4836 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation

and Enforcement

30 CFR Parts 740, 745, 761, and 772

RIN 1029–AB42

Valid Existing Rights

AGENCY: Office of Surface Mining

Reclamation and Enforcement, Interior.

ACTION: Proposed rule.

SUMMARY: The Office of Surface Mining

Reclamation and Enforcement (OSM) is

proposing to amend its regulations to

redefine the circumstances under which

a person has valid existing rights (VER)

to conduct surface coal mining

operations in areas where these

operations are otherwise prohibited by

section 522(e) of the Surface Mining

Control and Reclamation Act of 1977

(SMCRA or ‘‘the Act’’). OSM also is

proposing to establish requirements and

procedures and define responsibilities

for the submission and processing of

requests for VER determinations, modify

and clarify the applicability of the

existing operation exemption, remove

the requirement that requests for

compatibility determinations for surface

coal mining operations on national

forest lands be accompanied by a permit

application, and, with certain

exceptions, require a VER determination

as a prerequisite for approval of coal

exploration activities that may result in

substantial disturbance of the lands

listed in section 522(e) of SMCRA. The

proposed rule also contains numerous

editorial revisions and organizational

changes intended to improve overall

consistency and clarity. If the proposed

rule becomes final, it would result in

removal of all existing suspensions of

the affected regulations.

DATES: Electronic or written comments:

OSM will accept electronic or written

comments on the proposed rule until

5:00 p.m. Eastern time on June 2, 1997.

Public hearings: Anyone wishing to

testify at a public hearing must submit

a request on or before 5:00 p.m. Eastern

time on March 17, 1997. Because OSM

will hold a public hearing at a particular

location only if there is sufficient

interest, hearing arrangements, dates

and times, if any, will be announced in

a subsequent Federal Register notice.

Any disabled individual who needs

special accommodation to attend a

public hearing should contact the

person listed under FOR FURTHER

INFORMATION CONTACT.

ADDRESSES: Electronic or written

comments: Submit electronic comments

to osmrules@osmre.gov. Mail written

comments to the Administrative Record,

Office of Surface Mining Reclamation

and Enforcement, 1951 Constitution

Avenue, N.W., Washington, DC 20240

or hand-deliver to the person listed

under FOR FURTHER INFORMATION

CONTACT.

Public hearings: If there is sufficient

interest, hearings may be held in

Billings, MT; Denver, CO; Lexington,

KY; Washington, DC; and Washington,

PA. To request a hearing, contact the

person listed under FOR FURTHER

INFORMATION CONTACT by the time

specified under DATES using any of the

methods listed for ‘‘Electronic or written

comments’’.

FOR FURTHER INFORMATION CONTACT:

Dennis Rice, Rules and Legislation,

Office of Surface Mining Reclamation

and Enforcement, Room 115, South

Interior Building, 1951 Constitution

Avenue, N.W., Washington, DC 20240.

Telephone: (202) 208–2829. E-mail

address: drice@osmre.gov. Additional

information concerning OSM, this rule,

and related documents may be found on

OSM’s home page at http://

www.osmre.gov.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Public Comment Procedures.

II. General Background on Proposed Rule.

III. Discussion of Proposed Rule.

A. Sections 740.4, 740.11 and 745.13: VER

Determinations for Lands Protected by

Paragraphs (e)(1) and (e)(2) of Section

522 of SMCRA.

1. Who is Responsible for VER

Determinations for Non-Federal Lands

Within Section 522(e)(1) Areas?

2. Which VER Definition Applies to Lands

Listed in Paragraphs (e)(1) and (e)(2) of

Section 522?

3. What Other Changes are Proposed?

B. Sections 740.10 and 745.10: Information

Collection.

C. Section 761.5: Definition of Valid

Existing Rights.

1. Statutory and Regulatory History.

2. Basic Definition.

3. Property Rights Demonstration.

4. Good Faith/All Permits Standard.

5. Needed for and Adjacent Standard.

6. VER for Access and Haul Roads.

7. Transferability of VER.

8. Continually Created VER: VER When

Prohibitions Come into Effect After

August 3, 1977.

D. Section 761.5: Definition of ‘‘Surface Coal

Mining Operations Which Exist on the

Date of Enactment’’.

E. Section 761.11: Areas Where Surface Coal

Mining Operations are Prohibited or

Limited.

1. Existing Operation Exemption.

2. Removal of Paragraph (h).

F. Section 761.12: Coordination with

Permitting Process; Waiver Requirements

and Procedures.

G. Section 761.13: Submission and

Processing Requirements for Requests for

VER Determinations.

1. Paragraph (a): Which agency will

process a request for a VER

determination?

2. Paragraph (b): What information must a

request for a VER determination include?

3. Paragraph (c): How may the public

participate in the VER determination

process?

4. Paragraph (e): How may a determination

be appealed?

H. Section 772.12: Requirements for Coal

Exploration on Lands Unsuitable for

Surface Coal Mining.

I. Effect in Federal Program States and on

Indian Lands.

J. Effect on State Programs.

IV. Procedural Matters

I. Public Comment Procedures

Electric or Written Comments

Comments should be specific and

confined to issues pertinent to the

proposed rule. They also should include

explanations in support of the

commenter’s recommendations. OSM

appreciates any and all comments, but

those most useful and likely to

influence decisions on the content of a

final rule will be those that either

involve personal experience or include

citations to and analyses of the Act, its

legislative history, its implementing

regulations, case law, other pertinent

State or Federal laws or regulations,

technical literature, or other relevant

publications.

Except for comments provided in an

electronic format, commenters should

submit two copies of their comments

whenever practicable. Comments

received after the time indicated under

DATES or at locations other than the

OSM office listed under ADDRESSES will

not necessarily be considered in the

final decision or included in the

administrative record.

Public Hearing

Persons wishing to testify at a public

hearing must contact the person listed

under FOR FURTHER INFORMATION

CONTACT by the time indicated under

DATES. If no one requests an opportunity

to comment at a public hearing, no

hearing will be held.

If a public hearing is held, it will

continue until all persons scheduled to

speak have been heard. Persons in the

audience who were not scheduled to

speak but who wish to do so will be

heard following the scheduled speakers.

The hearing will end after all scheduled

speakers and any other persons present

who wish to speak have been heard.
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4837

Filing of a written statement at the

time of the hearing will assist the

transcriber and facilitate preparation of

an accurate record. Submission of

electronic or written statements to OSM

in advance of the hearing will allow

OSM officials to prepare adequate

responses and appropriate questions.

Public Meeting

If there is only limited interest in a

hearing at a particular location, a public

meeting, rather than a public hearing,

may be held. Persons wishing to meet

with OSM representatives to discuss the

proposed rule may request a meeting by

contacting the person listed under FOR

FURTHER INFORMATION CONTACT. All

meetings will be open to the public and,

if possible, notice of the meetings will

be posted at the appropriate locations

listed under ADDRESSES. A written

summary of each public meeting will be

made a part of the administrative record

of this rulemaking.

II. General Background on Proposed

Rule

Section 522(e) of SMCRA provides

that, subject to VER, there shall be no

surface coal mining operations on

certain lands after the date of enactment

(August 3, 1977). The Act exempts

operations in existence on that date.

Section 522(e)(1) protects all lands

within the boundaries of units of the

National Park System; the National

Wildlife Refuge System; the National

System of Trails; the National

Wilderness Preservation System; the

Wild and Scenic Rivers System,

including study rivers designated under

section 5(a) of the Wild and Scenic

Rivers Act; and National Recreation

Areas designated by Act of Congress.

Section 522(e)(2) protects Federal lands

within the boundaries of any national

forest, although it provides a

mechanism and criteria for approving

(a) surface operations and impacts

incident to an underground mine on any

type of national forest land, and (b) any

type of surface operations on lands that

lack significant forest cover and are

located west of the 100th meridian.

Section 522(e)(3) prohibits operations

that would adversely impact publicly

owned parks and properties listed on

the National Register of Historic Places;

however, it permits operations that

receive joint approval from the

regulatory authority and the agency

with jurisdiction over the park or place.

Except for mine access and haul roads,

section 522(e)(4) prohibits operations

within 100 feet of the outside right-ofway line of any public road, but it

provides a mechanism and criteria for

approval of exceptions from this

prohibition. Section 522(e)(5) prohibits

operations within 100 feet of a cemetery

or within 300 feet of a public building,

school, church, community or

institutional building, or public park.

This paragraph also prohibits operations

within 300 feet of an occupied dwelling,

but it allows the owner of the dwelling

to waive the prohibition.

SMCRA does not define or explain the

VER exemption. As discussed in greater

detail in other sections of this preamble,

OSM previously defined or attempted to

define VER by regulation in 1979, 1983,

1988, and 1991. None of these efforts

was fully successful. Judicial review of

the 1979 and 1983 definitions and

related rules resulted in the remand of

several provisions, including most of

the 1983 definition of VER. In 1988,

OSM proposed a new definition, which

it withdrew in 1989 for further study.

On July 18, 1991 (56 FR 33152–65),

OSM again proposed to revise the

definition of VER and related rules. The

comment period for this proposal

originally closed September 16, 1991,

but, by notice dated September 12, 1991

(56 FR 46396), OSM extended the

deadline until October 16, 1991. In

addition, in response to requests from

interested persons, OSM scheduled and

held two public hearings on the

proposed rule, one in Knoxville,

Tennessee, which attracted 27 speakers,

and another in Morgantown, West

Virginia, at which 3 individuals offered

testimony.

The overwhelmingly majority of the

approximately 750 comments received

did not directly discuss either the

proposed rule language or the specific

issues upon which OSM had requested

comment. Instead, the commenters

opposed the proposed rule in principle

because they believed that it would lead

to increased mining in national parks

and wildlife refuges and irreparable or

uncompensated damage to dwellings,

cemeteries, churches, and other

structures. Copies of all comments

received and transcripts of the public

hearings are on file as part of the

administrative record of the 1991

rulemaking effort.

Before OSM completed development

of a final rule, the President signed the

Energy Policy Act of 1992 (EPAct),

Public Law 102–486, 206 Stat. 2776,

into law on October 24, 1992. Section

2504(b) of that statute effectively placed

a one-year moratorium on adoption of a

new or revised VER definition.

At the Department’s request, Congress

included a revised version of this

moratorium in the appropriations acts

for fiscal years 1994 and 1995 for the

Department of the Interior and related

agencies. Specifically, the Fiscal Year

1995 Appropriations Act (Pub. L. 103–

332) contained a provision that

effectively prohibited the Department

from publishing a final Federal VER

definition or disapproving existing State

definitions of VER until October 1,

1995. However, Congress did not

include the moratorium language in the

fiscal year 1996 appropriations

legislation or continuing resolutions.

After evaluating the comments

received and taking intervening events

into consideration, OSM has decided to

withdraw the 1991 proposal and

publish a new, extensively revised

proposed rule concerning the definition

of VER and related issues. The new

proposed rule is based upon, but not

identical to, the 1991 proposal. Except

as discussed below, all substantive

comments received in response to the

1991 proposed rule have been

considered in developing the rule being

proposed today. However, because OSM

has decided to withdraw the 1991

proposal in favor of the rule being

proposed today, the preamble does not

necessarily discuss the disposition of all

comments. Persons who believe that the

new proposal does not adequately

address their 1991 concerns must

submit new comments or resubmit

relevant portions of earlier comments to

insure consideration of those concerns

during development of the final rule.

Some commenters expressed

opposition to OSM’s position that the

prohibitions and limitations of section

522(e) of SMCRA do not apply to

subsidence or other adverse surface

impacts resulting from underground

mining activities conducted beneath or

adjacent to protected lands. OSM

announced this policy in a separate

Federal Register document (56 FR

33170–71) published on July 18, 1991,

in tandem with the proposed rule

concerning VER. However, on

September 21, 1993, in National

Wildlife Fed’n v. Babbitt, 835 F. Supp.

654 (D.D.C. 1993), the court vacated the

policy set forth in the notice and

remanded the issue to the Secretary for

rulemaking in accordance with the

notice and comment procedures of the

Administrative Procedure Act (5 U.S.C.

553). OSM is addressing this issue in a

separate rulemaking, which is also being

published in proposed form in today’s

Federal Register.
4838 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

III. Discussion of Proposed Rule

A. Sections 740.4, 740.11 and 745.13:

VER Determinations for Lands Protected

by Paragraphs (e)(1) and (e)(2) of

Section 522 of SMCRA

1. Who Is Responsible for VER

Determinations for Non-Federal Lands

Within Section 522(e)(1) Areas?

While SMCRA does not directly

address responsibilities for VER

determinations, section 503(a) speaks of

States having exclusive jurisdiction over

the regulation of surface coal mining

and reclamation operations on nonFederal lands. In accordance with this

principle, former 30 CFR 761.4, as

promulgated on March 13, 1979 (44 FR

15341), assigned the responsibility for

VER determinations to the regulatory

authority, with the Secretary retaining

responsibility for VER determinations

involving Federal lands.

On February 16, 1983 (48 FR 6935),

OSM revised the Federal lands

regulations at 30 CFR 740.4 by adding

paragraph (a)(4). This paragraph

narrowed the Secretary’s responsibility

for VER determinations by restricting it

to proposed surface coal mining

operations that would be located on

Federal lands within the boundaries of

any areas listed in paragraph (e)(1) or

(e)(2) of section 522 of the Act. In the

same rulemaking, OSM revised 30 CFR

745.13 by adding paragraph (o). This

paragraph specifies that the Secretary

may not delegate the responsibility for

making VER determinations on Federal

lands within any areas listed in

paragraph (e)(1) or (e)(2) of section 522

to the State in a cooperative agreement

for the regulation of mining on Federal

lands. The preamble to that rulemaking

explains that exclusive authority for

VER determinations involving those

lands is an integral component of the

Secretary’s commitment to protect the

areas listed in paragraphs (e)(1) and

(e)(2) of section 522 in accordance with

congressional direction and to prevent

mining on Federal lands within the

National Park System (48 FR 6917, col.

2, February 16, 1983).

On September 14, 1983 (48 FR 41312),

OSM removed 30 CFR 761.4 because it

was no longer needed in view of the

provisions added to 30 CFR 740.4 and

745.13 on February 16, 1983. Citizen

and environmental groups filed a

challenge to the removal; they also used

this occasion as an opportunity to argue

that SMCRA requires that the Secretary

make VER determinations in all cases

involving lands within the boundaries

of section 522(e)(1) areas, regardless of

ownership. The court rejected the

plaintiffs’ arguments, noting that section

503(a) of the Act ‘‘permits States to

assume exclusive jurisdiction over the

regulation of surface coal mining and

reclamation operations on non-Federal

lands.’’ In re Permanent Surface Mining

Regulation Litigation II, Round III—

Valid Existing Rights, 22 ERC 1557,

1566 (D.D.C. 1985) (‘‘PSMRL II, Round

III—VER’’). The court also noted that

nothing in section 523(c) of the Act,

which prohibits the Secretary from

delegating to the States his authority to

designate Federal lands as unsuitable

for mining under section 522 of the Act,

‘‘persuades the court to the contrary.’’

Ibid.

However, in oral arguments defending

against the challenge, counsel for the

Government stated that:

[I]n those situations where surface mining

on private inholdings will affect federal

lands, that kicks in the Federal Lands

Program, and under the Federal Lands

Program, the Secretary makes the VER

determination, so there may be

circumstances where you have a private

inholding within the protected area, in which

the Secretary would make the VER

determination, but he can’t in the abstract

know when he’s going to be required to make

that determination, until he knows what land

is going to be mined, and what potential

impact that might have on federal lands.

Transcript of Oral Argument, Dec. 21,

1984, at 46; quoted in PSMRL II, Round

III—VER, 22 ERC at 1566.

The court did not address the validity

or interpretation of this argument,

which, taken at face value, would

extend the reach of the Federal lands

program to lands in which there is no

element of Federal ownership.

On November 20, 1986 (51 FR 41952–

62), OSM published a final rule

document that suspended a number of

regulations. Among other things, that

document, which is known as the 1986

suspension notice, partially suspended

the VER definition promulgated on

September 14, 1983. In the preamble

discussion of the impact of the

suspension of the VER definition on the

Federal lands program, OSM announced

that the Secretary would make VER

determinations for non-Federal lands

within the boundaries of the areas listed

in section 522(e)(1) whenever surface

coal mining operations on those lands

would affect the Federal interest (51 FR

41955). This policy is known as the

‘‘affected by’’ standard. However, the

notice did not suspend or modify 30

CFR 740.4(a)(4), which provides only

that the Secretary is responsible for VER

determinations for Federal lands, or any

other rule to reflect this policy.

In 1991, OSM requested comment on

whether the policy set forth in the 1986

suspension notice (the ‘‘affected by’’

standard) should be codified. Based on

the comments received and further

review of the background of this issue,

the agency is reconsidering the 1986

policy. OSM is now seeking comment

on four alternatives with respect to

responsibility for VER determinations

for non-Federal lands within the areas

protected by section 522(e)(1):

(1) Reaffirming existing 30 CFR

740.4(a)(4), which would mean that

OSM would be responsible for making

all VER determinations for Federal

lands in section 522(e)(1) areas and that

the regulatory authority (either OSM or

the State) would be responsible for

making all determinations for nonFederal lands;

(2) Reaffirming existing 30 CFR

740.4(a)(4) and revising 30 CFR Part 761

to provide that the regulatory authority

(either OSM or the State) must obtain

the concurrence of the pertinent land

management agency before finding that

a person has VER for any lands within

the boundaries of the areas listed in 30

CFR 761.11(a)(1) and section 522(e)(1)

of the Act;

(3) Codifying the ‘‘affected by’’

standard, the policy set forth in the 1986

suspension notice; or

(4) In a variation on the affected by

standard, requiring that OSM make all

VER determinations for both Federal

and non-Federal lands within the

boundaries of the areas designated in 30

CFR 761.11(a)(1) and section 522(e)(1)

of the Act.

For the reasons discussed below,

OSM has selected the first alternative as

the preferred alternative. Therefore,

although OSM retains the option of

adopting any of the alternatives, the rule

text being proposed today reflects the

first alternative, which would assign

responsibility for making VER

determinations for all non-Federal lands

to the regulatory authority. If OSM

ultimately adopts an alternative other

than the preferred alternative, the text of

the final rules will be revised in a

manner consistent with the alternative

selected. As discussed in finding G of

this preamble, OSM also is proposing to

revise 30 CFR Part 761 to clearly

delineate agency responsibilities for

VER determinations for both Federal

and non-Federal lands. See proposed 30

CFR 761.13(a).

Adoption of the first alternative

would be consistent with the

congressionally mandated doctrine of

State primacy as expressed in sections

101(f) and 503(a) of SMCRA. In

particular, section 503(a) provides for

exclusive State jurisdiction over the

regulation of surface coal mining and

reclamation operations on non-Federal

lands, except as specified in sections
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4839

521 (Federal oversight) and 523 (Federal

lands) and Title IV of the Act

(abandoned mine land reclamation).

The first alternative would also

complement OSM’s policy of a shared

commitment with the States to achieve

the goals of SMCRA. This policy

promotes mutual trust and a spirit of

cooperation between OSM and the

States and maximizes the States’ role in

environmental protection and the

regulation of surface coal mining and

reclamation operations within their

borders. Subchapter C of 30 CFR

Chapter VII provides that State

regulatory programs must be no less

stringent than the Act and no less

effective than the Secretary’s regulations

in meeting the requirements of the Act.

Hence, there should be no difference in

the degree of environmental protection

regardless of whether OSM or the State

makes the VER determination.

The second alternative is identical to

the first in that the regulatory authority

would be responsible for making VER

determinations for all non-Federal

lands, including those within the

boundaries of section 522(e)(1) areas.

However, under the second alternative,

if the proposed operation would be

located on land within the boundaries

of an area listed in section 522(e)(1), the

agency statutorily responsible for

management of the protected lands

would have to concur with the

regulatory authority’s determination

before the determination could take

effect. If adopted, this provision would

be added to the decisionmaking

requirements of proposed 30 CFR

761.13(d). This alternative would

largely preserve the State’s lead role in

the regulatory process in keeping with

the dictates of sections 101(f) and 503(a)

of SMCRA while providing additional

assurance that the lands designated in

section 522(e)(1) receive the level of

protection that Congress intended; i.e.,

minimization of surface coal mining

operations on lands that Congress

designated as unsuitable for surface coal

mining operations. It is somewhat

analogous to 30 CFR 816.116(b)(3)(i)

and 817.116(b)(3)(i), which require that

the regulatory authority obtain the

concurrence of State agencies

responsible for the administration of

forestry and wildlife programs when

approving revegetation success

standards for operations with a

postmining land use involving woody

plants. Although SMCRA did not

require adoption of that provision (just

as SMCRA does not require the

concurrence of the land management

agency for VER determinations

involving section 522(e)(1) areas), OSM

nevertheless deemed it appropriate to

promote attainment of SMCRA’s

environmental protection and land

reclamation goals.

