89–006

106TH CONGRESS REPT. 106–1014 " ! HOUSE OF REPRESENTATIVES 2d Session Part 1

COAL ACCOUNTABILITY AND RETIRED EMPLOYEE ACT FOR

THE 21ST CENTURY

OCTOBER 27, 2000.—Ordered to be printed

Mr. YOUNG of Alaska, from the Committee on Resources,

submitted the following

R E P O R T

[To accompany H.R. 4144]

[Including cost estimate of the Congressional Budget Office]

The Committee on Resources, to whom was referred the bill

(H.R. 4144) to provide for the allocation of interest accruing to the

Abandoned Mine Reclamation Fund, and for other purposes, having

considered the same, report favorably thereon with an amendment

and recommend that the bill as amended do pass.

The amendment is as follows:

Strike all after the enacting clause and insert the following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Coal Accountability and Retired Employee Act for

the 21st Century’’.

SEC. 2. TREATMENT OF CERTAIN FUNDS FOR MINER BENEFITS.

Notwithstanding any other provision of law, interest credited to the fund established by section 401 of the Surface Mining Control and Reclamation Act of 1977

(30 U.S.C. 1231) for fiscal years 1992 through 1995 that is not transferred to the

combined benefit fund referred to in section 402(h)(2) of such Act (30 U.S.C.

1232(h)(2)) prior to the date of enactment of this Act shall be transferred to such

combined benefit fund within 30 days after the date of enactment of this Act to pay

the amount of any shortfall in any premium account for any plan year under the

combined benefit fund. The entire amount transferred by this section is designated

by the Congress as an emergency requirement pursuant to section 252(e) of the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 902(e)).

PURPOSE OF THE BILL

The purpose of H.R. 4144 is to provide for the allocation of interest accruing to the Abandoned Mine Reclamation Fund, and for

other purposes.

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BACKGROUND AND NEED FOR LEGISLATION

H.R. 4144 would require the Office of Surface Mining (OSM) to

transfer any remaining interest credited to the Abandoned Mine

Land Reclamation Fund (AML) from fiscal years 1992 through

1995 to the United Mine Workers of America Combined Benefit

Fund (CBF).

The Surface Mining Control and Reclamation Act of 1977

(SMCRA, Public Law 95–87, codified at 30 U.S.C. 1201 et seq.) regulates surface coal mining operations by States and Indian tribes

which host mineable coal deposits. Coal mines often went

unreclaimed after the exhaustion of the coal resources until the

federal government stepped in to create a level, highly regulated

playing field through Title V of SMCRA to regulate the surface impacts of all active coal mines in the United States.

Title IV of SMCRA provides for the restoration of pre-1977 abandoned coal mines for instances where no former operator was obligated under State law to reclaim those sites. Title IV established

the AML in the U.S. Treasury supported by a fee collected by OSM

of 35 cents per ton of surface mined coal, 15 cents per ton of underground mined coal, and 10 cents per ton of lignite. The AML fee

is levied on all coal mined anywhere within the United States and

was originally slated to expire in 1992. Congress has acted twice

to extend the fee collection authority. Section 6002 of Public Law

101–508 extended the fee to 1995; this law also established the

AML as an interest-bearing account. Section 19143 of Public Law

102–486 extended the fee to September 30, 2004, and mandated

that a portion of the interest in the AML be transferred to the

CBF. Public Law 102–486 also required the AML fee to be extended beyond 2004 in the amount necessary to fulfill the interesttransfer obligation to the CBF.

This interest transfer device relates back to the Coal Act of 1992,

which established the CBF by merging earlier retiree benefit programs negotiated between the Bituminous Coal Operators Association and the United Mine Workers of America beginning in 1950

when President Harry Truman ordered the end of a United Mine

Worker nationwide strike. These were later followed by other wage

and benefit agreements, the latest in 1988. The Coal Act created

a ‘‘reach back’’ tax levied on former companies and individuals (no

longer in the mining business) who signed those labor agreements

to pay the escalating costs of retiree health benefits of their former

workers.

