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66–308 PDF 2012

EPA MINING POLICIES: 

ASSAULT ON APPALACHIAN JOBS—PART II 

(112–30) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

WATER RESOURCES AND ENVIRONMENT 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

MAY 11, 2011 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

Available online at: http://www.gpo.gov/fdsys/browse/ 

committee.action?chamber=house&committee=transportation 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JOHN L. MICA, Florida, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

TIMOTHY V. JOHNSON, Illinois 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ANDY HARRIS, Maryland 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

JAIME HERRERA BEUTLER, Washington 

FRANK C. GUINTA, New Hampshire 

RANDY HULTGREN, Illinois 

LOU BARLETTA, Pennsylvania 

CHIP CRAVAACK, Minnesota 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BILLY LONG, Missouri 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

JEFFREY M. LANDRY, Louisiana 

STEVE SOUTHERLAND II, Florida 

JEFF DENHAM, California 

JAMES LANKFORD, Oklahoma 

REID J. RIBBLE, Wisconsin 

VACANCY 

NICK J. RAHALL II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

STEVE COHEN, Tennessee 

LAURA RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

(II) 

SUBCOMMITTEE ON WATER RESOURCES AND ENVIRONMENT

BOB GIBBS, Ohio, Chairman 

DON YOUNG, Alaska 

JOHN J. DUNCAN, JR., Tennessee 

GARY G. MILLER, California 

TIMOTHY V. JOHNSON, Illinois 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ANDY HARRIS, Maryland 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

JAIME HERRERA BEUTLER, Washington, 

Vice Chair 

CHIP CRAVAACK, Minnesota 

LARRY BUCSHON, Indiana 

JEFFREY M. LANDRY, Louisiana 

JEFF DENHAM, California 

JAMES LANKFORD, Oklahoma 

JOHN L. MICA, Florida (Ex Officio) 

VACANCY 

TIMOTHY H. BISHOP, New York 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

RUSS CARNAHAN, Missouri 

DONNA F. EDWARDS, Maryland 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

MICHAEL E. CAPUANO, Massachusetts 

GRACE F. NAPOLITANO, California 

JASON ALTMIRE, Pennsylvania 

STEVE COHEN, Tennessee 

LAURA RICHARDSON, California 

MAZIE K. HIRONO, Hawaii 

NICK J. RAHALL II, West Virginia 

(Ex Officio) 

(III) 

(V) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... vi 

TESTIMONY 

PANEL ONE

Carey, Michael, President, Ohio Coal Association ................................................ 7 

Hopper, M. Reed, Principal Attorney, Pacific Legal Foundation ......................... 7 

Roberts, Steve, President, West Virginia Chamber of Commerce ....................... 7 

Sunding, David L., University of California, Berkeley ......................................... 7 

PANEL TWO

Stoner, Nancy K., Acting Assistant Administrator, Environmental Protection 

Agency, Office of Water ....................................................................................... 28 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Carey, Michael ......................................................................................................... 54 

Hopper, M. Reed ...................................................................................................... 59 

Roberts, Steve .......................................................................................................... 67 

Stoner, Nancy K. ...................................................................................................... 71 

Sunding, David L. .................................................................................................... 81 

SUBMISSIONS FOR THE RECORD 

Stoner, Nancy K., Acting Assistant Administrator, Environmental Protection 

Agency, Office of Water, submittal of peer-reviewed literature published 

since 2007 that supports the Spruce Mine 404(c) final determination ............ 38 

ADDITIONS TO THE RECORD 

Peters, Leonard K., Secretary, State of Kentucky Energy and Environment 

Cabinet: 

Cover letter to Hon. Bob Gibbs, Chairman, Subcommittee on Water Resources and Environment, May 17, 2011 ....................................................... 85 

Letter regarding permit delays to Nancy Stoner, Acting Assistant Administrator, Office of Water, Environmental Protection Agency, May 17, 2011 .. 86 

‘‘EPA Specific Permit Objection—CY2000 to Present’’—Spreadsheet showing 

EPA objections to Kentucky permits .............................................................. 90 

ECOS, ‘‘Objection to U.S. Environmental Protection Agency’s Imposition 

of Interim Guidance, Interim Rules, Draft Policy and Reinterpretation 

Policy’’ ................................................................................................................ 94 

National Mining Association Memorandum Opinion ........................................ 96 

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(1) 

EPA MINING POLICIES: 

ASSAULT ON APPALACHIAN JOBS—PART II 

THURSDAY, MAY 11, 2011 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON WATER RESOURCES

AND ENVIRONMENT, COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, Washington, DC. 

The subcommittee met, pursuant to notice, at 10:37 a.m., in 

Room 2167, Rayburn House Office Building, Hon. Bob Gibbs (chairman of the subcommittee) presiding. 

Mr. GIBBS. Good morning. The committee of—the Subcommittee 

of Water Resources and Environment, subcommittee of Transportation and Infrastructure, will come to order. Today we are having 

our—we are calling it a part two hearing of EPA mining policies 

and the effect on jobs in Appalachia. 

I will start with an opening statement. Welcome, again. The Appalachian region is being subjected to an unequal treatment under 

the law by the Environmental Protection Agency for the arbitrary 

reason that it produces a domestic source of energy. 

The United States consumes 1.1 billion tons of coal every year— 

33 percent of this coal, or approximately 390 million tons—annually comes from the Appalachian region of the United States. And 

50 percent of the power generated in this Nation comes from coal 

as its fuel source. 

Coal is an abundant and domestic source of energy. Its use is not 

subject to the whims of foreign cartel, nor does it tend to thrust us 

into international conflicts. In addition, using domestic coal creates 

American jobs. It is clear that coal will and must remain a major 

source of energy well into the future. And, therefore, it is important 

that we keep coal as a safe and inexpensive alternative to other energy options. 

But to quote one of our witnesses from last week’s panel, Michael 

Gardner, general counsel of Oxford Resources, one of the job providers harmed by the actions of the EPA—as he quotes, ‘‘These permit applications literally fell into a black hole, where no information was forthcoming. Literally, the opposite of transparency. You 

couldn’t find out why a permit was on the list. You couldn’t find 

out how to get them issued off the list. This was a de factor moratorium on section 404 permits. So much for transparency and the 

EPA enhanced coordination.’’ 

I am extremely concerned how the administration is attempting 

to short-circuit the process for changing substantive Agency policy 

under the Clean Water Act without following the proper transVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
2 

parent rulemaking process that is dictated by the Administrative 

Procedures Act. This Act lays out a process for public comment, 

making amendments to policy for States to object and for judicial 

review. By ignoring the Administrative Procedures Act, EPA is 

changing the Clean Water Act, it is implementing regulations 

through means of interim guidance, interim rules, draft policy, or 

reinterpretation of policy. 

EPA is taking these actions with little regard to economic consequences, with little regard to national security, and, most importantly, with little regard to the law. Much of the Clean Water Act 

is a delegated program. Through its practices, EPA is usurping the 

role of the States. 

At last week’s hearing on this issue, the committee heard from 

two State regulators on the issue of EPA’s legally dubious interpretation of the law. As Teresa Marks, representing the Environmental Council of the States, the 50 State departments of environmental quality agencies, said last week, ‘‘Requiring States to implement interim guidance puts each State in the position of deciding 

whether it will break the Federal law or State law. At the very 

least, this should be a good enough reason why a Federal agency 

should never ask a State to implement something that is not final.’’ 

Even though EPA is very much involved in the permit application process with the States, the Corps of Engineers, and other 

Federal agencies, EPA is now revoking permits that have already 

been issued. This is not legal. In addition, revoking a permit after 

it has been issued is an arbitrary and irresponsible way for a Government to act. I consider this regulatory overreach, and to be a 

fundamental property rights issue. This is an example of Government that thinks it has no limitations on its power. 

What does it really mean to get a permit? What does it mean to 

get a final decision from the Federal Government? If an agency is 

given the right to unilaterally revoke an already-issued permit, 

then nothing can ever be considered final. The issuance of a Federal permit should come with some certainty that the activity can 

go forward unencumbered, but within the bounds of the permit, 

particularly those activities on private lands. This no longer seems 

to be the case, and it is going to have a stifling effect on not just 

mining operations in Appalachia, but on the economic development, 

nationwide. 

I would like to close my statement with a quote. As our committee ranking member, Mr. Rahall, eloquently said last week, 

‘‘EPA has a legitimate role to play in the Clean Water Act permitting process. Early on in this administration many had high hopes 

that the EPA would provide the clarity and the certainty that coal 

mining constituencies throughout Appalachia have been asking for, 

pleading for, and for many years. Unfortunately, we have been disappointed, as a result of the guidance that the EPA issues in April 

of last year, guidance with far-reaching consequences that was 

made effective immediately, without the opportunity for the public 

comment. Instead of offering that clarity and certainty, the regime 

set forth by the EPA has thrown the entire permitting process 

throughout the region into utter turmoil.’’ End quote from Ranking 

Member Rahall. 

3 

I welcome our witnesses today. Before we move to our witnesses, 

I recognize Ranking Member Representative Bishop for an opening 

statement. 

Mr. BISHOP. Thank you, Mr. Chairman. Today marks the second 

of two planned hearings on issues surrounding the oversight and 

regulation of surface coal mining. As I mentioned at last week’s 

hearing, while I do not live with the day-to-day impacts of surface 

coal mining, I have quickly learned that few issues engender a 

more passionate response from industry, from mine workers, and 

from everyday citizens as this one. 

Last week we heard the concerns from representatives of the 

States and mining industry on recent actions by the Obama administration related to surface coal mining operations. Today we will 

have the opportunity to hear from other affected interests, as well 

as a witness from the United States Environmental Protection 

Agency. 

Mr. Chairman, when we last met I noted that the issue of surface coal mining highlights the complex balance in providing wellpaying jobs for American families, in ensuring the continued 

growth and economic health and safety of our communities, and in 

protecting our natural environment for current and future generations. Finding this balance can—finding this balance point can be 

particularly tricky, especially when we consider that the production 

of energy itself comes with a significant cost. 

Several Members have already alluded to a pendulum of oversight and regulation of surface coal mining practices that may have 

been too lax in the last administration—is now swinging back in 

the other direction. 

I am hopeful today the administration will have the opportunity 

to explain its actions with respect to surface coal mining, and its 

reasons for undertaking its actions to date. I welcome all of the 

witnesses. I look forward to your testimony. I yield back the balance of my time. 

Mr. GIBBS. Thank you. Ranking Member Rahall, do you have a 

statement? 

Mr. RAHALL. No, Mr. Chairman. I don’t have any statement. I 

appreciate, again, you having these hearings. I think I said it all 

last week—I must have, since you quoted me this morning—I appreciate it. 

But I do want to welcome our president of the West Virginia 

Chamber of Commerce, Steve Roberts, a constituent of mine—I believe you still live in Huntington—and looking forward to his testimony, as well as the entire panel. 

Thank you, Mr. Chairman. 

Mr. GIBBS. At this time I recognize Representative Capito. 

Mrs. CAPITO. Thank you, Mr. Chairman. Thank you, Chairman 

Gibbs, and thank you, Ranking Member Bishop, for holding this 

second hearing regarding jobs and job loss in Appalachia. 

I, too, would like to join my colleague from West Virginia in welcoming Mr. Steve Roberts, who is the president of our West Virginia Chamber of Commerce. Thank you, Steve, for coming today, 

and thank you for your hard work in creating and preserving our 

jobs in West Virginia. 

4 

As we all know, I come from West Virginia. West Virginia is a 

major producer of coal and natural gas. These industries produce 

thousands of jobs and millions of dollars in tax revenue for my 

home State, our home State, of West Virginia. The administration’s 

coordinated effort to end coal mining threatens the very future, I 

believe, of our Appalachia, and I am here today to continue to fight 

for every mining job that the EPA policies threaten. 

In fact, as I have stated numerous times before, when I met with 

Administrator Jackson she told me point blank that she does not 

take into consideration the economic or the job impact of the policies or decisions that they make. Well, I am here to tell the members of the committee that these policies are threatening communities, and potentially hurting our families. And if you look out into 

the audience, you will see the faces of coal who are here today to 

protect an industry that is so important to the way of life of Appalachia. 

The revocation of the 404 permit given to Spruce Mine No. 1 in 

West Virginia sent shock waves throughout the entire energy industry. Last week, during his testimony, Dr. Leonard Peters stated 

that the science the EPA is using to revoke the permit from Spruce 

Mine No. 1, as well as review 235 other permits, is ‘‘incomplete.’’ 

Furthermore, the EPA revocation is without precedent. While the 

EPA does have the authority to veto an existing permit, it is questionable whether EPA has the authority to revoke a permit that 

has already been approved by the Army Corps of Engineers and 

the EPA. The EPA has not given any indication how revoked permits could be regained. 

This massive overreach by the EPA has created so much uncertainty within Appalachia that companies are beginning to withdraw their own permit requests, and that means job loss. Companies are not willing to invest hundreds of millions of dollars in a 

mining operation that could be shut down at a moment’s notice. 

We are now seeing inflation on the rise, and food costs are soaring through the roof, and employment has been at or above 9 percent for the last 2 years. It seems incomprehensible to me that our 

Government would take such drastic measures that could result in 

job loss, increase our energy costs for every American, and increase 

our demand for overseas energy sources. 

Mr. Chairman and members of the committee, if the administration is willing to take drastic measures to destroy coal, what would 

they be willing to do to the industries in your district? 

I look forward to hearing today’s testimony, and I yield back my 

time. 

Mr. GIBBS. I would just like to give notice to the people in the 

audience that outbursts will not be tolerated, and you will be removed. Just decorum and respect to the Members and the witnesses. 

At this time I recognize Representative Cravaack for an opening 

statement. 

Mr. CRAVAACK. Thank you, Chairman Gibbs and Ranking Member Bishop, for holding the second part of this important hearing 

to the effect the EPA has on mining jobs in Appalachia. I would 

like to welcome today’s witnesses for our panel, and I look forward 

to hearing your testimony, the EPA’s permitting process, and how 

5 

it affects jobs not only in the Appalachian coal mining communities, but also in the taconite and precious metal mining communities in Minnesota’s Iron Range. 

As you know, 50 percent of our Nation’s power comes from coal; 

33 percent of the coal mines for—come right from the Appalachian 

regions. Coal mining provides thousands of jobs and supports numerous businesses and communities throughout the United States. 

In times of rising energy costs and high unemployment, jobs 

must be protected and costs must be kept as low as possible, while 

at the same time protecting our environment. I am concerned at 

some of the steps recently taken by the EPA to expand its oversight, and to impose increased burdensome regulation on industry. 

The new process is creating a permitting process that is more burdensome, and with proven inefficiencies. 

I find the EPA’s new regulations and overreach very troubling, 

and I worry about the effect it will have on the mining jobs in and 

outside of Appalachia. I wonder why the changing permitting process is necessary, and also what thought was put into making these 

changes the EPA is attempting to push through. 

I look forward to hearing from our witnesses today, and their 

thoughts on what steps can be taken to protect thousands of jobs 

within the United States. Thank you again, and I look forward to 

hearing from your testimony. 

And I yield back, sir. 

Mr. GIBBS. Mr. Landry, do you have an opening comment? Proceed. 

Mr. LANDRY. Thank you, Mr. Chairman, for calling today’s hearing. Thank you all for participating. 

Today’s hearing addresses part of an enormous problem in this 

country: the EPA and the 404 permit process is stifling economic 

progress and job creation in this county. According to Chairman 

Mica’s landmark study entitled, ‘‘Sitting on our Assets,’’ a 404 permit application costs over $271,000 to prepare, not counting the 

cost of mitigation, design changes, carrying capital, and other costs. 

And it takes more than 2 years to secure. 

Each and every year, businesses and local governments spend 

more than $1.7 billion trying to secure 404 permits. But as today’s 

hearing will show, even after a 404 permit applicant completes this 

onerous process, the EPA can simply come in and arbitrarily revoke a permit. This is exactly what they did to Mingo Logan, a subsidiary of Arch Coal. This company created a 1,600-page permit 

document for a mine which impacted 8.1 acres of applicable water. 

And after all of the work, the EPA unilaterally and retroactively 

revoked this permit last year. In doing so, the EPA acted far outside the authority Congress has provided to it. 

The EPA has also acted outside of congressional authority by 

issuing guidance which virtually halts Appalachian coal mining, 

short-circuits the official rulemaking process, and completely undermines the expedient 404 permit process envisioned by Congress. 

The sum of EPA’s action in Appalachian coal mines have been 

the loss of at least 17,000 coal mining jobs, and more expensive 

power for much of the eastern seaboard. However, this is not the 

only region to be hurt by EPA’s abuse of the Clean Water Act. In 

2008, EPA revoked the 404 permit for the Yazoo Backwater Area 

6 

Project. This project was designed to protect more than 400,000 

acres of land and 1,300 homes from flooding by installing a pumping system to drain the area during flooding. That project was authorized and appropriated by Congress, and provided a permit by 

the U.S. Army Corps of Engineers. Yet, even after all of this study 

and approval, EPA pulled the permit at the last minute. In their 

official documents they said they were pulling the permit because 

the project would endanger 67,000 acres of wetlands. 

This makes absolutely no sense. How can EPA endanger countless lives, 400,000 acres of land, 1,300 homes, in order to save 

6,000 acres of wetlands? Where is our priorities and where is our 

balance? When will EPA see that residents of those 1,300 homes, 

residents who are currently homeless, due to the historic flooding 

experienced in the Mississippi River Valley are more important 

than the 6,000 acres of wetlands they claim that it would protect? 