The chief argument in favor of the

third alternative (codification of the

affected by standard) is that the Federal

interest in lands included within the

boundaries of section 522(e)(1) areas

(national parks, wildlife refuges, wild

and scenic rivers, wilderness areas, etc.)

is not necessarily limited to lands

included in the definition of Federal

lands in section 701(4) of the Act.

Activities on private inholdings may, in

fact, affect Federal lands. The

boundaries of section 522(e)(1) areas are

established by Congress or the President

in recognition of the national

significance of these areas and the

uniquely high natural, historical, or

cultural values associated with the

lands included therein. Surface coal

mining operations on non-Federal lands

within the boundaries of section

522(e)(1) areas could affect the Federal

interest by adversely impacting the

values for which the lands were

designated, at least on a short-term

basis.

Adoption of the third alternative

would afford the Federal government

(the Secretary) a decisionmaking role in

VER determinations for operations on

lands in which there is any type of

Federal interest, even if the Federal

government has no property interest in

the lands in question. Historically,

proponents of this alternative have

argued that reserving this authority to

the Secretary would ensure national

consistency and may result in more

favorable consideration of arguments

advanced by the Federal land

management agency with jurisdiction

over the protected site. Implementation

of this alternative would require

delineation of the responsibilities of the

various State and Federal agencies

involved (including which agency has

authority to make the affected by

determination) and establishment of

procedures to coordinate interagency

processing of requests for VER

determinations.

The fourth alternative, under which

OSM would be responsible for making

all VER determinations for all lands

within the boundaries of section

522(e)(1) areas, is a variation on the

affected by standard. This alternative

relies upon the argument that because

Congress or the President established

the boundaries of those areas, all lands

within their boundaries must possess

values of national significance or

interest. Therefore, surface coal mining

operations on any lands within the

boundaries of those areas would

automatically affect the Federal interest

in some way. Also, in many cases, nonFederal lands are intertwined with

Federal lands in such a fashion that

activities on the non-Federal lands

would have an impact on the Federal

lands in terms of noise, dust, and other

environmental factors.

The affected by standard represents

current OSM policy. Although the 1986

suspension notice does not explain the

basis or origin of the policy, it appears

that the policy arises from the

Government’s oral argument in PSMRL

II, Round III–VER, as quoted in the

decision. This argument apparently

derives from and expands upon

language in the court’s earlier decision

in In re Permanent Surface Mining

Regulation II, Round I, No. 79–1144

(D.D.C. July 6, 1984), slip op. at 11–15

(hereinafter ‘‘PSMRL II, Round I’’). In

that decision, the court noted that the

definition of ‘‘surface coal mining

operations’’ in section 701(28) of the Act

includes a broad ‘‘affected by’’ test and

that under section 523(a) of SMCRA and

the definition of ‘‘Federal lands

program’’ in section 701(5), all surface

coal mining and reclamation operations

on Federal lands are subject to the

Federal lands program.

Because the scope of the decision in

PSMRL II, Round I was limited to

Federal lands, and because the court in

PSMRL II, Round III–VER did not review

the merits of the position suggested in

oral argument by Government counsel,

neither decision compels adoption of an

affected by standard.

Also, in PSMRL II, Round I, the court

struck down 30 CFR 740.11(a)(3) (1983)

only to the extent that that rule did not

apply the Federal lands program to all

Federal lands. Specifically, the court

held that, with respect to the

jurisdiction of the Federal lands

program, the Secretary is ‘‘powerless to

limit’’ the statutory definition of

‘‘surface coal mining operations’’ in

section 701(28) and that, ‘‘if surface

mining activities take place on Federal

lands, the Secretary is powerless to

exclude them from the Federal lands

program.’’ Id. at 14–15. The court

rejected the Secretary’s argument, as

stated in the preamble to the 1983

rulemaking, that

because of the interaction of the State

primacy provision, section 503 of the Act,

with section 523 of the Act, the Federal lands

program can be interpreted to exclude State

or privately-owned surface overlying

Federally-owned coal where the operation

will not involve mining the Federally-owned

coal and where there will be no disturbance

of the Federally-owned estate.

48 FR 6921, February 16, 1983.
4840 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

Nothing in this decision would

compel extension of the Federal lands

program to lands in which there is no

Federal property interest, i.e., lands in

which both the surface and mineral

estates are entirely in non-Federal

ownership. There is no indication that

the court contemplated using the

affected by test in section 701(28) to

extend the Federal lands program to

lands in which there is no Federal

property interest. The court noted that

‘‘[w]hen Congress discussed state

administration of the Act, it virtually

always referred to non-federal lands.’’

Id. at 14.

Furthermore, when OSM

repromulgated 30 CFR 740.11(a) in 1990

to address the judicial remand, the

agency rejected a commenter’s argument

that the court had explicitly endorsed

an affected by test to determine the

jurisdiction of the Federal lands

program. In declining to adopt an

affected by standard, OSM stated that:

An ‘‘affected by’’ test would be very

difficult to administer. A determination that

the Federal interest would or would not be

affected would have to be made on a caseby-case basis, and could be subject to

different interpretations.

55 FR 94001, March 13, 1990.

In summary, SMCRA does not appear

to require adoption of an affected by

standard. Therefore, OSM’s preferred

alternative is to return to the pre-1986

approach, which, in accordance with

the language of section 503(a) of the Act,

provided the regulatory authority with

exclusive jurisdiction to make VER

determinations for all non-Federal

lands.

Regardless of which alternative is

adopted, the Secretary would retain

exclusive authority for making VER

determinations for Federal lands within

the boundaries of the areas listed in 30

CFR 761.11(a)(1) and section 522(e)(1)

of the Act and for Federal lands (but not

private inholdings) within the

boundaries of any national forest. None

of the alternatives would affect the

memorandum of understanding between

OSM and the U.S. Department of

Agriculture, Forest Service, which

details the procedures applicable to the

processing of requests for VER

determinations involving lands for

which the Forest Service owns the

surface estate. Each primacy State (State

with a regulatory program approved

under section 503 of SMCRA) would

retain the authority to make VER

determinations for non-Federal lands

within national forest boundaries.

Under the first and second

alternatives, the regulatory authority

would be responsible for making VER

determinations for all non-Federal

lands, including those within the

boundaries of section 522(e)(1) areas.

The second alternative includes an

additional requirement that the

regulatory authority obtain the

concurrence of the agency with

management jurisdiction over the area if

the land is located in an area listed in

section 522(e)(1). The third alternative

would extend the Secretary’s

responsibility to include VER

determinations for non-Federal lands

within section 522(e)(1) areas whenever

surface coal mining operations on those

lands would affect the Federal interest.

And, under the fourth alternative, the

Secretary would be responsible for

making VER determinations for all nonFederal lands within the boundaries of

section 522(e)(1) areas.

None of the alternatives would affect

responsibilities for VER determinations

for other types of Federal or non-Federal

lands. Except as provided in the second,

third, and fourth alternatives, the

regulatory authority would retain sole

responsibility for VER determinations

for non-Federal lands. In primacy States

without a Federal lands cooperative

agreement pursuant to 30 CFR Part 745,

the Secretary would remain responsible

for making VER determinations for

Federal lands under paragraphs (3), (4),

and (5) of section 522(e) of the Act. In

primacy States with a Federal lands

cooperative agreement, the State

regulatory authority would remain

responsible for making VER

determinations pursuant to paragraphs

(3), (4), and (5) of section 522(e) for

Federal lands not listed in paragraph (1)

or (2) of section 522(e).

2. Which VER Definition Applies to

Lands Listed in Paragraphs (e)(1) and

(e)(2) of Section 522?

Under section 503(a) of SMCRA,

States with regulatory programs

approved by the Secretary have

exclusive jurisdiction (except as

otherwise provided in sections 521 and

523 of the Act) over all surface coal

mining and reclamation operations

located or proposed to be located on

non-Federal, non-Indian lands within

the State’s borders. Section 523(c)

further provides that a State may enter

into a cooperative agreement with the

Secretary under which the State also

would assume responsibility for the

regulation of mining on Federal lands

within its borders.

The Federal lands rules at 30 CFR

740.11(a) currently specify that, upon

approval of a State regulatory program

pursuant to 30 CFR Part 732 or

promulgation of a Federal program for a

State under 30 CFR Part 736, that

program will apply to all surface coal

mining and reclamation operations on

any Federal lands within the State

except Indian lands. Therefore, under

the current rules, the Secretary must

apply the State program definition of

VER when making VER determinations

for Federal lands in primacy States.

However, on November 20, 1986, at

51 FR 41952–62, OSM published a

document that, among other things,

partially suspended the VER definition

promulgated on September 14, 1983.

Although the document did not suspend

any provision of 30 CFR Part 740, the

portion of the preamble that discusses

the impact of the suspension of the VER

definition on the Federal lands program

slightly modifies the general principle

that, consistent with 30 CFR 740.11(a)

as discussed in the preceding paragraph,

OSM must use the VER definition set

forth in the applicable State or Federal

regulatory program when making VER

determinations for Federal lands.

Specifically, the preamble states at 51

FR 41955 that when a state definition

relies upon an all-permits standard,

OSM will apply the State standard as if

it includes a good faith component. In

addition, the preamble provides that,

pending promulgation of a new Federal

definition of VER, OSM will not process

requests for VER determinations

involving lands within the boundaries

of units of the National Park System if

the approved State program definition

of VER includes a takings standard. (See

Part III.C. of this preamble for an

explanation of the all-permits, good

faith/all permits, and takings standards

for VER.) At present, the deferral policy

affects only units of the National Park

System within Illinois and West

Virginia. OSM adopted this policy as a

result of concerns expressed by the

National Park Service.

OSM is now proposing to revise 30

CFR 740.11 (a) and (g) to specify that the

Federal definition of VER will apply

whenever a VER determination involves

lands listed in paragraph (e)(1) or (e)(2)

of section 522 of SMCRA, regardless of

whether OSM or the State is responsible

for making the determination.

Application of the Federal definition

will ensure that requests for VER

determinations involving lands of

national interest and importance are

evaluated on the basis of the same

criteria.

In primacy States without a Federal

lands cooperative agreement pursuant to

30 CFR Part 745, the Secretary would

continue to use the approved State

program definition of VER when making

VER determinations for all other types

of Federal lands under paragraphs (3),

(4), and (5) of section 522(e) of the Act.
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4841

Similarly, in States with a Federal lands

cooperative agreement, the State

regulatory authority would continue to

use the State program definition of VER

when making VER determinations

pursuant to paragraphs (3), (4), and (5)

of section 522(e) for Federal lands not

listed in paragraph (1) or (2) of section

522(e) of the Act.

3. What Other Changes Are Proposed?

OSM is proposing to revise 30 CFR

740.4(a)(5) and 30 CFR 745.13(p) to

incorporate references to the provisions

of 30 CFR Part 761 that correspond to

section 522(e) of SMCRA. In addition, to

conform with the language of section

522(e) of the Act, which refers only to

surface coal mining operations, OSM is

proposing to replace the term ‘‘surface

coal mining and reclamation

operations’’ in 30 CFR 740.4(a)(4) and

745.13(o) with ‘‘surface coal mining

operations.’’ This change will also

ensure consistency with the policy set

forth in the preamble to a final rule

published on April 5, 1989 (54 FR

13814), which specifies that SMCRA

does not require a permit or other

regulatory authority approval as a

prerequisite for conducting reclamation

work alone. In other words, the latter

change clarifies that the prohibitions

and restrictions of 30 CFR 761.11(a) and

section 522(e) do not apply to

reclamation activities such as the

restoration of abandoned mine lands or

bond forfeiture sites.

B. Sections 740.10 and 745.10:

Information Collection

The proposed rule changes discussed

in III.A. will not alter the information

collection burden associated with Parts

740 and 745. However, OSM is

proposing certain editorial revisions to

§§ 740.10 and 745.10 to maintain

consistency with Departmental

guidance concerning the format and

content of these sections.

C. Section 761.5: Definition of Valid

Existing Rights

1. Statutory and Regulatory History

As discussed in the portion of this

preamble entitled ‘‘General Background

on Proposed Rule,’’ section 522(e) of

SMCRA (30 U.S.C. 1272(e)) prohibits

surface coal mining operations on

certain lands in the absence of a waiver

or compatibility finding unless a person

has VER to conduct such operations or

unless the operation was in existence on

the date of enactment (August 3, 1977).

SMCRA does not define or explain VER,

and the legislative history of both

section 522(e) in general and the phrase

‘‘subject to valid existing rights’’ in

particular is sparse.

The committee report on H.R. 2, the

House version of the legislation that

ultimately became SMCRA, contains the

following discussion:

The language ‘‘subject to valid existing

rights’’ in section 522(e) is intended,

however, to make clear that the prohibition

of strip mining on the national forests is

subject to previous court interpretations of

valid existing rights. For example, in West

Virginia’s Monongahela National Forest, strip

mining of privately owned coal underlying

federally owned surface has been prohibited

as a result of United States v. Polino, 133 F.

Supp. 772 (1955). In this case the court held

that ‘‘stripping was not authorized by

mineral reservation in a deed executed before

the practice was adopted in the county where

the land lies, unless the contract expressly

grants stripping rights by use of direct or

clearly equivalent words. The party claiming

such rights must show usage or custom at the

time and place where the contract is to be

executed and must show that such rights

were contemplated by the parties.’’ The

phrase ‘‘subject to valid existing rights’’ is

thus in no way intended to open up national

forest lands to strip mining where previous

legal precedents have prohibited stripping.

H.R. Rep. No. 218, 95th Cong., 1st Sess. 95

(1977).

The committee report on S. 7, the

Senate version of the legislation that

ultimately became SMCRA, contains a

similar discussion, including the

statement that:

The language of 422(e) [now 522(e)] is in

no way intended to affect or abrogate any

previous State court decisions. * * * The

phrase ‘‘subject to valid existing rights’’ is

thus in no way intended to open up national

forest lands to strip mining where previous

legal precedents have prohibited stripping.

S. Rep. No. 218, 95th Cong., 1st Sess. 94–95

(1977).

Thus, the committee reports

accompanying the versions of SMCRA

passed by each chamber of Congress

emphasize that the VER exemption is

intended to maintain existing State

prohibitions on surface coal mining

operations. The reports do not discuss

whether or how Congress intended VER

to apply as a means of authorizing

operations that SMCRA would

otherwise prohibit. In other words, the

reports emphasize that nothing in

SMCRA was intended to create new

property rights or mining authority for

surface coal mining operations.

The conference committee report does

not address this issue. See H.R. Conf.

Rep. No. 493, 95th Cong., 1st Sess. 110–

11 (1977).

On several occasions, a colloquy

between Congressmen Udall and

Roncalio during floor debate on H.R. 2,

the House bill that eventually became

SMCRA, has been interpreted to mean

that one purpose of the VER provision

in SMCRA may be to avoid the

compensable takings that could

otherwise result from the application of

the prohibitions of section 522(e).

Congressman Roncalio proposed an

amendment to delete the sentence in

section 601(d) that reads, ‘‘[v]alid

existing rights shall be preserved and

not affected by such designation.’’

(Section 601 provides for the

designation of Federal lands as

unsuitable for noncoal mining.)

Congressman Udall, who is generally

recognized as the chief architect of

SMCRA, opposed the amendment

‘‘because it takes from the bill a

statement that valid legal rights should

be preserved. I do not think we should

do that without paying compensation

under the fifth amendment.’’ 123 Cong.

Rec. 12,878 (1977). The House rejected

the amendment and retained the

language at issue.

However, nothing in this colloquy

provides any guidance on how Congress

intended VER under section 522(e) to be

defined. Because section 601 addresses

only noncoal mining operations on

Federal lands, Congressman Udall’s

statement and the sentence in question

in section 601(d) probably refer to VER

as that term is defined under the

General Mining Law of 1872 and similar

Federal laws involving the public

domain. In such statutes, the term VER

typically refers to the set of

circumstances under which persons

who have unvested interests or

expectations in Federal lands or

minerals will be allowed to vest those

interests or expectations as property

rights when the United States is the fee

owner. In general, the VER provisions of

those statutes apply to cases in which

the Federal government changes the

eligibility criteria or other requirements

for vesting of property rights. In such

cases, the term VER refers to

circumstances in which a person who

has taken some action to vest a property

right in Federal lands or minerals has

the right to complete the process

regardless of any statutory or regulatory

changes to the contrary. This type of

VER is not analogous to VER for surface

coal mining operations under section

522(e) of SMCRA, which applies to both

private and Federal lands and does not

involve a transfer of a property right

from the Federal government to another

party. Instead, VER under section 522(e)

of SMCRA concerns a person’s right to

use property for a particular purpose

(conducting surface coal mining

operations) when that person already

has vested property rights.
4842 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

Although the legislative history of

SMCRA is largely silent on the meaning

of VER, the extent to which the Federal

government and States may prohibit or

restrict the exercise of private property

rights without providing compensation

is determined by case law established

pursuant to the Fifth and Fourteenth

Amendments to the U.S. Constitution.

Accordingly, in its first rulemaking

defining VER, OSM ‘‘endeavored to

determine the point at which payment

would be required because a taking had

occurred, then to define ‘valid existing

rights’ in those terms, i.e., those rights

which cannot be affected without

paying compensation.’’ 44 FR 14992–93,

March 13, 1979.

OSM’s first regulatory definition of

VER provided that, except for haul

roads, VER included only those

property rights in existence on August

3, 1977, the owners of which either had

obtained all necessary permits for the

proposed surface coal mining operation

on or before August 3, 1977 (the ‘‘all

permits’’ standard), or could

demonstrate that the coal for which the

exemption was sought was both needed

for and immediately adjacent to a

surface coal mining operation in

existence on August 3, 1977 (the

‘‘needed for and adjacent’’ standard). 44

FR 14902, 15342 (March 13, 1979).

The mining industry, the State of

Illinois, the National Wildlife

Federation, and assorted environmental

organizations all challenged the validity

of the 1979 definition. Because the

plaintiffs presented no evidence of

specific harm, the court declined to rule

on the constitutionality of the

definition. However, the court held that

a person who applies for all permits, but

fails to receive one or more through

government delay, engenders the same

investments and expectations as a

person who has obtained all permits.

Specifically, the court stated that ‘‘a

good faith attempt to have obtained all

permits before the August 3, 1977 cutoff date should suffice for meeting the

all permits test.’’ In re Permanent

Surface Mining Regulation Litigation I,

14 ERC 1083, 1091 (D.D.C. 1980),

(‘‘PSMRL I, ROUND I’’).

To comply with this decision, which

partially remanded the all permits

standard, OSM suspended the definition

of VER insofar as it required that all

permits have been obtained prior to

August 3, 1977 (45 FR 51547–48,

August 4, 1980). The suspension

document stated that, pending further

rulemaking, OSM would interpret the

definition as including the court’s

suggestion that a good faith effort to

obtain all permits should suffice to

establish VER. This standard is known

as the ‘‘good faith/all permits’’ standard.

The industry plaintiffs appealed those

portions of the District Court’s decision

in PSMRL I, ROUND I that were adverse

to their interests. However, the U.S.

Court of Appeals for the District of

Columbia Circuit remanded the appeal

in 1981 after the government informed

the court that it was reconsidering the

1979 definition. Thus, the court never

reached a decision on the merits of the

appeal.

On June 10, 1982 (47 FR 25278), OSM

published a proposed rule setting forth

six options for revising the definition of

VER. These options included the good

faith/all permits standard, a mineral

rights ownership standard, a mineral

rights ownership plus right to mine by

the method intended standard (the

‘‘ownership and authority to mine’’

standard), and three variations on the

latter two standards. Since the proposed

standards all attempted to establish a

clearly defined ‘‘bright line’’ test for

VER, they became known as

‘‘mechanical tests.’’

Commenters criticized each option as

either too broad or too narrow, and

many argued that one or more of the

proposed options would result in a

taking of property without just

compensation in violation of the Fifth

and Fourteenth Amendments to the U.S.

Constitution. Because the Supreme

Court has consistently declined to

prescribe set formulas for determining

when a taking will occur, OSM

concluded that any mechanical test

likely would be either over-inclusive or

under-inclusive of all potential takings

that might result from the section 522(e)

prohibitions. Therefore, the final rule

promulgated on September 14, 1983 (48

FR 41314) included a definition of VER

which provided, in part, that a person

has VER if a prohibition on surface coal

mining operations would result in a

compensable taking of that person’s

property interests under the Fifth and

Fourteenth Amendments to the U.S.

Constitution. This standard is known as

the ‘‘takings’’ standard.

