as the Department has moved 
forward with its review.
    Question 4. The state regulators at the Committee's hearing 
expressed concerns that the proposed merger will affect the Abandoned 
Mine Land (AML) program under the Surface Mining Control and 
Reclamation Act (SMCRA).

   Will the proposed merger affect the AML program?
   If so, how?

    Answer. OSM's core duties and responsibilities, including oversight 
of state regulatory and AML programs, will remain intact and under the 
purview of the OSM Director, and once a state or tribe attains primacy 
to administer its own approved SMCRA regulatory and AML programs, OSM 
retains oversight authority to assure compliance with SMCRA and the 
approved programs.
    Question 5. The state regulators at the Committee's hearing 
expressed concerns that the proposed merger will affect the States' 
regulatory authority under SMCRA.

   Will the proposed merger affect the States' regulatory 
        authority under SMCRA?
   If so, how?

    Answer. We do not anticipate changes to state regulatory authority 
under SMCRA. The Department has been clear that OSM's core duties and 
responsibilities prescribed by SMCRA will remain intact and under the 
purview of the OSM Director, and once a state or tribe attains primacy 
to administer its own approved SMCRA regulatory and AML programs, OSM 
retains oversight authority to assure compliance with SMCRA and the 
approved programs.
    Question 6. The state regulators at the Committee's hearing 
expressed concerns that the proposed merger will affect OSM's 
regulatory grants to States under SMCRA.

   Will the proposed merger affect OSM's regulatory grants to 
        States under SMCRA?
   If so, how?

    Answer. We do not anticipate that the administration of the AML 
program under Title IV of SMCRA will be affected. The Department has 
been clear that OSM's core duties and responsibilities prescribed by 
SMCRA will remain intact and under the purview of the OSM Director. 
Once a state or tribe attains primacy to administer its own approved 
SMCRA regulatory and AML programs, OSM retains oversight authority to 
assure compliance with SMCRA and the approved programs. Moreover, while 
the Department cannot comment on budget allocations that are yet to be 
made, the allocation of grant monies and funds for SMCRA Title IV 
abandoned mine land programs will continue to be made in accordance 
with existing practices.
    Question 7. A witness at the Committee's hearing expressed concerns 
that the proposed merger will result in permitting delays.

   What steps will the Secretary take to ensure that the 
        proposed merger will not result in permitting delays at OSM and 
        BLM?

    Answer. This proposal is a positive, substantive attempt to make 
government work better, to build on our strengths, and to get the most 
out of available resources. As indicated in the February 15 report, 
significant consultations and meetings with Departmental employees, 
tribes, state agencies and local communities, industry representatives, 
and congressional staff have taken place as the Department has 
developed an implementation plan for the original order.

       Responses of David Hayes to Questions From Senator Heller

    Question 1. As you know, the Department of the Interior (DOI) 
natural resource development on public lands brings in vast revenue for 
the federal government. Additionally, the resource development industry 
has been one of the few areas of our economy where we have seen growth 
in recent years. Increased production means more jobs, more economic 
activity, and ultimately, more money to the federal treasury.
    I am generally concerned about this Administration's approach to 
energy and natural resource development--especially during these 
challenging times when jobs, revenue, and affordable energy resources 
are more important than ever.
    In my home state of Nevada, the mining industry is one of the few 
bright spots in our economy. Nevada's unemployment is 13.4%, but in our 
largest mining region, it is more than 6% lower. Our mining industry 
could be even more robust if DOI had policies that promoted responsible 
development. In fact, I recently introduced S. 1844, which is 
legislation to address administrative delays for public lands 
permitting. My legislation would give DOI 45 days to complete required 
Washington office reviews of Notices of Availability required by the 
National Environmental Policy Act prior to publication in the federal 
register.
    I don't know if you are aware that this one administrative 
requirement can add up to a year to the permitting process for a mining 
plan of operations. This is ridiculous. I would suggest that adopting 
my legislation would be a good first step towards real reform of 
duplicative and unnecessary regulations within DOI.
    Policies that promote responsible resource development are good for 
our economy. In that light, my question to you is: with this proposal 
to merge BLM and OSM functions, how can you be certain that it won't 
complicate an already cumbersome permitting process and further delay 
job creation?
    Answer. The Department and its bureaus are always searching for 
opportunities to improve program performance, and the consolidation of 
certain overlapping functions implemented by two bureaus in the same 
Departments is a positive, substantive attempt to make government work 
better, to build on our strengths, and to get the most out of available 
resources. The agencies are continuing their efforts to process various 
mining applications, permits, and notices of availability in a timely 
fashion with a view to meeting the requirements of applicable laws.
    Question 2. I also have a question that relates to broader issues 
of access to public lands. I am aware of a new draft proposal by DOI to 
limit access to certain federal lands for shooting sports. I do not 
take restriction of 2nd Amendment rights lightly. Nearly 85% of Nevada 
is controlled by the federal government--and most of that land is under 
the management of the Bureau of Land Management (BLM). Access to public 
land is vital for the economic health and character of my state. The 
mere assertion that some people ``freak out'' about gun rights isn't 
enough of a reason to alter the Constitution.

          1. Can you give me specific examples in Nevada of places 
        where the BLM has determined ``social conflicts'' relating 
        Second Amendment rights exist?
          2. Who should decide what constitutes a ``social conflict'' 
        that merits federal action--DOI? Congress? Voters?
          3. Do you believe Congress has been unclear in defining the 
        scope of Americans' Second Amendment rights?
          4. Does DOI believe that different backcountry activities, 
        such as hunting and hiking, are mutually exclusive?
          5. Given that a DOI employee has stated that this policy is 
        not a result of public safety concerns, does the draft policy 
        reflect a position that sportsmen's activities do not enjoy 
        equal protection under BLM multiple-use mandate? Please 
        explain.