I hope today’s hearing sheds some light on these issues, and 

helps us get back to the path where we prevent EPA from utilizing 

the Clean Water Act to put supposed wetlands protection ahead of 

people’s lives and their livelihood. 

Thank you, Mr. Chairman. 

Mr. GIBBS. Representative Altmire, do you have an opening 

statement? 

Mr. ALTMIRE. Thank you, Mr. Chairman. I would say thank you 

to the witnesses for being here for this second hearing on this topic. 

I found the first to be very productive. 

And I wanted to just shed some light in a bipartisan way on our 

support, as a group, this entire committee, of cultivating our own 

domestic resources. There is a national security implication, there 

is an economic implication, a jobs implication, and certainly an energy implication to using all of our resources. And anything that 

we can do to help lessen the burden that is in front of you in doing 

that, we want to assist with that, and we very much appreciate 

your being here today to discuss this issue, because we take it in 

the national interest. And certainly being from western Pennsylvania, it is critical to my region of the country, also. So, thank you, 

Mr. Chairman, for holding the hearing. I look forward to hearing 

the witnesses. 

Mr. GIBBS. Representative Herrera-Beutler, do you have a comment? OK. No? Lankford, Representative Lankford? 

Mr. LANKFORD. Thank you. And thank you for being here. You 

will find a common passion among many of the representatives for 

clean water and clean air and an interest in living in a society that 

we are very grateful for our own children to grow up in, and that 

we want to be good stewards of our environment, as well. But we 

also are a Nation that has to have power, and that continues to 

fuel our economy and jobs. And we need to be able to strike a balance. 

As you are very aware, EPA’s mission began in the Nixon administration, with the beginning point of those five major focus areas. 

But during the Carter administration, there was a dramatic shift 

to be able to push more and more of the Federal Government towards coal. And that became a major focus during that administration and the days after that. Many of these power plants responded 

by continuing to use coal as the piece of energy that was encourVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
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aged by our Federal Government. They have done a good job, they 

have been good stewards with those things. They have made corrections, and they have made changes along the path. 

As a Nation that needs more power, though, we are bumping up 

against, I sense, an EPA that is continuing to focus on its central 

core mission of land, air, and water, but that is changing the rules 

on a lot of people that felt like they were abiding by the rules. 

When a permit can change in the middle of a 10-year process, that 

makes a big shift for a group of people that were trying to play by 

the rules. 

When 316(b) rules change, or they are not clear for a coal-fired 

power plant, and they are not sure what happens around the intake valve, there is no clarity and there is no ability to be able to 

plan. When the air quality rules change on them, good players are 

not able to determine what are the fair rules, and how do we do 

this. And when it takes 10 years to do an environmental study, at 

some point we have to ask the question: Is EPA intentionally 

standing in the way of developing more power for the United 

States, and slowing down our economy? 

Now, I would hope the answer to that would be no. And I would 

anticipate from you it would be. But we are going to have to look 

at the facts and the details and say, ‘‘Are these continual changing 

rules changing our power capacity and our jobs in the United 

States?’’ And, if so, we need to be able to hold those to account, and 

to be able to hear clearly, ‘‘Where are we going from here?’’ 

With that, I yield back. 

Mr. GIBBS. Thank you. And again, I welcome our witnesses 

today. We are going to have two panels. The first panel, we have: 

Mr. Michael Carey, president of the Ohio Coal Association; also, 

Mr. Steve Roberts, president of the West Virginia Chamber of Commerce; Dr. David Sunding, University of California at Berkeley; 

and Mr. Reed Hopper, principal of the Pacific Legal Foundation. 

And in our second panel will be acting assistant administrator of 

the Environmental Protection Agency, Office of Water, Ms. Nancy 

Stoner. 

Welcome, Mr. Carey. The floor is yours. 

TESTIMONY OF MICHAEL CAREY, PRESIDENT, OHIO COAL ASSOCIATION; STEVE ROBERTS, PRESIDENT, WEST VIRGINIA 

CHAMBER OF COMMERCE; DAVID L. SUNDING, UNIVERSITY 

OF CALIFORNIA, BERKELEY; AND M. REED HOPPER, PRINCIPAL ATTORNEY, PACIFIC LEGAL FOUNDATION 

Mr. CAREY. Chairman Gibbs, Ranking Member Bishop, Congressman Rahall, members of the committee, good morning. I want to 

thank you for inviting me to testify at this important hearing regarding the litany of new regulations being put forth by the U.S. 

EPA, and their effects on Appalachian jobs. My name is Mike 

Carey; I am president of the Ohio Coal Association. The Association 

provides a voice for many thousands of citizens working in Ohio’s 

coal sector. I also serve on the National Coal Council, an advisory 

committee to the Secretary of Energy on energy resource issues. 

Cheap, abundant coal is what powers the manufacturing base 

and provides affordable energy for families across the Midwest and 

other regions in America. The companies we represent, both large 

8 

and small, directly employ over 3,000 individuals in Ohio alone, 

and over 30,000 secondary jobs that are dependent upon our industry. 

The Obama administration and its allies have declared war on 

coal across Appalachia. We are at ground zero for the fundamental 

overreach by this administration’s regulatory agenda. The rural regions of Ohio, Kentucky, West Virginia, Tennessee, Illinois, Pennsylvania, and Indiana would all be devastated from losing major 

employers such as coal companies. 

In a rare statement of honesty, which actually bordered on hubris, last year the Office of Surface Mining stated, in justification 

for the Stream Protection Rule, that 7,000 jobs—7,000 jobs—would 

be lost in Appalachia. That was OK, because some jobs would be 

created out West. Mr. Chairman, that is simply unacceptable. 

In fact, just last week, the Army Corps of Engineers filed a lawsuit against Buckingham Coal Company related to an operation in 

Morgan County, Ohio, which is right in your congressional district. 

They are attempting to prevent access for mining coal reserves already permitted under our State regulatory authority. Doing so ignores the intent of this committee and Congress when it wrote the 

Clean Water Act and SMCRA, where permitting jurisdiction was to 

be vested to the States. 

As you can clearly see, this administration is picking winners 

and losers by regulatory proclamation. The policies of the current 

administration will force fuel-switching and shifts in regional coal 

from eastern to western reserves, which would lead to an increase 

in utility costs. 

Some people may think that I am exaggerating, but one need 

only look at the host of new regulatory proposals that are aimed 

at the Appalachian coal industry that are not only just coming from 

the EPA, but they are coming from the Department of Interior, 

MSHA, and, as I mentioned before, the Army Corps of Engineers, 

a partial list of which has been provided in my written testimony. 

Mr. Chairman, we need to do four things to stop this abuse on 

Appalachian coal jobs. First, we need to declare a regulatory timeout. We are still recovering from a recession. And this administration seems to forget that, compared to 30 years ago, our air is 

cleaner, our mines are safer, and of course, our water resources are 

better protected. 

Number two, we need to reassert the primary role of the States 

in permitting decisions. We need legislation clarifying that our 

States continue to have primacy in interpreting the relevant portions of the Clean Water Act. 

Three, end the abusive use of regulatory guidance documents. If 

it is important enough to be issued as a guidance document, then 

it is important enough to go through the normal public notice and 

comment period. 

Number four, provide certainty in permitting decisions. Unfortunately, we need Congress to tell the administration to live up to its 

permitting promise. We also need the permits to be processed in a 

timely manner. 

The thousands of workers that are affected in Appalachia deserve the right to earn a livelihood without being subjected to the 

whims of bureaucracy. And, unfortunately, the administration is 

9 

pushing bureaucracy to advance the most extreme anti-coal agenda 

that our Nation has ever seen. 

And how do we know this? They simply are following through on 

their campaign plan. Also, as Commissioner of the New Jersey Department of Environmental Protection, current EPA administrator, 

Lisa Jackson, issued the New Jersey global warming plan, which 

called for a moratorium on all coal-fired power plants. Now, she 

may not be calling for a moratorium today at the EPA, but her regulatory policies are certainly creating them. 

Again, Mr. Chairman, this committee could declare a regulatory 

time-out, reassert State primacy in permitting decisions, end the 

abuse of the regulatory guidance documents, and provide certainty 

in permitting decisions. 

Mr. Chairman, I appreciate the opportunity to testify, and I look 

forward to your questions. 

Mr. GIBBS. Thank you. 

And our next panelist is Mr. Steve Roberts, president of the West 

Virginia Chamber of Commerce. 

Welcome. 

Mr. ROBERTS. Thank you. Thank you very much for having me. 

Ladies and gentlemen, honorable chairman, and members of the 

committee, thank you very much for your interest and concern 

about the impact of actions of the U.S. EPA on mining production, 

energy needs, employment, and quality of life in mining communities throughout West Virginia and the Nation. I particularly 

want to acknowledge and express appreciation to Chairman Gibbs, 

to the Honorable Nick Rahall, and Shelley Moore Capito, who I am 

proud to know, and by whom I and my family members living in 

both Huntington and Charleston, West Virginia, are so proud to be 

represented. I am Steve Roberts, I am the president of the West 

Virginia Chamber. 

West Virginia is a beautiful State, populated by decent, hardworking, caring people. We are proud of our over-20 colleges and 

universities, our well-developed transportation network, our 

breathtaking peaks and valleys, and our industrial base that supplies the much-needed coal, gas, timber, and electricity that have 

helped build our great Nation. 

West Virginia proudly boasts the Nation’s lowest crime rate, the 

highest level of home ownership, and the first public schools found 

in the post-Civil War South. The West Virginia mountains have 

given our Nation many famous Americans. Coal and energy production have long been key components of our State’s being. And 

because of that, we are especially afraid of the assault referred to 

in this hearing’s title. 

Outside of Wyoming, we produce the most coal in the United 

States. Because of the sensitive nature of our economy, these jobs 

are more than important. Without them, tens of thousands of families, and a historic American mountaineer culture, would cease to 

exist here. 

The best jobs in our State’s neediest areas are nearly always 

mining jobs. Per capita income in southern West Virginia is about 

half the national figure. Yet the average coal job pays more than 

four times that amount. A mining income can stabilize an extended 

family, providing support for the elderly, a future for children, and 

10 

a livelihood for many relatives of the wage earner. Killing off such 

work will do the opposite. Tens of thousands of families will be 

thrown into crisis. 

If surface mining ended in West Virginia, coal production would 

be cut by 40 percent. There are 537 mines in West Virginia, and 

232 of those are surface mines. If permitted, more could exist. 

As the country’s second-largest coal mining State, limiting 40 

percent of our production would be destructive to our country, 

broadly, at a time when our country needs energy. Locally, 6,255 

surface miners would be jobless. Many workers at coal handling facilities would be let go, and secondary industries would experience 

cuts, as well. For these reasons, the environmental impact of surface mining can never be considered in isolation from the real experience of real people who live in this environment. 

Before I delve further into statistics, let me quote one of these 

people. Ellen Taylor is the president of the Beckley-Raleigh County 

Chamber of Commerce. Her area is particularly rich in coal and 

coal mining history. She knows mining communities. She says, in 

reference to 404 mining permits, that ‘‘Canceling permits will have 

a disastrous affect on the people here. Not only mining families, 

but local businesses will be widely affected.’’ 

To use one of many examples, buying groceries could become a 

real problem if they were to lose their jobs. Stores would close. Refusing to issue permits would have a terribly harsh trickle-down effect on the economy. Many, many families depend on that paycheck 

from mining companies, Ms. Taylor says. 

This is because those companies treat their employees well. In 

the mining industry, wages have increased 3.9 percent yearly, on 

average, through 2008. Mining companies freely maximize their 

employment. They do not risk pressuring employees by under-hiring. As of 2008, the coal industry in West Virginia employs over 

20,000 people, more than any other State. These workers were paid 

$1.5 billion with total compensation of $2.8 billion. And these statistics and those to follow come from recent studies by West Virginia’s two largest universities. 

I have just listed some of the direct benefits of coal. The indirect 

benefits are also vast. In 2008, coal companies paid over almost 

$700 million in taxes, amounting to a substantial portion of all 

State revenue. It is the Chamber’s assessment that this contribution will shrink to the point of State crisis if 404 mining permits 

are denied. The loss of property taxes alone would be fatal to local 

governments, the above-referenced study found. 

Thank you for the opportunity to testify, Mr. Chairman. We believe the denial and revocation of 404 permits has already threatened our economy and workforce. There could be much more damage still. For this reason, I appreciate your attention to our struggle, as we try to retain jobs in this most traditional of Appalachian 

industries. Thank you very much. 

Mr. GIBBS. Thank you. 

Our next panelist is Dr. David Sunding, University of California 

at Berkeley. 

Welcome. 

Mr. SUNDING. Thank you. Chairman Gibbs, members of the subcommittee, it is an honor to speak here today. 

11 

This committee is considering an issue of regulatory policy that 

has significant implications for the vast range of public and private 

projects that must receive permits under section 404 of the Clean 

Water Act. The willingness of the EPA to revoke a valid discharge 

permit approved after a decade-long review process including indepth environmental impact assessment and public comment, as 

well as the direct involvement by the EPA and the permitting process, can have far-reaching economic incentive effects. 

The EPA’s action may bring into question any future investment, 

hiring, or development decisions in projects that rely on an approved section 404 permit. These activities are vital to the American economy, and include pipelines and electric transmission, 

housing and commercial development, renewable energy projects 

like wind, solar, and biomass, transportation infrastructure, including roads and rail, agriculture, and many others. The Army Corps of Engineers estimates that over $220 billion of 

investment each year is conditioned on the issuance of 404 permits. 

EPA’s precedential decision to override the judgement of the Corps 

of Engineers in this case alters the incentive to invest in projects 

requiring a permit under section 404. 

Project development often requires significant capital expenditure over a sustained period of time, after which the project generates some return. Actions that undermine the certainty of the 

404 permit raise the threshold for any private or public entity to 

undertake the required early-stage investment. In this way, the 

EPA’s action may chill investment in activities requiring 404 authorization. 

Increasing the level of uncertainty can also reduce investment by 

making it more difficult to obtain project financing. Land development activities, infrastructure projects, and the like, often require 

a significant level of capital formation. Reducing the reliability of 

the section 404 permit will make it harder for project proponents 

to find financing at attractive rates, as lenders and bond holders 

will require higher interest rates to compensate for increased risk. 

And some credit rationing may also result. 

It is worth remembering that public and private activities requiring section 404 authorization generate significant and direct benefits to affiliated industries, thus reduced levels of project investment translate directly into lost jobs and lost economic activity. 

You have just heard testimony about the indirect impacts of mining 

on the economies of the Appalachian States. 

Similar indirect benefits are evident for housing and commercial 

development, road-building, and other activities. In the case of 

housing construction, for example, which, over the long run, accounts for as much as 15 percent of all economic activity in the 

United States, every $1 spent on housing construction produces 

roughly $2 in total economic activity. And every $1 billion in residential construction generates nearly 12,000 new jobs. Regulation 

that creates a disincentive for investment in projects requiring 404 

authorization places these indirect economic benefits at risk. 

A reduced level of investment in projects requiring a section 404 

permit would have effects that go far beyond the industry participants themselves. Private projects authorized under section 404 increase the supply of housing, commercial development, and the 

12 

like. When development projects are not undertaken, these consumer benefits are reduced or lost all together. 

Public sector activities, like road building and repair and utility 

infrastructure also contribute in fundamental ways to the quality 

of life throughout the Nation, as evidenced by the frequently large 

benefit cost ratios associated with transportation infrastructure 

projects. Similarly, other types of public land development, such as 

libraries, schools, and emergency response infrastructure generate 

significant levels of economic welfare, some part of which would be 

at risk, as a result of the EPA’s actions. 

Finally, it should be remembered that land owners could suffer 

losses and wealth as a result of the EPA’s action. In a competitive 

land market, prices reflect the discounted value of the returns 

earned from dedicating land to its highest and best use. For undeveloped land, this sum is typically equal to the value of rents when 

the land is in an undeveloped condition, plus the amount that developers are willing to pay for land when they ultimately initiate 

their project. Regulation that lowers the profits from development 

will be capitalized into current land values, meaning that the equilibrium market price of land will be lower, as a result. 

I am currently working on a study of these various disincentive 

effects and economic impacts of the EPA’s actions with respect to 

the Spruce Mine matter, and hope to have results on their importance within the next few weeks. I will make the results of the 

study available to the committee, and look forward to discussing 

them with you and your staff. Thank you. 

Mr. GIBBS. Thank you. 

Our final panelist on this panel is Mr. Reed Hopper, from the Pacific Legal Foundation. 

Welcome. 

Mr. HOPPER. Thank you. Mr. Chairman, members of the committee, as an attorney with the Pacific Legal Foundation, a nonprofit public interest organization dedicated to the protection of individual rights and private property rights, I wish to thank you for 

this opportunity to testify. 

The handling of the Mingo Logan permit is instructive in a number of ways, in that it raises a number of red flags that indicate 

when an agency is pursuing a political agenda, as opposed to pursuing its statutory mandate. 

The first red flag is when the agency response is disproportionate 

to the payoff. The final notice of the permit revocation indicates, for 

example, that the Mingo Logan Mine is one of the largest mining 

projects of its type, and therefore, is unprecedented. However, it 

fails to mention that the evaluation of this particular project was 

also unprecedented. 