The revised definition also defined

the ‘‘needed for’’ aspect of the needed

for and adjacent standard and

established the concept of ‘‘continually

created VER’’ to protect the rights of

persons with mining operations or

mineral interests in areas that come

under the protection of section 522(e)

sometime after August 3, 1977, as would

occur, for example, when a park is

created or expanded or a protected

structure is built after that date.

However, the U.S. District Court for

the District of Columbia subsequently

remanded most of the revised definition

on procedural grounds. The court held

that the takings standard represented

such a significant departure from the

options presented in the proposed rule

that a new notice and comment period

was necessary to comply with the

public participation requirements of the

Administrative Procedure Act (5 U.S.C.

553). See PSMRL II, ROUND III–VER, 22

ERC 1557, 1564. The court also held

that the proposed rule failed to provide

adequate notice that it would expand

the needed for and adjacent standard to

include properties acquired after the

date of enactment of SMCRA (August 3,

1977). Accordingly, the court remanded

both the takings standard (including

that portion of the newly adopted

continually created VER provision that

relied on the takings standard) and the

revised needed for and adjacent

standard to the Secretary for proper

notice and comment.

In response to this order, on

November 20, 1986 (51 FR 41952,

41961), OSM suspended most of the

September 14, 1983 definition of VER.

Since the court upheld the concept of

continually created VER for existing

operations as set forth in 30 CFR

761.5(d)(1), that portion of the revised

definition was not suspended. As

discussed at 51 FR 41954–55, in the

absence of an applicable State program

definition of VER, the suspension notice

effectively reinstated the 1980 good

faith/all permits standard and the

original (1979) needed for and adjacent

standard, while adding a continually

created VER component for operations

in existence at the time a protected

feature comes into existence or is

expanded. Except as discussed in Part

III.A. of this preamble, the suspension

notice did not impact State program

definitions or their application by either

the State or OSM.

On December 27, 1988 (53 FR 52374),

OSM proposed the good faith/all

permits standard and the ownership and

authority to mine standard as options

for a regulatory definition of VER.

Under the ownership and authority to

mine standard, an individual could

establish VER by demonstrating

possession of both a right to the coal

and the right to mine it by the method

intended, as determined by State law.

After evaluating the comments received,

OSM withdrew the entire proposed rule

for further study on July 21, 1989 (54 FR

30557).

As part of that study, OSM and the

University of Kentucky College of Law,

in cooperation with the American Bar

Association, cosponsored a national

symposium on April 3–4, 1990, on the

meaning of VER under SMCRA. Volume

5, Number 3 of the Journal of Mineral
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4843

Law and Policy, contains the

proceedings of this symposium. The

participants did not reach a consensus

on how to define VER.

Also in 1990, Belville Mining

Company, an Ohio mining firm, filed

suit against the Secretary of the Interior

alleging that he had, among other

things, (1) failed to perform a mandatory

duty to promulgate the definition of

VER needed to implement section

522(e); (2) in lieu of regulations, issued

various statements and directives on

VER (including the policy set forth in

the November 20, 1986 suspension

notice) without notice and comment in

violation of the Administrative

Procedure Act; and (3) made VER

determinations relying on State

regulations identical to an invalidated

Federal regulation. Belville Mining Co.

v. Lujan, No. C–1–89–790 (S.D. Ohio

1991) (‘‘Belville I’’).

In a July 22, 1991, decision, the court

in Belville I, (1) ordered the Secretary to

begin proceedings to promulgate a final

rule defining VER; (2) enjoined him

from enforcing or applying the

November 20, 1986 suspension notice or

any temporary directive that extends the

policy of the suspension notice; and (3)

directed him to immediately begin

proceedings to disapprove State

program definitions of VER that rely

upon the all permits standard. On

September 21, 1992, pursuant to the

Government’s motion for

reconsideration, the court narrowed the

latter portion of its ruling to require

only the disapproval of the Ohio

program definition of VER insofar as

that definition affects Belville and its

VER applications. In doing so, the court

accepted the Government’s argument

that federal remedy law prohibits the

imposition of injunctive remedies that

are beyond the scope of the plaintiff’s

individual injuries and related VER

applications. Consequently, OSM

interprets the decision barring use of the

1986 policy as applying only to Ohio. In

all other States, OSM continues to

adhere to the policy set forth in the

November 20, 1986 suspension

document.

On July 18, 1991, OSM proposed to

revise the definition of VER by

reinstating the takings standard, the

good faith/all permits standard, and the

1979 version of the needed for and

adjacent standard. In addition, the

proposed rule eliminated the separate

provisions concerning continually

created VER for existing operations and

incorporated the concept of continually

created VER into the other standards for

VER.

OSM did not finalize this rule before

the President signed the Energy Policy

Act of 1992 (Pub. L. 102–486, 206 Stat.

2776) (EPAct) into law on October 24,

1992. Section 2504(b) of that law

required adherence to the VER policy in

the November 20, 1986 suspension

notice (51 FR 41952) for one year after

the date of enactment. That provision

had the effect of suspending the Belville

I decision in Ohio and halting

publication of a new final rule defining

VER. Although the EPAct provision

expired on October 24, 1993, the

appropriations acts for the Department

of the Interior and related agencies for

fiscal years 1994 and 1995 each

included a moratorium on adoption of

a new or revised Federal VER definition

or disapproval of existing State program

definitions of VER. The last moratorium

(section 111 of H.R. 4602 (1994))

expired October 1, 1995. Congress did

not include similar language in any

legislative for fiscal year 1996.

2. Basic Definition

In many respect, the definition of VER

being proposed today resembles the

definition previously proposed on July

18, 1991. Both rules include a basic

definition that describes VER as a set of

circumstances under which a person

may conduct surface coal mining

operations which section 522(e) of the

Act would otherwise prohibit. The

definition also clarifies that, even if a

person has VER, surface coal mining

and reclamation operations on these

lands are subject to all other

requirements of the Act and the

pertinent regulatory program. The VER

exemption does not entitle a person to

an exemption from any other permitting

requirements or performance standards.

This language establishes the

conceptual framework within which the

standards of paragraphs (a) and (b) of

the definition must be applied.

3. Property Rights Demonstration

Like the 1991 proposal, paragraph (a)

of the definition of VER at 30 CFR 761.5

in this proposed rule would reinstate

the requirement that a person claiming

VER for any type or aspect of surface

coal mining operations other than roads

must demonstrate that a legally binding

conveyance, lease, deed, contract, or

other document vests that person with

the property right, as of the date that the

land came under the protection of

section 522(e) of the Act and 30 CFR

761.11, to conduct the type of surface

coal mining operations intended.

Interpretation of the comments relied

upon to establish these rights must be

based upon applicable State statutory or

case law, or, if no applicable law exists,

upon custom and generally accepted

usage at the time and place that the

documents came into existence.

This provision, which originally

appeared in the 1979 definition but was

deleted in 1983 without explanation,

should ensure consistency with section

510(b)(6)(C) of SMCRA, which provides

that ‘‘the surface-subsurface legal

relationship shall be determined in

accordance with State law,’’ and with

the legislative history of the Act, which

indicates that Congress did not intend to

enlarge or diminish property rights

under State law. See H.R. Conf. Rep. No.

493, 95th Cong. 1st Sess. 106 (1977);

H.R. Rep. No. 218, 95th Cong. 1st Sess.

95 (1977); and S. Rep. No. 128, 95th

Cong. 1st Sess. 94–95 (1977). The

legislative history frequently references

United States v. Polino, 131 F. Supp.

772 N.D. W.Va. 1955), in which the

court held that the right to use surface

mining methods to recover privately

owned coal underlying Federal lands

within the Monongahela National Forest

depends upon the language of the deed,

the interpretation of which is a matter

of State law.

The property rights demonstration

requirement being proposed today

differs slightly from the 1979 rule. First,

it incorporates the concept of

continually created VER, which means

that the property rights must be vested

as of the date that the land comes under

the protection of the Act. In some cases,

this date may be later than the date of

enactment of SMCRA (August 3, 1977),

which is the date referenced in the 1979

rule. The proposed change recognizes

that houses, churches, roads, parks, and

other features protected by section

522(e) come into existence and are

expanded on an ongoing basis. Because

the protection of section 522(e) is not

limited to those features in existence on

the date of enactment, VER for lands

coming under the protection of the Act

after the date of enactment should not

be limited to property rights in

existence on the date of enactment.

Second, the proposed rule no longer

limits eligible property rights to the

right to produce coal. Property rights

(and hence VER) may exist for (1)

surface coal mining operations such as

coal preparation plants and coal mine

waste disposal sites that do not involve

coal extraction, and (2) non-extractive

activities, facilities, and surface

disturbances (such as support facilities,

ventilation shafts, and topsoil storage

areas) associated with coal-producing

surface coal mining operations.

As in the 1979 rule, the property

rights demonstration requirement does

not necessarily apply to roads. VER

standards for roads are set forth in

paragraph (b) of the proposed definition.
4844 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

4. Good Faith/All Permits Standard

In addition to the property rights

demonstration, the proposed definition

requires that a person claiming VER for

surface coal mining operations other

than roads meet either the good faith/all

permits standard of paragraph (a)(1) or

the need for and adjacent standard of

paragraph (a)(2), which is discussed at

length under a subsequent heading in

this preamble.

The good faith/all permits standard

provides that a person has VER if, prior

to the date the land came under the

protection of 30 CFR 761.11 and section

522(e) of the Act, that person or a

predecessor in interest had obtained, or

made a good faith effort to obtain, all

State and Federal permits and other

authorizations required to conduct

surface coal mining operations.

Potentially necessary permits and

authorizations include, but are not

limited to, State mining permits,

National Pollutant Discharge

Elimination System (NYDES) permits,

U.S. Forest Service special use permits,

air quality plan approvals, U.S. Mine

Safety and Health Administration

ground control plan approvals, and (for

some types of facilities) building

permits and zoning charges. Expired or

lapsed permits or authorizations are not

acceptable. If no permits were required

prior to the enactment of SMCRA, none

are needed to establish VER, provided

the person obtained, or made a good

faith attempt to obtain, all necessary

authorizations to operate from all

appropriate State and Federal agencies

by the pertinent date. See the

Greenwood Land and Mining Company

and Mower Lumber Company VER

determinations at 46 FR 36758 and 45

FR 52467, respectively.

OSM believes that the good faith/all

permits standard is the standard most

consistent with the legislative history of

section 522(e), which indicates that

Congress’ purpose in enacting section

522(e) was to prevent new surface coal

mining operations in the listed areas,

either to protect human health, safety,

and general welfare or because the

environment values and other features

associated with these areas are generally

incompatible with surface coal mining

operations. See S. Rep. No. 128, 95th

Cong. 1st Sess. 94 (1977). The two other

principal potential standards (the

takings standard and the ownership and

authority to mine standard) would be

either far more complex and difficult to

administer (the takings standard) or

much less protective of the areas listed

in section 522(e) (the ownership and

authority to mine standard).

Almost all commenters from every

interest group opposed the takings

standard when OSM first formally

proposed it in 1991. In particular, they

objected to its subjective or

unpredictable nature and the potentially

onerous information collection and

analytical burdens it would place on

persons seeking a VER determination

and the agency making the

determination. The ownership and

authority to mine standard arguably

would be less complex and more

objective than the takings standard, but

it would offer no protection to section

522(e) lands beyond that afforded by the

right-of-entry provisions of the

permitting requirements applicable to

surface coal mining and reclamation

operations on all lands. Such a result

most likely would not be in accordance

with congressional intent in enacting

the prohibitions of sections 522(e). See

S. Rep. No. 128, 95th Cong. 1st Sess. 94

(1977).

OSM recognizes that the U.S. Court of

Appeals for the District of Columbia

Circuit found that the legislative history

of SMCRA suggests that ‘‘Congress did

not intend to infringe on valid property

rights or effect takings through section

522(e).’’ Nat’l Wildlife Fed’n v. Hodel,

839 F.2d 694, 750 (D.D.C. 1988)

(‘‘NWF’’). However, OSM does not

believe that this statement militates

against adoption of a good faith/all

permits standard for VER. As discussed

at length in the portion of this preamble

entitled ‘‘Statutory and Regulatory

History,’’ in PSMRL I, ROUND I, supra,

at 14 ERC 1091, the court declined to

find the closely related 1979 all permits

standard unconstitutional. The

definition being proposed today is

consistent with that court’s decision

that ‘‘a good faith attempt to have

obtained all permits before the August

3, 1977 cut-off date should suffice for

meeting the all permits test.’’

Furthermore, in Hodel v. Virginia

Surface Mining & Reclamation Ass’n,

452 U.S. 264, 296 n.37 (1981) (‘‘Hodel’’),

the U.S. Supreme Court stated that,

while nothing in the statutory language

of SMCRA or its legislative history

would compel adoption of an all

permits standard for VER, section 522(e)

‘‘does not, on its face, deprive owners of

land within its reach of economically

viable use of their land since it does not

proscribe nonmining uses of such land.’’

There is nothing in court decisions to

date, the statute, or the legislative

history that would preclude OSM from

exercising its discretion to adopt a good

faith/all permits standard for VER under

section 522(e).

Section 522(e) is a form of land use

regulation that may be considered

analogous to certain provisions of

zoning law. VER under section 522(e) is

generally analogous to those provisions

of land use laws that define when a

person attains a vested right to a

particular land use regardless of

subsequent changes in zoning

ordinances that would otherwise

prohibit or restrict that use. State laws

vary widely with respect to when a

person develops a vested interest in a

particular land use, but mere ownership

is rarely sufficient. Some States require

that a person both obtain all necessary

permits and make significant

expenditures in reliance on those

permits. Others require that a person

reach a certain point in the permit

process or make substantial good faith

expenditures based on the existing

zoning before he or she develops a

vested interest in uses allowed under

that zoning.

The good faith/all permits standard

for VER has a similar effect and is based

in part on a similar rationale. Therefore,

OSM anticipates that, in any review of

the validity of a final VER standard, a

court would consider principles

analogous to those that have guided

judicial decisions on challenges to the

validity of zoning ordinances and

similar land use regulatory provisions.

In general, the courts have upheld land

use restrictions as a legitimate exercise

of the police power under the U.S.

Constitution.

In making VER determinations, OSM

and 20 of the 24 States with primacy

rely upon a VER definition that includes

either the all permits standard or the

good faith/all permits standard. Apart

from the Belville litigation and The

Sunday Creek Coal Co. v. Hodel, No. C–

2–88–0416 (S.D. Ohio, June 2, 1988)

(‘‘Sunday Creek’’), OSM is aware of no

cases in which the State or Federal

courts have found that the good faith/all

permits standard or an agency

determination that a person did not

have VER under the good faith/all

permits standard was invalid on the

basis of a conclusion that the standard

or determination would result in a

compensable taking of a property

interest under the Fifth and Fourteenth

Amendments to the U.S. Constitution.

Belville and Sunday Creek are isolated

cases that do not establish precedent

outside the Southern District of Ohio.

OSM believes that the good faith/all

permits standard proposed in this rule

is both reasonable and consistent with

congressional intent. As discussed

above, there is a lack of clear or directly

applicable legislative history with

respect to how Congress intended the

VER exemption in section 522(e) of the

Act to be interpreted. In the absence of
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such guidance or direction, the good

faith/all permits standard would

balance a number of statutory purposes

and policy objectives for this

rulemaking, including ensuring basic

fairness, establishing a reasonable

standard that is practicable to

administer, providing substantial

environmental protection to

congressionally designated areas,

encouraging efficient removal of coal

resources, minimizing disruption of

existing State regulatory programs and

expectations engendered thereunder,

and avoiding across-the-board or

indiscriminate compensable takings of

property interests.

5. ‘‘Needed for and Adjacent’’ Standard

The ‘‘needed for and adjacent’’

standard in the definition of VER

promulgated on March 13, 1979 (44 FR

14902, 15342) provided that any person

who owned an ongoing surface coal

mining operation for which all permits

were obtained prior to August 3, 1977,

possessed VER for coal immediately

adjacent to that operation if the person

had a property right to the coal as of

August 3, 1977, and if he or she could

demonstrate that the coal was needed

for the ongoing operation. The National

Wildlife Federation challenged this

standard as unduly expanding the scope

of the VER exemption beyond that

intended by Congress. However, the

court upheld the standard, finding it to

be ‘‘a rational method of allowing

mining when denial would gravely

diminish the value of the entire mining

operation, thereby constituting a taking

under Supreme Court declarations.’’

PSMRL I, Round I, 14 ERC 1083, 1091–

92 (D.D.C. 1980).

The revised definition of VER

promulgated on September 14, 1983 (48

FR 41315–16) modified the ‘‘needed for

and adjacent’’ standard by deleting the

requirement that the owner of the

operation have acquired the property

rights to the coal for which the

exemption is sought prior to August 3,

1977 (although OSM’s response to a

comment concerning this issue at 48 FR

41316 suggests that the deletion may

have been unintentional). In that

rulemaking, OSM also defined ‘‘needed

for’’ as meaning that the extension of

mining to the coal in question is

essential to make the surface coal

mining operation as a whole

economically viable.

The National Wildlife Federation

challenged these changes as being both

procedurally and substantively

improper. The U.S. District Court for the

District of Columbia agreed in part,

finding that the agency had failed to

comply with the Administrative

Procedure Act (5 U.S.C. 553) by not

affording the public adequate notice and

opportunity for comment on these two

changes. The court did not rule on the

merits of the revised standard. PSMRL

II, Round III–VER, 22 ERC 1566–67. In

response, on November 20, 1986 (51 FR

41952, 41961), OSM suspended

paragraph (c) of the 1983 definition of

VER. In the preamble to the suspension

notice, OSM stated that, pending

adoption of a new rule, it would rely

upon the approved State program

definition in primacy States. In nonprimacy States, the suspension had the

effect of restoring the 1979 version of

the needed for and adjacent standard,

which did not contain a definition of

‘‘needed for.’’ 51 FR 41954–55,

November 20, 1986.

On July 18, 1991, OSM proposed to

revise the 1983 definition by reinstating

the property rights ownership

requirement and removing the sentence

defining the ‘‘needed for’’ component of

the standard. In the preamble to this

proposed rule, OSM stated that the

explanation of ‘‘needed for’’ in the 1983

definition did not substantively clarify

the meaning or application of the

needed for and adjacent standard. In

addition, OSM proposed to replace the

requirement that both the property

rights and the operation have been in

existence on August 3, 1977, with a

requirement that both have been in

existence on the date that the land for

which the exemption is sought came

under the protection of 30 CFR 761.11

and section 522(e) of the Act. The latter

change reflects the concept of

continually created VER, which was

upheld in NWF, supra, 839 F.2d 694,

750.

With two significant exceptions, the

definition being proposed today

substantively resembles the one

proposed on July 18, 1991. One change

clarifies that the standard applies to

land, not just coal, needed for an

existing operation. Land may be

essential to the operation for reasons

other than the coal it contains. For

example, an operator has little leeway in

the location of ventilation shafts for

underground mines.

Also, OSM has attempted to eliminate

any ambiguity caused by use of the term

‘‘ongoing surface coal mining

operation’’ in the 1979 and 1983 rules.

In 1991, OSM essentially proposed to

replace ‘‘ongoing’’ with ‘‘existing.’’

However, comments received indicated

some uncertainty as to whether this

term included inactive or approved but

unstarted operations. OSM believes that

there is no rational basis for

differentiating between active

operations and those which are inactive

or approved but unstarted. Both

engender the same type of investmentbacked expectations and rely upon the

same economic planning

considerations. Both also require a

significant resource outlay. Accordingly,

OSM is now proposing to define this

standard to include land needed for and

adjacent to operations for which all

permits had been obtained, or a good

faith effort to obtain such permits had

been made, as of the date the section

522(e) prohibitions became applicable

to the land in question.

Under the revised needed for and

adjacent standard being proposed today,

VER would exist if a person can (1)

make the property rights demonstration

required by paragraph (a) of the

definition, and (2) document that the

land is both needed for and immediately

adjacent to a surface coal mining

operation for which all State and

Federal permits and other

authorizations required to conduct

surface coal mining operations had been

obtained, or a good faith effort to obtain

all necessary permits and authorizations

had been made, prior to the date the

land came under the protection of

section 522(e) and 30 CFR 761.11. OSM

does not intend for this standard to

authorize surface coal mining

operations on bond forfeiture sites, sites

with expired or revoked permits

(including permits that have expired

under section 506(c) of SMCRA),

abandoned sites, or long-dormant

facilities for which no permit was

required prior to the enactment of

SMCRA and which would have to be

substantially or completely

reconstructed before usage could

resume.