    Answer. The Department supports opportunities for hunting, fishing 
and recreational shooting on federal land. By facilitating access, 
multiple use and safe activities on public lands, the Bureau of Land 
Management helps ensure that the vast majority of the 245 million acres 
it oversees are open and remain open to recreational shooting. Based on 
feedback received from the Wildlife and Hunting and Heritage 
Conservation Council, Secretary Salazar directed the BLM, on November 
23, 2011, to take no further action to develop or implement the draft 
policy on recreational shooting referenced in your question and to 
manage recreational shooting on public lands under the status quo under 
existing authorities.
                                 ______
                                 
     Responses of Joe Pizarchik to Questions From Senator Barrasso

    Question 1. A number of witnesses at the Committee's hearing 
expressed concerns about OSM's increased use of ten day notices.

   Why is OSM increasing its use of ten day notices?

    Answer. OSM has undertaken oversight improvement initiatives that 
include increasing the number of OSM's oversight inspections, including 
independent inspections, for the purpose of evaluating how states 
administer their SMCRA regulatory programs. The number of Ten Day 
Notices (TDNs), the instrument that OSM uses to notify states of 
alleged or actual violations, has increased along with the number and 
type of inspections. These notifications allow states to take action to 
rectify those violations or show good cause for not taking action, such 
as demonstrating that the violation does not exist under the approved 
program. Most TDNs are resolved cooperatively with state regulatory 
authorities.
    Question 2. A number of witnesses at the Committee's hearing 
expressed concerns about OSM's proposed stream protection regulations 
and the manner in which the agency has conducted the rulemaking 
process.

   What steps will OSM take to ensure that state regulators, 
        especially regulators representing cooperating agencies for the 
        purposes of the National Environmental Policy Act, have a 
        meaningful opportunity to comment during the rulemaking 
        process?
   What steps will OSM take to ensure that the public has a 
        meaningful opportunity to comment during the rulemaking 
        process?

    Answer. All state agencies will have the opportunity to comment on 
the proposed stream protection rule and DEIS when the proposed rule and 
notice of availability of the DEIS are published in the Federal 
Register. Nineteen state agencies, including 11 state regulatory 
authorities, are serving as cooperating agencies in development of the 
DEIS under NEPA, and OSM is carefully considering their input in the 
ongoing process of preparing the DEIS. OSM values the expertise of the 
state cooperating agencies, and appreciates the time and resources they 
are contributing to the development of the proposed rule.
    The public will be given the opportunity to comment on the proposed 
rule and DEIS, in accordance with applicable Federal law, including the 
Administrative Procedure Act and NEPA. OSM will respond to the public 
comments it receives, and consider them when taking final action on the 
rule and EIS. Any final rule and final EIS will be published in the 
Federal Register. Publication of the draft rule will build upon earlier 
extensive public outreach conducted by OSM. Although not required by 
law, OSM issued an Advance Notice of Proposed Rulemaking to solicit 
early public comments on issues that ought to be addressed in the 
regulation. This advance notice generated over 32,000 public comments. 
OSM also conducted 15 stakeholder outreach sessions with a broad cross-
section of stakeholders, including state and tribal regulatory 
authorities, industry, environmentalists and others, to obtain further 
input. Additionally, OSM held nine public scoping meetings across the 
country to obtain initial public input for the development of the DEIS, 
consistent with the requirements of NEPA.
    Question 3. It is my understanding that OSM's former contractor 
estimated that the proposed stream protection regulations would cost 
thousands of jobs. I am concerned that OSM's new contractor may be 
subject to improper influence with respect to job loss estimates.

   What steps is OSM taking to ensure that the individuals 
        responsible for estimating job losses from the proposed stream 
        protection regulations will not be subject to improper 
        influence?

    Answer. OSM is currently completing an analysis of the 
environmental impacts of the rule under development, in accordance with 
NEPA and other applicable federal law. This analysis will include 
relevant socioeconomic impacts, including impacts to jobs, costs, etc, 
as appropriate. OSM staff is completing those portions of the analysis 
for which the agency has in-house expertise. For certain other portions 
of the NEPA analysis, OSM has hired a contractor with significant 
technical expertise and experience in the Federal NEPA process. The 
completed analysis will be based on sound science and clearly 
articulated methodologies. As required by NEPA, it will make explicit 
reference to scientific and other sources relied upon for its 
conclusions. To help ensure confidence in the integrity of the process, 
OSM has also arranged for the DEIS analysis and conclusions to be 
evaluated in a peer review process. When OSM completes the DEIS and 
proposed rule, they will be made available for public review and all 
interested parties will at that time have the chance to comment on 
OSM's analysis, methodologies, assumptions and conclusions.

                              Appendix II

              Additional Material Submitted for the Record

                              ----------                              

                       Buffalo Creek Watershed Association,
                                                    Claysville, PA.
Ken Salazar,
Department of the Interior, 1849 C Street, NW, Washington, DC.
    Secretary Salazar:

    While there is national awareness that significant changes need to 
be made to reduce the national deficit, there is no consensus on what 
those changes should be. Many agencies, institutions, and organizations 
are experiencing trepidation as legislators struggle to stabilize the 
economy. Of utmost concern to the Buffalo Creek Watershed (BCWA) and 
similar community-based environmental protection organizations, is the 
potential adverse impact that selected corrective action proposals such 
as Secretarial Order No. 3315, driven by a mandated deadline and 
initiated without the benefit of congressional consultation or public 
input, may have on the environment and the future health, safety, and 
welfare of the nation's citizenry.
    Downsizing and consolidation of services are popular contemporary 
strategies for capturing operational efficiencies and lowering costs--
actions that tend to be politically, if not publically, appeasing and, 
once approved, quickly implemented. The most expeditious strategy, 
however, is not necessarily the most optimal; and, what may prove 
economically feasible is not necessarily morally appropriate.
    The Office of Surface Mining (OSM) and the Bureau of Land 
Management (BLM) have conflicting purposes and responsibilities. In 
addition, there is substantial anecdotal and documented evidence to 
suggest that neither entity is functioning in a consistently efficient 
and effective manner. So, here we are once again in reaction mode, 
attempting to ``band-aid'' known operational deficiencies within two 
governmental agencies that could and should have been proactively 
addressed. That being said, the internal weaknesses of those two 
agencies will most likely not be resolved by bureaucratizing them. 
Rightsizing and restructuring would be the more prudent approach 
subjecting both to a rigorous long-overdue analysis and reform that 
would ultimately streamline operations, reduce costs, and maximize the 
performance of both agencies.
    The BCWA is not opposed to exploring opportunities for improving 
the function of the OSM and the BLM. It is strongly opposed, however, 
to entombing the OSM in a behemoth administrative quagmire of 
conflicting interests that threaten to diminish the OSM's regulatory 
and enforcement responsibilities, and timely response to environmental 
threats. The BCWA challenges the notion that an OSM/BLM merger will 
boost industry oversight or coal reclamation. This proposal, 
incidentally or deliberately, offers another obvious ``pass'' to the 
coal industry at the expense of public health and safety and 
preservation of the nation's natural resources.
    The sense of urgency to address the country's economic woes is 
legitimate. It is interesting, however, that the Department of the 
Interior has targeted the OSM as a problematic agency given a press 
release just one year ago (November 18, 2010) in which you, the 
Assistant Secretary for Land and Minerals Management Wilma Lewis, and 
OSM Director Joseph Pizarchik commended OSM initiatives to improve 
oversight of state surface coal mining programs and its ``great strides 
in establishing and enacting consistent, transparent and effective 
policies.''
    Know that the BCWA does not support Secretarial Order No. 3315--
Consolidation of the OSM within the BLM. It is the association's 
contention that any immediate savings that might be realized under this 
proposal would be minimal compared to the long-term impact of, and 
potentially catastrophic costs associated with, diminished 
environmental protection. Frankly, this proposal, when viewed 
collectively with the recent budget and human resource reductions to 
the states' Department of Environmental Protection, and proposed plan 
of some presidential candidates and legislators to eliminate the 
federal Environmental Protection Agency, makes this proposal 
conspiratorially suspect. As one of many front-line environmental 
protection organizations the BCWA is intimately aware of the legacy of 
land and water damage sustained from decades of irresponsible mining 
practices and lax governmental oversight and enforcement. We decry any 
legislative decision that values the special interests of an industry 
over that of citizens, wildlife, aquatic life, and habitat.
                                 ______
                                 
             Statement of Mary Ellen DeClue, Litchfield, IL
    Dear Secretary Salazar and Ms. Adams:

    Thank you for the opportunity to comment on Secretarial Order No. 
3315 that places OSMRE in the Bureau of Land Management.
    My home is surrounded by coalfields and a coal fired utility. My 
community as well as others in Illinois have endured adverse effects of 
polluted air, water and subsided farmland. Illinois Department of 
Natural Resources/Office of Mines and Minerals approves permits and 
promotes agendas of mine operators without consideration of the health 
of residents and contamination of the environment.
    OSMRE is a vital community resource that citizens can turn to with 
concerns, questions, and guidance. If this agency is placed in the BLM, 
the focus and viability to citizens will be lost.
    There are consistent violations of SMCRA, the Clean Air Act, and 
the Clean Water Act that are allowed. Addressing these issues through 
Administrative Review with a hearing officer hired by and directed by 
IDNR/OMM is a meaningless, expensive process for citizens.
    OSMRE, represented by the Alton Field Office and the Indianapolis 
Area Office, has consistently been available to listen, examine, and 
address concerns of coalfield residents. Over the last 3 years, I have 
personally had many one-on-one meetings, e-mail communications, and 
letter correspondence with this office.
    IDNR/OMM was approving underground coal slurry injection into mine 
voids through insignificant permit revisions. The public was not 
involved or informed that this was taking place or that their well 
water might be contaminated. OSMRE addressed this matter and IDNR/OMM 
now recognizes coal slurry injection applications to be considered as a 
significant permit revision.
    Citizens living in coal communities need a voice and ability to 
communicate local effects to a national directory. If OSMRE is lost in 
the mega complex of BLM, their issues will not only be 
``insignificant,'' but their cumulative effects will not be recognized.
    The attention of OSMRE to issues of coal mining in the Mid-West is 
illustrated by the Director of OSMRE, Joseph Pizarchik, along with 
Erwin Barchenger and Andy Gilmore's productive meeting on June 20, 2011 
with me and several citizens to listen to our issues in order to 
minimize the adverse impacts of coal mining in communities.
    OSMRE should not be changed, but rather additional funding would 
greatly help them do their mission of protecting communities. I 
strongly oppose the Secretarial Order No. 3315 that would place OSMRE 
in the Bureau of Land Management.
                                 ______
                                 
                                        Southwest Virginia,
                                                 November 30, 2011.
Department of the Interior,
1849 C Street, N.W., Washington DC.
Email: [email protected]

    Dear Ms. Adams:

    We wish to submit comments on the above referenced order No. 3315. 
We understand that a Senate Congressional hearing was held on November 
17th and we wish the following comments to be made a part of the public 
record for the November 17th hearing.
    We do not represent an organization, with the exception of one 
organization who chose to be signatory to the comments, but we do 
represent a loose knit set of community members in southwest Virginia 
that have a vested interest in the proposed folding of OSM into BLM. 
Order No. 3315 is an absurd proposition and we do not support the move.
    Although residents of the coalfield communities are not always in 
complete agreement with OSM's actions, we realize their importance in 
the scheme of industry activities and their oversight and evaluation 
worth. In the absence of such activities, we feel that the communities 
of the coalfields would be even more at risk.
    OSM was established by Congress to be a separate entity and we fear 
Secretary Salazar has neither the authority nor the right to move OSM 
into BLM where OSM's numbers and resources could be treated with very 
real inferiority.
    SMCRA (1977) prohibits the integrating of OSM with any Federal 
agency ``whose purpose is promoting the development or use of coal or 
other mineral resources'' (Sec. 201), which is a primary responsibility 
of the BLM. Moving OSM into BLM would be a direct violation of SMCRA.
    BLM is primarily a land management and mineral leasing agency while 
the duty of OSM is to be a law enforcement agency related to coal 
mining and reclamation. Combining these will create a dysfunctional 
bureaucratic agency with employees at odds internally. It would be an 
impossible situation.
    The Appalachian people frequently feel they are left out of 
conversations regarding decisions that affect their communities, their 
health, and their environment. This is currently being repeated again. 
OSM has the role of protecting our communities from the irresponsible 
actions of coal mining operations. On many occasions, these mining 
operations are very close neighbors to us. The Interior Dept. must 
understand and acknowledge OSM's role in our communities as valid and 
important.
    Thank you for the opportunity to submit our comments to be included 
in the record for the November 17th congressional hearing on this very 
important matter.
            Respectfully submitted,
                    Kathy Selvage, Gary Selvage, Tommy Kilgore, Joyce 
                            Kilgore, Mary Ellen Kelly, Carl Ramey, 
                            Louise D. Ramey, Margaret Flynn, Elizabeth 
                            Jaspers, Lucy Spencer, Marlene Bush, Larry 
                            Bush, Raymond Davidson, Dorothy Taulbee, 
                            Maude Jervis, Mary Pace, Samuel Needham, 
                            Judy Needham, Bill Wilder, Rita Carr, Gary 
                            Bowman, Carol Bowman, Jackie Hanrahan, CND, 
                            Appalachian Faith & Ecology Center.
                                 ______
                                 
                                           Trout Unlimited,
                                  Arlington, VA, November 23, 2011.
Hon. Jeff Bingaman,
Chairman, U.S. Senate Committee on Energy and Natural Resources, 304 
        Dirksen Senate Building, Washington, DC.
Hon. Lisa Murkowski,
Ranking Member, U.S. Senate Committee on Energy and Natural Resources, 
        304 Dirksen Senate Office Building, Washington, DC.
    Dear Chairman Bingaman and Ranking Member Murkowski: I am writing 
on behalf of Trout Unlimited (TU) and its 140,000 members nationwide 
with concerns regarding the consolidation of the Office of Surface 
Mining (OSM) and Bureau of Land Management (BLM) as announced by U.S. 
Department of the Interior Secretary Salazar on October 26, 2011 in 
Secretarial Order 3155. The Order was the subject of a hearing last 
week before your Committee. Please include this letter in the hearing 
record.
    TU's mission is to conserve, protect and restore North America's 
trout and salmon fisheries and their watersheds. In pursuit of this 
mission, TU works to clean up abandoned coal mines throughout the 
Appalachian coal fields and protect high-quality coldwater fisheries 
from new mining operations that threaten to pollute these sensitive 
headwater ecosystems. In particular, TU has received technical support 
from the OSM and financial assistance through its Watershed Cooperative 
Agreement Program--both of which have been critical components to the 
planning and implementation of numerous abandoned coal mine remediation 
projects.
    As a result of our positive experiences working with the OSM and 
our overall efforts to protect high-quality coldwater streams, we list 
the following concerns regarding the consolidation of OSM and BLM:

          1. From the standpoint of integrating two agencies with 
        different--and somewhat conflicting--roles, we are concerned 
        about OSM's ability to continue the active enforcement of coal 
        mining operations once it becomes part of the BLM. OSM is 
        statutorily required by the 1977 Surface Mining Control and 
        Reclamation Act (SMCRA) to enforce regulations that protect 
        citizens and the environment from coal mining operations and 
        ensure that the land is properly reclaimed post-mining. On the 
        other hand, BLM is responsible for managing and leasing 
        millions of surface and sub-surface acres for the purpose of 
        mineral extraction.
          2. We are concerned about the potential for the consolidation 
        of OSM and BLM to impact OSM's Watershed Cooperative Agreement 
        Program (WCAP) and the relationship that citizen groups have 
        developed with OSM over the past few decades regarding 
        abandoned coal mine cleanup. The tens of millions of dollars 
        from OSM's WCAP have played an important role in helping 
        citizen groups fund and implement on-the-ground abandoned mine 
        drainage remediation projects. Additionally, OSM staff have 
        provided invaluable technical support to citizen groups, and 
        have helped to ensure that projects are implemented in a cost-
        effective, technically sound manner.
          3. We have questions about whether the Title IV Abandoned 
        Mine Land Fund of SMCRA as reauthorized in 2006, and 
        subsequently the Abandoned Mine Land programs led by states, 
        will be affected by the consolidation of OSM and BLM. Our 
        concern is that changes to the Title IV fund could impact the 
        amount of restoration work being done on the ground.

    TU strongly urges the Committee to ensure that the Department of 
the Interior addresses these concerns before it moves forward with the 
consolidation of OSM and BLM. It is imperative that solutions or 
policies are developed to adequately address any negative impacts to 
OSM's roles and programs as a result of consolidation with the BLM.
            Sincerely,
                                               Steve Moyer,
                              Vice President of Government Affairs.
                                 ______
                                 
               Navajo Nation Department of Justice,
                            Office of the Attorney General,
                              Navajo Nation, AZ, November 17, 2011.

    Dear Chairman Bingaman, Ranking Member Murkowski, and Members of 
the Committee on Energy and Natural Resources:

    The Navajo Nation welcomes this opportunity to comment on the 
recent, and startling, news that the Department of the Interior 
(Interior) intends to consolidate the Office of Surface Mining 
Reclamation and Enforcement (OSM) within the Bureau of Land Management 
(BLM), two departments within Interior which are of critical importance 
to the Navajo Nation (Nation). This proposed consolidation was done 
without any consultation with the Nation as required under Executive 
Order 13175 and pursuant to the federal trust responsibility, without 
adequate planning and coordination with the Nation's programs which 
operate under direct federal grants from one or more of these agencies, 
without consideration of the impact on the Nation's Abandoned Mine Land 
Reclamation (AML) Program and Surface Coal Mining and Reclamation 
(Surface Mining) Program, under Titles IV and V, respectively, of the 
Surface Mining Control and Reclamation Act of 1977 (SMCRA), 30 U.S.C. 
Sec. Sec.  1201 et seq.