This was the first time that a full EIS has been completed for 

such a project. As has already been indicated, 10 years in review, 

1,600 pages in length, 58 pages responding to comments of the 

EPA. More importantly, the two agencies that issued permits for 

the project, the State department of environmental protection and 

the Corps of Engineers, opposed this revocation, and indicated that 

the mine has been in full compliance with the permit, that these 

agencies continue to monitor compliance regularly, and that they 

have the wherewithal to address any unforseen impacts. The noVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00026 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
13 

tion that the EPA suddenly needed to intervene to protect us 

against some sort of a significant disastrous ecological impact simply is not credible. 

The second red flag is when the agency abruptly changes its policy or practice. This typically results when an agency is pushing 

the envelop on its statutory or regulatory authority. In this case, 

the Agency has, for the first time in its history, used the 404(c) 

veto power retroactively to suspend a permit that has been ongoing 

and has been held in compliance for over 3 years. 

In most cases, the courts would require the agency to justify this 

type of change in policy or practice, which brings me to the third 

red flag, and that is when the agency policy or practice is changed 

by means of ‘‘guidance,’’ as opposed to the formal APA rulemaking 

procedure. Using internal guidance as a means to substantively 

change the law is a recurring practice with the EPA. We saw this 

with the SWANCC guidance after the 2001 Supreme Court decision, after the Rapanos decision in 2006, and now, with this mining 

policy. The sole purpose appears to be to insulate the Agency from 

having its broad interpretation of the law subject to any sort of direct legal challenge. The guidance forces a case-by-case challenge, 

which means that, overall, there can never be any real change in 

Agency practice, even if a court finds that the application of its policy is illegal in a particular circumstance. 

Another red flag is when the agency changes its policy or practice, and creates greater uncertainty, instead of more uniformity. 

The proper purpose, I think, of agency rules or guidance should be 

to ensure objective and uniform administration of the law. But the 

new mining policy does just the opposite: it demonstrates that the 

Agency can change procedures and standards at will; and, with respect to 404(c), that it can revoke a permit whenever it deems appropriate. This is the very definition of arbitrary Government. 

Finally, I think that another red flag is when the agency shows 

little or no regard for the impact its change in policy or practice 

will have on affected parties. The new mining policy truly is an assault on jobs, individual rights, property rights, and the economy. 

Until now, 404 permits could be modified or revoked only with 

a consideration of the effect on the investment and the reliance 

that the permit-holder had in properly complying with the permit. 

But EPA has thrown that out the window. 

Instead of viewing land owners and permit-holders as allies to be 

helped, the EPA views land owners and permit holders as enemies 

to be thwarted. I believe this needs to change. 

Mr. GIBBS. Thank you. We will begin our first round of questions. 

Mr. Carey, you are a member of the National Coal Council advisory 

board of the Department of Energy. How many meetings does the 

Council have with the Secretary of Energy, the administrator of the 

EPA, and how would you describe those meetings? 

Mr. CAREY. Mr. Chairman, I would be unprepared to give you 

that, but I would be happy to find out exactly how many meetings 

took place, and provide that to the committee. 

I would not be able to answer that question, because I don’t 

know exactly—— 

Mr. GIBBS. Yes. The second part of the question is how would 

you describe the tone of the meetings? 

14 

Mr. CAREY. Well, again, I wasn’t in the meetings, so it would be 

hard for me to actually answer that question, Mr. Chairman. 

Mr. GIBBS. OK. Let’s go on to Mr. Hopper. Since a section 404 

permit has never been revoked prior to the Arch Coal permit. What 

types of compensation would you suggest would be, you know, warranted? 

Mr. HOPPER. Well, that has to be determined on a case-by-case 

basis by the court. But it is clear that the coal company has spent 

millions of dollars in reliance on this permit. The courts typically 

look at the reasonableness of that reliance, the extent of the reliance, and issue a mandate as to how much that compensation 

should be. 

As you know, the mine has sued the Agency, arguing that the 

retroactive application of this 404(c) veto power is illegal, and they 

have itemized in those pleadings the extent of their reliance. 

Mr. GIBBS. OK, thank you. Mr. Roberts, in your testimony, you 

talked about how important the jobs are to West Virginia, and of 

course, the whole Appalachian region. With these new policies coming from this administration in regards to the mining policies, 

what—have you seen anything the administration has done to help 

bring new jobs to your State? 

Mr. ROBERTS. We are very concerned about the actions that have 

an impact on mining jobs, because those are the jobs that really 

pay the kinds of benefits that can support families. We have not 

seen any sort of commensurate effort, in terms of bringing new jobs 

into the area where mining occurs, and particularly into southern 

West Virginia, where this method of mining is most prevalent. 

Mr. GIBBS. OK. Dr. Sunding, I am really concerned about the 

EPA’s policy on the conductivity tests for water quality. It is my 

understanding that the science advisory board really convened 

after that decision was made by the EPA. Do you think that is— 

that they kind of went backwards, that they should have developed 

the science first before they put out the guidance—guidelines? 

Mr. SUNDING. Well, I am an economist, so that is somewhat outside my area of expertise. Maybe there are others here on the panel 

that can—— 

Mr. GIBBS. OK, we can open it up to the rest of the panelists. 

Mr. SUNDING [continuing]. That could address that. Sure. 

Mr. GIBBS. Anybody else want to comment on that? Mr. Carey? 

Mr. CAREY. Mr. Chairman, I will comment. I think it would be 

nice to actually—to have the development of the policies before you 

actually make the outcome. So I would agree with that, Mr. Chairman. 

Mr. GIBBS. Also for the panelists, the expanded coordination. 

Want to comment a little bit about that? 

When I read through your testimony, it kind of looks like that’s 

a procedure they kind of put in place to, at least at the very minimum, delay permitting action by 60 days, and really go on forever. 

Because, the way I read the law, there is no provision to do that 

in expanded coordination that is in law. How do you see the impact 

of what’s happened on that, and what is your feelings about—with 

regard to the law? 

Mr. CAREY. Mr. Chairman, I would be happy to answer that 

question. I think, if you looked at just Ohio, you had a company 

15 

from Ohio that talked about having permits that were caught in 

that tidal wave, where they were in no-man’s land, nobody knew 

where they were. 

But I think if you look to our neighbor just to the south of us, 

in West Virginia, they clearly had over 154 permits that were tied 

up in that. And that truly devastated them, because how do you 

make investments in moving forward with mining operations and 

meeting market demands? So, clearly, it hasn’t worked. 

Mr. GIBBS. OK. At this time I will yield to Mr. Rahall. Do you 

have questions for the panelists? 

Mr. RAHALL. Did you want to go first? Go ahead. 

Mr. GIBBS. Whoever wants to go first. 

Mr. RAHALL. Yes, let—— 

Mr. GIBBS. OK. Mr. Bishop? 

Mr. RAHALL. Thank you, Mr. Chairman, I appreciate it. 

Mr. BISHOP. Thank you, Mr. Chairman. And, Mr. Rahall, thank 

you. 

I always find it helpful—and we all have the same set of facts— 

both Mr. Carey and Mr. Roberts, I think it’s fair to characterize or 

summarize your testimony that—and I believe, Mr. Carey, you may 

have even used this phrase, that the current administration is— 

has declared a war on coal. Is that pretty much what you said? I 

don’t want to put words in your mouth. 

Mr. CAREY. That is true. 

Mr. BISHOP. OK. Here is my understanding of the permitting 

numbers since the Obama administration took office, that they inherited 140 pending permits. Of that number—for surface mining— 

52 have been approved. Of the 88 that have not been approved, 

none have been denied. Some are still pending. And some were 

withdrawn. Do you feel that those, that set of numbers, you still 

keep to your characterization? 

Mr. CAREY. Mr. Chairman, Ranking Member Bishop, I would say 

not just only in the numbers of permits, but I think, if you look at 

my written testimony, I describe a series of attacks on the coal industry, not just from the EPA perspective, but also if you look at 

MSHA, if you look at the Office of Surface Mining. If you look at 

the myriad of issues that are now facing the coal industry, there 

is no doubt in my mind, Mr. Chairman, Ranking Member Bishop, 

that the coal industry is under assault. 

And as far as the numbers of permits, where the permitting 

numbers are concerned, I think you have to look back at certainly 

there were 140 permits, but then, when you throw all those permits back into some coordinated policy that delays the time period, 

I think that is an issue. 

Mr. BISHOP. But to be clear, the current administration inherited 

140 pending permits. So, if they were thrown back, as you just 

said, into some other process, that was a process that perhaps took 

place prior to the advent of this administration? 

Mr. CAREY. Mr. Chairman, again, I would have to look at the 

exact permits to which you were referring in order to be able to answer that question. But I would be happy to provide those answers 

to you. 

Mr. BISHOP. Mr. Roberts? 

16 

Mr. ROBERTS. Sir, I—the information that I had provided to me 

indicates that there is a backlog of 239 permit applications, and 

that 190 of those had already been considered complete by the U.S. 

Corps of Engineers. So, one of the challenges for us is to deal with 

the sort of going back and re-looking at permits that have also received the blessing of the appropriate regulatory authorities in the 

States and within the U.S. Corps of Engineers. 

Mr. BISHOP. But the fact that remains is that, of the applications 

that have been acted on by the current administration, with the exception of the Spruce Mine, 100 percent of the decisions rendered 

have been favorable decisions allowing that mining to go forward. 

Mr. ROBERTS. I wouldn’t have—that is just not information I 

have. The information I have is related to the 235—— 

Mr. BISHOP. It is information that we have. So—— 

Mr. ROBERTS. Thank you. 

Mr. BISHOP [continuing]. Thank you. Let me just go to the issue 

of jobs. And, again, something all of us need to be—have a heightened concern about, no matter where we live, what we represent. 

My understanding is that—and this is data that comes from 

MSHA—is that over the recent past, mining employment has 

dropped from about 60,000 jobs to about 30,000 jobs. Does that 

comport pretty much with—Mr. Carey, Mr. Roberts, or Mr. 

Sunding, does that comport—Dr. Sunding, I’m sorry, does that 

comport pretty much with your information? 

Mr. CAREY. Mr. Chairman, Mr. Bishop, I would say that I can 

tell you about the 3,000 direct employees that are employed in 

Ohio’s coal mining industry—and I believe that there are 17,000 

that are in our sister State of West Virginia, and somewhere in the 

middle in Pennsylvania. So it would be hard for me to quantify 

that exact—— 

Mr. BISHOP. My understanding, again, from MSHA, is that we 

have gone from about 60,000 employees in the mining industry to 

about 30,000, and that all of that job loss took place prior to the 

Obama administration, and that the vast majority of that job loss 

is related to a move away from underground mining and more so 

towards surface mining, because it is considered to be less expensive and safer. Does that comport with your information? 

Mr. CAREY. Mr. Chairman, Mr. Bishop, I would say that is absolutely not true. 

Mr. BISHOP. So what is the loss? If the loss took place prior to 

the advent of the Obama administration, and it is not related to 

the move to surface mining, then what is it related to? 

Mr. CAREY. Mr. Chairman and Mr. Bishop, I would say that if 

you’re—what time period are you referring to, that there is a loss 

of 30,000 coal jobs? I would argue very clearly that there is probably a difference in the amount of wagon wheel makers from 1890 

to 1940. 

Mr. BISHOP. Trust me, I am not trying to be that specious, OK? 

We are—this is recent data from MSHA. And I do think wagon 

wheel production has gone down. I’m not sure of that, but I think 

it has. 

[Laughter.] 

Mr. CAREY. Mr. Chairman and Mr. Bishop, as has the pick axe. 

17 

But I will tell you that I would again have to see the numbers 

for which you are referring. Because, certainly, as mining practices 

have improved, just the amount of tonnage that you can get out of 

an underground coal mine now by man-hour is completely different 

than it was 20, 30, 40 years ago. But as far as the move to western 

coal, again, I would—it would be hard to quantify that. 

Mr. BISHOP. But—I’m sorry, my time has expired. Thank you, 

Mr. Chairman. 

Mr. GIBBS. We will have another round. 

Mr. BISHOP. Thank you for indulging. 

Mr. GIBBS. I would just like to interject, just to clarify a question. 

Mr. Bishop talked about the number of permits. When I have 

looked at this, it looks like to me that just close to 250 permits that 

are under the enhanced coordination process. And in my understanding, that’s kind of fallen into a black hole, where nobody 

knows what is happening. And then some of those permits, I think, 

have been withdrawn, because they have given up. Is this accurate, 

this statement? Anybody want to answer that? 

Mr. CAREY. Mr. Chairman, I would agree with that, completely. 

Mr. GIBBS. So enhanced coordination is really the issue here on 

the permitting part? 

Mr. CAREY. Mr. Chairman, members of the committee, I think 

it’s a myriad of things. But I think certainly that is one issue. 

Mr. GIBBS. OK. At this time we will move on to Representative 

Cravaack. Do you have questions? 

Mr. CRAVAACK. Thank you, Mr. Chairman. Thank you, panelists, 

as well. 

Dr. Sunding, what are the added costs, in your opinion, related 

to the permitting and any uncertainty of the whole EPA process 

here? Could you comment on that? 

Mr. SUNDING. Sure. I mentioned a few types of direct and indirect effects in my testimony. Two that I would point out, just as 

a matter of economic theory, almost. 

The issue of delay, which is related to uncertainty, we were discussing it a few minutes ago. In the context of most land development activities, delay is tremendously significant. And it is often 

sort of a hidden cost of regulation. The fact that the permitting 

process under 404 has no certain end to it can be very significant 

when developers, lenders, other entities are considering whether or 

not to enter into an activity in the first place. So I would point out, 

first, delay. 

Second, I did speak directly to the issue of uncertainty. The way 

most development, private and public, works is a significant 

amount of money is put up first, in terms of, you know, investment 

in the permitting process, and required capital expenditures. And 

then the returns come later. What this process does, what the 

EPA’s action does, is put more uncertainty onto that stream of returns, which makes it much less likely that the investment will 

pass the required threshold in the first place. So that is probably 

the most important incentive effect that I would point out. 

Mr. CRAVAACK. Related to that, can you tell me—I don’t know if 

you have these kind of figures—what kind of job loss are we talking about during a time period like that, or lack of job creation? 

Would you have numbers on that? 

18 

Mr. SUNDING. Right. I think we have better information on—sort 

of at the project level, you know. For a typical land development 

project, a housing project, typical mining project, we know. 

To figure out the expected economic cost of what the EPA has 

done in this case, it’s important to have a lot of other information 

about the whole range of economic activities that get permitted 

under 404. I think we’re not quite there yet, I’m just not able to 

give you, you know, a number for, ‘‘Here is the cost on the economy.’’ 

But what I can do is point out—pretty effectively, I think—some 

of the fundamental economic incentive effects of eliminating the 

certainty of the 404 permit, and then talking on a project-by-project 

or activity-by-activity basis, what the impacts might be. And they 

are potentially very significant. 

Mr. CRAVAACK. OK. Thank you very much, sir. Appreciate it. 

Mr. Carey, I’m assuming you’re a Buckeye? 

Mr. CAREY. Mr. Chairman—Congressman, that is for sure, yes. 

Mr. CRAVAACK. I’m a fellow Buckeye too, so I was kind of—I was 

born in Charleston, grew up in Ohio, so there you go. 

I just have one quick question for you. We have open pit mining 

in Minnesota, in the Iron Range. We mine taconite. And this concerns me greatly, what you guys have happening in the Appalachian mines, as well. 

How important in your industry—and one of the problems that 

we’re having is we’re trying to actually get an open pit precious 

metal mine. We’re talking 7 years, I think over $27 million in—just 

in studies and EPA studies. And one of the things I keep on hearing more and more is that the EPA keeps on moving the bar, which 

moves the timeline, almost to see who is the last man standing at 

the end of this game. That is the impression that I am getting. We 

are trying to open up a taconite mine that—it’s an old mine. It’s 

going to do the same thing it did before, but more efficiently, and 

more environmentally friendly, and we are still having those— 

these type of problems. 

How important is—in the industry—would you say is a pretty 

solid timeline to the coal industry? 

Mr. CAREY. Mr. Chairman, Congressman, I—clearly, any time 

that you are investing millions and millions of dollars into a 

project, you want to have a rate of return. And if you simply can’t 

get the permit, you can’t get your product to market, you are not 

going to make that investment. And that investment, those investment dollars, will go offshore. We need the material. 

Mr. CRAVAACK. I couldn’t agree with you more. And I just hope 

to keep our mines open in Minnesota, as well, because it is essential to not only the Iron Range, but it is also essential to Minnesota. And I thank you for all the efforts that you are going 

through right now. 

So, Mr. Chairman, with that I have got about 18 seconds, so I 

will just go ahead and yield back my time. Thank you. 

Mr. GIBBS. Mr. Rahall? 

Mr. RAHALL. Thank you, Mr. Chairman. I appreciate all the panel’s testimony this morning. And in particular, thank you, Mr. Roberts, for giving the committee some insight into the history and the 

heritage of West Virginia, and our relationship to coal mining, and 

19 

what it means for job creation, what it means for, literally, keeping 

the lights on and employing a lot of law enforcement officials in our 

southern counties who otherwise would not have the budget from 

coal severance taxes to do such. And it is a story that is not well 

known in many parts of this Nation, yet it is a story that has contributed so much to the energy security of this Nation. 

Now, we all want to see our economy diversified, and we want 

to see other job creation, which the Chamber of Commerce is certainly in the lead in developing. And I am sure you recognize, as 

much as the next person, how we have struggled over decades in 

West Virginia to strike this proper balance between job creation, 

diversifying our economy, and environmental preservation. And it 

can be done. 

You know the importance of tourism to our State of West Virginia, for example, and how those figures keep on the upswing. So 

we can do it. We can preserve our beauty, we can create jobs in 

tourism at the same time that we provide jobs in coal mining. 