To avoid subverting the congressional

prohibitions in section 522(e), OSM

believes that VER determinations under

this standard must be based on an

analysis of how denial of the claim

would affect the value, as of the date the

land came under the protection of 30

CFR 761.11 and section 522(e), of the

operation as a whole from the time it

began operation, not merely whether the

additional land or coal would prolong

the operation’s life or provide increased

profits. Otherwise, this standard could

be used to justify unlimited expansion

of operations adjoining protected areas,

which could effectively nullify the

prohibition. This approach receives

implied support in PSMRL I, ROUND I,

14 ERC 1083, 1091–92, in which the

court upheld the needed for and

adjacent standard as a reasonable means

of avoiding compensable takings. OSM

seeks comment on whether the rule

language should be revised to explicitly

incorporate this interpretation.
4846 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

6. VER for Access and Haul Roads

As in 1991, OSM is proposing to

revise paragraph (b) of the definition of

VER to incorporate the concept of

continually created VER, which was

previously promulgated as paragraph (d)

of the September 14, 1983 definition

and upheld in subsequent litigation.

The revised definition would recognize

VER for the use or construction of an

access or haul road as part of a surface

coal mining operation if (1) the road was

in existence on the date the land upon

which it is located came under the

protection of section 522(e), (2) a right

of way or easement for the road was

properly recorded as of that date, (3) the

regulatory authority had issued a permit

for an access or haul road in that

location as of the applicable date, or (4)

the person can demonstrate the

existence of VER under the standards of

paragraph (a) of the definition. The last

alternative is a new addition intended to

clarify that, because the definition of

surface coal mining operations in 30

CFR 700.5 includes access and haul

roads, a person may also demonstrate

VER for such roads using the same

criteria applicable to other types of

surface coal mining operations and

activities.

OSM also is proposing to expand the

scope of paragraph (b) to apply to access

roads. Previous versions of this

definition have applied only to haul

roads. None of the earlier preambles

explains why access roads were not

included, but a reading of the 1979

preamble suggests that this failure may

have been an accidental by-product of

the fact that the comments received

focused exclusively on haul roads. That

preamble sets forth the following

rationale for allowing existing roads to

be used as haul roads, regardless of

location or prior use:

OSM believes that it is less damaging [to

the environment] to use existing roads,

whether or not previously used for coal

haulage, than to require construction of

additional roads. Therefore, all roads in

existence as of August 3, 1977, have valid

existing rights.

44 FR 14993, March 13, 1979.

This line of reasoning would apply

equally well to the use of existing roads

as access roads—perhaps more so, since

roads used solely for access generally

involve less massive construction

impacts and are usually used less

intensively than haul roads.

Consequently, the environmental

impacts of access roads are usually less

severe than those associated with haul

roads, which often carry heavy truck

and equipment traffic resulting in

significant noise, dust, vibration, and

other problems. In addition, permits and

recorded rights of way for access roads

are no less legitimate than permits and

recorded rights of way for haul roads.

Accordingly, OSM is proposing to apply

the standards of paragraph (b) to both

access and haul roads.

7. Transferability of VER

As in 1991, OSM is proposing to

reaffirm that VER are transferable,

primarily because the proposed

definition of VER includes a property

rights component. In essence, OSM is

proposing to consider VER as being

attached to the property to which those

rights pertain rather than as being valid

only for the person claiming such rights

or, with the exception of VER under the

needed for and adjacent standard, for a

specific operation. (VER under the

needed for and adjacent standard would

attach jointly to both the property and

a specific surface coal mining

operation.) Once attached to the

property, VER would become subject to

whatever State property law exists

concerning rights of alienation as an

element of property ownership. SMCRA

(especially section 510(b)(6)) generally

defers to State property law.

The VER exemption is analogous to a

zoning variance, which, in the interest

of equity, allows an otherwise

prohibited use to occur under certain

fact-specific circumstances even though

that use was not in existence on the

land in question at the time the zoning

ordinance took effect. Like VER under

the proposed rule, zoning variances

typically convey with the title to the

property even if the rights conferred by

the variance have not been exercised.

However, the alienation or transfer of

property is not an absolute right. Certain

interests in real property, such as leases,

licenses or profits a prendre, may be

inherently nontransferable or of limited

transferability, either by their terms or

by operation of State law. If a person’s

coal property interests are of this nature,

then any VER resting on those interests

would also be nontransferable.

Furthermore, it is possible that a State

could designate VER under SMCRA as

nontransferable as a matter of law.

In the rule being published today,

OSM is proposing to reaffirm the

transferability of VER to the extent that

the underlying property rights are

transferable under State law. Therefore,

to the extent that State law allows the

sale or other transfer of the underlying

coal rights or other pertinent property

rights, a person with VER may sell or

transfer the VER to another person as an

appurtenance to the coal or other

property rights. Nothing in this rule is

intended to create rights that do not

already exist in State law or expand

upon those that do. Individual States

may prohibit VER transfers to the extent

that they have the authority to do so

under State law.

8. Continually Created VER: VER When

Prohibitions Come Into Effect After

August 3, 1977

On September 14, 1983, OSM added

paragraph (d) to the definition of VER to

address situations where the

prohibitions of section 522(e) become

applicable to a particular parcel after

August 3, 1977, the date of enactment of

SMCRA. This paragraph, which

introduced the concept of continually

created VER, provides that:

Where an area comes under the

protection of section 522(e) of the Act

after August 3, 1977, valid existing

rights shall be found if—

(1) On the date the protection comes

into existence, a validly authorized

surface coal mining operation exists on

that area; or

(2) The prohibition caused by section

522(e) of the Act, if applied to the

property interest that exists on the date

the protection comes into existence,

would effect a taking of the person’s

property which would entitle the person

to just compensation under the Fifth

and Fourteenth Amendments to the

United States Constitution.

Paragraph (d)(1) extends the existing

operation exemption to validly

authorized surface coal mining

operations in existence on the date the

land on which they are located comes

under the protection of section 522(e).

Paragraph (d)(2) was intended to extend

the VER exemption in a parallel manner

to situations in which operations were

not yet in existence when the land came

under the protection of section 522(e).

In PSMRL II, Round III–VER, the court

upheld the basic concept of continually

created VER, but remanded paragraph

(d)(2) because it incorporated the

takings standard, which, the court ruled,

had not been subject to proper notice

and opportunity for comment under the

Administrative Procedure Act. 22 ERC

1564. To comply with the court’s

decision, OSM subsequently suspended

paragraph (d)(2) to the extent that it

incorporated the takings standard. 51 FR

41961, November 20, 1986.

The VER definitions proposed on

December 27, 1988, and July 18, 1991,

would have deleted paragraph (d) in

favor of incorporating the concept of

continually created VER into each of the

VER standards set forth in the other

paragraphs of the definition. However,

this change would have had the effect

of eliminating continually created VER

for existing operations since the
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4847

proposed definitions included no

counterpart to paragraph (d)(1) of the

1983 definition. This clearly was not the

intent of the proposed rules. As stated

in the preamble to the 1991 proposal,

although the continually created VER

provision adopted in 1983 ‘‘is rewritten

and reorganized in this proposal, the

basic intent and application are not

changed.’’ 56 FR 33156, July 18, 1991.

Therefore, although the definition of

VER being proposed today is similar to

the 1991 proposal in that the concept of

continually created VER has been

incorporated into each of the individual

VER standards in paragraphs (a) and (b)

of the definition, OSM also is proposing

to revise the existing operation

exemption, now proposed for

recodification as 30 CFR 761.11(b), to

incorporate language consistent with

paragraph (d)(1) of the 1983 definition.

Specifically, proposed 30 CRF 761.11(b)

provides that the prohibitions of 30 CFR

761.11(a) do not apply to (1) surface

coal mining operations for which a valid

permanent program permit exists on the

date that the land came under the

protection of 30 CFR 761.11(a) or

section 522(e) of SMCRA, or (2) other

surface coal mining operations that were

validly authorized as of that date.

Further discussion of this proposed

change appears in Part III.E.1. of this

preamble, which addresses the

proposed revisions to 30 CFR 761.11

with respect to the existing operation

exemption.

D. Section 761.5: Definition of ‘‘Surface

Coal Mining Operations Which Exist on

the Date of Enactment’’

In a nonsubstantive editorial change,

OSM is proposing to remove the term

‘‘surface coal mining operations which

exist on the date of enactment’’ and its

definition from 30 CFR 761.5.

Application of the concept of

continually created VER to the existing

operation exemption will render this

term obsolete. Two variations of this

term appear in the current versions of

30 CFR 761.12(h) and the introduction

to 30 CFR 761.11, but they are not used

in the revised version of Part 761 being

proposed today.

E. Section 761.11: Areas Where Mining

Is Prohibited or Limited

OSM is proposing to reorganize and

revise this section for clarity and

consistency with revisions to other

sections of 30 CFR Part 761. Except as

discussed below, no substantive

changes in meaning are intended.

1. Existing Operation Exemption

As discussed in the portion of this

preamble addressing continually crated

VER, OSM is proposing to recodify

paragraph (d)(1) of the 1983 definition

of VER, which establishes continually

created VER for operations in existence

on the date that land comes under the

protection of section 522(e) after August

3, 1977, as part of the existing operation

exemption. In addition, because several

commenters on the 1991 proposal

reflected confusion over the scope of the

current existing operation exemption,

OSM is proposing to adopt clarifying

language. To accommodate these

changes, OSM is proposing to move the

exemption from the introductory

portion of 30 CFR 761.11 to a separate

paragraph (b) within the section.

Proposed 30 CFR 761.11(b) provides

that the prohibitions of 30 CFR

761.11(a) do not apply to surface coal

mining operations for which a valid

permanent regulatory program permit is

in existence on the date that the land

comes under the protection of 30 CFR

761.11(a) or section 522(e) of the Act. To

address situations in existence before

completion of the transition between the

initial and permanent regulatory

programs, the rule further specifies that

the exemption includes all other validly

authorized operations in existence as of

that date, although this provision has no

prospective applicability apart from the

one remaining active initial program

mine. Illegal (‘‘wildcat’’) operations and

operations for which the permit has

expired or been revoked do not qualify.

In all cases, the proposed rule limits

the scope of the exemption to lands for

which the permittee or operator had the

right under State property law, as

demonstrated in accordance with 30

CFR 778.15, to enter and conduct

surface coal mining operations as of the

date the land in question came under

the protection of 30 CFR 761.11(a) or

section 522(e) of SMCRA. By limiting

the existing operation exemption in this

fashion, the proposed rule effectively

requires that the permittee seek and

obtain a VER determination before

initiating surface coal mining operations

on any lands within the permit area for

which no right of entry has been

obtained as of the date the land comes

under the protection of section 522(e).

This additional step should ensure that

the permittee demonstrates possession

of the necessary property rights,

including, when appropriate, a knowing

waiver from the owner of the protected

feature in accordance with 30 CFR

761.11(a) (2), (3), (4), or (5), before

initiating surface coal mining operations

in a protected area.

On-site activity or physical

disturbance of the protected land is not

a prerequisite for the exemption. This

interpretation is consistent with the

underlying language in section 522(e),

which exempts surface coal mining

operations ‘‘which exist on the date of

enactment of this Act.’’ Nothing in the

term ‘‘exist’’ requires on-site activity or

physical disturbance. In addition, this

interpretation is consistent with the

language of section 522(a)(6), which

enumerates lands exempt from

designation as unsuitable for mining

and which the legislative history also

characterizes as an existing operation

exemption. Specifically, section

522(a)(6) exempts all ‘‘lands on which

surface coal mining operations are being

conducted on the date of enactment of

this Act or under a permit issued

pursuant to this Act * * *.’’ The

legislative history of this provision

states that ‘‘an existing mine might not

be one actually producing coal.’’ H.R.

Rep. No. 218, 95th Cong. 1st Sess. 94–

95 (1977).

The proposed rule is consistent with

the language of paragraph (d)(1) of the

1983 VER definition, its preamble, and

the rationale used by the courts in

upholding the concept of continually

created VER. In particular, the 1983

preamble states that paragraph (d)(1)

was intended to prevent the disruption

of mining or deprivation of the right to

mine after the permittee made the

substantial investments required to

obtain a permit. By way of explanation,

the preamble stated that to do otherwise

would be totally inconsistent with the

framework of protection that SMCRA

provides to both permittees and

citizens:

Without the protection provided by this

provision, it would be possible, for instance,

for a person who objected to a mining

operation to move a mobile home to the edge

of the property adjoining a mine, and occupy

it, thereby forcing the operator to cease all

operations within 300 feet of this occupied

dwelling. OSM does not believe that this is

the intended result of section 522(e) of the

Act. Congress provided the public ample

opportunity to review and make objections to

any proposed mining operation through the

permitting process. The regulatory authority

is required to seek and consider the views of

the public [before] it issues or denies a

permit. To allow any person the opportunity

to take extraordinary means to disrupt

mining or deprive the operator of a right to

mine after the operator has made the

substantial investments required to obtain a

permit and begin operations is totally

inconsistent with the framework of

protection the Act gives to both operators and

citizens.

48 FR 41315, September 14, 1983.

OSM has adhered to these principles

in developing the proposed rule.

In upholding paragraph (d)(1) of the

1983 definition, the U.S. Court of

Appeals for the District of Columbia
4848 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

Circuit relied primarily on language in

the legislative history of section 522

indicating that Congress intended to

allow the continuance of mines already

in existence at the time land is

determined to be unsuitable for mining.

The court held that this rule ‘‘should

apply equally to mines in existence as

of August 3, 1977, or to mines

subsequently started on lands which

have permits approved for mining.’’

NWF, supra, 839 F.2d 694, 750. The

court rules that the operative principle

in determining whether an operation is

exempt from the section 522(e)

prohibitions is whether it had been

‘‘lawfully established’’ before the land

came under the protection of section

522(e).

The rule being proposed today would

consider an operation to be lawfully

established upon issuance of a

permanent program permit for lands for

which the permittee has procured the

necessary right of entry under 30 CFR

778.15. This approach is consistent with

30 CFR 774.13, which provides that the

regulatory authority cannot summarily

revise or revoke an approved permanent

program permit. Therefore, when lands

within an approved permanent program

permit come under the protection of

section 522(e) after permit issuance, the

permittee would appear to have the

right to continue to operate on those

lands under the existing operation

exemption unless the regulatory

authority orders the permittee to revise

the permit to remove those lands from

the permit area in accordance with the

procedures and criteria of 30 CFR

774.13. If a person believes that a permit

has been improperly issued because a

protected feature came into existence

prior to rather than after permit

approval, he or she has the option of

either filing a timely challenge to

approval of the permit application or

submitting a complaint to the regulatory

authority. If the permit is ultimately

found to be defective, the regulatory

authority must require that the

permittee revise the permit in

accordance with 30 CFR 774.13.

With respect to initial program

operations (operations subject to

Subchapter B of 30 CFR Chapter VII)

and operations conducted prior to the

effective date of the initial regulatory

program, the existing operation

exemption includes all lands disturbed

by the operation as of the date the land

came under the protection of section

522(e) or 30 CFR 761.11(a). However,

except for one operation on Indian

lands, OSM and the States have

completed the repermitting of initial

program operations in accordance with

30 CFR 773.11 and section 502(d) of the

Act. All initial program surface coal

mining and reclamation operations on

non-Indian lands that were not

repermitted under the permanent

program (and thus remain subject to the

initial regulatory program) are now

abandoned, reclaimed, or in the process

of reclamation. Under 30 CFR 773.11(a),

no further coal removal or additional

site disturbance for purposes of

conducting surface coal mining

operations is permissible unless the

person first obtains a permanent

program permit.

The existing operation exemption is

similar to a nonconforming use

exemption under State zoning law in

that the right to use the site for a

nonconforming use (in this case, the

right to conduct surface coal mining

operations) is extinguished when the

use (in this case, the existing operation)

ceases. Any person seeking to repermit

the site of an abandoned or reclaimed

initial program operation must comply

with the prohibitions and restrictions of

30 CFR 761.11(a) as a prerequisite for

obtaining a permanent program permit.

Since all States with the potential for

coal production in the foreseeable future

now have either a State or Federal

regulatory program approved under

SMCRA, there will be no new surface

coal mining operations under the initial

regulatory program. Therefore, in effect,

both the existing and proposed rules

will be applied only to operations with

permanent program permits.

2. Removal of Paragraph (h)

As in 1991, OSM is proposing to

remove 30 CFR 761.11(h), which

provides that no coal exploration or

surface coal mining operations would be

licensed or permitted on Federal lands

within the National Park System, the

National Wildlife Refuge System, the

National System of Trails, the National

Wilderness Preservation System, the

Wild and Scenic Rivers System, or

National Recreation Areas unless

specifically authorized by acts of

Congress. OSM promulgated this

provision on September 14, 1983 (48 FR

41349), in response to numerous

comments from persons concerned that

mining or drilling would occur in

national parks and other areas protected

under section 522(e)(1) of the Act.

Industry subsequently challenged the

rule on both procedural and substantive

grounds. Upon review, the court

remanded the rule to the Secretary

because it found that he had failed to

provide adequate notice and

opportunity for comment under the

Administrative Procedure Act (5 U.S.C.

553). In its opinion, the court also noted

that there appeared to be no rational

basis for distinguishing between Federal

and non-Federal lands in this context

since section 522(e)(1) prohibits surface

coal mining operations on any lands

within the statutorily protected areas.

PSMRL II, Round III–VER, 22 ERC 1557,

1565 (D.D.C. 1985).

On November 20, 1986, OSM

suspended 30 CFR 761.11(h) to comply

with the court’s order (51 FR 41952,

41956). As a result of the suspension,

neither Federal nor private lands are

subject to the absolute prohibitions

found in 30 CFR 761.11(h).

On September 22, 1988, the

Department of the Interior issued a

policy statement setting forth the

actions the Department would take to

prevent surface coal mining operations

in section 522(e)(1) areas. This policy

statement, which was published in the

Federal Register at 53 FR 52384 on

December 27, 1988, in conjunction with

a previous proposed rule concerning

VER, remains in effect even though

OSM subsequently withdrew the

proposed rule on July 21, 1989. The

policy statement commits the

Department, subject to appropriation, to

use available authorities (including

exchange, negotiated purchase and

condemnation) to seek to acquire

mining rights within the areas listed in

30 CFR 761.11(h) whenever a person

attempts to exercise VER. The policy

applies to all lands within the

boundaries of the areas listed in section

522(e)(1), not just to Federal lands.

The policy statement will not, and is

not intended to, provide protection

equivalent to that afforded by 30 CFR

761.11(h). As the court noted in its

decision remaining paragraph (h), ‘‘an

absolute proscription on any mining,

permitting, licensing or exploration

within the 522(e)(1) protected areas

might run directly contrary to the

statute’s language that such

proscriptions are subject to VER.’’

PSMRL II, Round III–VER at 1565.

Accordingly, OSM believes that it

would be inappropriate to repromulgate

the prohibitions in paragraph (h). The

1988 policy statement expresses the

Secretary’s intent to acquire privately

held coal interests in areas of national

significance to the extent financial or

other resources are available to do so.

Any further commitment would, in

most cases, exceed the Secretary’s legal

authority since most land acquisition

actions are subject to congressional

authorization and appropriation.

F. Section 761.12: Coordination With

Permitting Process; Waiver

Requirements and Procedures

OSM is proposing only minor

revisions and editorial changes in
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4849

§ 761.12. These revisions include

correcting references to § 761.11, adding

a reference to newly proposed § 761.13,

combining existing paragraphs (a) and

(b)(1) and revising them for consistency

with § 761.11. In addition, to be

consistent with changes in terminology

adopted as part of the permitting rules

promulgated on September 28, 1983 (48

FR 44349), OSM is proposing to replace

the obsolete term ‘‘complete

application’’ in paragraph (a) with its

current equivalent, ‘‘administratively

complete application.’’

OSM also is proposing to revise

paragraph (a) to clarify that its

requirements apply to applications for

incidental and other boundary

revisions. Although OSM always has

interpreted the somewhat ambiguous

term ‘‘application for a surface coal

mining operation permit’’ in 30 CFR

761.12 as including applications for all

types of permit boundary revisions, this

change will remove any question as to

its meaning. Removal of this ambiguity

should enhance adherence to the

prohibitions of section 522(e) and 30

CFR 761.11(a).

As in 1991, OSM is proposing to

revise paragraph (c) to specify that

requests for the findings required prior

to the approval of surface coal mining

operations on Federal lands in national

forests may be submitted in advance of,

and separate from, the permit

application. OSM’s experience in the 18

years since the enactment of SMCRA

has shown that evaluation of the entire

permit application is not essential to

preparation of the requested findings.

However, in response to a concern

raised by the U.S. Environmental

Protection Agency about the 1991

proposal’s complete lack of information

requirements for such requests, OSM is

proposing to specify that the requester

remains responsible for submitting

sufficiently comprehensive information

about the nature and location of the

proposed operation to enable OSM and

other responsible parties to properly

evaluate the request and prepare

adequately documented findings.

In 1991, OSM proposed to add a new

paragraph (a)(1) to 30 CFR 761.12 to

establish information requirements for

requests for VER determinations.