     FEDERAL TRUST RESPONSIBILITY AND REQUIREMENT FOR CONSULTATION

    On October 26, 2011, Secretary Ken Salazar, Department of the 
Interior, issued Secretarial Order No. 3315 (Order) which would 
consolidate OSM with BLM, and would ``integrate the management, 
oversight, and accountability of activities associated with mining 
regulation and abandoned mine land reclamation; ensure efficiencies in 
revenue collection and enforcement responsibilities; and provide 
independent safety and environmental oversight of these activities.'' 
Secretarial Order No. 3315. As recognized in Executive Order 13175, the 
federal trust responsibility requires prior and meaningful consultation 
with the Navajo Nation on agency actions with tribal implications. See 
Executive Order 13175, 65 Fed. Reg. 67249, 6724967252 (Nov. 6, 2000)*; 
see DOI Departmental Manual, 512 DM 2 (``It is the policy of the 
Department . to consult with tribes on a government-to-government basis 
whenever plans or actions affect tribal trust resources, trust assets, 
or tribal health and safety''); see also DOI Departmental Manual 303 DM 
2 (``The proper discharge of the Secretary's trust responsibilities 
requires that persons who manage Indian trust assets . . . [p]romote 
tribal control and self-determination over tribal trust lands and 
resources''). ``Policies that have tribal implications'' are 
specifically defined under EO 13175 as ``proposed legislation ... or 
actions that have substantial direct effects on one or more Indian 
tribes .. . .'' Id. at 6249 (emphasis added).
---------------------------------------------------------------------------
    * Document has been retained in committee files.
---------------------------------------------------------------------------
    In this case, the Order is clearly an action with tribal 
implications. Yet, contrary to clear federal policy, prior to the 
Secretary issuing the Order, there was no consultation with any Nation 
official, at any level, by any official in the Department of the 
Interior, including any official in OSM or BLM. Moreover, Secretary 
Salazar apparently has no intention of consulting with Indian tribes 
before the Order becomes effective on December 1, 2011. See October 26, 
2011 Memorandum from Secretary Salazar to Directors of OSM and BLM 
(``The Order will become effective December 1, 2011, following 
consultation with the White House, Office of Management and Budget, 
employees, and applicable congressional committees with 
responsibilities over these functions'') (emphasis added). 
Unfortunately, due to the lack of consultation with the Nation, the 
full extent of the impacts of the Order on the Nation and its affected 
programs remains unclear.
    Undoubtedly, in order to accommodate the merger of the two 
agencies, the Order will require substantial rewriting of multiple 
federal laws and regulations, including laws and regulations that 
directly impact the Nation's AML and Surface Mining Programs. The 
Nation will also have to rewrite the Nation's own laws and policies, as 
well as agreements with OSM, to correspond with changes to OSM and BLM 
resulting from the Order, including the Navajo Abandoned Mine Lands 
Reclamation Act, 18 N.N.C. Sec. Sec.  1601 et seq., the Navajo 
Reclamation Plan, and the Nation's cooperative funding agreements with 
OSM. In addition, OSM and BLM are partners with the Bureau of Indian 
Affairs (BIA) in a multi agency agreement addressing management of coal 
mining on Indian lands, and that agreement would also have to be 
amended.
    Moreover, the changes under the Order will directly impact tribal 
trust assets, and the federal land management responsibility to restore 
tribal lands impacted by past federally approved mining activities. The 
Nation's primary economic assets are its coal, oil, and gas resources, 
resources which are directly regulated by BLM and OSM. The federal 
government and the Department of the Interior in particular have an 
obligation to manage these resources in the best interests of the 
Nation. Additionally, past mining activities on the Nation, approved by 
the federal government, and expressly benefiting United States defense 
interests, have left a legacy of adverse health, safety and economic 
impacts on the Nation. The federal government, as the Nation's trustee, 
has an obligation to ensure these impacts are addressed and not further 
adversely impacted by the proposed consolidation of OSM into BLM.

                    POTENTIAL SMCRA TITLE IV IMPACTS

    The Nation's AML Program has ongoing reclamation responsibility for 
260 identified coal sites and approximately 1100 identified non-coal 
mine sites, primarily uranium mine sites left over from the long 
federal legacy of uranium mining to support U.S. defense efforts. The 
Nation's AML Program also provides leverage funding for crucial 
infrastructure projects in tribal communities most impacted by the 
legacy of mining on the Nation. The Order would impact communication 
and coordination between the federal officials directing responsible 
for engaging with the Nation's AML Program on these important 
activities, including strategic planning, facilitating grants, 
providing technical assistance, and ensuring continuity of vital AML 
Program activities on the Nation, and the long-term stewardship of the 
land.
    Given the great success of the Nation's AML Program, the Nation 
finds it alarming that the Secretary has decided to issue his Order. In 
partnership with OSM, the Nation's AML Program works. Since 1988, the 
Nation's AML Program has developed a proven track record of effectively 
reclaiming both coal and non-coal abandoned mine sites, as evidenced by 
five AML reclamation awards given to it by OSM, including two national 
awards for extraordinary efforts in reclamation. The Order, issued 
without any consultation or consideration of this past history and 
success, has the potential to dislocate an excellent federal-tribal 
working relationship.

                    POTENTIAL SMCRA TITLE V IMPACTS

    As with the Title IV comments above, the Nation is concerned with 
the impact the Order would have on the development of the Nation's 
Surface Mining Program. Specifically, the Nation is concerned with the 
impact this Order will have on the establishment and continued growth 
of the Nation's Surface Mining Program, including future funding for, 
and development of, the Navajo Nation Mining and Reclamation Act. Since 
1982, the Nation has been working diligently with OSM for the Nation to 
obtain regulatory primacy over coal mining operations occurring on the 
Nation's lands. This endeavor has and will continue to require 
continuous and close contact between the Nation's officials and 
representatives of OSM. The Order may very well adversely impact the 
Nation's, and OSM's, long efforts to achieve this important goal 
consistent with the federal policy for tribal self-determination and 
control of its resources.