I wanted to comment—that’s just a comment, not a question. I 

wanted to comment on what my dear friend, Mr. Bishop, brought 

up in regard to the pending permits, 140 pending—I believe he was 

quoting, obviously, EPA statistics—and 52 approved. And of the 88 

not approved, none were denied, I believe, is an accurate description. 

I would say of those 52 that were approved, it was one heck of 

a process to get those 52 approvals. I mean it was—to say put the 

industry through the ringer would be an understatement. And a lot 

of concessions were made along the way by industry—by all groups, 

both sides. As we know, it is part of the approval process. 

And some of those that were approved were characterized by 

many as a dare-to-mine permit, if you will. In other words, conditions were placed upon that approval such that one misstep, however slight, could cause a revocation of that permit approval. And 

now we have seen, since the Spruce revocation, that there is even 

the further danger that these approvals don’t really mean much if 

the Agency can come back later and revoke a permit that has been 

granted. 

In addition, there is court cases. Court cases have contributed a 

great deal to this backlog, more so than what any administration 

has done. So, it is one hell of a process. And I am not saying that 

is bad, because there are obviously—there is obviously a negotiating process that has to occur here. 

But I guess I would ask you, you know, it does have an effect 

upon business’ ability to make a decision for job creation, because 

they need a certainty. And is it your understanding that many of 

these permit applications have been withdrawn because the industry simply has gotten so frustrated, has been unable to make those 

decisions to keep people working, and are not sure of the rules of 

the game because they keep shifting, and in other cases cannot 

even find out what they have to do? So it is a whole maze of uncertainty here. Did you wish to comment on that? 

Mr. ROBERTS. I would comment briefly, sir, that employers very 

much need stability and predictability, and that without stability 

and predictability the level of risk goes up enormously. 

20 

And then the cost benefit ratio begins to turn into, ‘‘Well maybe 

it is safer to not then,’’ too, and that is where, really, the risk of— 

managing the risk comes into play. It is predictability and stability 

that the companies are saying they need as much—it is not their 

inability to play within the rules, it is the ability to know what the 

rules are, and for those rules to be stable and predictable. 

Mr. RAHALL. Thank you. Thank you, Mr. Chairman. 

Mr. GIBBS. Before I go to the next—our next question, I just 

want to interject a question here to the panel. My understanding 

of enhanced coordination and dealing with the criteria integrated 

resource assessment, MCIR, it is unique to the Appalachian region. 

And it is also my understanding that there is close to about 250 

of those permits under enhanced coordination. And I think only 

two have been approved. 

Now, when you talk about permits being approved, is that a national figure, what is happening in Appalachia is because of enhanced coordination that we are not getting those approved? Is— 

would you have any insight on that, Mr. Carey, or anybody? 

Mr. CAREY. Mr. Chairman, I would go back to what Mr. Rahall 

said, with describing a lot of those permits that were in the process 

of—they had already been in the process, and some things—the 

things that were given by those permits to move forward was almost a dare-to-mine type of scenario. So I would clearly—and your 

numbers may be more correct. 

But I would also say the concern that we have, as producers of 

a commodity, is for our customers. Our customers have to have reliability that we will be able to get our product to market. And if 

we in Ohio and West Virginia, Kentucky, Pennsylvania cannot 

meet that market demand for coal, that coal will come from someplace else. We need to have consistency and permitting. We need 

to have a reasonable time schedule so we can get our product to 

market. 

Mr. GIBBS. But it is clear to understand that there is, from this 

administration, the Appalachian region has been targeted, compared to the rest of the country. Is that true? 

Mr. CAREY. Mr. Chairman, I would clearly say that, and I believe 

I did say that in my testimony. 

Mr. GIBBS. OK, thank you. Mr. Landry, do you have questions? 

Mr. LANDRY. Thank you, Mr. Chairman. Mr. Carey, you don’t believe that the Federal agencies in this country create uncertainty 

in industries, do you? 

Actually, my questions are for Mr. Hopper. You served as counsel 

for the board of the Mississippi Levee Commission, is that not correct? 

Mr. HOPPER. Yes, our foundation does. 

Mr. LANDRY. Are you—were you involved, or do you know the 

particulars of the vetoing of the Yazoo Backwater Area Project permit? 

Mr. HOPPER. I know some of them, yes. 

Mr. LANDRY. And I am sure you understand the impact that the 

current flood waters are having on the Yazoo River basin. 

If those levies fail, is—I guess could—if EPA would not have vetoed that permit, and that project would have been allowed to proVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
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ceed, would it—would the levee system be in a better position to 

handle the flood waters currently than they are now? 

Mr. HOPPER. Certainly for that area, there is no question about 

it. 

Mr. LANDRY. So, just to make sure I understand, so EPA’s 

vetoing of that permit could be endangering over 1,000 homes and 

hundreds of thousands of acres right now. 

Mr. HOPPER. That is correct. 

Mr. LANDRY. All right. So, it would be logic to say that if EPA 

would have been around in 1927, and would have been vetoing 404 

permits, could we have built the Mississippi River and tributaries 

levees that are protecting, you know, not only Mississippi, but Louisiana, Arkansas, as well? 

Mr. HOPPER. Well, I don’t know how to answer that. But I think, 

clearly, it is contrary to the public interest to stand in the way of 

these flood protection programs. The EPA needs to facilitate these 

things, and not hinder them. 

As you say, this backwater area is flooded regularly. We now 

have serious flooding because of the rising Mississippi currently 

that has resulted in harm to individuals, private property, and to 

the ecosystem itself. 

The EIS, the new EIS that the Corps did, indicated that there 

would be a net improvement of wetland resources. The veto is 

based on a technicality that shouldn’t come into play. 

Mr. LANDRY. I just wonder whether or not, you know, the—this 

404 permit, had it been around, you know, between 1927 and, I 

guess, you know, into the 1960s, if the Corps would have been able 

to even build the system that is currently protecting hundreds of 

thousands of Americans right now in that Mississippi River basin, 

in addition to the property that it is currently protecting. 

We certainly noted there are weaknesses in the system right 

now. I pray that the Corps is able to, you know, rectify those weaknesses in the levee system. But I think it is important for people 

to understand that if EPA would have been around back then, we 

might not have those levees. 

One last question. In reading your statement I found it interesting that you believe that—do you believe—see if I can make this 

brief—do you believe that EPA’s retroactive vetoing of a 404 permit 

to be a Government taking? 

Mr. HOPPER. Yes. I think that the argument could be made that 

it is a Government taking. The courts have recognized that when 

one relies to one’s detriment reasonably on a valid permit, that one 

establishes a vested right, which is a property interest, and it cannot be taken away without regard for an opportunity to recoup the 

investment. I think that is black letter law. 

But, that is just one means by which these new mining policies 

can result in a taking of private property. There are other means, 

as well. 

Mr. LANDRY. Thank you, Mr. Chairman. I yield back. 

Mr. GIBBS. Representative Lankford, do you have questions? 

Mr. LANKFORD. Thank you, Mr. Chairman. Mr. Carey, you mentioned four things that we can do to try to find some balance here: 

regulatory time-out; the State, making them the primary permitting authority; ending the guidance document without any kind of 

22 

public comment; and then also certainty in permits. Let me just 

specify one of those. 

Let’s talk a little bit more about the State being primary in the 

permitting process. Do you know of a State out there that you 

would look at, Mr. Carey, and say, ‘‘This State is really not competent to handle the energy sources,’’ whether they be coal, oil, natural gas—whatever the energy—wind, that that State, in particular, does not have competent leadership? 

Mr. CAREY. Mr. Chairman, Congressmen, there are actually a 

couple of States that are currently—the Federal Government currently does the permitting and the inspecting. I believe Tennessee 

is one of those States, and I could be mistaken, but I believe the 

Missouri. But I could provide those numbers to you. 

So I think there are certain models that, clearly, the Federal 

Government has taken over the State programs when they have 

proved to be inefficient or unable to actually meet the challenge 

under the Federal law of SMCRA. 

Mr. LANKFORD. OK. A Federal structured program for, let’s say, 

coal mining. Mining of coal, is it the same in West Virginia and 

Ohio and Wyoming, Oklahoma? They’re all pretty much the same, 

each one is the same, acts the same, has the same kind of regulations and permits, or are they uniquely different, State to State? 

Mr. CAREY. Mr. Chairman, Congressman, no. Each State is different. Each State has different topography. Each State has different coal seams that are mined in different manners. So each 

State is different. 

Mr. LANKFORD. So, have you seen EPA regulations show that 

kind of flexibility, that they are different in Ohio than they are in 

West Virginia or Kentucky or Wyoming, or are they pretty much 

trying to regulate with the same instrument in every single State? 

Mr. CAREY. Mr. Chairman, Congressman, they are trying to regulate the same in all States, and break it up by regions. And that 

simply does not work. 

Mr. LANKFORD. OK. Dr. Sunding, let’s talk about some economic 

models here. Investment slows down when you don’t have certainty 

in the permitting process. If you are trying to get investment into 

any type of energy, then obviously that slows down when no one 

has any idea what is going to be permitted. 

What we have—seem to have at this point is an administration 

that, at their whims, is going to try to pick and choose winners and 

losers. When a plant started the permitting process 10 years ago, 

now with a change of administration, you lose favor and now you 

have millions of dollars on the line. 

Based on that, what type—and knowing the topography—who 

knows what is going to happen in the Presidential election next 

time. Based on—if this model continues, where it is not based on 

science, it is based on the politics of what is the preferences of an 

executive when an energy company has to plan 10 years in advance, what type of energy would you recommend for any power 

company out there and say, ‘‘This would be a good investment 

model, I would look at this?’’ 

Mr. SUNDING. Right. Well, I think you are right to focus on the 

incentive effects, and I will say a few remarks about energy, but 

then I want to return to a broader focus, not to minimize the imVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
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portance of energy at all, but the 404 program touches virtually 

every part of the economy. 

Mr. LANKFORD. Right. 

Mr. SUNDING. And I do want to return to that a little bit. 

You are quite correct to point out that the EPA’s decision in this 

case is precedential, and can have impacts that last far into the future, way beyond the case with just Arch Coal. I think it is fair to 

say that it would have a chilling effect on any potential investment 

that requires a 404 permit, whether it is energy or otherwise. So 

I think your point there is very well taken. 

With respect to other kinds of activities, let me come back again 

to something I talked about in my testimony, residential construction and transportation. By many measures, economists would say 

those are the most important sectors of the economy, in the sense 

that the average household in this country spends over half of their 

disposable income on housing and transportation, transportation 

being linked to energy, of course. 

But this is a tremendously important economic decision. And 

housing permits, or housing projects, most of the large projects that 

I know or have studied, require 404 authorization. So this could 

not be more important for the housing sector. And—— 

Mr. LANKFORD. So, basically, you are saying this removes certainty from all of the most critical parts of our economy. 

Mr. SUNDING. Yes. 

Mr. LANKFORD. That if we don’t have certainty in permitting in 

this, we are in trouble economically, because no one can plan, no 

one knows how to invest, and it is at the whims of whatever the 

policies are at the moment, rather than based on long-term science 

and planning and certainty. 

Mr. SUNDING. Right. The ability to revoke a permit like 404 can 

have very important incentive effects on investment across the entire economy. 

Mr. LANKFORD. OK. Let me just ask an opinion question of Mr. 

Hopper, as well. How long should a 404 permit take? What is a 

reasonable period of time? 

Mr. HOPPER. A reasonable period of time would be 90 days to 6 

months. 

Mr. LANKFORD. And they typically take how long now? 

Mr. HOPPER. According to—— 

Mr. LANKFORD. If they hold? 

Mr. HOPPER [continuing]. The research by Dr. Sunding, they 

typically take 2 years or more. 

Mr. LANKFORD. OK. Thank you. I yield back. 

Mr. GIBBS. Thank you. Representative Capito? 

Mrs. CAPITO. Yes, thank you. Mr. Roberts, you mentioned in your 

testimony that if surface mining were to be discontinued in West 

Virginia it would cost directly 6,255 jobs. But there is a job multiplier, I am sure, that you use. What is that job multiplier? For 

every one of those jobs, how many ancillary jobs? 

Mr. ROBERTS. Mr. Chairman and Congresswoman, we think that 

a reasonable multiplier could be perhaps—a reasonable and conservative multiplier could be anything from one-and-a-half to two, 

related to those jobs. And I think that is probably on the very— 

if that is an error, it is on the very low side. 

24 

Our estimates are that, while we have approximately 21,000 

mining jobs in West Virginia, and nationwide approximately 81,000 

mining jobs, according to the U.S. Bureau of Labor Statistics, that 

we have another close to 80,000 jobs in West Virginia that exist because of the mining industry. So, if we were to extrapolate from 

that that 40 percent of those jobs are related to surface mining, 

that is 32,000 ancillary jobs related to surface mining in West Virginia. 

Mrs. CAPITO. OK, thank you. And then, just recently—I believe 

maybe Monday—in Congressman Rahall’s district was announced 

the beginning of a construction of a coal-to-liquid plant which will 

obviously create jobs, another usage of coal, and will also help with 

our dependence issue on the foreign sources of oil. 

We have had stops and starts with coal-to-liquid before, because 

of the high expense of converting. How do you see this, in terms 

of the future and the longevity of coal, other uses of coal, and what 

kind of things are we doing in West Virginia to promote this? 

Mr. ROBERTS. I am actually pretty optimistic about the long-term 

prospects for using coal and converting it to other types of energy, 

and doing it cleanly and in an environmentally sound way. 

One of the mantras that people who are close to coal tend to 

have is that in our country and in the world we are going to need 

all of the energy we can get, on a going forward basis, and we are 

going to need it from virtually every source that we can think to 

create it. And to that extent, what we are hopeful about is that 

more research dollars will go into how we convert coal to other energy uses, and then how we do that cleanly and in an environmentally sound way, and how we transport that energy, once we 

convert it. 

But from a looking-forward basis, there is lots of reason for optimism that the massive coal reserves we have can be converted to 

other energy uses. 

Mrs. CAPITO. Right, and our universities are doing that right 

now, particularly WVU and Marshall—there again, another job creator, in terms of the development of technology and research 

around coal. 

Dr. Sunding, let me ask you a question. Does the EPA have to 

consider energy and economic impacts when they are making a decision? My understanding is that that should be part of their decision. And our next witness says in there that they do consider that, 

although, as I said in my opening statement, the administrator 

said that’s not a consideration that she takes. What is your take 

on that? 

Mr. SUNDING. Right. My take would be that, as a matter of public policy, they should be considering economic impacts. Earlier this 

morning I forget who was talking about balancing. And I think 

that is what we are ultimately trying to find here, is some kind of 

balance. Economic impacts and jobs are part of the balancing test. 

Mrs. CAPITO. But is it statutory that they consider this? Is it in 

the statute? 

Mr. SUNDING. Well, again, I am not an attorney. There are probably better people here to—— 

Mrs. CAPITO. There is Mr. Hopper. You are an attorney. Is it in 

the statute? 

25 

Mr. HOPPER. I am not aware of a requirement in the statute. 

Mrs. CAPITO. To consider that as an impact? 

Mr. HOPPER. But the administrator has very broad discretion in 

how she administers the law, including rulemaking and enforcement. 

Mrs. CAPITO. OK. And one last question for Mr. Roberts. West 

Virginia generates, what is it, 98 percent of our energy from coal. 

Mr. ROBERTS. From coal. 

Mrs. CAPITO. For obvious reasons. We are right there, we have 

a lot of it. 

When you are recruiting businesses to West Virginia and asking 

them to relocate to West Virginia, one of our primary recruiting 

goals is our affordable energy resources, because of the proximity 

of the resource, the abundance of the resource, and the fact that 

we are very reliant on the resource. 

If that goes away, what kind of disadvantage would that put our 

State—but other States, like Indiana, I think, is one of the States 

that has a large reliance on coal as a resource. 

Mr. ROBERTS. Yes. 

Mrs. CAPITO. What would you—— 

Mr. ROBERTS. The result of the high level of electricity generation that comes from coal in our State and in many similar States 

is that we have the—among the lowest electricity cost for commercial and industrial users in the Nation. For many years, West Virginia has had the second-lowest electricity costs in the Nation for 

industrial and commercial users. And that is very important, as 

our country tries to see its manufacturing economy recover. The recovery is likely to occur in the States that can provide the energy 

and provide it in a dependable, reliable, and low-cost way. And, for 

West Virginia, that has been a key factor in keeping some of the 

industrial facilities that we have in our State. 

Mrs. CAPITO. Thank you, and I think my time has expired. But 

the other question I wanted to ask—so I am just going to put it 

out there—is in West Virginia we have had a lot of issues around 

DEP, who has primacy on water rights, you know, the Corps, and 

it looks like a circle that keeps going around. 

And I think this is something that we need to have decided, because our State government officials are in a quandary, not knowing how to react, not only—well, around the permitting issues. Not 

only the private sector doesn’t know how to react, but the State 

government is in a big quandary as to the correct way to move forward on what they think is an authority that the State DEP has. 

And with that, I thank you. 

Mr. GIBBS. Thank you. Representative Richardson, do you have 

a question? 

Ms. RICHARDSON. Thank you, Mr. Chairman. I just have two 

questions. 

Dr. Sunding, first of all, welcome. I am from California, so welcome here. In your testimony you argued that EPA’s decision to 

override the judgement of the Corps of Engineers in the Arch Coal 

case alters the incentives to invest in projects requiring a permit 

under section 404, and that the EPA’s actions will chill investment 

in activities requiring a 404 authorization. Could you elaborate a 

little further on that point? 