However, section 761.12 pertains to

permitting requirements and

procedures. Because the rules being

proposed today (like the preambles to

both the 1983 final rule and the 1991

proposed rule) state that requests for

VER determinations may be submitted

and processed in advance of preparation

and submission of a permit application,

OSM is now proposing to place these

information requirements in a new

§ 761.13, which addresses only the

submission and processing of requests

for VER determinations. For the same

reason, OSM also is proposing to move

existing 30 CFR 761.12(h), the VER

determination appeal provisions

proposed as 30 CFR 761.12(i) in 1991,

and the sentence in existing 30 CFR

761.12(b)(2) that pertains to notification

of the National Park Service and the

U.S. Fish and Wildlife Service to the

new section.

G. Section 761.13: Submission and

Processing of Requests for Valid Existing

Rights Determinations

This proposed new section consists of

submission and documentation

requirements for requests for VER

determinations; notice, comment, public

participation, and decision

requirements for the processing of

requests for VER determinations; and

provisions for administrative and

judicial review of decisions on requests

for VER determinations. Major portions

of this section previously appeared in,

or were proposed in 1991 for addition

to, 30 CFR 761.12. Other portions were

added in response to comments

received on the 1991 proposed rule or

to provide consistency with rule

changes in other parts of 30 CFR

Chapter VII.

These requirements are intended to

provide the procedural framework

necessary to ensure that the prohibitions

of section 522(e) are fully and properly

implemented in the manner intended by

Congress. They also should ensure that

all affected persons receive equitable

treatment and have adequate notice and

opportunity to participate in the

decisionmaking process.

1. Paragraph (a): Which Agency Will

Process a Request for a VER

Determination?

Proposed 30 CFR 761.13(a) provides

that OSM will make all VER

determinations for Federal lands within

the boundaries of the areas listed in 30

CFR 761.11(a) (1) and (2), which

correspond to the areas listed in

paragraphs (e)(1) and (e)(2) of section

522 of SMCRA. VER determinations for

all other lands, including non-Federal

lands within the boundaries of the areas

listed in 30 CFR 761.11(a)(1), would be

the responsibility of the regulatory

authority.

These provisions are consistent with

the exiting and proposed Federal lands

regulations at 30 CFR 740.4(a)(4) and

745.13(o), which are discussed in Part

III.A. of this preamble.

Consistent with the proposed changes

to 740.11(g), the proposed rule also

specifies that the definition of VER in 30

CFR 761.5 applies to all VER

determinations for lands protected

under 30 CFR 761.11.(a)(1) or (2),

including non-Federal lands within the

boundaries of the areas listed in 30 CFR

761.11(a)(1), regardless of whether OSM

or the State is responsible for making

the determination. For all other lands,

both OSM and State regulatory

authorities must use the definition of

VER in the appropriate approved

regulatory program.

2. Paragraph (b): What Information Must

a Request for a VER Determination

Include?

Paragraph (b) of proposed 30 CFR

761.13 contains submission and content

requirements for requests for VER

determinations. These requirements are

primarily derived from provisions

proposed as 30 CFR 761.12(a)(1) on July

18, 1991, which, in turn, are similar to

guidelines set forth in the preamble to

the 1983 definition of VER. See 48 FR

41314, September 14, 1983. However,

because the proposed VER definition no

longer contains an explicit takings

standard, the proposed rule does not

include items pertinent only to that

standard. Other modifications are

intended to improve clarity, provide

additional specificity, and ensure that

the rule includes requirements pertinent

to each standard in the definition of

VER.

In keeping with the intent expressed

in the preambles to the 1983 final rule

(see 48 FR 41322, September 14, 1983)

and the 1991 proposed rule (see 56 FR

33161, July 18, 1991), proposed

paragraph (b) expressly states that a

request for a VER determination may be

submitted and decided in advance of

preparation and submission of a permit

application. Surface coal mining

operations may not always be

technically feasible, legally permissible,

or economically viable in the absence of

VER. Therefore, a requirement that

requests for VER determinations be

accompanied by a permit application

may be unreasonably burdensome in

that it could result in significant permit

application preparation expenditures

that would be futile if the agency

ultimately determines that the requester

does not have VER and consequently is

ineligible to receive a permit. This is

especially true of Federal lands within

the boundaries of the areas specified in

30 CFR 761.11(a)(1) and (2), for which

OSM has sole authority to process

requests for VER determinations even

when it is not the regulatory authority

responsible for reviewing permit

applications.

Nothing in the foregoing discussion

should be interpreted as meaning that
4850 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

States may not require that requests for

VER deteminations be accompanied by

a permit application. Sections 503 and

505 of SMCRA afford States

considerable discretionary authority to

adopt requirements that either have no

Federal counterparts or are more

stringent than their Federal counterparts

in achieving the requirements and

purposes of the Act. Furthermore, OSM

also reserves the right to require

submission of a permit application if

information in the application is needed

or useful in evaluating the request for a

VER determination.

The intent of the provision for

advance VER determinations is to allow

VER questions to be fully settled in

advance of permit application

preparation and review. Therefore, OSM

anticipates that advance VER

determinations would be subject to de

novo review during the permit

application review process only under

exceptional circumstances. Because the

proposed rule establishes notice,

comment, and public participation

reqirements for the submission and

processing of requests for VER

determinations, the lack of opportunity

for de novo review of VER

determinations when such

determinations are part of a subsequent

permit application would not abridge

violate the rights of citizens to

participate in the permitting process.

Circumstances that might justify

reconsideration of an advance VER

determination include, but are not

limited to, a material misrepresentation

of facts, discovery of new information

that significantly alters the basis of the

VER determination, or a substantial

change in the nature of the intended

operation (e.g., a switch from

underground mining methods to surface

mining techniques). If these

circumstances arise after permit

issuance, the regulatory authority

should, based upon written findings and

subject to administrative and judicial

review, order that the permit be revised

to correct any deficiencies. See 30 CFR

774.11 (b) and (c). However, a State

regulatory authority may not reconsider

or overturn a VER determination made

by OSM.

Because most of the VER standards for

roads do not include the property rights

component of paragraph (a) of the

definition of VER in § 761.5, proposed

30 CFR 761.13(b)(1) establishes special,

more limited information requirements

for requests for VER determinations for

coal mine roads. Specifically, if the

request is based on one of the standards

in paragraphs (b)(1) through (b)(3) of the

definition of VER in § 761.5, the

requester would have to submit

satisfactory documentation that (1) the

road was in existence on the date the

land upon which it is located came

under the protection of § 761.11, (2) a

right of way or easement for the road

was properly recorded as of the date the

land came under the protection of

§ 761.11, or (3) the regulatory authority

had issued a permit for the access or

haul road on the land in question as of

the date the land came under the

protection of § 761.11(a). If the request

is based on the standard in paragraph

(b)(4) of the definition of VER in § 761.5,

the requester would have to comply

with all other applicable information

requirements since paragraph (b)(4)

merely incorporates the standards of

paragraph (a) of the definition.

All other requests for VER

determinations would have to include

the information set forth in paragraphs

(b)(2) (i) through (vi) of proposed 30

CFR 761.13 to demonstrate compliance

with the property rights component of

paragraph (a) of the definition of VER in

§ 761.5. Specifically, these paragraphs

would require a legal description of the

land; complete documentation of the

character and extent of the requester’s

current interests in the surface and

mineral estates in question; a chain of

title and discussion of any title

instrument provisions concerning

mining or mining-related surface

disturbances or facilities; a description

of the nature and ownership of all

property rights for the surface or

mineral estates in question as of the date

the land came under the protection of

§ 761.11; and a description of the type

and extent of surface coal mining

operations planned, including the

intended method of mining and any

mining-related surface facilities, and an

explanation of how the planned

operations are consistent with State

property law. If the coal interests have

been severed from other property

interests and the surface estate is held

by a Federal agency, paragraph (b)(2)(v)

would require submission of a title

opinion or other official statement from

the Federal agency confirming that the

requester has a property right to conduct

the type of surface coal mining

operations intended. This requirement

is intended to ensure that the record is

adequate to determine whether a

property rights dispute exists.

Proposed 30 CFR 761.13(b)(2)(vii)

provides that, if the request is based on

the needed for and adjacent standard set

forth in paragraph (a)(2) of the

definition of VER in 30 CFR 761.5, the

requester must explain why and how

the coal is needed for the operation. As

several commenters noted in response

to the lack of a similar provision in the

1991 proposal, the agency will need this

information to make an informed

decision on the request.

Proposed 30 CFR 761.13(b)(2)(viii)

provides that, if the request is based on

the good faith/all permits standard set

forth in paragraph (a)(1) of the

definition of VER in 30 CFR 761.5, the

person making the request must submit

the application dates and identification

numbers and, if applicable, approval

and issuance dates and identification

numbers for any licenses, permits, or

authorizations for surface coal mining

operations on the land in question if

such licenses, permits, or authorizations

are or were held or applied for by the

requester or predecessor in interest as of

the date the land in question came

under the protection of 30 CFR 761.11.

Examples of relevant permits include

State or Federal surface or underground

coal mining permits, National Pollutant

Discharge Elimination System permits,

State air pollution control permits, and

U.S. Forest Service special use permits,

and (for some types of facilities such as

coal preparation plants and ventilation

housing for underground mines)

building permits and zoning approvals.

The agency will need this information

to make an informed decision on the

request.

3. Paragraph (c): How May the Public

Participate in the VER Determination

Process?

Because section 102(i) of SMCRA

provides that one of the purposes of the

Act is to assure that appropriate

procedures are provided for public

participation in the development and

enforcement of State and Federal

regulatory programs, OSM is proposing

to include notice and comment

requirements and provisions for public

participation in the VER determination

process, as suggested by several

commenters on the 1991 proposal. The

special protection Congress provided for

the lands listed in section 522(e) also

lends support to public participation in

the VER determination process.

With minor modifications, the notice

and comment requirements set forth in

proposed 30 CFR 761.13(c) parallel

those currently in use by OSM for VER

determinations as a matter of policy.

They also resemble the notice and

comment requirements for applications

for coal exploration permits under 30

CFR 772.12, which have been tailored to

minimize resource demands on affected

parties while maintaining consistency

with the statutory provisions

encouraging public participation.

Under the proposed rule, an agency

receiving a request for a VER

determination must publish a notice in
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4851

a newspaper of general circulation in

the county in which the land is located

inviting comment on whether the

request should be approved. Because of

the national significance of the areas

listed in 30 CFR 761.11(a) (1) and (2),

this notice also must appear in the

Federal Register if the request involves

Federal lands within the boundaries of

those areas. (Under proposed 30 CFR

761.13(a)(2), OSM would have sole

responsibility for making VER

determinations on those lands. Hence,

the Federal Register publication

requirement would not place any added

burden on State regulatory authorities.)

The notice must identify the applicable

VER standard, the location of the land

involved, the name and address of the

agency office to which comments

should be addressed, and the closing

date of the comment period, which must

be a sufficient amount of time after the

date of publication so as to afford

interested persons a reasonable

opportunity to prepare and submit

comments. It also must describe the

property rights claimed, the basis for the

claim, the type of surface coal mining

operations planned, and the procedures

the agency will follow in processing the

request.

If the land in question involves

severed estates or divided interests, the

proposed rule provides that the agency

must make a reasonable effort to locate

all owners of interest, both surface and

mineral, and provide them with a copy

of the notice. In addition, such

notification must be provided to the

owner of the structure or feature causing

the lands to come under the protection

of 30 CFR 761.11(a). These proposed

requirements are intended to provide

full protection for the listed lands

consistent with section 102(b) of

SMCRA, which states, that one of the

Act’s purposes is to ‘‘assure that the

rights of surface landowners and other

persons with a legal interest in the land

or appurtenances thereto are fully

protected from [surface coal mining]

operations.’’

Finally, in paragraph (c)(3), OSM is

proposing to provide that, whenever a

request for a VER determination

pertains to land within the boundaries

of an area under the protection of 30

CFR 761.11(a)(1) and section 522(e)(1),

the agency responsible for processing

the request must notify the agency with

jurisdiction over the protected land and

allow that agency 30 days from receipt

of the notification to respond. Upon

request, the agency responsible for the

VER determination must grant the

agency with jurisdiction over the

protected area an additional 30 days to

review and comment upon the request.

After that time, the agency responsible

for the VER determination would have

the right to make the determination in

accordance with proposed 30 CFR

761.13(d).

A similar requirement currently

appears in 30 CFR 761.12(b)(2), where it

applies only to lands within the

jurisdiction of the National Park Service

or the U.S. Fish and Wildlife Service.

OSM is proposing to extend the

consultation requirement to all lands

protected under 30 CFR 761.11(a)(1) and

section 522(e)(1) because there does not

appear to be a rational basis for limiting

it to lands under the jurisdiction of the

two agencies identified in the current

rule.

4. Paragraph (d): How Will a Decision

Be Made?

Paragraph (d) of proposed 30 CFR

761.13 specifies requirements pertinent

to the decisionmaking process for

requests for VER determinations. OSM

originally proposed a version of this

paragraph as part of 30 CFR 761.12(h)

on July 18, 1991 (56 FR 33162, 33165).

The rule being proposed today includes

additional language in response to

commenters’ concerns regarding public

participation issues and property rights

disputes.

Specifically, the proposed rule

provides that the agency responsible for

making the VER determination must

review the materials submitted with the

request, the information received during

the comment period, and any other

relevant available information to

determine whether the record is

adequate to support a decision in favor

of the requester. If not, the agency must

notify the requester in writing,

explaining the inadequacy of the record

and requesting submittal, within a

reasonable time, of any additional

information the agency deems necessary

to remedy the inadequacy. Upon receipt

of the requested information or other

explanation, the agency must determine

whether the requester has demonstrated

VER for the land in question.

In keeping with the intent of Congress

in enacting the prohibitions of section

522(e), the agency processing requests

for VER determinations has an

obligation to critically analyze such

requests to ensure that section 522(e) is

fully implemented and that new surface

coal mining operations in these areas

are prohibited except to the extent that

they qualify for one of the statutorily

authorized waivers or exemptions. The

proposed rules establish the procedural

requirements and decision criteria

needed to meet this obligation.

As currently proposed, 30 CFR

761.13(d)(2) includes a provision

requiring deferral of a decision on a

request for a VER determination if the

underlying property rights are in

dispute. The deferral would remain in

effect until the parties resolve the

dispute in the proper venue, which is

normally the State courts. To do

otherwise would constitute de facto

adjudication of the property rights

dispute in favor of one of the parties, a

result that would violate the prohibition

on such adjudication in section

510(b)(6)(C) of SMCRA. In addition,

deferral of a decision in situations

involving property rights disputes is

consistent with section 102(b) of

SMCRA, which states that one of the

Act’s purposes is to ‘‘assure that the

rights of surface landowners and other

persons with a legal interest in the land

or appurtenances thereto are fully

protected from [surface coal mining]

operations.’’

OSM does not interpret section

510(b)(6)(C) of SMCRA as requiring

deferral of a decision if there is only a

mere allegation of a property rights

dispute. For example, if the parties to

the alleged dispute are not diligently

pursuing resolution of the disagreement

in the proper venue, then, depending on

the facts of the case, the agency

processing the request for a VER

determination might reasonably

conclude that the lack of any serious

attempt to resolve the dispute means

that no bona fide dispute exists and,

therefore, that no deferral is necessary.

Finally, proposed 30 CFR 761.13(d)(3)

specifies that the decision document

must (1) explain how the requester has

or has not satisfied all applicable

elements of the definition of VER, (2) set

forth the relevant findings of fact and

conclusions, and (3) specify the reasons

for the conclusions. Under the proposed

rule, the agency must provide a copy of

the decision to the requester and the

owner of (or agency with jurisdiction

over) the area or feature that caused the

land to come under the protection of 30

CFR 761.11(a). The agency would also

have to publish notice of the decision in

a newspaper of general circulation in

the county in which the land is located.

When Federal lands within the areas

listed in 30 CFR 761.11(a) (1) or (2) are

involved. OSM would publish notice of

the decision in the Federal Register.

These requirements are similar to the

procedures OSM has followed in the

past to ensure adequate notice and

public participation in VER

determinations. OSM’s experience

indicates that the requirements are not

unduly burdensome and should afford

adequate notice and opportunity for

adversely affected parties to appeal the

decision. Federal Register publication
4852 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

of decisions on requests for VER

determinations affecting Federal lands

within the boundaries of the areas listed

in 30 CFR 761.11(a) (1) and (2) is

appropriate because these lands are of

national significance. Under proposed

30 CFR 761.13(d)(3)(ii), the Federal

Register publication requirement would

apply only to OSM and only to Federal

lands.

5. Paragraph (e): How May a

Determination Be Appealed?

Paragraph (e) provides that VER

determinations are subject to

administrative and judicial review

under 30 CFR 775.11 and 775.13, which

contain administrative and judicial

review requirements for permitting

decisions. With respect to VER

determinations, this provision is

substantively identical to both existing

30 CFR 761.12(h) and 30 CFR 761.12(i)

as proposed in 1991.

H. Section 772.12: Requirements for

Coal Exploration on Lands Unsuitable

for Surface Coal Mining

As promulgated on September 8,

1983, the regulations at 30 CFR Part 772

governing coal exploration require that

a person who intends to conduct any

type of coal exploration in areas

designated as unsuitable for surface coal

mining operations in 30 CFR 761.11(a)

and section 522(e) of SMCRA first

obtain a permit in accordance with 30

CFR 772.12. However, the 1983

regulations did not require a VER

demonstration either as a mandatory

component of the permit application or

as a prerequisite for permit approval or

issuance. On June 22, 1988 (53 FR

23532), OSM proposed to adopt a rule

that would have done so, but the final

rule promulgated on December 29, 1988

(53 FR 52942) did not include this

provision. Instead, the preamble to that

rule stated that OSM would reconsider

the issue of VER requirements for coal

exploration after promulgation of a new

definition of VER (53 FR 52945).

The National Wildlife Federation and

other groups challenged OSM’s failure

to adopt the proposed rule. Upon

judicial review, the U.S. District Court

for the District of Columbia held that

OSM had failed to articulate a proper

rationale for not adopting the proposed

rule. Nat’l Wildlife Fed’n versus Lujan,

Nos. 89–0504, 89–1221 and 89–1614,

slip op. at 25–33 (D.D.C. September 5,

1990). In response, on July 18, 1991 (56

FR 33152), OSM proposed to add

paragraph (b)(5) to 30 CFR 772.14 to

require a VER demonstration as a

prerequisite for approval of coal

exploration activities in which coal is to

be removed for sale or commercial use.

After considering the comments

received, OSM is withdrawing this

proposed change and is instead

proposing to add a new paragraph

(b)(14) to 30 CFR 772.12, the section

containing permitting requirements for

exploration that will remove more than

250 tons of coal or that will occur on

lands designated as unsuitable for

surface coal mining operations. Under

the proposed rule, a person planning to

conduct exploration on lands listed in

section 522(e) and 30 CFR 761.11(a)

would have to submit an application

that includes a demonstration that (1)

the exploration activities will not

substantially disturb the protected

lands, (2) the owner of the coal

possesses VER, (3) the exploration is

needed for mineral valuation purposes

or is authorized by judicial order, or (4)

the applicant has obtained a waiver or

exception in accordance with 30 CFR

761.12 (c) through (f).

Similarly, OSM is proposing to add a

new paragraph (d)(2)(iv) to 30 CFR

772.12 to provide that the regulatory

authority may not approve an

application for exploration unless it first

finds that the exploration activities

described in the application will not

substantially disturb any lands listed in

30 CFR 761.11(a). Alternatively, the

regulatory authority may find that the

applicant has (1) demonstrated VER in

accordance with 30 CFR 761.13, (2)

obtained one of the waivers or

exceptions authorized under 30 CFR

761.11(a) (2) through (5) in accordance

with 30 CFR 761.12 (c) through (f), or

(3) demonstrated that the exploration is

needed for mineral valuation purposes

or authorized by judicial order.

OSM recognizes that nothing in

SMCRA prohibits coal exploration on

lands designed as unsuitable for mining.

The rule changes being proposed today

do not ban exploration on any lands.

Instead, they merely restrict the

methods that may be used to conduct

exploration on lands protected under

section 522(e) of the Act or the potential

impact of exploration on those lands.

Section 512(a) of the Act provides

broad authority for the promulgation of

regulations governing coal exploration,

and section 201(c)(2) authorizes the

Secretary to ‘‘promulgate such rules and

regulations as may be necessary to carry

out the purposes and provisions of this

Act.’’ As discussed below, the rules

being proposed today will further the

purposes of section 522(e) of the Act.