                            FUNDING AT RISK

    The Nation has past experience with OSM and Interior regarding 
potential reductions in funding without adequate consultation with the 
Nation. For example, OSM and Interior have previously attempted to 
reverse the 2006 amendments to SMCRA, amendments which were developed 
and passed in close coordination with affected Indian tribes. These 
efforts would have effectively eliminated AML's funding and the 
Nation's AML Program in its entirety. In trying to reverse the 2006 
amendments to SMCRA, as in the case of the Order here, OSM and Interior 
repeatedly failed to meaningfully consult with the Nation.
    Similarly, here, in addition to the appalling lack of consultation 
before issuing the Order, there has been no consideration of potential, 
and significant, adverse financial impacts from this reorganization on 
current and future funding for the Nation's AML and Surface Mining 
Programs. The Nation's AML and Surface Mining Programs receive 100% of 
their funding through cooperative grant agreements with OSM. 
Additionally, the Nation's Minerals Department currently receives 
separate funding from BLM to carry out various natural resources 
related regulatory responsibilities, funding which is potentially at 
risk in a merger of these two federal agencies.
    The Nation appreciates this opportunity to present testimony 
regarding the potentially adverse, and unknown, impacts of the Order, 
issued without any consultation or coordination with the Nation. The 
federal trust responsibility demands that the Department of the 
Interior consider impacts to federally recognized Indian tribes, 
including the Nation, when undertaking any such actions which have such 
clear and direct tribal implications. The Nation looks forward to 
working together with the federal government, including the United 
States Congress, under the auspices of our government-to-government 
relationship, to identify and ameliorate the potential adverse impacts 
to the Nation from the Secretary's Order.
            Respectfully yours,
                                           Harrison Tsosie,
                                                  Attorney General.
                                              Paul Spruhan,
                                           Acting Attorney General.
                                 ______
                                 
                      Interstate Mining Compact Commission,
                                     Herndon, VA, October 24, 2011.
Hon. Patty Murray,
Co-Chairman, Joint Select Committee on Deficit Reduction, 448 Russell 
        Senate Office Building, Washington, DC.
Hon. Jeb Hensarling,
Co-Chairman, Joint Select Committee on Deficit Reduction, 129 Cannon 
        House Office Building, Washington, DC.
    Dear Senator Murray and Representative Hensarling:

    We are writing on behalf of the 34 member states and tribes of the 
Interstate Mining Compact Commission (IMCC) and the National 
Association of Abandoned Mine Land Programs (NAAMLP) regarding a 
legislative proposal contained in the President's Plan for Deficit 
Reduction related to the reclamation and cleanup of abandoned coal mine 
lands (AML) located throughout the United States. We understand that 
this proposal, among others, is being considered by your Committee as 
part of a larger deficit reduction plan.\1\ The coal AML proposal would 
have significant, deleterious impacts on current efforts by state and 
tribal programs for the ongoing cleanup of abandoned mined lands and as 
such we strongly oppose it. The proposal would also leave the public 
with fewer protections from these dangerous hazards and would 
negatively impact the environment, particularly the restoration of 
mine-scarred lands and waters. In the end, there is the potential for 
the loss of jobs in areas that are already economically depressed.
---------------------------------------------------------------------------
    \1\ The President's Plan also includes a somewhat related proposal 
that would establish a new program for the cleanup of hardrock 
abandoned mine lands. While the states and tribes have strongly 
advocated for a meaningful hardrock AML program, including Good 
Samaritan protections for potential Clean Water Act liability, we 
believe any legislative consideration and debate should occur before 
the committees of jurisdiction in Congress and not as part of deficit 
reduction given the complexities associated with this matter and its 
potential interrelationship with the ill-conceived coal AML proposal. 
In this regard, we understand a hearing on potential legislation 
addressing hardrock AML is tentatively scheduled for November 17 before 
the House Energy and Mineral Resources Subcommittee.
---------------------------------------------------------------------------
    More specifically, the coal AML proposal would, among other things:

   Eliminate AML funding to certified states and tribes
   Eliminate funding to states based on historic coal 
        production
   Eliminate minimum funding to under-funded states
   Prohibit the expenditure of AML money for noncoal 
        reclamation
   Restrict the re-payment of unappropriated (prior balance) 
        funds to states and tribes based on the amount of money paid 
        into the AML Fund by these states and tribes
   Restrict the use of AML funds for future acid mine drainage 
        cleanups
   Restrict the use of AML funds for restoration of coalfield 
        citizen water supplies
   Restrict the use of AML funds for addressing environmental 
        impacts from prior coal mining
   Undermine a 30 year working relationship between the states, 
        tribes and federal government