26 

Mr. SUNDING. Sure, I would be happy to. 

Ms. RICHARDSON. And if you could, provide some specific examples. 

Mr. SUNDING. Yes, sure, I would be happy to. I could give you 

some examples. 

Let me just say, as a threshold comment, that people often forget—I am not saying any members of the committee have forgotten—but the 404 program touches, as we were talking about a 

minute ago, many parts of the economy, not just the mining sector, 

not just housing. Virtually all public infrastructure projects can potentially have to get 404 authorization: school building, road building, emergency response infrastructure, utility pipelines. These are 

all projects that routinely get 404 authorization. 

And if you think about the economic incentive effects of being 

able to revoke a valid permit ex-post, that is very different than the 

economic incentive effects of not just approving it in the first place. 

Because the investment has already been made. So that money is 

sunk. And it can’t be recovered. Once part of a road is built, or part 

of a project is completed, it is irreversible, can’t be recouped if the 

EPA changes its mind. 

So, that is a much more consideration, ex ante, than just the 

ability to have a permit denied in the first place, before the investment is made. So when I talk about the direct incentive effects of 

the action on all kinds of activities that happen in the economy, 

that is really what I am referring to. 

Ms. RICHARDSON. OK. Thank you, sir. And, Mr. Carey, in your 

statement today you argued that one of the four things that could 

help to stimulate job creation in the Appalachian coal mining industry is to declare a regulatory time-out. 

Sir, with all due respect, if you look at various things that have 

happened in this country, whether it is financial regulation, whether it is the Deepwater Horizon, I don’t think, realistically, you are 

going to get support of a regulation time-out. So what might you 

suggest that would be something more in the middle that we could 

possibly address and help you with? 

Mr. CAREY. Mr. Chairman, Congresswoman, I think I laid out 

pretty specifically what I think this committee could outline to promote jobs in Appalachia. To take a middle ground approach, I am 

not sure what that means. If we are saying—if we are looking at 

what the surface mining or the 7,000 jobs that—the direct jobs that 

would be lost in Appalachia because of the surface mining rules, 

and other jobs grown into the west, I am not sure that is—how do 

you cut that in half and say, ‘‘Well, I will take half of those job 

losses?’’ 

The Penn State University did a study a number of years ago 

that says for one coal job, up to 11 spin-off jobs are associated with 

that one job. So, if we are talking 7,000 people—— 

Ms. RICHARDSON. Excuse me. 

Mr. CAREY [continuing]. Congressman, we are looking at a factor 

of 77,000. 

Ms. RICHARDSON. Excuse me. Excuse me. Excuse me. This is my 

time. You already gave your testimony, OK? So excuse me. 

And I do want to say for the record, Mr. Chairman, I was a little 

offended by this gentleman’s testimony in reference to the PresiVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
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dent and to the EPA administrator. I have been on this committee 

4 years, and we don’t attack our administrators, and I don’t think 

we allow people giving testimony to do so, either. 

Sir, the question I was asking you—and I am trying to help you, 

I am not against you—my question to you was you are not going 

to see no regulation. You know, you can sit here, if you want people 

to lie to you, you know, look at someone else. But I am just telling 

you I seriously doubt you are going to see anything that is going 

to be no regulation. 

So, if it is going to be no regulation—and we are talking about 

regulations, I am not talking about a specific job—what specific 

things could we do—because, you know, EPA is coming up next— 

what specific items could we help you within that regulation to 

ease—to get to the point of where you are trying to go? I am trying 

to help you. 

Mr. CAREY. Mr. Chairman, Congresswoman, I would be happy to 

outline several different things that you could help with. 

Ms. RICHARDSON. OK. 

Mr. CAREY. I would be more than happy. But I do want to say 

something. I don’t think that I ever inflammatorily went after the 

director of the EPA. I just stated what she did as an EPA administrator in New Jersey. 

Ms. RICHARDSON. We normally don’t reference specific to our administrators or to the President, and I don’t know if you have testified here before, but I thought it was a little over the top, in my 

opinion. 

I welcome your comments of specific examples, and I would be 

happy to work with the chairman and the ranking member to assist you to achieve your goal. We want to help you, and we want 

you to be successful. Thank you. 

Mr. GIBBS. Mr. Bishop? 

Mr. BISHOP. Thank you. Just one point, and I thank the chairman for indulging me. 

Dr. Sunding, and I think Mr. Roberts and Mr. Carey all made 

reference to the fact that the section 404 veto authority remains 

with the EPA, leads to a level of uncertainty that is debilitating. 

Under the heading of us all having the same set of facts, in the 

last 39 years—which I think we will agree is the post-wagon wheel 

era—in the last 39 years, the Army Corps of Engineers has authorized over 2 million activities in the waters of the United States 

that are subject to section 402 regulatory authority. There have 

been 13 vetoes. And, to be specific, the Obama administration, one 

veto. The Bush II administration, one veto. Bush I, four vetoes. 

Reagan, seven vetoes. 

So, I think 2 million permits set against 13 vetoes, it is a little 

difficult to argue that there is a level of uncertainty that is debilitating. 

I thank you, I yield back. 

Mr. GIBBS. Thank you. I want to thank this panel for your coming and testifying. It is very enlightening. And just a quick comment. 

You know, we are—I am really personally concerned about the 

revocation of a permit after 3 years it was issued. That is different 

from a veto, in my opinion. I think in the process, the application 

28 

process, the EPA has the right to veto it. But the question here is 

after the fact, for not being in violation of that permit. And I 

haven’t seen any evidence yet that they were in violation of the 

permit. 

So, again, thank you, and we are going to conclude this first 

panel and move on to our second panel, with the administrator, 

Ms. Stoner. 

Welcome, Ms. Stoner. At this time I welcome Ms. Stoner, the acting assistant administrator of the Environmental Protection Agency Office of Water. The floor is yours. 

TESTIMONY OF NANCY K. STONER, ACTING ASSISTANT ADMINISTRATOR, ENVIRONMENTAL PROTECTION AGENCY, OFFICE 

OF WATER 

Ms. STONER. Good morning, Chairman Gibbs, Ranking Member 

Bishop, and members of the committee. Mr. Rahall, as well. I am 

Nancy Stoner, acting assistant administrator of the office of water 

at the U.S. EPA. I appreciate the opportunity to testify before you 

on EPA’s work to protect all of America’s waters, including those 

in Appalachia. 

Mr. Chairman, before I describe EPA’s obligations to protect 

water quality and the environment, allow me to repeat something 

EPA Administrator Lisa Jackson has said many times: ‘‘Americans 

do not need to choose between having clean water and a health 

economy; they deserve both.’’ 

Let me also repeat another point the administrator has made. 

None of EPA’s actions are about ending coal mining. They are 

about reducing coal pollution and protecting the health and the environment of coal field communities. We have a responsibility 

under the Clean Water Act passed by Congress to ensure that surface coal mining projects do not impair water quality or endanger 

human health or environmental health. We are committed to fulfilling that responsibility, because we believe that every community 

deserves our full protection under that law. 

In the last 29 months we have worked with our Federal and 

State colleagues and with mining companies to design projects so 

they do not adversely impact water quality, so that they can move 

ahead. In fact, since 2009, more than 50 of the permits have now 

been issued that had been stalled, due to litigation or other factors. 

We all want our communities to be successful. The health of humans and ecosystems is an essential part of this equation. And 

clean water is essential to the health and well-being of every American. When the water is polluted, the community struggles, as we 

have seen in parts of the world where people have inadequate access to clean water, and are forced to rely on contaminated sources. 

In 2010 an independent peer-reviewed study by 2 university professors found that communities near degraded streams have higher 

rates of respiratory, digestive, urinary, and breast cancer. The 

study was not conducted in a far-off country. It was conducted 

here, in the U.S., in Appalachian communities. 

A peer-reviewed West Virginia University study released yesterday concludes that Appalachian citizens in areas affected by mountaintop mining experience significantly more unhealthy days each 

year than the average American. 

29 

Healthier watersheds mean healthier people. It has been a high 

priority of this administration to reduce the substantial human 

health and environmental consequences of surface coal mining in 

Appalachia, to minimize further impairment of already compromised watersheds. We have demonstrated a constructive approach in our work with mining companies. When people of good 

will work together, we are able to find approaches that allow mining projects to move forward without degrading water quality. 

Let me make two specific points about this. First, initial monitoring data shows that mines that use modern practices to protect 

the environment can achieve downstream water quality well below 

levels of concern. These companies should be commended for working with EPA to protect water quality and human health while also 

mining coal. 

Second, given the discussion today about Arch Coal’s Spruce 

Mine permit, I would like to point out that EPA offered a pathway 

for that project to move forward in a manner that did not impair 

water quality, just as we did with the projects we approved. Unfortunately, the company rejected this approach, and refused to modify the mine to protect waterways and stream life, as required by 

law. 

EPA reserves its authority to veto permits for only truly unacceptable circumstances. EPA has used its authority to revoke an 

issued permit only twice since 1972. We have stood our ground in 

this case, based on peer-reviewed science that has increasingly documented the effects of surface coal mining operations on downstream water quality and aquatic life. I have brought some of those 

peer-reviewed studies with me here today. 

Peer-reviewed studies have found elevated levels of highly toxic 

and bioaccumulative selenium, sulfates, and total dissolved solids 

in streams downstream of valley fills. Studies by the West Virginia 

Department of Environmental Protection have emphasized the role 

of high selenium levels in causing developmental effects in fish. 

EPA itself recently completed a review of the scientific literature 

related to the environmental impacts of surface coal mining, and 

found effects that included resource loss, water quality impairment, 

and degradation of aquatic ecosystems. We also completed an extensive assessment of the relationship between stream quality and 

high levels of conductivity. Both EPA reports were subject to extensive peer—public comment, and have been independently peer-reviewed by our science advisory board. 

In conclusion, Mr. Chairman, science has told us that when we 

don’t protect our waters from coal pollution, our communities and 

future generations will suffer. As leaders, we should be taking 

every possible step to keep them healthy, and working together to 

provide a clear path for the future of coal, a path that ensures the 

health and prosperity of Americans living in Appalachia, and the 

energy future for our Nation. 

Just months before his passing, after serving 57 years in the U.S. 

Congress, Senator Robert Byrd stated eloquently that, ‘‘The greatest threats to the future of coal do not come from possible constraints on mountaintop removal mining, or other environmental 

regulations. But rather, from rigid mindsets, depleting coal reVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00043 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
30 

serves, and the declining demand for coal. The future of coal—and, 

indeed, of our total energy picture—lies in change and innovation.’’ 

I sincerely respect Senator Byrd’s challenge to all of us to embrace the future. EPA will continue to work with our Federal partners, State agencies, the mining industry, and the public to fulfill 

our common goals of reducing adverse impacts to water quality, 

aquatic ecosystems, and human health. Thank you. 

Mr. GIBBS. Thank you for your testimony, Ms. Stoner. I will get 

right to the questions. 

My first question with the Spruce permit. Did the State of West 

Virginia support EPA’s veto, or the—what you call a veto, I call it 

revocation of the permit. 

Ms. STONER. No, sir. I don’t believe they did so. The U.S. Fish 

and Wildlife Service supported it, and U.S. EPA made the determination. 

Mr. GIBBS. Did the Army Corps of Engineers support it? 

Ms. STONER. They did not indicate that they thought a veto was 

necessary. 

Mr. GIBBS. Did they find any information that—in your testimony you talk about—because information had changed that warranted the revocation of the permit. Did the Corps give any new 

information to the EPA that there was any new information from 

the Corps? 

Ms. STONER. They have specific statutory factors that they need 

to follow. They didn’t find that those were met. But the new information, the science that I just referred to, I have brought with us 

today. These are scientific—— 

Mr. GIBBS. Well, let me just stay with the Corps a second. Is that 

true, that the Corps submitted a report that was at least 50 pages 

long with no new information? 

Ms. STONER. The correspondence that I saw referred to the statutory factors for the Corps’ decision about whether to take further 

action. 

Mr. GIBBS. OK, but for the record, they did not support EPA’s 

action. 

Ms. STONER. They did not ask EPA to take that action, that is 

correct. 

Mr. GIBBS. OK. Can the EPA revoke a permit, even though the 

applicant is in full compliance with the law, and the regulations 

and water quality standards are in effect? 

Ms. STONER. The statute specifies withdrawing a specification. It 

indicates the criteria for a 404 that include significant adverse impacts on wildlife, drinking water sources, other specific factors. 

That is what the statute refers to. 

Mr. GIBBS. In your testimony you talk about there was significant new scientific information that emerged, because I keep in 

mind that they went through an environmental impact study of 

about 10 years, got—and, of course, they got their permit there in 

2007. And in your testimony you talk about how there was significant new scientific information. Can you be specific of what that information is? 

Ms. STONER. Yes. Again, I brought more than 100 studies. I 

would actually like to have them be made a part of the record, if 

I could. And what that scientific information is, is documentation 

31 

of the adverse impacts of valley fills and mountaintop mining, discharges in waterways on both the stream communities buried by 

that fill and downstream—— 

Mr. GIBBS. Would that be using the conductivity as a test, as the 

main component of the studies? 

Ms. STONER. Conductivity is a measure of stream degradation. 

So there are studies on conductivity, including one that EPA did 

and was peer-reviewed by the SAB. But there is lots of different 

studies that show the adverse impacts on public health and the environment. And those studies have been coming in in large numbers since 2007. 

Mr. GIBBS. Just so you are aware, last week we had a Dr. Leonard Peters, who is the secretary of the State of Kentucky energy 

and environment, he is a chemical engineer, and he testified on the 

conductivity that your standard that you have—that the EPA is 

imposing now, the water cannot exceed 500 siemens. And I am told 

that most bottled water is allowed up to 750. Is that true? 

Ms. STONER. It is a standard that is based on fresh water. So it 

is what creatures that live in the water all the time need in order 

to survive. It is different than what we drink, and the salt that we 

are used to. 

Mr. GIBBS. In regards to enhanced coordination, there has been 

concern, we have had testimony that this procedure only applies to 

the Appalachian region, it doesn’t apply anywhere else in the country. 

Do you think that—where do you—where can you tell me where 

it is in the law, that the EPA has the authority to do the enhanced 

coordination? Because, to me, it looks like it is kind of circumventing the permitting process. Can you—— 

Ms. STONER. It is designed to have agencies work together better 

to make decisions, provide clarity to industry, to do so in a timely 

way. That is the purpose of the process—— 

Mr. GIBBS. I think the facts of what has happened, the results, 

have been that there is many—numerous delays. And since you are 

using that procedure that is not in law, there is nothing in the law 

that says you have to move forward in a timely fashion under enhanced coordination, because enhanced coordination does not exist 

in the law, is my understanding. 

Ms. STONER. The enhanced coordination procedures actually has 

time limits in it. And those are designed to help move the permitting process along. As I said, more than 50 permits have moved 

through that process. A lot of those permits were stalled prior to 

the development of the enhanced coordination process. 

Mr. GIBBS. My understanding, there has only been two permits 

issued under enhanced coordination. Is that correct, out of the 250 

that you had when you started your administration? 

Ms. STONER. No, sir, I don’t believe that is correct. 

Mr. GIBBS. OK. OK, Representative Rahall? 

Mr. RAHALL. Thank you, Mr. Chairman. And thank you, Administrator Stoner, for once again being before our committee on water 

resources. 

As you certainly know, I have a number of concerns regarding 

EPA’s review of Corps-issued section 404 permits and its intervenVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
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tion in coal-related State-issued section 402 permits in West Virginia, throughout the Appalachian region. 

Now, with respect to the April 2010 guidance document affecting 

mining permits in Appalachia—and only, by the way, only by the 

way, coal mining in Appalachia, no other industry, no other region 

has been targeted by this guidance document, April 2010. You have 

testified previously that this kind of guidance is just a first step, 

and that such guidance, the documents are never binding and mandatory. 

Yet the EPA is using that guidance document in discussions with 

State agencies to comment on, dictate the terms of, and object to 

coal mining permits in Appalachia. This guidance document, along 

with other guidance documents on this matter, sets new timelines 

and criteria for permits that differ from the law and current regulation. 

So, my question is, how do you reconcile the way the guidance 

is being issued by EPA with the Agency’s assertion that the guidance is not binding? 

And then, a second question I have is how many permits have 

been approved—because that seems to be a topic of discussion 

today—how many permits have been approved since that April 

2010 guidance document was issued? 

Ms. STONER. First, on the guidance document, it applies to Appalachia because of the science on which it is based, which is science 

that was done in the field in Appalachia. So that is why the guidance document applies to Appalachia. It is not binding. And there 

have been no decisions that have been made that are based on 

guidance, as opposed to on the statutes and the regulations that 

govern our decisionmaking. They are informed by that science that 

has been done. 

So, that is the way that we are using it. It has timeframes in it 

to try to get the agencies to work promptly with mining companies 

to find solutions that allow mining to continue and protect water 

quality. 

Mr. RAHALL. So you are working with coal companies to try to 

develop these models, or whatever, to—so we can move forward? 

Ms. STONER. Yes, sir. We are working with coal companies. We 

have been very proud of the progress that we have made in a number of situations, including with Coal-Mac, with Hobet 45 in having 

permits that are issued that protect public health and allow coal 

mining to continue. 

And even in Spruce, the mining that had already started was allowed to continue. So we are looking for solutions. We are looking 

for ways of protecting public health and protecting the economy in 

Appalachia. 