Coal exploration involving substantial

disturbance can result in environmental

impacts similar in both nature and

extent to those resulting from surface

coal mining operations. The legislative

history of section 522(e) of the Act

indicates that Congress’ purpose in

enacting that section was to prevent

new surface coal mining operations in

the areas listed therein, either to protect

human health, safety, and general

welfare or because the environmental

values and other features associated

with these areas are generally

incompatible with surface coal mining

operations and their impacts. See S.

Rep. No. 128, 95th Cong., 1st Sess. 94

(1977). In this context, allowing coal

exploration that would result in similar

impacts appears generally incompatible

with congressional intent in the absence

of VER or a waiver or exception

authorized under section 522(e).

OSM recognizes that there may be

circumstances in which exploration

activities causing such impacts are

unavoidable. Specifically, coal

exploration involving substantial

disturbance (road construction to

provide access for a drill rig, for

example) may sometimes be necessary

for mineral valuation purposes or to

comply with a judicial order even when

there is no possibility of obtaining

approval to conduct surface coal mining

operations. Accordingly, the proposed

rules authorize approval of a coal

exploration permit under these

circumstances. However, all exploration

activities must be planned and

conducted in accordance with the

requirements and performance

standards of 30 CFR Parts 772 and 815,

which are designed to minimize adverse

environmental effects.

Under proposed 30 CFR

772.12(b)(14)(ii), the VER determination

requirements and procedures of 30 CFR

761.13(a) through (d) would apply to

requests for VER determinations sought

in connection with coal exploration. All

determinations would be subject to

administrative and judicial review in

accordance with 30 CFR 761.13(e). The

proposed prohibition of certain types of

coal exploration in the absence of VER

is intended to restrict the number of

situations in which exploration could

cause impacts similar to those that

would result from surface coal mining

operations. Specifically, it attempts to

limit such exploration to those lands for

which a person has the right to conduct

surface coal mining operations.

Therefore, OSM does not propose to

define VER in a different fashion or

differentiate procedurally between VER

determinations sought in connection

with plans to conduct surface coal

mining operations and those sought in

connection with plans to conduct coal

exploration, regardless of the purpose of

the exploration or type of mining

operations contemplated.
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4853

A VER determination obtained in

connection with an application for a

coal exploration permit would remain

valid for any subsequent application

seeking approval of a permit for surface

coal mining operations, provided the

type of surface coal mining operations

proposed in the application is

consistent with the type of operations

contemplated by the VER

determination.

OSM acknowledges that exploration

may sometimes be necessary to

determine the feasibility of using

underground mining methods to remove

the coal underlying section 522(e) areas.

Under current OSM policy, only surface

facilities associated with underground

operations are subject to the

prohibitions of section 522(e). If no

surface facilities are to be located on the

lands protected by section 522(e), a VER

determination is not a prerequisite for

approval of a permit for an underground

mine. For the reasons set forth above,

the proposed rule would nevertheless

require a VER determination as a

prerequisite for approval of exploration

in advance of such a mine if the

exploration would involve substantial

disturbance of the protected lands. This

requirement would apply regardless of

whether the person proposing the

exploration planned to construct any

surface facilities on the protected lands.

To protect the values for which

Congress designated certain lands as offlimits to surface coal mining operations,

the guiding principle in determining

whether a VER determination is needed

for exploration should be the nature of

the impacts of exploration on the

protected lands, not the type of mining

operation ultimately planned.

Furthermore, OSM believes that, in

most cases, the necessary exploration

activities can be conducted either on

adjacent lands or by using methods

(such as core drilling from existing

roads and pathways) that do not result

in substantial disturbance of the land

surface.

OSM also is considering revising 30

CFR Part 772 (or possibly Part 761 or

both) to include a provision similar to

30 CFR 762.14, which provides that the

regulatory authority has an obligation to

use the exploration permit application

review and approval process to ensure

that exploration activities will not

interfere with any of the values for

which the area has been designated

unsuitable for surface coal mining

operations. (Section 762.14 applies only

to lands designated unsuitable for

surface coal mining operations pursuant

to the petition process set forth in 30

CFR Part 762 and section 522(a) of the

Act.) OSM seeks comment on whether

this provision should be adopted either

in addition to or in place of the

proposed revisions to 30 CFR 772.12 set

forth in this rulemaking. As currently

proposed, the rules would not place

these restrictions on exploration if the

regulatory authority determines that a

person has VER or qualifies for one of

the other exemptions in 30 CFR

772.12(b)(14).

Finally, as a housekeeping measure,

OSM is proposing to revise 30 CFR

772.12(d)(2)(ii) and (iii) to correct a

citation to the Endangered Species Act

and to add a reference to the National

Historic Preservation Act Amendments

of 1992 in Public Law 102–575.

I. Effect in Federal Program States and

on Indian Lands

Through cross-referencing in the

respective regulatory programs, this

proposed rule would apply to all lands

in States with Federal regulatory

programs. States with Federal regulatory

programs include Arizona, California,

Georgia, Idaho, Massachusetts,

Michigan, North Carolina, Oregon,

Rhode Island, South Dakota, Tennessee,

and Washington. These programs are

codified at 30 CFR Parts 903, 905, 910,

912, 921, 922, 933, 937, 939, 941, 942,

and 947, respectively.

The proposed changes to 30 CFR Part

761 would apply to Indian lands by

virtue of the incorporation of this part

by reference in 30 CFR 750.14. The

proposed changes to 30 CFR Part 772

would apply to coal exploration on

Indian lands to the extent provided in

30 CFR 750.15.

In the preamble to the 1991 proposed

rule, OSM invited the public to

comment on whether there are unique

conditions in any Federal program

States or on Indian lands that should be

reflected in the national rules or as

specific amendments to the Federal

programs or Indian lands rules. Since no

commenters identified any unique

conditions or amendment needs, the

rules being proposed today do not

include any changes to the Indian lands

rules or individual Federal programs.

However, the public is again invited to

comment on whether any such changes

would be necessary if OSM adopts the

proposed rules.

J. Effect on State Programs

If the proposed rules are adopted,

OSM will evaluate State regulatory

programs approved under 30 CFR Part

732 and section 503 of the Act to

determine whether any changes in these

programs will be necessary to maintain

consistency with Federal requirements.

If the Director determines that a State

program provision needs to be amended

as a result of these revisions to the

Federal rules, he will notify the State in

accordance with 30 CFR 732.17.

In the preamble to the 1991 proposed

rule, OSM solicited comments on

whether State program VER definitions

must be amended to include standards

identical to those of the revised Federal

definition to be no less effective than

the revised Federal definition. 56 FR

33156, July 18, 1991. Because the

standards proposed today differ

somewhat from those proposed in 1991,

OSM once again invites comment on the

need for revision of State program

definitions of VER if the definition in 30

CFR 761.5 is adopted as proposed. OSM

particularly seeks comment on whether

those States with an approved takings

standard should be required to remove

this standard or whether the rationale

OSM relied upon to approve the takings

standard in the Illinois definition

remains valid. (See 30 CFR 917.15(j) and

54 FR 123, January 4, 1989.) In other

words, may the takings standard be

considered no less effective than the

good faith/all permits standard in

achieving the purposes and

requirements of the Act even though it

balances the purposes in a different

manner with potentially different

results?

IV. Procedural Matters

A. Federal Paperwork Reduction Act

In accordance with 44 U.S.C. 3507(d),

OSM has submitted the information

collection and recordkeeping

requirements of 30 CFR Parts 761 and

772 to the Office of Management and

Budget (OMB) for review and approval.

30 CFR Part 761

Title: Areas designated by Act of

Congress.

OMB Control Number: 1029–0102.

Abstract: Part 761 includes criteria

and procedural requirements for

waivers and exemptions (including the

VER and existing operating exemptions)

from the prohibition on conducting

surface coal mining operations in the

areas specified in section 522(e) of

SMCRA. This part identifies the

documentation persons need to provide

to demonstrate possession of or

eligibility for a waiver or exemption. It

also establishes review and notification

requirements and decision criteria for

the agency responsible for making

decisions on requests for VER

determinations.

Need for and Use: OSM and State

regulatory authorities use the

information collected under 30 CFR Part

761 to ensure that persons planning to

conduct surface have the right to do so
4854 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

under one of the exemptions or waivers

provided by this section of the Act.

Respondents: Persons who prepare

the approximately 475 applications for

permits for surface coal mining

operations that OSM and State

regulatory authorities receive each year,

and the 24 State regulatory authorities

who must evaluate the validity of

waiver and exemption claims and

requests for VER determinations that

accompany or precede these

applications.

Total Annual Burden: OSM estimates

that a person will need an average of 6

hours to prepare each request for a VER

determination under 30 CFR 761.13.

The agency responsible for processing

the request will require an average of 8

hours to comply with the information

collection requirements of these section,

resulting in an average total burden of

14 hours for each request. Under 30 CFR

761.12, preparation and processing of

requests for other types of exemptions

and waivers will require an average of

2 hours per request. The estimated total

annual burden for part 761 is 2,366

hours.

30 CFR PART 772

Title: Requirements for coal

exploration.

OMB Control Number: 1029–0033.

Abstract: Section 512 of SMCRA

provides that persons conducting coal

exploration on non-Federal lands must

comply with exploration regulations

issued by the regulatory authority.

Section 512(d) of the Act requires a

permit and the prior approval of the

regulatory authority for exploration

removing more than 250 tons of coal; 30

CFR Part 772 extends this requirement

to all exploration on lands designated as

unsuitable for surface coal mining

operations. For all other types of

exploration, the Act and regulations

require submission of a notice of intent

to explore. The regulations in 30 CFR

Part 772 establish content requirements

for notices of intent, content and

processing requirements for

applications for coal exploration

permits, and recordkeeping

requirements for regulatory authorities.

Need For and Use: OSM and State

regulatory authorities use the

information collected under 30 CFR Part

772 to maintain knowledge of coal

exploration activities, evaluate the need

for an exploration permit, and ensure

that exploration activities comply with

the environmental protection and

reclamation requirements of 30 CFR

Parts 772 and 815 and section 512 of

SMCRA.

Respondents: Persons who prepare

the approximately 1,225 notices of

intent to explore and 4 applications for

coal exploration permits received each

year by OSM and State regulatory

authorities. Also, the 24 State regulatory

authorities that process notices of intent

and applications for exploration

permits.

Total Annual Burden: The estimated

annual burden for this part totals 13,354

hours, which translates to an

approximate burden of 11 hours for the

average notice of intent (10 hours to

prepare the notice and 1 hour for the

regulatory authority to review and file

it), and 104 hours for the average

application for a coal exploration permit

(70 hours to prepare the application and

34 hours for the regulatory authority to

process and file it). See 30 CFR 772.10

for a section-by-section burden

summary for this part.

Comments are invited on:

(a) Whether the proposed collection of

information is necessary for the proper

performance of OSM and State

regulatory authorities, including

whether the information will have

practical utility;

(b) The accuracy of OSM’s estimate of

the burden of the proposed collection of

information;

(c) Ways to enhance the quality,

utility, and clarity of the information to

be collected; and

(d) Ways to minimize the burden of

collection on the respondents.

Under the Paperwork Reduction Act,

OSM must obtain OMB approval of all

information and recordkeeping

requirements. No person is required to

respond to an information collection

request unless the form or regulation

requesting the information has a

currently valid OMB control (clearance)

number. These numbers appear in

section xxx.10 of 30 CFR Parts 710

through 955. To obtain a copy of OSM’s

information collection clearance

requests, explanatory information, and

related forms, contact John A. Trelease

at (202) 208–2783 or by e-mail at

jtreleas@osmre.gov.

By law, OMB must submit comments

to OSM within 60 days of publication of

this proposed rule, but may respond as

soon as 30 days after publication.

Therefore, to ensure consideration by

OMB, you must send comments

regarding these burden estimates or any

other aspect of these information

collection and recordkeeping

requirements by March 3, 1997, to the

Office of Management and Budget,

Office of Information and Regulatory

Affairs, Attention: Interior Desk Officer,

725 17th Street, NW, Washington, DC

20503. Please refer to OMB Control

Numbers 1029–0033 and 1029–0102 in

any correspondence.

B. Executive Order 12866

The proposed rule is a significant

regulatory action under section 3(f) of

Executive Order 12866. Accordingly,

OSM has prepared a cost/benefit

assessment (economic analysis) of the

rulemaking alternatives pursuant to

section 6(a)(3)(C) of the executive order.

C. Regulatory Flexibility Act

Pursuant to the Regulatory Flexibility

Act, 5 U.S.C. 601 et seq., the Department

of the Interior has determined that this

proposed rule would not have a

significant economic impact on a

substantial number of small entities. See

50 FR 13250 (April 3, 1985). A small

entity flexibility analysis has been

prepared and placed in the

administrative record of this

rulemaking.

D. Unfunded Mandates

For purposes of compliance with the

Unfunded Mandates Reform Act of

1995, this rule will not impose any

obligations that individually or

cumulatively would require an

aggregate expenditure of $100 million or

more by State, local, and Tribal

governments and the private sector in

any given year.

E. National Environmental Policy Act

(NEPA)

On April 3, 1985 (50 FR 13250), OSM

published a notice of intent to conduct

rulemaking on the applicability of the

section 522(e) prohibitions to

underground mining. On June 19, 1985

(50 FR 25473), OSM announced the

agency’s intent to prepare an

environmental impact statement (EIS)

pursuant to section 102(2)(C) of NEPA,

42 U.S.C. 4332(2)(C) for this rulemaking.

OSM held scoping meetings for the EIS

on August 1, 1985, in Pittsburgh,

Pennsylvania; August 6, 1985, in St.

Louis, Missouri; and on August 9, 1985,

in Washington, D.C. to obtain public

input. Written comments on the scope

of the EIS were accepted separately

through September 10, 1985.

Based on the comments received and

the March 22, 1985, decision in PSMRL

II, Round III–VER remanding the

definition of VER, OSM decided to

conduct a combined analysis of the

rulemaking alternatives for both VER

and the applicability of the section

522(e) prohibitions to underground

mining. OSM announced its intent in

another scoping notice published on

January 22, 1987 (52 FR 2421). OSM

also held a meeting on February 6, 1987,

to solicit further input on the

rulemaking alternatives and the scope of

the EIS from the public and potentially

affected Federal agencies. On February
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4855

23, 1987, OSM held another meeting to

receive testimony from environmental

groups and other organizations unable

to attend the earlier meeting.

On December 27, 1988 (53 FR 52374),

OSM published a draft EIS and

regulatory impact analysis concurrently

with a proposed rule addressing both

VER and the applicability of the

prohibitions to subsidence from

underground mining. On July 21, 1989

(54 FR 30557), OSM withdrew the

proposed rule.

On April 19, 1991 (56 FR 16111),

OSM published a revised draft EIS for

review and comment, followed by a new

proposed VER rule on July 18, 1991 (56

FR 33152) and, on the same date, a

notice of inquiry concerning the

applicability of the prohibitions to

underground mining.

OSM never finalized the VER rule,

electing instead to develop the new

proposed rule being published today.

On April 28, 1994 (59 FR 21996), OSM

published a notice of intent to prepare

a revised EIS analyzing both VER and

the applicability of the prohibitions to

underground mining. After analyzing

the comments received, OSM has

completed a new draft EIS (OSM–EIS–

29), which is now available to the

public for review and comment.

F. Executive Order 12630 (Takings)

In accordance with E.O. 12630 (March

18, 1988), and the ‘‘Attorney General’s

Guidelines For the Evaluation of Risk

and Avoidance of Unanticipated

Takings,’’ dated June 30, 1988, the

Department has prepared a takings

implication assessment, which has been

made a part of the administrative record

for this rulemaking, and is set forth

below:

Section 5221(e) of SMCRA provides

that, subject to VER (and with certain

other specified exceptions), no surface

coal mining operations shall be

permitted on certain lands designated

by Congress. As stated in the preceding

sections, the proposed rule defining

VER would establish a GFAP standard

for VER under section 522(e).

Under the GFAP standard, a person

would have VER if, prior to the date the

land came under the protection of

section 522(e), the person or a

predecessor in interest had all necessary

property rights and had obtained, or

made a good faith effort to obtain all

State and Federal permits and other

authorizations required to conduct

surface coal mining operations.

The proposed rule may have some

significant, but unquantifiable, takings

implications. OSM expects that the

proposed rule would not be found by a

court to constitute a per se taking, since

that issue was litigated in 1979–80.

1. No Per Se Takings

It is unlikely that the GFAP standard

would be determined to constitute a

taking per se. This standard is a

modification of the All Permits standard

adopted on March 13, 1979, which

required that a person demonstrate valid

issuance by August 3, 1977, of all

necessary State and Federal permits.

The rule was challenged in In Re:

Permanent Surface Mining Regulation

Litigation I, No. 79–1144 (D.D.C.

February 26, 1980), 14 Env’t Rep. Cas.

1083, as effecting a compensable taking

of property. While the court declined to

address the constitutionality of the VER

definition, it found that a person who

applies for all permits, but fails to

receive one or more through government

delay, engenders the same investments

and expectations as a person who has

obtained all permits. Therefore, the

court found that a good faith attempt to

obtain all permits before August 3, 1977,

should suffice for purposes of VER. The

court remanded to the Secretary that

portion of the definition that required

the property owner actually to have

obtained all permits necessary to mine.

2. Likelihood of Compensable Takings

In evaluating taking claims for

compensation concerning government

regulatory actions, the courts have

typically considered three factors on a

fact-specific, case-by-case basis: the

character of the governmental action,

the economic impact of the action, and

the extent to which the government

action interferes with reasonable

investment-backed expectations. See

Penn Central Transportation Co. v. New

York City, 438 U.S. 104, 124 (1977).

Because of the scope of the proposed

rule and the lack of information on

specific property interests that might be

affected, this assessment cannot predict

or evaluate the effects of the proposed

rule on property rights. Instead, the

assessment will discuss generally the

anticipated impacts of the proposed

rule, and compare them to the impacts

of the other alternatives considered.

a. Character of the governmental

action. The purpose served and the

statutory provisions implemented by

this proposed rulemaking are discussed

in the preamble to the proposed rule.

The proposed rule substantially

advances a legitimate public purpose.

The legitimate public purpose is the

implementation of the protections for

specified areas set forth in section

522(e) of SMCRA. In that section,

Congress determined that subject to

certain exceptions, including valid

existing rights, surface coal mining is

prohibited on specified lands because

such mining is incompatible with the

values for which those lands were

designated as unsuitable for surface coal

mining operations.

The proposed rule substantially

advances that purpose by providing that

the VER exception for mining in those

protected areas applies only to the

extent that a person can demonstrate

that a good faith effort had been made

to obtain all required permits for a

surface coal mining operation before the

area came under the protection of

section 522(e). The proposed definition

of VER thus advances the regulatory

scheme Congress developed to prevent

the harms which surface coal mining

operations would cause in those areas.

OSM does not know of any other

property use or actions that would

significantly contribute to the problems

caused by surface coal mining

operations in such areas.

b. Economic impact. Use of the GFAP

standard or the All Permits standard by

20 States (and for a number of years, by

OSM) has not resulted in any

compensation awards to date, nor has it

resulted in any financial compensation

in those instances where the application

of the standard by OSM has resulted in

litigation, as discussed below.

Therefore, OSM believes that adoption

of a GFAP standard will not result in

any change in the Government’s

financial exposure relative to the

current situation.

The property interests that could be

affected by this rule are coal rights in

section 522(e) areas. It cannot be

determined in advance which coal

rights would be affected by the eventual

application of this proposed rule, or

what value those rights would have.

There is no data base that definitively or

reliably lists all properties protected

under section 522(e), or the nature or

extent of individual coal rights included

in such areas. Such a list would not

remain current for any appreciable time

because individual properties would be

added or removed on a continual basis

as protected features come into

existence, evolve, and sometimes

disappear. Even if it could be

determined which coal rights are subject

to section 522(e), it cannot reliably be

predicted which coal an owner might

seek to mine or for which a VER

determination would be necessary.

Because takings determinations are

case-specific, OSM cannot predict all

the factors necessary to determine

whether a denial of VER would

constitute a compensable taking.

For purposes of this assessment, the

evaluation of potential economic impact
4856 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

utilizes in part the analyses set out in

the Draft Environmental Impact

Statement (DEIS) (OSM–EIS–29,

September 1995) and Draft Economic

Analysis (EA) (September 1, 1995) for

the proposed rule. The DEIS and EA

discussions of the alternatives

summarize the number of acres

estimated to be disturbed under each

VER alternative over a 20-year period.

Because of the difficulty in predicting

the actual mining in protected areas

under this rule, OSM could not predict

the actual impacts of the alternatives. To

provide a basis for comparing the

relative environmental and economic

impacts of the proposed rule and the

alternatives, OSM developed impact

estimates by using a model that relied

on specific methodologies and

assumptions.