However, an ‘‘unassigned beneficiaries’’ class of mining retirees

exists where no entity exists to cover the premiums on their retirement and health benefits. To protect the solvency of the CBF, Congress opted to allow the transfer to the CBF of not more than $70

million annually of interest from unappropriated balance of the

AML trust fund for the unassigned class only. This transfer, which

is not subject to appropriation, is made after an annual audit calculates the necessary amount. The transfer has never reached the

maximum allowed and was approximately $42 million in 1999.

However, because of solvency concerns generated by several court

decisions which limited the class of ‘‘reachback’’ entities and the

size of the premiums owed by the remaining companies, transfer

of additional AML interest is necessary to cover these benefits.

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COMMITTEE ACTION

Congressman Nick J. Rahall II (D–WV) introduced H.R. 4144 on

March 30, 2000. The bill was referred to the Committee on Resources and within the Committee to the Subcommittee on Energy

and Mineral Resources. The Subcommittee was discharged from

consideration of the bill on April 11, 2000. On May 17, 2000, the

Subcommittee held a hearing on assessing future needs and uses

of the Abandoned Mine Reclamation Fund established under Title

IV of the Surface Mining Control and Reclamation Act of 1977. On

July 26, 2000, the Full Resources Committee met to consider the

bill. The bill was ordered favorably reported with an amendment

in the nature of a substitute offered by Congresswoman Barbara

Cubin (R–WY) by unanimous consent. The Cubin amendment in

the nature of a substitute, as does the original bill, allows the

transfer of AML interest to the CBF without the limitation in current law that such funds be used only to cover the premium costs

of unassigned beneficiaries. The Cubin amendment, however, limits

such transfer to the amount available from the AML interest accrued during the period fiscal years 1992 through 1995 (approximately $96.2 million). Interest accruing to the AML in subsequent

years will remain limited to transfer only for the unassigned beneficiaries’ premium costs and remain capped at $70 million annually.

COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of rule XIII

of the Rules of the House of Representatives, the Committee on Resources’ oversight findings and recommendations are reflected in

the body of this report.

CONSTITUTIONAL AUTHORITY STATEMENT

Article I, section 8 of the Constitution of the United States

grants Congress the authority to enact this bill.

COMPLIANCE WITH HOUSE RULE XIII

1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the Rules of

the House of Representatives requires an estimate and a comparison by the Committee of the costs which would be incurred in carrying out this bill. However, clause 3(d)(3)(B) of that rule provides

that this requirement does not apply when the Committee has included in its report a timely submitted cost estimate of the bill prepared by the Director of the Congressional Budget Office under section 402 of the Congressional Budget Act of 1974.

2. Congressional Budget Act. As required by clause 3(c)(2) of rule

XIII of the Rules of the House of Representatives and section

308(a) of the Congressional Budget Act of 1974, this bill does not

contain any new budget authority, credit authority, or an increase

or decrease in revenues or tax expenditures. According to the Congressional Budget Office, enactment of this bill would result in a

net increase in direct spending in 2001 and 2002.

3. Government Reform Oversight Findings. Under clause 3(c)(4)

of rule XIII of the Rules of the House of Representatives, the Committee has received no report of oversight findings and recVerDate 11-MAY-2000 16:36 Oct 30, 2000 Jkt 089006 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\HR1014P1.XXX pfrm02 PsN: HR1014P1
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ommendations from the Committee on Government Reform on this

bill.

4. Congressional Budget Office Cost Estimate. Under clause

3(c)(3) of rule XIII of the Rules of the House of Representatives and

section 403 of the Congressional Budget Act of 1974, the Committee has received the following cost estimate for this bill from the

Director of the Congressional Budget Office:

H.R. 4144—Coal Accountability and Retired Employee Act for the

21st Century

Summary: H.R. 4144 would require the Office of Surface Mining

to transfer any remaining interest credited to the Abandoned Mine

Land Reclamation Fund (AML) from fiscal years 1992 through

1995 to the United Mine Workers of America Combined Benefit

Fund (CBF). The Congress would designate the amount of the

transfer as an emergency requirement pursuant to section 252(e) of

the Balanced Budget and Emergency Deficit Control Act.