Mr. RAHALL. Why is it that the April 2010 guidance document 

issued ‘‘for surface coal mining in Appalachia’’ is being applied to 

all types of mining, including deep mining and mining that not 

even occurs in jurisdictional waters? 

Ms. STONER. It applies to surface coal mining in Appalachia. And 

the information—— 

Mr. RAHALL. Not deep mining? 

33 

Ms. STONER. The information in it may be relevant, but the guidance is limited to—those areas in which the information was gathered was surface coal mining in Appalachia. 

Mr. RAHALL. All right. Let me ask you. On April—I’m sorry, May 

2nd of this year, the EPA and the U.S. Corps of Engineers jointly 

published in the Federal Register their proposal to issue clarifying 

guidance for determining which waters and wetlands throughout 

the Nation are protected in the CWA programs. That draft guidance was made public, and the Agency solicited comments from all 

interested parties. 

In April 2010 the EPA issued its detailed guidance for permitting 

and surface coal mining in Appalachia. It was made effective immediately. And the public comment was only solicited afterward. 

Can you tell me why the EPA, on the one hand, felt it was important to allow the public to weigh in on new guidance before it 

took effect, but on the other hand, in the instance involving only 

the Appalachian States, it did not allow that public input? 

Ms. STONER. We are, as you may know, getting input on the mining guidance. We got it through the past year, we are analyzing 

that input, and are planning to move forward with a revised guidance, based on that input and based on our experience. 

We did feel it was important to get the science out to people to 

address the clarity issues that have come up several times in the 

hearing. 

Mr. RAHALL. But all that was done after you implemented. 

Ms. STONER. No, the science was put out at the same time, April 

of last year, the science reports from our office of research and development. We felt it was important to get that science out at that 

time so people could look at the science, which went through a peer 

review process thereafter, as well as the guidance, and have the 

best information possible on the clarity that people are seeking on 

how the permit process would work, so that we could reach our solutions of having mining permits issued that protect public health 

and the environment. 

Mr. RAHALL. Why did you seek OMB review of your national 

guidance on jurisdictional waters but not on the guidance targeting 

Appalachian coal mining? 

Ms. STONER. OMB is currently reviewing the revision to the Appalachian coal mining guidance. So we are seeking OMB review, 

other agencies’ review—— 

Mr. RAHALL. At my request, by the way. 

Ms. STONER [continuing]. Through that process. We were glad to 

see to that request. 

Mr. RAHALL. What is the timeline for the EPA issuing its final 

guidance? 

Ms. STONER. I expect it to come out later this month. 

Mr. RAHALL. Thank you. Thank you, Mr. Chairman. 

Mr. GIBBS. Representative Cravaack, have you got a question? 

Yes. 

Mr. CRAVAACK. Thank you, Mr. Chairman. Ms. Stoner, last time 

we spoke—I appreciate you being here today—I asked you what 

the definition of navigable waters is. Can you please tell me what 

the definition of navigable water is in the new guidance? 

34 

Ms. STONER. The new guidance has a number of elements that 

are involved in the definition of navigable waters that relate to 

tributaries, that relate to wetlands, that relate to those connections 

to traditionally navigable waters and interstate waters. 

Mr. CRAVAACK. Would it include a seasonal slough or a wet 

meadow? 

Ms. STONER. It would depend on the specific facts and circumstances associated with those. 

Mr. CRAVAACK. So you are saying that it would include a seasonal slough or a wet meadow at times? 

Ms. STONER. It could, if they had a significant nexus to a traditional navigable water or an interstate water. The point of the 

draft guidance is to close loopholes and, again, as with the mountaintop mining guidance, provide greater clarity to the public to 

speed the permitting process and allow projects to move forward. 

Mr. CRAVAACK. Well, this isn’t just affecting mountaintop mining. It is also affecting open pit mining in Minnesota. For example, 

the Keetac Mine has gone through 3 years and $300 million of EPA 

studies in regards to trying to get a mine open that was already 

a previous mine that has just been shut down for a number of 

years. So the issue is there. 

So what wasn’t able to go through the Clean Water—America’s 

Commitment to Clean Water Act, it seems like you are legislating 

by regulating. 

Well, let me ask you, then. If the EPA has guidance, would you 

agree that it should not be binding in any way? 

Ms. STONER. EPA guidance is not binding. That is correct, Congressman. 

Mr. CRAVAACK. OK. If this is correct, if this is true, why would 

you propose such guidance? 

Ms. STONER. It is to provide information and clarity to the regulated public. 

Mr. CRAVAACK. Why not a white paper? 

Ms. STONER. A white paper could be considered a guidance. 

Mr. CRAVAACK. OK. But you are classifying it a guidance. And 

the reason why I bring this up, I have seen what guidance has 

done to our timber industry in the northern part of Minnesota; it 

has become a mandate. And that is what we are very concerned 

with, as well. 

Could you tell me just yes or no, do you believe the implementation of the ERP presents a substantive change to prior regulations? 

Ms. STONER. I am not sure what the ERP is. Are you talking 

about the enhanced coordination process? 

Mr. CRAVAACK. Yes, yes. 

Ms. STONER. Yes, that is not a substantive change. That is a 

process. 

Mr. CRAVAACK. OK. You think it is a process. All right. 

What authority, then, is the EPA acting under this enhanced review procedure, instead of the Corps regulations to process a certain coal permits selected by the EPA? 

Ms. STONER. It is just a coordination process among Federal 

agencies. So we are operating with our Federal agencies to enhance 

our coordination to improve the permitting process. 

35 

Mr. CRAVAACK. OK. I just understood—didn’t I understand that 

the Army Corps did not agree with your assessment? 

Ms. STONER. That was a question about the Spruce Mine veto. 

They very much agreed to and signed an MOU with us on the enhanced coordination process. We are working closely with the Army 

Corps on that process to get permits issued that protect public 

health and the environment. 

Mr. CRAVAACK. OK. So then how does the EPA reconcile the fact 

that in this process that you are saying—called the enhanced review of permits, suspends the Corps timeline for issuing the 404 

permits required by the Clean Water Act and the Corps regulations? 

Ms. STONER. It is my understanding that it includes dates for 

speeding up the process, not for slowing down the process. 

Mr. CRAVAACK. OK. Again, I will go back to the Keetac Mine 

with 3 years and, you know, through this process moving—the experience that we have seen in Minnesota is that the EPA keeps on 

changing the bar, where they will come up to a certain point— 

PolyMet Project, as well—where they will come up to a certain 

point, and then they will reach that point, and then the EPA 

changes the point, the data point, once again. 

So, my question is, you know, how can—and we talked just recently in the previous panel—how can business go about and do 

any type of certainty if EPA keeps on moving the bar on us? 

Ms. STONER. We are very anxious to provide the certainty which 

you are seeking, and that is actually what these efforts are about. 

One thing about the scope of Clean Water Act jurisdiction is that 

we had heard from a lot of different entities from different perspectives that there was a lack of clarity. That is one of the reasons 

to provide the guidance and close those loopholes, provide that clarity the regulated entities need. 

Mr. CRAVAACK. Well, ma’am, to tell you the truth, and speaking 

in regards to the mines in Minnesota—and I will—the people of the 

mines in Appalachia—I can tell you there is not one person or one 

entity that has said the EPA gives them any type of certainty. As 

a matter of fact, it does the exact opposite. 

So, that is my comment to you. And I am out of time, and I will 

yield back, sir. 

Mr. GIBBS. Thank you. Representative Richardson? 

Ms. RICHARDSON. Thank you, Mr. Chairman. Ms. Stoner, you 

mentioned about EPA working together. Do you have a stakeholders group or an advisory group regarding mining, coal mining, 

specifically? 

Ms. STONER. We have advisory groups on a lot of different topics. 

I am not sure whether we have one on coal mining, in particular. 

Ms. RICHARDSON. OK. Might I suggest that if something raises 

to the level of the U.S. House of Representatives, you might want 

to consider having a stakeholders group. I don’t really think, legitimately, you can say that you are working together if you don’t even 

have a group where you are seeking their feedback to be able to 

work with them. 

So, my request would be—if you would take it back to the administrator—if she would consider having a stakeholders advisory— 

whatever you want to call it—and I think certainly, with all due 

36 

respect to Mr. Carey, he should be one of the people that is first 

on the list to be considered as a part of that group. Would you consider that? 

Ms. STONER. I would be happy to take that suggestion back. 

Ms. RICHARDSON. Thank you, Ms. Stoner. My second question 

would be any time something like this rises to the level, it says to 

us there is probably a problem, and I listen to my colleagues here. 

Have you had any hearings in the Appalachian area to talk about 

some of the concerns that have been brought forward to us today? 

Ms. STONER. Yes, we have. We have had hearings, including 

hearings on the Spruce Mine itself, in which we had lots of public 

interest, lots of testimony from people from various perspectives 

within Appalachia: people who were concerned about public health, 

people who were concerned about the environment, people who 

were concerned about jobs, people who were concerned about all 

kinds of issues. And we did listen to and considered all of the input 

we received at those hearings. 

Ms. RICHARDSON. And specifically regarding the ability to do 

jobs, what have you implemented, based upon those hearings that 

you had? 

Ms. STONER. Our strategy is to work with companies to meet the 

requirements of the Clean Water Act to protect public health and 

the environment and get permits issued that allow mining to continue and provide those jobs, while protecting public health. 

Ms. RICHARDSON. And what, specifically, are you doing to help 

them to do that? 

Ms. STONER. We are doing that in individual cases, working with 

those companies under the ECP process that we have been talking 

about, mostly through our regions. Most of the implementation of 

the Clean Water Act is through our regions. And we have been 

proud of the success that we have had. We have data showing 

that—recent data from Coal-Mac permits showing that the requirements of the Clean Water Act can be met in those cases, and jobs 

can be preserved, as well. That is our strategy. 

Ms. RICHARDSON. OK. Ms. Stoner, I thank you for your time, and 

I would just really urge you to—if we say we are working together, 

we need to be able to prove that we are working together. And I 

would just strongly encourage some sort of group where the impacted people have an opportunity to work with you and make 

some changes. 

Mr. Carey, I asked him—I apologize, Mr. Chairman—I asked Mr. 

Carey if he would give us some specific examples of regulatory 

things that could be done to help. Are you willing to consider those 

and answer what he provides to this committee? 

Ms. STONER. Of course. 

Ms. RICHARDSON. Thank you, ma’am. I yield back. 

Mr. GIBBS. Representative Capito, do you have a question? 

Mrs. CAPITO. Thank you. I am sorry I had to be out of the room, 

but I read your testimony, and I appreciate you coming before the 

committee. 

I want to ask a question about the interplay between the EPA 

and the DEP. My understanding is that the DEP—the State DEP— 

I am from West Virginia—is tasked with setting the water quality 

37 

standards, correct? But EPA has come in and keeps changing the 

standards and overturning what the State is doing. 

How are you working with the State to try to work out those 

issues? 

Ms. STONER. We are not overturning State standards. So you are 

correct, that West Virginia sets State standards. 

Mrs. CAPITO. Right. 

Ms. STONER. Some of the standards are narrative standards, and 

they need interpretation. And the science that we are working on 

is to help interpret those standards so that they can achieve their 

goals, which is ensuring that waters are usable for the people of 

West Virginia. 

And so, we are in regular contact with the State in discussing 

those State standards, and discussing particular permits, and trying to move forward together to get the permits issued to protect 

public health for citizens in West Virginia. 

Mrs. CAPITO. When you are considering the standards—and you 

heard, probably, my testimony, and you heard my conversation 

with Administrator Jackson telling me that the implications of jobs 

and the economy is something that she considers when making a 

decision, because her job is to oversee the Clean Water Act, exclusively. 

And in your statement, you talk about—and we have talked 

about this—the balance between healthy watersheds and a healthy 

economy. What considerations do you have when you are looking 

at a permit, in terms of the economic impact? Do you have a job 

impact statement? Do you have a—do you go to the community and 

talk to people that are actually living and working there, what kind 

of impact this is going to have on their livelihoods? 

Is that part of your written statement? Is there a metric that you 

have to follow? Or is that, in fact, as the administrator said, that 

is not considered, in terms of whether to move forward? 

Ms. STONER. It—first of all, with respect to the Spruce Mine, as 

I mentioned, we had a hearing in West Virginia where we had lots 

of people, and could consider all of the different input that they 

provided at that hearing. 

But our strategy on jobs is to work with the company to meet the 

requirements of the Clean Water Act, which are about meeting 

those water quality standards that you referenced before. And 

those standards are set to ensure that waters are usable for the 

things that people use them for: drinking, swimming, fishing, and 

so forth. Those are all economic activities. The Clean Water Act 

supports strong economies. 

And so, having clean water, having a strong economy, having 

public health protection in West Virginia, that is our goal. 

Mrs. CAPITO. Well, I mean, I agree clean water—I mean I live 

in West Virginia, it is important to all of us across the Nation. I 

mean I don’t think there is a disagreement there. 

But I think you would agree and I would agree that weaving the 

balance between the economy and the environment is difficult, not 

just in mining, but in—we are seeing this in our natural gas exploration in the northern part of our State. The ag community has 

seen it, the hard rock mining folks are seeing it. 

38 

And so, I guess basically what you are telling me is that, no, you 

don’t, as the EPA, consider the job and economic impact. That is 

the company’s job, to put forth the job and economic impacts, and 

to—and so, in plain talk I guess, what I want to see is you basically 

following up with what you are actually saying, and having behavior follow what the rhetoric is. And that is my concern. And that 

is our concern in West Virginia. 

Ms. STONER. So what I am saying is that Appalachian communities don’t need to choose between jobs and a healthy environment. They deserve and can have both. And we are totally committed to following up to ensure that we are working toward that 

common goal. 

Mrs. CAPITO. Well, I wish I could feel that that were absolutely 

the case. But, as I said, actions speak louder than words. And, unfortunately, a lot of the actions that we are seeing don’t follow with 

what you are telling me today. 

I would yield back. 

Mr. GIBBS. Ms. Richardson, you had a follow-up? 

Ms. RICHARDSON. Yes, Mr. Chairman. I just wanted to clarify. I 

didn’t hear for the record. Did you accept Ms. Stoner’s materials 

into the printed record? She had asked, but I did not hear us confirm it. 

Mr. GIBBS. Oh, yes, we will. 

[The information follows:] 

The studies may be accessed online at the Government Printing Office’s Federal 

Digital System (FDsys) at: http://www.gpo.gov/fdsys/search/pagedetails.action? 

st=jacketid%3A72-211&granuleId=CPRT-112HPRT72211&packageId=CPRT-112HP 

RT72211. In the ‘‘Download Files’’ section of the Web page, select the PDF format. 

Ms. RICHARDSON. Perfect. Thank you, sir. Appreciate that. 

Mr. GIBBS. Representative Landry? 

Mr. LANDRY. Ms. Stoner, I was glad to see the chairman point 

out the fact that, you know, in your guidance on conductivity 

standards you said that they could not exceed 500 siemens, and 

Perrier doesn’t—would exceed that. So should I not put Perrier in 

my fish tank, or should I not swim in it, or should I not drink? I 

mean I am trying to understand. You know, what exactly is—you 

know, are we setting as a threshold? 

Ms. STONER. Well, first of all, in the guidance 500 is not a standard, as you suggested. It is—again, based on the science, it is a 

benchmark. But what it is designed to do is to protect fresh water 

communities. So there is fish and various different kinds of creatures that live in fresh water and some that live in salt water. This 

is fresh water communities. And what we are doing is, based on 

the science, what is necessary to protect those. 

And what we have seen is that high conductivity levels are 

linked with high levels of dissolved solids that are detrimental to 

that stream life. So the conductivity limit is about protecting 95 

percent of the species that one would find in a mountain stream. 

Mr. LANDRY. Well, but what I am concerned about is whether or 

not you put out these guidance documents, and then you strongarm those permitees by threatening your use of your veto power. 

So it is kind of like we want you to—this is a guidance, but if you 

don’t meet it, remember we can veto you over here. 

39 

You know, that is what concerns, I believe, not only me but my 

colleagues here, is what goes on not in this committee room and 

your answers, but when you all close the door and put those companies in your office. Believe you me, as a business owner, I 

wouldn’t deny that you all do that, because I have experienced it. 

The other thing that kind of strikes me is that section 101(f) of 

the Clean Water Act states, ‘‘It is the national policy that, to the 

maximum extent possible, the procedures utilized for implementing 

this act shall encourage the drastic minimization of paperwork.’’ 

Now, considering that a 404 permit required an EIS on a permit 

that I studied that I had mentioned earlier that spanned over 1,600 

pages, including 58 pages just to respond to your EPA comments, 

would you say that you all are failing to actively implement that 

section? 

Ms. STONER. Most 404 permits are issued through a general permit process, and that is about 80,000 per year, as I understand it. 

And they take less than 90 days. So that is how most 404 authorizations occur. 

Mr. LANDRY. Well now, I want you to know something. Down— 

you know, look, I have got levee districts back in Louisiana that 

basically can’t repair their levees because the cost of your permit 

is more expensive than the cost to repair the levee. Do you understand what kind of effect you all are having? 

Ms. STONER. I agree with you on the importance of limiting paperwork, and in speed and efficiency in Government operations. 

That is in everybody’s interest. I completely agree. 

Mr. LANDRY. Well, I don’t understand, because back when the 

Chapala Basin levee was first—or when it was strengthened back 

in the 1980s, the 404 permit came like that. But yet—so at a time 

when the 404 permits started, the issuance of them happened at 

a quicker pace. But yet, as time has dragged on, the amount of 

time that it’s taken to get that permit has continued to exceed 

what it was prior to it. 