Therefore, the DEIS and EA estimates

of coal acreage that could be mined

under the GFAPT alternative and the

other alternatives are relevant to this

assessment only to the limited extent

that they show the anticipated relative

economic impacts of the proposed rule,

compared to the other alternatives.

Tables V–1 through V–5 of the DEIS

show relative amounts of coal acreage

estimated to be mined over a 20-year

period under the different alternatives,

as calculated using the model.

Generally speaking, these analyses

assume that relatively few persons

would be able to demonstrate VER

under a GFAP standard; that, for some

categories of lands, more persons might

be able to demonstrate VER under a

GFAPT standard, and that in some

cases, even more persons might be able

to demonstrate VER under an O&A

standard. The analyses further assume

that the impacts of a Bifurcated standard

would be somewhere between the

impacts of the GFAP standard and those

of the O&A standard.

In general, the GFAP standard is more

likely to limit surface coal mining

operations. As a result, more takings

claims would be expected to be filed

under a GFAP standard. Whether courts

would find that a negative VER

determination under the GFAP standard

constituted a compensable taking

should turn on the specific property

rights involved.

For purposes of evaluating the

economic impact of the proposed rule,

OSM surveyed historical permitting

information, relevant litigation, and the

DEIS and EA analyses of anticipated

mining impacts in individual section

522(e) categories of lands.

Historical data: Currently, five States

use the All Permits standard and 15 use

the GFAP standard. Two States use a

Takings standard, one uses only the

Needed for and Adjacent standard, and

one State has no VER definition. OSM

is not aware of any instance in which

the States’ use of these standards has

resulted in a judicial determination of a

compensable takings. Therefore, history

does not suggest that the promulgation

of a GFAP standard would result in a

significant number of takings

compensation awards. While the

likelihood of some degree of financial

exposure exists, the use of the GFAP

standard or the All Permits standard by

20 States (and for a number of years, by

OSM) has not resulted in any

compensation awards to date, nor has it

resulted in any financial compensation

in those instances where the application

of the standard by OSM has resulted in

litigation, as discussed below.

Therefore, based on the above data,

OSM believes that the adoption of a

GFAP standard will not result in any

change in the Government’s financial

exposure.

Litigation on use of a GFAP standard:

The question of whether application of

the GFAP standard for VER effects a

compensable taking was examined by

the court in Sunday Creek Coal Co. v.

Hodel (‘‘Sunday Creek’’), No. 88–0416,

Slip op. (S.D. Ohio June 2, 1988). In

Sunday Creek, applying Ohio’s

equivalent of the GFAP standard of

VER, OSM denied the plaintiff’s VER

request. The court ruled that OSM’s

application of Ohio’s VER standard

would deprive Sunday Creek of its

property rights in violation of the Fifth

Amendment. The court therefore

reversed OSM’s negative VER

determination. In another case that

considered the question of VER, Belville

Mining Co. v. United States (‘‘Belville

II’’), No. C–1–89–874 (S.D. Ohio), the

court simply assumed that if an

applicant could demonstrate a right to

strip mine, then denial of VER would

constitute a ‘‘taking’’ of that applicant’s

interest. These two decisions indicate

that, at least in Ohio, a Federal court

would be likely to find that application

of the GFAP standard for VER would

effect a compensable taking.

Summary of takings implications for

section 522(e) lands: Based upon

available information, including the

DEIS and EA for the proposed rule, and

a survey of permits, the following

takings impacts from the proposed rule

are anticipated.

Section 522(e)(1) lands: These areas

include National Park lands, National

Wildlife Refuge lands, National Trails,

National Wilderness Areas, Wild and

Scenic Rivers and study rivers, and

National Recreation Areas. OSM

anticipates relatively few takings impact

in (e)(1) areas because there has been a

relative dearth of VER determinations

and any resulting takings claims

concerning (e)(1) areas in the last 18

years.

Further, as previously discussed, the

Secretary’s 1988 policy concerning

exercise of VER in (e)(1) areas remains

in effect. That policy states that, if a

person acts to exercise VER on (e)(1)

lands, then, subject to appropriation, the

Secretary will use available authorities

to seek to acquire the rights through

exchange, negotiated purchase or

condemnation.

All of this suggests that there may

continue to be few VER requests, little

economic impact, few takings cases, and

even fewer takings awards in (e)(1)

areas.

Surface mining: As discussed in the

EA, OSM anticipates that in many cases

a compensable taking for denial of VER

to surface mine would not be found,

because the requisite property right to

surface mine coal could not be

demonstrated. And in many cases, if

VER for surface mining were denied,

underground mining would still be a

reasonable remaining use of the coal, so

a takings award would not be likely for

denial of VER to surface mine in section

522(e)(1) areas.

Underground mining: The related

OSM rulemaking concerning

applicability of section 522(e)

prohibitions to subsidence proposes that

the prohibitions would not apply to

subsidence. Therefore, OSM expects

that any takings award for denial of VER

for underground mining would be

limited to coal that could not be mined

from portals outside the (e)(1) area.

Section 522(e)(2) lands: These areas

consist of Federal lands within national

forests. OSM anticipates relatively few

takings from VER determinations on

(e)(2) lands.

Surface mining: OSM anticipates that

no takings claims would arise out of

application of the proposed VER

standard in surface mining VER

determinations in the western national

forests and national grasslands. This is

because coal owners in the western

(e)(2) areas have never pursued surface

mining VER determinations, but rather

have obtained compatibility

determinations under section 522(e)(2).

OSM does anticipate that some acreage

might be precluded from surface

mining, and some takings claims might

arise, concerning surface mining VER

determinations in the eastern national

forests.

For surface coal mining, OSM expects

that a compensable taking will be

unlikely if underground mining is an

economically and technically feasible

alternative (because if VER were denied
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4857

for surface mining, most owners could

qualify for a compatibility exception for

underground mining, so underground

mining would be a reasonable

remaining use). As discussed in the

DEIS and EA, OSM anticipates that in

a substantial number of cases (a higher

proportion in the eastern coal fields), a

court would find no property right to

surface mine under State property laws.

This is because the coal in many cases

was severed from the surface rights

relatively early, when surface mining

was not common at the time and place

of severance. As a result, under State

property law, typically the coal owner

would not have the necessary right to

surface mine. OSM does not have

information on actual dates of severance

of coal rights. (There might also be

mitigation of takings in those limited

instances where the United States

decides to purchase coal rights.)

Underground mining: The (e)(2)

compatibility determination exception

would continue to apply. Therefore,

OSM would expect few takings claims

from denial of VER for underground

mining in national forests, because OSM

assumes that virtually all underground

mining could qualify for a compatibility

determination. This is based in part on

the fact that the Multiple-Use Sustained

Yield Act and the National Forest

Management Act establish multiple use

as the guiding principle for management

of national forest lands, and in part on

the fact that, in the past, requests for

compatibility determinations have never

been denied. Surface operations and

impacts associated with underground

mining generally disturb only a

relatively minimal amount of the land

surface. Roads and surface facilities can

generally be sited in such a way as to

avoid significant impacts on other land

uses such as timber production,

livestock grazing, and recreation.

Section 552(e)(3) lands: These areas

include lands where surface coal mining

operations would adversely affect a

publicly owned park or site on the

National Register of Historic Places.

OSM does not anticipate that any

significant takings would occur on (e)(3)

lands as a result of surface or

underground mining VER

determinations. Pursuant to (e)(3),

jurisdictional agencies, together with

the regulatory authority, may approve

mining in the vicinity of protected

areas, and thus waive the prohibition of

(e)(3). A sampling of permit records

indicated that some such mining has

occurred, but no VER requests were

located for such areas. Therefore, OSM

anticipates that, in many cases,

operations may avoid such sites or

resolve any jurisdictional agency

concerns about mining impacts, so that

the jurisdictional agency and the

regulatory authority would jointly

approve mining pursuant to (e)(3). In

such cases, a VER determination would

be unnecessary.

Section 522(e)(4) lands: These areas

include lands within one hundred feet

of the right of way of a public road.

OSM anticipates relatively few takings

claims concerning VER determinations

for (e)(4) areas. Coal mines now tend to

avoid urban areas (where many roads

and streets are located) because of

increased acquisition and public safetyrelated costs of mining in such areas. In

the vast majority of cases, an exception

of the prohibitions of (e)(4) is obtained

under the waiver provision of (e)(4),

rather than through a VER

determination. Therefore, OSM does not

expect the choice of a VER standard to

have a major effect on takings claims for

coal located under roads. As noted

above, OSM’s survey of permitting data

located only a few instances of VER

determinations for (e)(4) areas.

Section 522(e)(5) lands: These areas

include lands within 300 feet of an

occupied dwelling, public building,

school, church, community or

institutional building, or public park, or

within 100 feet of a cemetery. OSM

anticipates relatively little economic

impact for takings purposes on (e)(5)

areas other than (e)(5) public park lands.

The survey of permit files indicated

that in most cases (more than 85%),

mining near dwellings occurs because

(e)(5) waivers are negotiated with

dwelling owners. Therefore, OSM

expects that VER would not be

necessary and would continue not to be

pursued in most such areas. Proposals

to mine in areas occupied by public

buildings, schools, churches, and

cemeteries are typically limited. It is

usually less expensive for the operator

to avoid such areas, rather than to pay

the costs of seeking VER, avoiding

material damage where prohibited, and

paying reclamation costs.

In addition, the permit survey did not

disclose any instances of VER requests

for mining in the areas around non-NPS

public parks protected under (e)(5).

However, the OSM model does

anticipate that in the next 20 years

substantial coal acreage in (e)(5) public

parks areas might be precluded from

mining as a result of underground

mining VER determinations under the

proposed rule, and a relatively smaller

but still significant acreage might be

precluded from surface mining as a

result of surface mining VER

determinations under the proposed rule.

Some portion of those acreages could

result in takings awards.

c. Interference with reasonable

investment-backed expectations.

Application of the proposed rule might

result in more interference with

reasonable investment-backed

expectations than would occur under

the other alternatives considered. Such

interference could occur when coal

rights holders would be unable to mine

the coal because they could not

demonstrate VER under the GFAP

standard. However, any such

interference could be limited by factors

such as the following:

In many cases, holders of coal rights

in section 522(e) areas will not request

VER, either because the holder

determines that the coal is not

economically minable, or because the

holder determines that it is less costly

to obtain some other exception (such as

a compatibility determination or a

waiver) from the prohibitions of section

522(e).

In other cases, under State property

law, where the mineral rights have been

severed from the surface estate, OSM

expects that coal holders would not

hold the necessary property right to

surface mine the coal, as discussed in

more detail in the DEIS and EA. Such

holders could have no reasonable

expectation of surface mining the coal.

If the holder of coal rights purchased

those rights after the land came under

the protections of section 522(e), the

purchaser would be deemed to be on

notice of the applicability of the

prohibitions of section 522(e) and

would have no reasonable expectation

of being allowed to mine. Thus any

significant investments made under

these circumstances would not likely be

found to be reasonable.

If a coal holder has made no

significant expenditures, the holder

would probably be unable to

demonstrate sufficient investmentbacked expectations to support a takings

claim. Further, if VER for surface

mining were denied, but underground

mining were possible and economical, a

takings claim would similarly be

difficult to sustain.

3. Alternatives to the Proposed Rule

As previously discussed, OSM

developed and considered three

alternatives to the GFAP standard for

VER. They are the GFAPT standard, the

O&A standard, and the Bifurcated

standard. The GFAP standard has the

greatest potential for takings

implications, and the only way to

minimize the takings implications of the

proposed rule is to select one of the

other alternatives. However, OSM does

not believe that such a selection is

justified. OSM believes that the
4858 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

proposed rule is the best alternative

because it best protects the areas listed

in section 522(e) from surface coal

mining operations, as Congress

intended.

GFAPT standard: The GFAPT

standard would provide that a person

could demonstrate VER by

demonstrating either compliance with

the GFAP standard, or that denial of

VER as of the date the area became

subject to section 522(e) would

reasonably be expected to result in a

compensable taking.

OSM would expect no takings

implications from the GFAPT standard

because in all cases, VER should be

granted if denial would result in a

compensable taking. However, as noted

in the preamble to the proposed rule,

when OSM proposed the GFAPT

alternative in 1991, it elicited some of

the strongest opposition OSM has ever

received on a proposed rule. OSM

received approximately 750 comments,

and virtually every comment

emphatically opposed the GFAPT

standard. Opponents charged that the

GFAPT standard would be impossibly

burdensome for States to implement.

Some commenters charged that it was

too complex, unpredictable, and

uncertain. Many commenters urged

adoption of a ‘‘bright-line’’ standard

instead. Some charged that it was not

protective enough of section 522(e)

areas, and others charged that it was

inappropriately restrictive of mining in

section 522(e) areas. Some commenters

felt that State regulatory authorities had

no authority under State law to apply

the standard. Every category of

commenter rejected the GFAPT

standard as unworkable, unacceptable,

or demonstrably inferior to some other

alternative.

Ownership and authority standard:

The O&A standard would provide that

a person would have VER upon

demonstrating ownership of the coal

rights plus the property right under

State law to remove the coal by the

method intended. The O&A standard

would require demonstrating, as of the

date the land came under the protection

of section 522(e), the property right to

mine the coal by underground methods

if VER for underground mining were

sought; and by surface mining methods

if VER for surface mining were sought.

OSM would not expect the O&A

standard to have significant takings

implications. If a person could not

demonstrate the right to mine the coal

by the method intended, there would be

no denial of or interference with

property rights for which compensation

would be due under takings law, since

a person must have the property right to

a particular use to be compensated for

denial of that use.

Although the O&A standard would

have no significant takings implications,

OSM believes that it suffers from a

serious shortcoming in that it would

effectively eviscreate the protections

afforded under section 522(e). The O&A

alternative would result in a finding of

VER whenever a person met the permit

application requirements for property

rights. The prohibitions of section

522(e) would be meaningless and

without practical effect. Such a result

would clearly be inconsistent with

congressional intent.

Bifurcated standard: Under the

Bifurcated standard, when the mineral

and surface estates have been severed,

the date of severance would determine

whether the O&A or the GFAP standard

for VER would be used. When the

mineral estate was severed from the

surface estate prior to the date the land

came under the protection of section

522(e), the O&A standard would be used

to determine VER. When the mineral

estate was severed from the surface

estate after the date the land came under

the protection of section 522(e), the

GFAP standard would be used.

4. Estimate of Potential Financial

Exposure From the Proposed Rule

The Attorney General’s guidelines

and the Department’s supplemental

guidelines for takings implications

assessments provide that the assessment

should set out an estimate of the

financial exposure if the proposed rule

were held to effect a compensable

taking. Given the geographic scope of

this proposed rule, however, and the

lack of information on the effects on

individual property rights, a meaningful

estimate of financial exposure is

impossible. Instead, as discussed above,

this assessment discusses generally the

anticipated takings impacts of the

proposed rule, relative to the other

alternatives considered. Federal

financial exposure might arise primarily

from claims concerning VER denials in

the eastern United States in section

522(e)(2) areas or from the costs

associated with acquisition of property

rights in section 522(e)(1) areas

pursuant to the Secretary’s 1988 policy

statement, as discussed above.

5. Conclusion

The proposed rule for VER is

expected to have a greater potential for

takings implications than the other

alternatives considered. More

significant takings implications are

anticipated primarily in some (e)(2)

areas (Federal lands in eastern national

forests); (e)(5) areas (State and local

parks); and, to a lesser extent, (e)(4)

areas (public roads). In light of the

Secretary’s 1988 policy on exercise of

VER for (e)(1) areas, takings

implications are less likely in (e)(1)

areas. Takings implications are also

substantially less likely in (e)(3) and (5)

areas. Case-by-case application of the

regulation might result in takings

implications, but such an analysis is

beyond the scope of this assessment and

cannot be made until the rule is actually

applied. Thus, insufficient information

is available to enable an accurate

assessment of the extent to which

significant takings consequences might

result from adoption of this rule.

Under the standards set forth in the

‘‘Attorney General’s Guidelines For the

Evaluation of Risk and Avoidance and

Unanticipated Takings,’’ dated June 30,

1988, and the Supplementary Takings

Guidelines of the Department of the

Interior, OSM therefore concludes that

this rulemaking has significant takings

implications.

G. Executive Order 12988 (Civil Justice

Reform)

This proposed rule has been reviewed

under the applicable standards of

section 3(b)(2) of E.O. 12988, ‘‘Civil

Justice Reform’’ (61 FR 4729). In

general, the requirements of section

3(b)(2) are covered by the preamble

discussion of this rule. Individual

elements of the order are addressed

below:

1. What is the Preemptive Effect, If Any,

To Be Given to the Regulation?

This proposed rule would have the

same preemptive effect as other

standards adopted pursuant to SMCRA.

To retain primacy, States have to adopt

and apply standards for their regulatory

programs that are no less effective than

those set forth in OSM’s rules. Any State

law that is inconsistent with or that

would preclude implementation of this

rule would be subject to preemption

under section 505 of SMCRA and its

implementing regulations at 30 CFR

730.11. To the extent that this rule

might ultimately result in the

preemption of State law, the provisions

of SMCRA are intended to preclude

inconsistent State laws and regulations

unless they provide for more stringent

land use or environmental controls and

regulations. This approach is

established in SMCRA and has been

judicially affirmed.
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4859

2. What Is the Effect on Existing Federal

Laws or Regulations, If Any, Including

All Provisions Repealed, Circumscribed,

Displaced, Impaired, or Modified?

This proposed rule would modify the

implementation of SMCRA as described

in the preamble. It is not intended to

modify the implementation of any other

Federal statute. The preamble

discussion specifies the Federal

regulatory provisions that would be

affected by this rule.

3. Does the Rule Provide a Clear and

Certain Legal Standard for Affected

Conduct Rather Than a General

Standard, While Promoting

Simplification and Burden Reduction?

As discussed in the preamble, the

standards proposed in this rule are as

clear and certain as practicable, given

the complexity of the topics covered,

the mandates of SMCRA and the

legislative history of section 522(e) of

SMCRA.

4. What is the Retroactive Effect, if Any,

To Be Given to This Regulation?

This proposed rule is not intended to

have retroactive effect.

5. Are Administrative Proceedings

Required Before Parties May File Suit in

Court? Which Proceedings Apply? Is the

Exhaustion of Administrative Remedies

Required?

Since this rule is only in proposed

form, these questions are not applicable.

However, if the rule is adopted as

proposed, the following answers would

apply:

No administrative proceedings are

required before parties may file suit in

court challenging the provisions of this

rule under section 526(a) of SMCRA, 30

U.S.C. 1276(a). However, administrative

procedures must be exhausted prior to

any judicial challenge to the application

of this rule. In situations involving OSM

application of this rule, applicable

administrative procedures may be found

at 30 CFR 775.11 and 43 CFR part 4. In

situations involving State regulatory

authority application of provisions

analogous to those contained in this

rule, applicable administrative

procedures are set forth in each State

regulatory program.

6. Does the Rule Define Key Terms,

Either Explicitly or By Reference to

Other Regulations or Statutes That

Explicitly Define Those Items?

This proposed rule defines the term

‘‘valid existing rights.’’ Other terms

important to the understanding of this

rule are set forth in 30 CFR 700.5, 701.5

and 761.5.

7. Does the Rule Address Other

Important Issues Affecting Clarity and

General Draftsmanship of Regulations

Set Forth By the Attorney General, With

the Concurrence of the Director of the

Office of Management and Budget, That

are Determined to be in Accordance

With the Purposes of the Executive

Order?

The Attorney General and the Director

of the Office of Management and Budget

have not issued any guidance on this

matter.

Author: The principal author of this

proposed rule is Dennis G. Rice, Rules and

Legislation, Office of Surface Mining

Reclamation and Enforcement, 1951

Constitution Avenue, NW., Washington, DC

20240; Telephone (202) 208–2829.

List of Subjects

30 CFR Part 740

Public lands, Mineral resources,

Reporting and recordkeeping

requirements, Surety bonds, Surface

mining, Underground mining.

30 CFR Part 745

Intergovernmental relations, Public

lands, Mineral resources, Reporting and

recordkeeping requirements, Surface

mining, Underground mining.

30 CFR Part 761

Historic preservation, National

forests, National parks, National trails

system, National wild and scenic rivers

system, Surface mining, Underground

mining, Wilderness areas, Wildlife

refuges.

30 CFR Part 772

Reporting and recordkeeping

requirements, Surface mining,

Underground mining.

Dated: April 30, 1996.

Bob Armstrong,

Assistant Secretary, Land and Minerals

Management.

For the reasons set forth in the

preamble, the Department is proposing

to amend 30 CFR Parts 740, 745, 761,

and 772 as set forth below:

PART 740—GENERAL

REQUIREMENTS FOR SURFACE COAL

MINING AND RECLAMATION

OPERATIONS ON FEDERAL LANDS

1. The authority citation for Part 740

continues to read as follows:

Authority: 30 U.S.C. 1201 et seq. and 30

U.S.C. 181 et seq.