    While the Administration attempts to make the case that these 
adjustments are consistent with the will of Congress, recent amendments 
in 2006 to the Surface Mining Control and Reclamation Act of 1977 
(SMCRA) belie this position. Instead, what the Administration proposal 
reflects is a consistent and continuing pattern of irritation and angst 
about the 2006 amendments that has been reflected in attempts to undo 
those amendments in every budget proposal since FY 2008. In each and 
every case, Congress has rejected these proposals and, to the contrary, 
has entertained legislation to further clarify the intent and focus of 
the 2006 amendments in response to regulations adopted by the Office of 
Surface Mining that run contrary to the law. Once again, with this 
deficit reduction proposal, we see the Administration attempting to 
emasculate the will of Congress as expressed in the 2006 Amendments. A 
more complete analysis of the impact of the proposal is attached.
    We urge the Select Committee to reject this proposal and to confirm 
the intent of Congress as expressed in the 2006 Amendments to SMCRA. 
While we understand that two of your primary goals are to eliminate 
wasteful spending and realize savings to the federal Treasury, this 
proposal would do so at the expense of existing state and tribal 
programs that effectively and efficiently protect the public and 
cleanup the environment. The changes worked by the Administration's 
proposal would only complicate and confuse programs that are working 
well by any standard of performance measurement and would also likely 
undermine the future viability of these programs. Any savings realized 
under the proposal are minimal as compared to what would be lost 
without the continuation of these vital programs as currently 
structured. Furthermore, the proposal would upset the statutory design 
and interrelationship between the Title IV (AML) program under SMCRA 
and the Title V program for the regulation of active mining operations, 
whereby the states were entitled to receive AML grants only where a 
Title V program was in place. Unduly restricting AML grants could 
result in a serious reevaluation by some states concerning the 
retention of those Title V programs.
    The original intent of the framers of SMCRA in 1977 was to protect 
public health and safety and the environment related to abandoned mine 
lands as a critical part of the surface mining program. In 2006, 
following 10 years of debate and eventual compromise among all affected 
parties, Congress once again labored over and decided upon a revised 
course of action for our nation with respect to the cleanup of 
abandoned coal mine lands that built additional certainty and stability 
into the program. We urge the Select Committee to allow this law to 
work as intended and to defer to the authorizing committees regarding 
any needed further adjustments.
    We appreciate your consideration of this request and would be 
pleased to answer any questions you may have or provide additional 
information to the committee.
            Sincerely,
                                         Gregory E. Conrad,
                                                Executive Director,
                              Interstate Mining Compact Commission.
                                        Madeline Roanhorse,
                                                         President,
              National Association of Abandoned Mine Land Programs.

        ATTACHMENT.--ANALYSIS OF PROPOSAL TO REFORM AML PROGRAM

                              INTRODUCTION

    The Obama Administration has proposed to make extensive changes to 
the existing Title IV Abandoned Mine Lands (AML) Program under the 
Surface Mining Control and Reclamation Act of 1977 (SMCRA). Proposed 
legislation related to these changes was submitted directly to the 
Joint Select Committee on Deficit Reduction, as part of the President's 
``Plan for Economic Growth and Deficit Reduction. The intent of the 
proposed legislation is to totally re-shape the AML program to focus 
solely on coal reclamation. In addition, funding would no longer be 
distributed directly to states and Indian tribes to carry out the 
purposes of the Act, as directed by the 2006 Amendment to SMCRA. 
Instead, every project proposed by the AML states and tribes for 
potential funding would be subject to a nationwide annual competitive 
grant process. More significantly, instead of states and tribes 
determining the priority for funding abandoned mine projects within 
their jurisdictions, the decision for awarding funding for specific 
projects would rest solely with the Secretary of Interior. This would 
undermine the concept of primacy under SMCRA and damage the working 
relationship between OSM and the states and tribes, replacing it with a 
single autonomous authority that would essentially federalize the 
process.
    The Administration has proposed similar changes through the budget 
process over the past several fiscal years with no success. Proposals 
have been offered up to eliminate funding for certain states and to 
change the focus of the program. Through an open and deliberative 
process, the appropriations committees, and ultimately Congress, have 
rejected such changes to Title IV. Additional attempts have been made 
by the Administration to eliminate the AML emergency program and shift 
18 positions to provide additional federal oversight of state programs 
under Title V of SMCRA. Those proposals have also been rejected, and 
yet the Administration perseveres with its course of action. It is 
clear from the recent legislative history that Congress believes that 
the current language and approach under SMCRA is the best path for 
achieving the reclamation and environmental restoration objectives of 
the Act. This latest proposal by the Administration to make major 
changes to the Act is the latest in a series of attempts to upset the 
balance and stability in the AML program forged by Congress.
    The proposed legislation submitted to the Select Committee is 
fraught with problems and errors. This reflects the fact that the 
language was drafted quickly and without the advantage of an open and 
deliberative process. For example, the revised language includes what 
appear to be incorrect section citations leading to confusion about how 
funding is intended to be applied. For instance, the proposed 
legislation notes that 80% of the monies in the fund would be disbursed 
each year but there is no specific language that clarifies that the 
disbursement would be for the express purpose of meeting the intent of 
Title IV and SMCRA. Also of concern is the lack of any reference 
regarding the use of the remaining 20%. The hurried and ill-conceived 
approach is clearly demonstrated by this failure to define with clarity 
how funds would be used under the proposed legislation.