So, what you are saying, your actions don’t match the rhetoric. 

Ms. STONER. Well, we are working closely with the Army Corps 

to make permit decisions expeditiously, and to make decisions that 

meet the requirements of the law and protect public health. 

Mr. LANDRY. Well, I am about to run out of time, but are you 

familiar with the fact that you all vetoed a permit in the Yazoo 

River Basin that now could come back to cost hundreds of millions 

of dollars if those levees fail? Do you understand that impact of 

what that decision may create for those people? And I do not represent Mississippi. 

Ms. STONER. I was not personally involved in the decision having 

to do with the Yazoo pumps veto, but my understanding is that it 

actually was not about flooding in the Mississippi River. So it was 

actually about pumping backwater behind the levees. That is my 

understanding, and that 67,000 acres of wetlands were involved in 

that decision. 

Mr. LANDRY. Have you ever lived in an area that is prone to 

flooding? 

Ms. STONER. You know, interesting that you ask that. I grew up 

in a flood plain, sir. I grew up in the flood plain on the south fork 

of the Shenandoah River in Waynesboro, Virginia. And my house 

40 

was frequently flooded. And I am very interested in protection 

against flooding. 

Mr. LANDRY. Well, I hope that EPA never vetoes any of the permits that would protect that area you used to live in. I yield back. 

Mr. GIBBS. Representative Young? 

Mr. YOUNG. Thank you, Mr. Chairman. Ms. Stoner, the newly 

created enhancement review procedures is—it is the EPA, not the 

Corps, that determines permit review criteria and—coal mining 

section and 404 permits. So who is making the ultimate determination of those permits, the Corps, the EPA regional offices, EPA 

headquarters, or the administrator? 

Ms. STONER. Normally, decisions about Corps 404 permits are 

made by the Corps. 

Mr. YOUNG. By the Corps? 

Ms. STONER. Yes, sir. 

Mr. YOUNG. OK, that is enough. What authority was EPA acting 

under when it created new enhanced review procedures instead of 

the Corps regulations to process certain coal permits as selected by 

EPA? What authority? 

Ms. STONER. It didn’t take away the authority of the Corps—— 

Mr. YOUNG. What authority did it act under? 

Ms. STONER. This is intergovernmental relations within the executive—— 

Mr. YOUNG. What authority did the EPA act under? 

Ms. STONER. We are acting under the Clean Water Act, our authority, the Corps’ authority—— 

Mr. YOUNG. So, you usurped the Corps? 

Ms. STONER. No, sir. 

Mr. YOUNG. That is what—my interpretation. 

Ms. STONER. It is about—— 

Mr. YOUNG. That is enough. Yes or no, do you believe that implementation enhanced review procedures represents a change in our 

prior regulations? 

If yes, why didn’t the Agency go through the formal rulemaking 

process to make these changes to the regulatory program, particularly since the CWA requires any changes to the 404(b)(1) guidelines must be done through rulemaking? 

Ms. STONER. They are not regulatory changes. 

Mr. YOUNG. They are not? So you don’t consider this a substantive change? 

Ms. STONER. No, sir. They are not a regulatory—— 

Mr. YOUNG. It is not a substantive change, yet you are overcoming the Corps. 

Ms. STONER. And it doesn’t overcome the Corps. We are working 

with the Corps. That is what the enhanced—— 

Mr. YOUNG. The Corps doesn’t agree with you. 

Ms. STONER. Well, that is—— 

Mr. YOUNG. And I have talked to the Corps. You are not working 

together. You are running roughshod, as an agency. And I think 

you can tell that Congress understands that. 

Ms. STONER. I meet with the Corps on a regular basis. 

Mr. YOUNG. You meet with the Corps, but you are not working. 

You are dictating to the Corps. 

Ms. STONER. We work closely with—— 

41 

Mr. YOUNG. Now—that is enough. 

Ms. STONER [continuing]. Congressman. 

Mr. YOUNG. Under the MOA issued by the administration almost 

2 years ago, the administration stated new procedures were then 

necessary to streamline and coordinate the permitting process. And 

how do you explain that the new process has only resulted in an 

issuance of eight permits in nearly 2 years? 

Ms. STONER. We—you are not counting the 42 that we issued immediately. 

Mr. YOUNG. No, what—— 

Ms. STONER. More than 50 had been—— 

Mr. YOUNG. In 2 years you issued eight permits. After this was 

organized, 2 years, eight permits. How is that a streamline? 

Ms. STONER. Since January—— 

Mr. YOUNG. It is not a streamline, and you and I know it. 

Ms. STONER. Since January of 2009, it has been more than 50. 

Mr. YOUNG. Ms. Stoner, I have to tell you I am not a happy person with EPA. I think you have gone far beyond your authority. 

You have been dancing very well at this hearing. And what you are 

doing is using abusive power against the legislative intent. 

I watched this in Alaska. You came in and set different standards on arsenic, which is natural, after we put a plan in 20 years 

ago. You changed it, and cost the community $37 million to meet 

your standards without any science. The science you have is 

flawed. 

Now, what I am suggesting to any State or any area to have a 

good set of scientists and contradict what you do. You are doing— 

you have an agenda. Your agenda does not make this country productive. It takes away jobs from this country. We are not producing 

in this country. And you look at every time we try to produce something, you are involved. And your administrator is directly involved. This administration has a new agenda. The agenda is nonproduction. No working for the working man. People sitting in their 

little office, making regulations. 

Mr. Chairman, this has to stop, and the only way it can stop is 

de-fund them. Go through each area and de-fund when it doesn’t 

make sense and when the science is not there. When they don’t listen to the other science, they use the science of a university to get 

the money from this Congress. And that is where we have to stop 

it. I yield back. 

Mr. GIBBS. I thank you. Representative Lankford? 

Mr. LANKFORD. Thank you, Mr. Chairman. Thanks for being 

here, as well. 

Obviously, we have a lot of questions and a lot of concerns. The 

last time you were here I asked you point blank if there was a 

State that you could identify their department of environmental 

quality, or whatever term they may use, that was incompetent for 

the task on that. At the time, you said back to me, ‘‘We don’t know 

of a State, they are all working, they are all doing a great job.’’ I 

affirm that, that is great. 

The issue comes up in a situation like this, where a State is saying, ‘‘We are walking through this process, we are trying to establish it,’’ EPA steps over the top of them and says, ‘‘No, we have got 

this, we are now going to take this on.’’ 

42 

And though the science comes up—and you referenced earlier we 

have a high propensity for, or higher propensity for certain diseases and things in this area—there is not a causal relationship 

that I am hearing from that science, unless you—unless there is 

something I missed on that. To say that this particular area has 

certain health issues, and then to say, ‘‘And it is because this water 

issue’’ is a different gap. 

Is your science saying that it is causal, or is your science saying 

that it exists here? Because there are lots of issues that could be 

causing that. Is there something that you are saying that is causing it? 

Ms. STONER. There are two studies, one about cancer rates and 

another about other health indices that show a correlation between 

degraded streams, between mountaintop mining, and between people’s health issues in Appalachia. So I am referring to the correlation that was found to be statistically significant by scientists at 

Virginia Tech, University of West Virginia, and the medical school 

at University—— 

Mr. LANKFORD. Part of what you gave to us today. 

Ms. STONER. Yes, sir. 

Mr. LANKFORD. Because I would be interested—I didn’t get a 

chance to see that. Because, obviously, there are a lot of assumptions that are made to say, ‘‘This occurs, and so naturally it is because of this, because we don’t like this at this point, and so we 

will try to shut this down,’’ whatever the ‘‘this’’ is at the moment 

of that. 

Let me shift a little bit. Obviously, the Federal Government, for 

years, has promoted coal. You go back to the Carter administration, as I mentioned earlier, the Carter administration was a leading advocate for coal, and pushing a lot of companies to start using 

more and more and more of that. Now they are, now America is 

very focused in on using coal, which has been very affordable and 

has been very efficient for us, and now there is—this administration is pulling away from it as fast as they possibly can, and there 

is a shift on that. 

We are seeing that not only in the mining of that, but also in 

coal production. Let me give you an example from my State, the 

316(b). Cooling ponds next to a coal-fired power plant have some 

fish that are getting caught into it, and so EPA has recently contacted them and said, ‘‘You are going to have to change the way 

that you do your intakes.’’ 

Is there a certain number—because they are trying to find—is 

there a certain number of minnows—and that is what it is in one 

of these ponds, literally, it is bait fish that are getting caught 

against this—is there certain minnows, a number out there, that 

they can go by and say if there are 300 minnows killed in a year 

that is OK, if there is 1,000 it is not OK? How is that guideline 

working? Because it is moving for them, and it is about to cost 

Oklahoma consumers of energy millions of dollars to make an adjustment. 

Ms. STONER. First of all, let me just say EPA actually is not 

working to end coal mining. What we are doing is addressing coal 

mining pollution and protecting public health and the environment 

under the statutes that we are authorized to implement. 

43 

Mr. LANKFORD. All right. 

Ms. STONER. With respect to 316(b), we are currently working on 

standards for existing facilities—I don’t know if this is an existing—— 

Mr. LANKFORD. It is an existing facility. 

Ms. STONER. And those standards are not yet complete. 

Mr. LANKFORD. Correct. And they have been years in the process. 

Ms. STONER. That is right. 

Mr. LANKFORD. And now—waiting, and now it is all coming 

down. 

My concern on it is there is no standard. There are millions of 

dollars in now having to retrofit something where there is something—and I am going to ask the same question. If there is going 

to be some standard implemented for how many minnows can be 

killed in an area, I am going to ask the same question. How many 

birds can be killed at a wind farm? Will EPA also be submitting— 

you know, we can’t have more than 10 birds a year killed at a wind 

farm, or else there is going to have to be some new guidance, some 

new something that happens in that. 

This is the moving process that is occurring in every form of energy production currently, that as soon as mining starts or shifts 

or begins to plan, they can’t plan because they don’t know what the 

EPA guidelines are going to be. These plants can’t change on a 

dime. They are 10 years in process to get up to speed. 

And currently, no one knows what type of energy is the new form 

of energy. Because if they put up wind offshore, Sierra is going to 

hit them because there are birds being killed there. So maybe that 

is going to last long, maybe that is not going to last long. We cannot do nuclear now, and we cannot do, really, coal now, because the 

permitting takes so long, and we don’t know if that is going to be 

acceptable. 

And for the energy companies, they have no idea about rules and 

now water streams and—they have no idea. ‘‘We would like to shift 

to natural gas.’’ Oh, no, wait. EPA is doing a whole big study now 

on hydraulic fracking. My State in Oklahoma, since 1949, has been 

doing hydraulic fracking. Come drink our water and breath our air. 

It is a beautiful State. 

No one knows what energy they can use. You are shutting down 

the production of energy, based on these arbitrary rulings and 

guidelines that go out that may have some scientists on it, but 

there is no correlation between reality of how things really get paid 

for and what really occurs. We have got to have some stability. 

If there is anything the EPA can give to us, it is a break in the 

regulatory environment and provide our consumers some stability 

so that we can catch up. That would be a great gift to our economy. 

And with that, I yield back. 

Mr. GIBBS. Thank you. Representative Bucshon? 

Dr. BUCSHON. Thank you for coming. I am a cardio-vascular surgeon, so I know something about peer-reviewed studies. And the 

question I have is you mentioned the environmental impact studies 

that were published and peer reviewed. And who were the scientists that peer-reviewed them and their organizations? 

Any—I mean do any of the studies that you are saying that are 

applying to this, did they come from outside of Government organiVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
44 

zations or organizations that were contracted by the Government 

to provide that data? 

Ms. STONER. Well, there are a number of studies. As I said, more 

than 100. So there are EPA studies that are peer-reviewed by our 

science advisory board. There are also studies from—— 

Dr. BUCSHON. Can I ask a question? Who appoints the science 

advisory board? Is that someone—does the administration pick the 

members of that? 

Ms. STONER. I don’t know the answer to that question. I would 

be happy to submit it for the record. 

Dr. BUCSHON. You know, because I think that is critically important. 

The point I am trying to make here is that if you are quoting 

peer-reviewed studies, like in health care—for example, would you 

believe a peer-reviewed study of a product if the companies that 

make the product did the peer review? 

Ms. STONER. That would be a factor to look at in evaluating the 

study. 

Dr. BUCSHON. That is just a yes or no. I mean would you believe—do you think the American people would believe a study on 

a product that is being made, if the people that make—or companies making the product did the peer reviewing, and then said it 

was peer-reviewed? 

Ms. STONER. There are such studies all the time. 

The other studies that I was referencing were ones from universities—— 

Dr. BUCSHON. My point is this. If your peer review that you are 

talking about are all Government agencies, or people who the Government has contracted on behalf of the Government to give peer 

review, that is not peer review. What peer review is, is independent 

people that have no financial or political motivation about what the 

results show. 

And so, I will—we will—it will be interesting to see those studies 

and see that—whether or not there is any of those type of folks 

that are telling you the same thing, or else—or whether or not this 

is all stuff that the Federal Government is doing. And I will be 

honest with you. As a citizen I don’t have a great deal of confidence 

that, because of politics and because of other reasons, there won’t 

be some outside thing motivating the results as a means to an end. 

The other question I have is do we have baseline conductivity, 

water—conductivity studies from water all around the country in 

different areas? You guys just—do you have just, you know, 

streams, rivers, everywhere, do you have, like, a whole list of what 

the—just baseline is of conductivity? 

Ms. STONER. Congressman, I have some information on the 

science advisory board. So we solicit nominations for reviewers 

from outside entities, including from mining representatives. 

Dr. BUCSHON. Great. 

Ms. STONER. And the other studies are from universities. And I 

think that the universities know how to do peer review work. 

Dr. BUCSHON. They may, unless you have contracted with them 

for the information. 

Ms. STONER. No, no. I am talking about studies they have 

done—— 

45 

Dr. BUCSHON. That is a big, big difference. 

Ms. STONER. That they have done, not that we—— 

Dr. BUCSHON. Well, they have done the studies. But if the EPA 

contacted them and they—and asked them to do the study and 

they are getting funded through some Government organization to 

do the study, that is not an independent peer review. That is a— 

and the—because I have trained at universities, I have went to 

multiple universities. I understand the whole university, you know, 

publish or perish environment. I understand all that. 

And if—say, for example, if a drug company came to a university 

and said, ‘‘Could you guys test our drug,’’ and the drug company 

was going to pay them a bunch of money to do it, would you believe 

that? I wouldn’t. 

Ms. STONER. No, I understand about the conflicts of interest 

point that you are making. It is an excellent point. 

Dr. BUCSHON. Yes. 

Ms. STONER. I would be happy to provide more information about 

the peer-review process. 

Dr. BUCSHON. That would be great. On the baseline conductivity, 

I am interested in how you establish—first of all, how you establish 

what is safe. And do we have baseline conductivity—and, for that 

matter, you know, particle studies like the selenium you are 

quoting—from multiple streams throughout the country to give 

us—you know, to see how—if there is a scientific baseline? 

Do we have that? Because if I was—as a scientist, want to say, 

‘‘OK, I am going to set a level,’’ I would want information from all 

my streams and waterways from all over the country, and I would 

look at all that, and I would say, ‘‘Well, here is what is reasonable.’’ 

Because I know you are making the distinction between the 

water and what is survivable by fish or other things, and that is 

a good distinction. But on the other hand, then where are you getting that survivability data from? Who studied it, and where is the 

baseline—how is the baseline established? 

Ms. STONER. We have an existing water quality criteria for selenium, so we have done—— 

Dr. BUCSHON. From—where did that come from, though? That is 

the—see, I understand that you have criteria, but the question is, 

who did it? Did you—if you did it, do you have scientific data that 

has shown it? Have they done—you know, that is the question. 

Ms. STONER. Right. We go through a rigorous scientific process 

to do a water quality criteria. And we would have data from different areas of the country for selenium—— 

Dr. BUCSHON. Could you please provide all of the water quality 

data based on conductivity and all other foreign products that are 

in water from every—from all 50 States, for example, so you can 

help the Congress establish what is actually out there as a baseline? 

Because if you set—and I can tell by your expression you are not 

quite understanding what I am saying—— 

Ms. STONER. That is true. 

Dr. BUCSHON [continuing]. Or whether it is useful or not. But in 

medicine, for example, if you are going to establish a baseline on 

anything, right, you have to have a broad, diverse data. You can’t 

just pull—you just can’t go to one area, one State, and say, ‘‘This 

46 

is how this works here.’’ If you are establishing this for the United 

States, I would think that you would want to see what your baseline levels are everywhere, and establish a reasonable baseline. 

Ms. STONER. Yes, we have a strong scientific peer review process 

for all those water quality criteria. We get input from outside entities for all of those. In the water quality criteria for conductivity 

we did have review by the science advisory board, which strongly 

endorsed our science and said it was a model for future water quality studies. 

Dr. BUCSHON. OK. I am over time, but what I would like to see 

is I would like to see the water quality data from around the country that the EPA uses to establish its baselines. Thank you. 

Mr. GIBBS. Thank you. I think there is a lot of things that just 

aren’t reconciling with some of your statements and what some of 

our information is. So we are going to have another round of questioning, and I am going to start that off. 

It is my understanding, when you talk about the conductivity 

that peer reviewed, it is my understanding that the EPA actually 

put out that guideline before it was peer-reviewed, is that correct? 

Ms. STONER. We put it out in draft before the peer review, and 

then took public comment in, went through the peer review with 

the SAB. That is correct. 