CBO estimates the transfer would increase direct spending by

$35 million in 2001 and $62 million in 2002. Because the transfer

would be designated as an emergency requirement, that spending

would not be subject to pay-as-you-go procedures.

In addition, the legislation would decrease federal Medicaid

spending by $1 million in 2001 and $2 million in 2002. Because

federal Medicaid spending is mandatory, pay-as-you-go procedures

would apply.

H.R. 4144 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA)

and would result in Medicaid savings for state governments.

Estimated cost to the Federal Government: The estimated budgetary impact of H.R. 4144 is shown in the following table. The costs

of this legislation fall within budget function 550 (health).

By fiscal year, in millions of dollars—

2001 2002 2003 2004 2005

CHANGES IN DIRECT SPENDING

Interest Transfer from the AML Fund:

Estimated Budget Authority ........................................................................... 97 0 0 0 0

Estimated Outlays .......................................................................................... 35 62 0 0 0

Federal Share of Medicaid:

Estimated Budget Authority ........................................................................... ¥1 ¥2000

Estimated Outlays .......................................................................................... ¥1 ¥2000

Net Effect on Federal Spending:

Estimated Budget Authority ........................................................................... 96 ¥2000

Estimated Outlays .......................................................................................... 34 60 0 0 0

Basis of estimate: H.R. 4144 would provide for the balance of the

AML Fund from 1992 through 1995 to be transferred to the CBF

within 30 days after the bill is enacted. According to the Office of

Surface Mining, $97 million of the interest earned during that period remains in the fund. Therefore, CBO estimates that $97 million would be transferred to the CBF in 2001 as a result of that

provision.

The money transferred would be used to cover the benefits of retired coal miners that would not otherwise be covered because premium collections were insufficient. CBO estimates that $35 million

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of the transfer would be used to pay for benefits in 2001 and $62

million would be spent in 2002.

In the event of a deficit, the trustees of the CBF would first try

to balance the fund through reducing spending on items and services other than health benefits. But if the deficit were large

enough, they would have to cut benefits. For retired coal miners

who are also enrolled in Medicaid, a portion of those benefits would

be shifted to the Medicaid program. Under H.R. 4144, the $97-million transfer to the CBF would reduce the amount of benefits that

would otherwise be shifted to Medicaid. That change would decrease federal Medicaid spending by $1 million in 2001 and $2 million in 2002.

Pay-as-you-go considerations: The Balanced Budget and Emergency Deficit Control Act sets up pay-as-you-go procedures for legislation affecting direct spending or receipts. The net changes in

outlays that are subject to pay-as-you-go procedures are shown in

the following table. Because H.R. 4144 would exempt the transfer

from the AML Fund from these provisions, it is not included. The

table below only shows the bill’s effect on the federal Medicaid

spending. For the purposes of enforcing pay-as-you-go procedures,

only the effects in the current year, the budget year, and the succeeding four years are counted.

By fiscal year, in millions of dollars—

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Changes in outlays ................................................... 0 ¥1 ¥200000000

Changes in receipts ................................................. Not applicable

Estimated impact on state, local, and tribal governments: H.R.

4144 contains no intergovernmental mandates as defined in

UMRA. Because additional resources in the Combined Benefit

Fund would provide health benefits to eligible retired coal miners,

estimated Medicaid spending would decrease. Consequently, CBO

estimates that states would save over $500,000 in 2001 and over

$1.1 million in 2002 in the Medicaid program.

Estimated impact on the private sector: This bill contains no new

private-sector mandates as defined in UMRA.

Estimate prepared by: Federal Costs: AML and CBF Funds:

Cyndi Dudzinski Smith; Medicaid: Eric Rollins. Impact on State,

Local, and Tribal Governments: Leo Lex. Impact on the Private

Sector: Lauren Marks.

Estimated approved by: Peter H. Fontaine, Deputy Assistant Director for Budget Analysis.

COMPLIANCE WITH PUBLIC LAW 104–4

This bill contains no unfunded mandates.

PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

This bill is not intended to preempt any State, local or tribal law.

CHANGES IN EXISTING LAW

If enacted, this bill would make no changes in existing law.

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