                               BACKGROUND

    The infrastructure of our nation was built on the back of mining. 
Mining fueled the growth of our industrialized economy, leaving us with 
a legacy of historic abandoned mines. The intent of Congress since the 
original passage of SMCRA has always been very clear. Congress 
determined that the priority of the Act was to protect the public from 
historic mine hazards and to restore the environment where impacted by 
past mining. That intent remains the same today.
    The original intent of the Act also recognized the strong 
connection between historic mining and current mining practices. The 
lessons of the past supported the value of having a strong regulatory 
program to ensure that mining can continue but in a safe, 
environmentally sound manner. SMCRA Title V provides for a strong 
regulatory program that includes an equally strong reclamation 
component for on-going mining operations. Congress also recognized the 
strong leadership role that states can and should play in the 
regulatory area. Thus SMCRA provided the language both allowing and 
encouraging states to accept primacy for regulatory programs and to 
serve as the lead for regulatory activities. To help encourage states 
to adopt primacy, SMCRA requires states to implement Title V regulatory 
programs in order to receive abandoned mine land funding under Title 
IV. These provisions recognized the leadership role played by the 
states and tribes for both the regulatory program and the abandoned 
mine land reclamation program.
    Over the years, the AML program faced many challenges regarding 
funding. Congressional action was required on several occasions to 
extend the AML fee under SMCRA and to allow funding to continue 
unimpeded for needed reclamation activities. in some years, Congress 
did not appropriate the full amount of funds collected through AML fee 
collections, which resulted in states being under-funded and further 
challenging the ability to effectively continue reclamation activities. 
The need to continually extend SMCRA also resulted in uncertainty for 
industry, since they had no ability to determine if, or when, the fees 
assessed on coal production would terminate.
    These uncertainties were the main driver for the changes enacted 
under the 2006 Amendments to SMCRA. Discussions and deliberations about 
what changes were appropriate under the Act continued for many years 
and ultimately resulted in the 2006 Amendments, which provided a clear 
path forward and a level of stability for the program. States and 
Tribes were guaranteed that they would have sufficient funding to 
properly manage their programs. Funding for reclamation activities was 
also guaranteed. The combination of these changes provided the 
certainty for states and Tribes to allow for efficient and effective 
planning and delivery of reclamation work. Where public facilities, 
such as water systems, were impacted by past mining activities, states 
and tribes could be assured of a source of funds to repair or replace 
that critical public infrastructure. The 2006 Amendments extended the 
Title IV program through September 30, 2021 thus giving the states and 
tribes a long term planning window for accomplishing needed 
reclamation. The extension of the program through September 30, 2021 
also provided industry with some certainty relative to the fee 
collection.
    Two things have always been understood: The intent of Congress, as 
expressed both through the original SMCRA and again through the 2006 
Amendments, was to protect the health and safety of the public from the 
impacts of past mining and to restore the environment. It was also 
clear that states and tribes were the appropriate entities to assume 
the leadership role to implement Title IV. The strong positive annual 
audits and annual oversight reports for state and tribal programs are 
positive proof that Congress's faith in the state and tribal leadership 
was well-placed.
    The need continues for strong programs addressing the remaining 
inventory of abandoned mine sites. States and tribes still have legacy 
abandoned mine sites that pose significant threat to public health and 
safety and continue to pose environmental challenges. The intent of 
Congress to address those issues is far from having been satisfied.

                          OVERVIEW OF CONCERNS

    The changes currently proposed by the Administration would have 
major impacts on state and tribal programs. The 2006 Amendments 
represented a significant compromise reached after many years of 
thoughtful debate and deliberation that brought critically needed 
certainty and stability to both the national program and state and 
tribal programs. The benefits resulting from those 2006 Amendments are 
clear and obvious. AML programs now provide an effective assessment and 
planning function critical to the implementation of the intent of 
SMCRA. State and tribal management of programs has resulted in much-
needed jobs, increased protection of citizens and communities from the 
impacts of past mining and resulted in the elimination of serious 
environmental hazards posed by abandoned mine sites.
    The 2006 Amendments provide certainty that funds would continue to 
be available for these important planning, management and reclamation 
activities. The language adopted in 2006 mandates that the AML funds 
derived through fee collections be used for the purposes of the Act. 
This ensures the timely flow of funding critical for the continuity of 
program activities. Unfortunately, the current Administration proposals 
would replace this certainty with language that is confusing and 
unclear on the intent of the availability and use of the funds. Many 
states, if they fail to receive administrative funding through the 
proposed competitive process, may be forced to discontinue their 
programs resulting in a loss of state and tribal programs.
    All performance assessments concerning current AML programs 
indicate that these programs are well managed, effective and are 
delivering strong results to meet the intent of SMCRA. Audit reports, 
annual oversight reports and program records demonstrate the success of 
the program as it currently exists. Over the last 30 years a strong and 
successful partnership has developed between the states and tribes and 
the OSM. This partnership has been further strengthened since the 
passage of the 2006 Amendments.
    The question then is this: With the strong positive benefits that 
have been demonstrated since the 2006 Amendments, what is the driving 
need to undermine the 2006 Amendments with rushed, flawed and unclear 
legislative language? This question is even more significant when we 
remember that it took nearly 10 years of deliberations to ultimately 
adopt the 2006 Amendments. Since the 2006 Amendments were the result of 
a multiple year effort (with extensive input from states, tribes, OSM 
and other stakeholders), what Is the rush to replace them without any 
public input? The current proposal was prepared in a vacuum without any 
opportunity for states, tribes or the committees of jurisdiction to 
comment on proposed legislative language.

                           SPECIFIC CONCERNS

    The current Administration proposal raises numerous concerns. 
Significant among them are the following:

   Guaranteed AML payments to states and tribes would be 
        eliminated. These guaranteed payments provided funding 
        certainty for planning, management and reclamation activities. 
        Areas affected by this change Include payments based on 
        historic coal production, payments to under-funded states, 
        repayment to states and tribes of unappropriated (prior 
        balance) payments, and payments to certified states and tribes.
   Expenditure of AML money for non-coal reclamation would be 
        prohibited.
   The acid mine drainage set-aside program would be 
        eliminated.
   The 2006 Amendment language clarifying that AML moneys could 
        be used for water supply projects without limitation would be 
        eliminated.
   Funding for environmental restoration projects may be 
        eliminated if funding is not approved by the Secretary of the 
        Interior.
   Greatly expanded AML project justifications would be 
        required as part of the annual competitive bidding process.
   States and tribes would be required to submit increased 
        accounting and reporting related to past expenditures on an 
        annual basis.

                               CONCLUSION

    The abandoned mine land program as amended through the 2006 
Amendments to the Act has a proven track record of success In 
efficiently addressing public health and safety concerns from legacy 
mining, the elimination of significant environmental hazards associated 
with abandoned mines, providing jobs, and improving local communities 
by addressing hazards that impact those communities. The program 
continues to work well. We cannot support the changes proposed by the 
Administration that would emasculate the 2006 Amendments, which were 
passed after years of public input and deliberation. The current 
proposal was obviously quickly crafted and contains flaws and confusing 
language that reflect the total lack of meaningful input by those who 
are Intimately familiar with the program. The current proposal is 
unsound, lacks the basis and need to support its adoption and should be 
rejected. SMCRA should be allowed to work as intended and, if it is 
determined that further adjustments are needed, that action be deferred 
to the authorizing committees.

                                    

      
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