Mr. GIBBS. OK. Because you know what is happening is some of 

these—it is kind of de facto taking effect. 

I am a little concerned. It is my understanding it took—the EPA 

spent more than 15 years to revise the aquatic life criteria for selenium, and that effort is still not completed. And it is—apparently 

it has just taken you, literally, months to develop a benchmark for 

conductivity—a matter of months. 

Can you tell me the difference in developing a water quality criteria versus developing a benchmark, and then explain how these 

two limits differ in their use? 

Ms. STONER. A water quality criteria is the science that EPA provides to States to use in setting water quality standards. It is done 

under a statutory provision, and has processes associated with it, 

including the science that I was just discussing with the other congressman. 

The benchmark is not as formal. It is based on science that we 

have been acquiring over the past several years. As I indicated, we 

did get that science peer-reviewed. But it is a benchmark. It is not 

a water quality standard, and it is not a water quality criteria. So 

it is used to provide guidance to States, for example, in interpreting the narrative criteria that they have. 

Mr. GIBBS. You referenced the science advisory board, SAB, 

panel. Apparently raised a number of issues that warranted further study, which certainly suggested that science is anything but 

conclusive, with respect to conductivity. How do you explain the response to the SAB’s concerns? 

Ms. STONER. We are revising the guidance, the guidance that 

was issued April of last year, we are revising it. It will reflect the 

recommendations from the SAB in full when we finish that guidance document. 

Mr. GIBBS. Did they ever respond to the National Mining Association’s report? 

47 

Ms. STONER. They examined the National Mining Association’s 

report, which—my understanding—was not peer-reviewed. But 

they did evaluate that in their final report. The office of research 

and development did, looked at the National Mining Association 

input. 

Mr. GIBBS. I mean I don’t think they responded to them, though. 

I don’t believe they did. 

Ms. STONER. If there was correspondence with them, I am not 

aware of it. But I do know that they received the report, I actually 

saw that they had received it and were considering it. 

Mr. GIBBS. What is the cost of replacing coal provided by these 

mines with other energy resources? Are these other energy resources currently available domestically through currently permitted operations? If not, what countries would we have to trade 

with to obtain these energy resources? And what are the national 

security implications of relying on energy resources from these 

countries, since we are not permitting coal operations? 

Ms. STONER. Well, it is my understanding that we have excess 

stockpiles of coal in this country at this point. I am not an expert 

in the mix of energy sources. My work relates to protecting water 

quality and human health and the environment. 

And so, the mix of energy sources, that is actually something 

that others, including the Department of Energy, would work on 

with the U.S. Congress. 

Mr. GIBBS. So it is not in consideration, then. OK. 

What EPA contracted with Morgan Worldwide to assess the alternative configurations for the Spruce No. 1 mine in August 2010. 

A year after that, they asked the Corps to modify, suspend, or revoke the permit, 4 months after they issued a proposed determination. Why did EPA contract with, you know, Morgan Worldwide 

and offer alternatives? But I don’t believe Arch-Coal was notified 

of those alternatives. 

Ms. STONER. You are correct that we contracted to get information. That report was delivered last fall, I believe, in the hope of 

having successful discussions with Arch. 

Mr. GIBBS. But you revoked the permit first, didn’t you? 

Ms. STONER. No, sir. We already had that information. We had 

been successful in working with Arch in other cases, including 

Coal-Mac, and we were preparing for a negotiation with them, in 

the hope of finding a way to have the permit be issued to protect 

water quality—— 

Mr. GIBBS. I believe you didn’t disclose that to Arch until afterwards, so—after the revocation was issued. 

Ms. STONER. They were informed of a number of different approaches that could be used to meet the requirements of the Clean 

Water Act. They did not express an interest in having further negotiations. 

Mr. GIBBS. But is it true to say that they weren’t formally informed before the revocation was issued? 

Ms. STONER. I am talking about discussion of alternatives in general. We had discussions, including region three had extensive discussions with Arch about sequencing as a means of meeting the requirements of the Clean Water Act. Arch did not express an interVerDate Aug 31 2005 14:54 Jan 31, 2012 Jkt 000000 PO 00000 Frm 00061 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\5-11-1~1\66308.TXT JEAN
48 

est in further modifications to the permit at the time that U.S. 

EPA headquarters met with them. 

Mr. GIBBS. Back in January, I believe this year, the President 

issued some executive order for regulatory streamlining. Enhanced 

coordination, how does that mesh with that? 

Ms. STONER. It totally meshes with it. What we are trying to do 

is get agencies to work together expeditiously to make determinations and provide the clarity that industry wants on what is necessary—— 

Mr. GIBBS. I think there has also been additional delays. 

Ms. STONER. It is not intended to result in additional delays. And 

we have actually issued more than 50 permits. We have not completed that work. You are absolutely correct about that. But we are 

working hard at it. It does require some time, sometimes, to find 

a solution, an innovative solution that will work for everyone. But 

we are trying to do that. Sometimes it takes time, but it does 

produce results that we are proud of when we are able to protect 

water quality and public health and have coal mining continue. 

Mr. GIBBS. This is my last question. Would you agree that revoking a permit after they went through a 10-year environmental impact study, revoking it 3 years after the fact, just because you 

claim there is new science, what precedent or what signal does that 

send out to all sectors in our economy? 

I am really concerned about this issue. Who is going to put capital together? Who is going to risk capital if they have to get permits, knowing that they are not in violation of their permit but 

they can still lose their permit, because of a policy decision in 

Washington, I mean, doesn’t that concern the EPA, what that is 

going to do to stifle economic growth and jobs? 

Ms. STONER. EPA is very concerned about growth and jobs, as 

well as protection of human health and the environment. We have 

expressed concerns about that particular permit for a very long 

time. Most of the delay to which you refer has to do with litigation, 

delay associated with litigation. 

But we worked very hard to try to find a solution that would 

have allowed that permit to be issued. We would like to still see 

a solution that would allow permitting to go forward for any mine 

in West Virginia that can meet the requirements of the Clean 

Water Act. 

Mr. GIBBS. Well, we need to move that on. We agree with you, 

and I would like to see that be handled, you know, as fast as possible. 

Representative Cravaack, do you have any more questions? 

Mr. CRAVAACK. Thank you, Mr. Chairman. Ms. Stoner, I am trying to get to the basis of understanding why you produced a guidance. Why produce a guidance? Why not go through a formal rulemaking? 

Ms. STONER. Is this a question about the waters of the U.S., or 

about the mountaintop mining guidance? 

Mr. CRAVAACK. Any. Any guidance coming out of the EPA. 

Ms. STONER. OK. 

Mr. CRAVAACK. Why would you produce guidance, versus a rulemaking process? 

49 

And in the guidance you just produced in 2010, you said there 

was public input to the guidance? 

Ms. STONER. If you are talking about the mountaintop—I am 

sorry, you are asking me about two different kinds of guidances, 

so—— 

Mr. CRAVAACK. All right. No, I am talking about any guidance 

coming out of—— 

Ms. STONER. Any guidance. Well, there is some guidance—again, 

guidance is not a term that means something specific. So it can be 

correspondence, it could be white papers, it could be all kinds of 

things. And part of what we do is provide information out to our 

regions, out to States, out to the regulated entities that indicate 

how we are interpreting the law. 

The law is binding, the guidance is not binding, but we put that 

out, and we figure out what is it that is the best means of putting 

out that information. Sometimes it is on the Internet, you know, 

on our home page. It could be on all kinds of different—and then 

we use all these other methods to gather information. 

So we have been talking about advisory committees, stakeholder 

meetings. We have regular dialogue with members of the public 

from various different sectors to get input. So it is not a static process, it is a process of accommodation and working—— 

Mr. CRAVAACK. OK. 

Ms. STONER [continuing]. To try to get information out to do our 

job. 

Mr. CRAVAACK. I understand. OK, so let’s specifically go with the 

mountaintop. OK. Was there public input prior to that, to your 

guidance there? 

Ms. STONER. It was put out, and public input was solicited at the 

time that it was put out. That is correct. 

Mr. CRAVAACK. So after it was put out. 

Ms. STONER. Yes, sir. 

Mr. CRAVAACK. The guidance was already put out, and then 

there was public input after that. And how long was the public 

input allotted? How long? 

Ms. STONER. I believe it was 6 months. I think it was—— 

Mr. CRAVAACK. OK. 

Ms. STONER. No, actually, it was through the end of the calendar 

year, I think. So that is from April 1 to the end of the—— 

Mr. CRAVAACK. All right. For the record, then, can this Congress 

be—can Congress be unequivocally assured that no agency, entity, 

or individual will be prosecuted, denied, or withdraw permitting, or 

made or enticed to comply with any guidance coming out of the 

EPA? 

Ms. STONER. Only the statutes and regulations are the basis for 

those actions. 

Mr. CRAVAACK. OK—I just want a yes or no. 

Ms. STONER. Not based on the guidance, that is right. Statutes 

and regulations guide those—— 

Mr. CRAVAACK. So, just to be clear, for the record, the EPA will 

not prosecute, deny, or withdraw any permitting, or made to entice 

any agency, entity, or individual to comply with any guidance out 

of—coming out of the EPA. 

50 

Ms. STONER. Only the statutes and the regulations. That is correct. 

Mr. CRAVAACK. OK. Thank you very much, sir, and I yield back. 

Mr. GIBBS. Representative Lankford? 

Mr. LANKFORD. Let me finish up on that comment for clarification. 

So, someone can ignore a guidance, and they will be fine? If a 

guidance comes out and they get a record, they are in the process 

of doing surface mining, whatever it may be, they get a guidance 

document, here is a letter from EPA, ‘‘Here is our guidance,’’ they 

can ignore that, that is fine? 

Ms. STONER. The guidance is our interpretation of the statutes 

and the regulations. The statutes and regulations are binding, the 

guidance is not. 

Mr. LANKFORD. OK. 

Ms. STONER. So it reflects our interpretation of those. And guidances always indicate that in site-specific circumstances, something 

different may apply, but, ‘‘Here is our general interpretation of the 

statutes and regulations, those are the legal requirements.’’ 

Mr. LANKFORD. OK. So they can ignore—they can say, ‘‘That’s 

nice, I can ignore that,’’ and just continue to move on because that 

is not binding, that is an opinion? Is there—is guidance typically 

the first step towards rulemaking in saying, ‘‘Here it comes, here 

is the guidance, this may become rule?’’ 

Ms. STONER. Sometimes. Again, guidance can be used for many 

different purposes. But the statute—the regulations are what people need to follow, so they need to make sure—— 

Mr. LANKFORD. Right. 

Ms. STONER [continuing]. That they are doing that. 

Mr. LANKFORD. I am processing through just our conversation 

today and the multiple times that I appreciate that you have come 

back and said, ‘‘We are not going after coal. We are not trying to 

shut down coal.’’ The difficulty for me is processing through that 

from what I see on the ground. 

Currently, there is a push to make coal fly ash a hazardous 

waste, which will make disposal of that very expensive. It goes into 

a lot of products: in cement, it goes into roofing materials. A lot of 

things that are out there, that will dramatically increase the cost 

of how to handle coal on that side of it. 

Mining permits are slow, or we now have one pulled. Retrofit, 

costs are going up dramatically, because this requirement for best 

technology, so anyone can invent a new technology, no matter how 

expensive it is, and say, ‘‘Now this is the new best technology,’’ and 

there is a push to now try to retrofit a plant dealing with that. 

Regional haze, all of the changes that are happening with that 

currently, and everyone is pointing directly at coal and saying, 

‘‘This is the culprit on it.’’ 316(b) intake, it is shifting—the cooling 

towers are having to shift around, another dramatic increase in 

cost. 

This administration is pushing to remove loans from rural electric companies that want to be able to do coal plants, and saying 

they can do it if they want to do wind, but they can’t do it if they 

want to do coal. 

We are talking about carbon capture. 

51 

Which one of these things would tell any investor coal is a good 

idea, if you want to invest and do something, do it in coal? There 

are eight things I just listed that are very specific that are—all 

seem to be going after coal. While I am hearing us say, ‘‘We are 

not going after coal,’’ everything that seems to be coming out of 

EPA and this administration is, ‘‘Oh, but yes, we are. We are just 

saying we are not.’’ 

And again, no one can evaluate motives. I am just telling you 

what I am seeing on this side of it. So that is the struggle that we 

are—let me ask you a specific question. I know that is not something you can really respond to on that. 

How long should a permit take? What is the target length of 

time, if they are going to request a permit from EPA? I know there 

is a given time. How long should it take? 

Ms. STONER. It really depends on what the permit is for. So the 

bigger the impacts, the more likely a significant degradation, as 

with the more than 6 miles of streams that were proposed to be 

filled with Spruce Mine. It does take longer with a bigger, more 

complicated, more significant matter. 

As I indicated, most actions, most 404 actions, go through the 

general permitting process—— 

Mr. LANKFORD. Which takes how long? 

Ms. STONER. Less than 90 days. 

Mr. LANKFORD. OK. 

Ms. STONER. That is—so it is designed to streamline those things 

that can go more quickly, and to spend more time on the more significant actions with more likely impacts on public health and the 

environment. 

Mr. LANKFORD. OK. I know you know this, we have talked about 

it before. I am tracking very carefully, because I am watching what 

is happening to coal, and now seeing companies that are trying to 

shift to natural gas, but also seeing on the horizon all of the studies that are now out there on fracking, knowing that the price of 

natural gas is dropping dramatically because of the supply we are 

able to pull out because of the fracking that is going on. 

It is the great unknown out there. Again, we are back to power 

plants. Can’t really plan, don’t really know what to predict, because 

they don’t know what EPA—if they are going to do to natural gas 

what they are doing to coal, then who knows what to predict on 

that one? 

Who is better for regulating fracking, a State or the EPA? 

Ms. STONER. I don’t know that I can answer that right now. You 

know, we have studies going on on fracking. There are—— 

Mr. LANKFORD. Do we have a date on that yet, when that is 

going to be complete? 

Ms. STONER. I believe it is still more than a year out, when we 

expect to have that study done from the office of research and development on fracking. 

You know, in general, the programs are run by the States, and 

it is our preference, in general, to have State-run programs for the 

underground injection control, for the Clean Water Act permitting, 

and so forth. And so that is generally our preference. 

52 

We are trying to figure out how well things are being done now 

on fracking. It is, you know, as you indicated, new, and a lot is still 

to be learned about it, outside of Oklahoma—— 

Mr. LANKFORD. Well, yes. Fracking is not new. 

Ms. STONER. Right. 

Mr. LANKFORD. I mean since 1949 it has been going on in our 

State. 

Ms. STONER. But—— 

Mr. LANKFORD. This is new to some areas. 

Ms. STONER. Right. 

Mr. LANKFORD. It is not new to other areas. 

Ms. STONER. No, I understand your point. And the technologies 

that are being used now are new. 

Mr. LANKFORD. Correct. 

Ms. STONER. And we are trying to ensure that we are protecting 

public health. There is a lot of concern about that. And one of the 

things that we are doing is looking at where fracking has occurred 

already, to figure out what is the best way to do that. 

But our general answer would be we like to have States run the 

programs, not EPA. But I can’t say that there isn’t anything that 

EPA would need to do to ensure that public health is protected, 

with respect to fracking. There may be things that we need to do, 

as well. 

Mr. LANKFORD. Well, thank you. I appreciate that. I yield back. 

Mr. GIBBS. We are going to close this down, but just kind of a 

little bit of follow-up. 

Last week we had Ms. Teresa Marks, who is the director of the 

State of Arkansas Department of Environmental Quality, and she 

talked about this issue with the guidance. This is a little bit disturbing, because you put out guidance and you say it is not binding. But then in some instances it could be in conflict with State 

law. And she testified that they are in a Catch-22: they are going 

to violate State law or they are going to violate the guidance, which 

sometimes becomes law by de facto standards. 

And you talk about we need to put out—you know, you are working to increase the certainty versus uncertainty. And it seems to 

me there is a huge issue there where you are creating massive uncertainty. Can you respond to that? 

Ms. STONER. The guidance is not binding. So it actually, I don’t 

think, could put States in a bind in the way that you are talking 

about, where they can’t comply with the guidance and with something else, because the guidance is not binding. 

Mr. GIBBS. I think what is happening in the practice, you know, 

they don’t know what to do. And then, of course, in the private sector a person that is in business, then they really get confused, because they don’t know what is going to come after them, litigation. 

And so it is creating a huge problem. 

And I think that we had two State directors of State EPAs testify 

to that fact. So I think you need to be—recognize that fact, that 

you are creating more uncertainty, and it is just bad public policy, 

I think, and you know, we sent a letter I had 172 co-sponsors on 

that, instead of putting out all these guidances and interim guidances, you need to move forward under the law with the regulatory 

process and have the public hearings and set the rules under that 

53 

framework that is established by law. Because you are kind of circumventing all that, and it is becoming de facto rules and creating 

problems and problems to economic growth and jobs. 

Just in closing, I need to say that we are really concerned. Administrator Jackson was before the Ag committee a few weeks ago, 

and both sides of the aisle had massive concerns about what this 

Agency is doing. And when I see State agencies, the EPAs, having 

the same concerns, there is a problem here. And it needs to be addressed, because we are not putting out the certainty and the confidence for the private sector to grow their businesses and create 

jobs. And the EPA is a massive hurdle blocking that; those investments. And I think you need to be aware of that. 

So, this will conclude the second hearing. The meeting is adjourned. 

[Whereupon, at 1:17 p.m., the subcommittee was adjourned.] 

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