2. In § 740.4, paragraphs (a)(4) and

(a)(5) are revised to read as follows:

§ 740.4 Responsibilities.

(a) * * *

(4) Determining whether a person

possesses valid existing rights to

conduct surface coal mining operations

on Federal lands within the areas

specified in paragraphs (a)(1) and (a)(2)

of § 761.11 of this chapter.

(5) Determining whether there are

significant recreational, timber,

economic, or other values that may be

incompatible with surface coal mining

operations on any Federal lands within

the boundaries of any national forest

under § 761.11(a)(2) of this chapter.

3. Section 740.10 is revised to read as

follows:

§ 740.10 Information collection.

(a) In accordance with 44 U.S.C. 3501

et seq., the Office of Management and

Budget (OMB) has approved the

information collection requirements of

this part. The OMB clearance number is

1029–0027. This information is needed

to implement section 523 of the Act,

which governs surface coal mining

operations on Federal lands. Persons

intending to conduct such operations

must respond to obtain a benefit.

(b) OSM estimates that the public

reporting burden for this part will

average 26 hours per respondent,

including time spent reviewing

instructions, searching existing data

sources, gathering and maintaining the

data needed, and completing and

reviewing the collection of information.

Send comments regarding this burden

estimate or any other aspect of these

information collection requirements,

including suggestions for reducing the

burden, to the Office of Surface Mining

Reclamation and Enforcement,

Information Collection Clearance

Officer, 1951 Constitution Avenue,

N.W., Washington, DC 20240; and the

Office of Management and Budget,

Office of Information and Regulatory

Affairs, Attention: Interior Desk Officer,

725 17th Street, NW, Washington, DC

20503. Please refer to OMB Control

Number 1029–0027 in any

correspondence.

4. In § 740.11, paragraph (a)

introductory text is revised and

paragraph (g) is added to read as

follows:

§ 740.11 Applicability.

(a) Except as provided in paragraph

(g) of this section, upon the approval of

a State regulatory program under part

732 of this chapter or promulgation of

a Federal regulatory program for a State

pursuant to part 736 of this chapter, that

program and this subchapter shall apply

to:

* * * * *

(g) Regardless of land ownership, the

agency making the determination, or
4860 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

State regulatory program provisions, the

definition of valid existing rights in

§ 761.5 of this chapter applies to all

decisions on requests for a

determination of valid existing rights to

conduct surface coal mining operations

on lands within the boundaries of the

areas specified in paragraphs (a)(1) and

(a)(2) of § 761.11 of this chapter.

PART 745—STATE-FEDERAL

COOPERATIVE AGREEMENTS

5. The authority citation for Part 745

continues to read as follows:

Authority: 30 U.S.C. 1201 et seq. and 30

U.S.C. 181 et seq.

6. Section 745.10 is revised to read as

follows:

§ 745.10 Information collection.

(a) In accordance with 44 U.S.C. 3501

et seq., the Office of Management and

Budget (OMB) has approved the

information collection requirements of

this part. The OMB clearance number is

1029–0092. This information is needed

to implement section 523(c) of the Act,

which allows States to regulate surface

coal mining operations on Federal lands

under certain conditions. States that

desire to enter into cooperative

agreements to do so must respond to

obtain a benefit.

(b) OSM estimates that the public

reporting burden for this part will

average 1,364 hours per respondent,

including time spent reviewing

instructions, searching existing data

sources, gathering and maintaining the

data needed, and completing and

reviewing the collection of information.

Send comments regarding this burden

estimate or any other aspect of these

information collection requirements,

including suggestions for reducing the

burden, to the Office of Surface Mining

Reclamation and Enforcement,

Information Collection Clearance

Officer, 1951 Constitution Avenue,

N.W., Washington, DC 20240; and the

Office of Management and Budget,

Office of Information and Regulatory

Affairs, Attention: Interior Desk Officer,

725 17th Street, NW, Washington, DC

20503. Please refer to OMB Control

Number 1029–0092 in any

correspondence.

7. In § 745.13, paragraphs (o) and (p)

are revised to read as follows:

§ 745.13 Authority reserved by the

Secretary.

* * * * *

(o) Determine whether a person

possesses valid existing rights to

conduct surface coal mining operations

on Federal lands within the areas

specified in paragraphs (a)(1) and (a)(2)

of § 761.11 of this chapter; or

(p) Determine whether there are

significant recreational, timber,

economic, or other values that may be

incompatible with surface coal mining

operations on any Federal lands within

the boundaries of any national forest, as

specified in § 761.11(a)(2) of this

chapter.

PART 761—AREAS DESIGNATED BY

ACT OF CONGRESS

8. The authority citation for Part 761

continues to read as follows:

Authority: 30 U.S.C. 1201 et seq.

9. Section 761.5 is amended by

removing the definition of ‘‘surface coal

mining operations which exist on the

date of enactment’’ and revising the

definition of ‘‘valid existing rights’’ to

read as follows:

§ 761.5 Definitions.

* * * * *

Valid existing rights means the

conditions under which a person may,

subject to the requirements of the Act

and the pertinent regulatory program,

conduct surface coal mining operations

on lands where 30 U.S.C. 1272(e) and

§ 761.11 would otherwise prohibit such

operations.

(a) Except as provided in paragraph

(b) of this definition, a person claiming

valid existing rights must demonstrate

that a legally binding conveyance, lease,

deed, contract, or other document vests

that person with the right, as of the date

the land came under the protection of

30 U.S.C. 1272(e) and § 761.11 of this

chapter, to conduct the type of surface

coal mining operations intended.

Interpretation of the documents relied

upon to establish the rights to which

this paragraph applies must be based

upon applicable State statutory or case

law concerning interpretation of

documents of this nature or, if no

applicable State law exists, upon

custom and generally accepted usage at

the time and place that the documents

came into existence. In addition, except

as provided in paragraph (b) of this

definition, any person claiming valid

existing rights must demonstrate that

one of the following conditions exists:

(1) All State and Federal permits and

other authorizations required to conduct

surface coal mining operations had been

obtained, or a good faith effort to obtain

all necessary permits and authorizations

had been made, before the date the land

came under the protection of § 761.11;

or

(2) The land is needed for and

immediately adjacent to a surface coal

mining operation for which all State and

Federal permits and other

authorizations required to conduct

surface coal mining operations had been

obtained, or a good faith effort to obtain

all necessary permits and authorizations

had been made, before the date the land

came under the protection of § 761.11.

(b) A person claiming valid existing

rights to use or construct an access or

haul road, for use as part of surface coal

mining operations, across the surface of

lands protected by § 761.11 must

demonstrate one of the following:

(1) The road was in existence on the

date the land upon which it is located

came under the protection of § 761.11;

(2) A right of way or easement for the

road was properly recorded as of the

date the land came under the protection

of § 761.11;

(3) The regulatory authority had

issued a permit for the access or haul

road on the land in question as of the

date the land came under the protection

of § 761.11; or

(4) Valid existing rights exist under

paragraph (a) of this definition.

10. Section 761.10 is added to read as

follows:

§ 761.10 Information collection.

(a) In accordance with 44 U.S.C. 3501

et seq., the Officer of Management and

Budget (OMB) has approved the

information collection requirements of

this part. The OMB clearance number is

1029–0102. The regulatory authority or

other responsible agency will use this

information to determine whether a

person has valid existing rights or

qualifies for one of the other waivers or

exemptions from the general prohibition

on conducting surface coal mining

operations in the areas listed in section

522(e) of the Act. Persons seeking to

conduct surface coal mining operations

on these lands must respond to obtain

a benefit in accordance with 30 U.S.C.

1272(e).

(b) OSM estimates that the public

reporting and recordkeeping burden for

this part will average 2 hours per

response under § 761.12 and 14 hours

per response under § 761.13, including

time spent reviewing instructions,

searching existing data sources,

gathering and maintaining the data

needed, and completing and reviewing

the collection of information. The

burden for § 761.13 includes 6 hours for

the person seeking the determination

and 8 hours for the agency processing

the request. Send comments regarding

this burden estimate or any other aspect

of these information collection and

recordkeeping requirements, including

suggestions for reducing the burden, to

the Office of Surface Mining

Reclamation and Enforcement,
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4861

Information Collection Clearance

Officer, 1951 Constitution Avenue,

N.W., Washington, DC 20240; and the

Office of Management and Budget,

Office of Information and Regulatory

Affairs, Attention: Interior Desk Officer,

725 17th Street, NW, Washington, DC

20503. Please refer to OMB Control

Number 1029–0102 in any

correspondence.

11. In § 761.11, the section title is

revised, paragraphs (a) through (g) are

redesignated as paragraphs (a)(1)

through (a)(7) and revised, the

introductory test is redesignated as

paragraph (a) introductory text and

revised, paragraph (h) is removed, and

a new paragraph (b) is added to read as

follows:

§ 761.11 Areas where surface coal mining

operations are prohibited or limited.

(a) Unless a person has valid existing

rights as determined in accordance with

§ 761.13, no surface coal mining

operation except those identified in

paragraph (b) of this section may be

conducted after August 3, 1977:

(1) On any lands within the

boundaries of:

(i) The National Park System;

(ii) The National Wildlife Refuge

System;

(iii) The National System of Trails;

(iv) The National Wilderness

Preservation System;

(v) The Wild and Scenic Rivers

System, including study rivers

designated under § 5(a) of the Wild and

Scenic Rivers Act (16 U.S.C. 1276(a)) or

study rivers or study river corridors

established in any guidelines

promulgated pursuant to that Act; or

(vi) National Recreation Areas

designated by Act of Congress.

(2) On any Federal lands within the

boundaries of any national forest, except

that operations on these lands

(excluding lands within the boundaries

of the Custer National Forest) may be

permitted if the Secretary finds that

there are no significant recreational,

timber, economic, or other values that

may be incompatible with surface coal

mining operations; and:

(i) Any surface operations and

impacts will be incident to an

underground coal mine; or

(ii) With respect to lands that do not

have significant forest cover within

national forests west of the 100th

meridian, the Secretary of Agriculture

has determined that surface mining is in

compliance with the Act, the MultipleUse Sustained Yield Act of 1960 (16

U.S.C. 528–531), the Federal Coal

Leasing Amendments Act of 1975 (30

U.S.C. 181 et seq.), and the National

Forest Management Act of 1976 (16

U.S.C. 1600 et seq.);

(3) On any lands where the operation

will adversely affect any publicly

owned park or any place included in the

National Register of Historic Places,

unless the operation is jointly approved

by the regulatory authority and the

Federal, State, or local agency with

jurisdiction over the park or place;

(4) Within 100 feet, measured

horizontally, of the outside right-of-way

line of any public road, except:

(i) Where a mine access or haul road

joins this right-of-way line, or

(ii) When the regulatory authority (or

the appropriate public road authority

designated by the regulatory authority)

allows the public road to be relocated or

closed, or the area within the protected

zone to be affected by the surface coal

mining operation, after:

(A) Providing public notice and

opportunity for a public hearing in

accordance with § 761.12(d); and

(B) Finding in writing that the

interests of the affected public and

landowners will be protected;

(5) Within 300 feet, measured

horizontally, of any occupied dwelling,

except when:

(i) The owner of the dwelling has

provided a written waiver consenting to

surface coal mining operations within

the protected zone; or

(ii) The part of the operation which is

located closer than 300 feet to the

dwelling is an access or haul road that

connects with an existing public road

on the side of the public road opposite

the dwelling;

(6) Within 300 feet, measured

horizontally, of any public building,

school, church, community or

institutional building, or public park; or

(7) Within 100 feet, measured

horizontally, of a cemetery, unless the

cemetery is relocated in accordance

with State law.

(b) The prohibitions of paragraph (a)

of this section do not apply to surface

coal mining operations for which a valid

permit, issued pursuant to Subchapter G

of this chapter or an approved State

regulatory program, existed when the

land came under the protection of

paragraph (a) of this section or section

522(e) of the Act (30 U.S.C. 1272(e)), or

to other validly authorized operations in

existence on that date. This exemption

applies only to lands upon which the

permittee or operator had the right to

enter and conduct the permitted or

authorized surface coal mining

operations as of the date the land comes

under the protection of this section.

12. Section 761.12 is amended by

removing paragraph (h) and revising the

section title, paragraphs (a) through (c),

and the introductory text of paragraph

(d) to read as follows:

§ 761.12 Coordination with permitting

process; waiver requirements and

procedures.

(a) When the regulatory authority

receives an administratively complete

application for a permit for a surface

coal mining operation or an

administratively complete application

for revision of the boundaries of a

surface coal mining operation permit,

the regulatory authority must review the

application to determine whether the

proposed surface coal mining operation

would be located on any lands protected

under § 761.11(a). The regulatory

authority must reject any portion of the

application that would locate surface

coal mining operations on those lands

unless the applicant:

(1) Qualifies for the existing operation

exemption under § 761.11(b);

(2) Obtains a waiver or exception from

the prohibitions of § 761.11(a) in

accordance with paragraphs (c) through

(f) of this section; or

(3) Has valid existing rights as

determined in accordance with § 761.13.

(b) If the regulatory authority has

difficulty determining whether an

application reviewed under paragraph

(a) of this section includes land within

an area specified in § 761.11(a)(1) or

within the specified distance from a

structure or feature listed in paragraph

(a)(6) or (a)(7) of § 761.11, the regulatory

authority must request that the Federal,

State, or local governmental agency with

jurisdiction over the protected land,

structure, or feature verify the location.

(1) The request for location

verification must include:

(i) Relevant portions of the permit

application;

(ii) A notice that any response

provided more than 30 days after receipt

of the request for location verification

will not necessarily be considered

during the application review process;

and

(iii) A notice that, upon request, the

agency will receive an additional 30

days to respond.

(2) If the agency does not respond in

a timely manner, the regulatory

authority may make the necessary

determination based on available

information.

(c) A person who intends to conduct

surface coal mining operations on

Federal lands within the boundaries of

a national forest under the compatibility

provisions of § 761.11(a)(2) must submit

to OSM a request that the Secretary

make the findings required by

§ 761.11(a)(2). If a person submits a

request before preparing and submitting

a permit application, the request must

include sufficient information about the

nature and location of the proposed
4862 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules

operation for the Secretary to evaluate

the request and make adequately

documented findings. The regulatory

authority may not issue a permit for the

proposed operation or approve a

proposed boundary revision unless

these findings have been made.

(d) When a person proposes to

relocate or close a public road, or to

conduct surface coal mining operations

(other than mine access and haul roads

as provided in § 761.11(a)(4)(i)) within

100 feet, measured horizontally, of the

outside right-of-way line of a public

road, the regulatory authority or public

road authority designated by the

regulatory authority must:

* * * * *

13. Section 761.13 is added to read as

follows:

§ 761.13 Submission and processing of

requests for valid existing rights

determinations.

(a) Agency responsible for making

valid existing rights determinations.

(1) Except as provided in paragraph

(a)(2) of this section, the regulatory

authority will make valid existing rights

determinations for all lands listed in

§ 761.11(a).

(i) In making these determinations,

the regulatory authority must use the

definition of valid existing rights in

§ 761.5 for land within the boundaries

of the areas specified in § 761.11(a)(1).

(ii) For all other lands, the regulatory

authority must use the definition of

valid existing rights in the applicable

regulatory program.

(2) OSM will make all determinations

as to whether a person has valid existing

rights to conduct surface coal mining

operations on Federal lands within the

areas specified in paragraphs (a)(1) and

(a)(2) of § 761.11. In making these

determinations, OSM will use the

definition of valid existing rights in

§ 761.5.

(b) What persons requesting valid

existing rights determinations must

submit. A person who, on the basis of

valid existing rights, intends to conduct

surface coal mining operations on lands

listed in § 761.11(a) must submit a

request to the appropriate agency under

paragraph (a) of this section. The

request may be submitted with or

without an application for a permit or

boundary revision for those lands.

(1) If the request is based on one of

the standards for access and haul roads

in paragraphs (b)(1) through (b)(3) of the

definition of valid existing rights in

§ 761.5, the requester must submit

satisfactory documentation that:

(i) The road existed on the date that

the land upon which it is located came

under the protection of § 761.11;

(ii) A right of way or easement for the

road was properly recorded as of the

date the land came under the protection

of § 761.11; or

(iii) The regulatory authority had

issued a permit for an access or haul

road in that location as of the date the

land came under the protection of

§ 761.11.

(2) If the request is based on the

standards in paragraph (a) of the

definition of valid existing rights in

§ 761.5, the requester must submit:

(i) A legal description of the land to

which the request pertains;

(ii) Complete documentation of the

character and extent of the requester’s

current interests in the surface and

mineral estates of the land to which the

request pertains;

(iii) A complete chain of title for the

surface and mineral estates of the land

to which the request pertains;

(iv) A description of the nature and

effect of each title instrument, including

any provisions pertaining to the method

of mining or mining-related surface

disturbances and facilities;

(v) Complete documentation of the

nature and ownership of all property

rights for the surface and mineral estates

of the land to which the request pertains

as of the date the land came under the

protection of § 761.11;

(vi) If the coal interests have been

severed from other property interests

and the surface estate is held by a

Federal agency, a title opinion or other

official statement from the Federal

agency confirming that the requester has

a property right to conduct the type of

surface coal mining operations

intended;

(vii) A description of the type and

extent of surface coal mining operations

planned, including the intended method

of mining and any mining-related

surface facilities, and an explanation of

how the planned operations are

consistent with State property law;

(viii) If the request is based on the

standard in paragraph (a)(2) of the

definition of valid existing rights in

§ 761.5, an explanation of why and how

the coal is needed for the operation; and

(ix) If the request is based on the

standard in paragraph (a)(1) of the

definition of valid existing rights in

§ 761.5, the application dates and

identification numbers and, if

applicable, approval and issuance dates

and identification numbers for any

licenses, permits, and authorizations for

surface coal mining operations on the

land to which the request pertains. This

requirement applies only to licenses,

permits, and authorizations that the

requester or predecessor in interest held

or had applied for as of the date the land

came under the protection of § 761.11.

(c) Notice and comment requirements

and procedures.

(1) When an agency receives a request

for a determination of valid existing

rights, the agency must publish a notice

in a newspaper of general circulation in

the county in which the land is located

inviting comment on whether the

request should be approved. If the

request involves Federal lands within

the boundaries of an area listed in

paragraph (a)1) or (a)(2) of § 761.11,

OSM will publish a similar notice in the

Federal Register. The notice must

include:

(i) The applicable standard(s) under

the definition of valid existing rights in

§ 761.5;

(ii) The location of the land to which

the request pertains;

(iii) The name and address of the

agency office to which comments

should be addressed;

(iv) The closing date of the comment

period, which must be sufficient to

afford interested persons a reasonable

opportunity to prepare and submit

comments;

(v) A description of the property

rights claimed and the basis for the

claim;

(vi) A description of the type of

surface coal mining operations planned;

and

(vii) A description of the procedures

the agency will follow in processing the

request.

(2) The agency must provide a copy

of the notice to the owner of the

structure or feature causing the land to

come under the protection of

§ 761.11(a).

(3) If the land to which the request

pertains involves severed estates or

divided interests, the agency must make

a reasonable effort to provide a copy of

the notice to all owners of interest, both

surface and mineral.

(4) When a request pertains to land

within the boundaries of an area

protected under § 761.11(a)(1) or 30

U.S.C. 1272(e)(1), the agency

responsible for the VER determination

must notify the agency with jurisdiction

over the protected land and provide that

agency 30 days (with an option for a 30-

day extension upon request) from

receipt of the notification to comment.

If the agency with jurisdiction over the

land fails to respond in a timely

manner, the agency responsible for the

VER determination may make the

determination in accordance with

paragraph (d) of this section.

(d) How a decision will be made.

(1) The agency responsible for making

the determination of valid existing
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Proposed Rules 4863

rights must review the materials

submitted under paragraph (b) of this

section, comments received under

paragraph (c) of this section, and any

other relevant information to determine

whether the record supports a decision

in favor of the requester. If not, the

agency must notify the requester in

writing, explaining the inadequacy of

the record and requesting submittal,

within a reasonable time, of any

additional information the agency

deems necessary to remedy the

inadequacy.

(2) Upon receipt of the requested

information or other explanation, the

responsible agency must determine

whether the requester has demonstrated

valid existing rights.

(i) The decision document must

explain how the requester has or has not

satisfied all applicable elements of the

definition of valid existing rights in

§ 761.5. It must set forth the relevant

findings of fact and conclusions and

specify the reasons for the conclusions.

(ii) If the underlying property rights

are in dispute, the agency must defer a

decision until the legal dispute is

resolved.

(3) After making a decision, the

agency must:

(i) Provide a copy of the decision to

the requester and the owner of, or

agency with jurisdiction over, the area

or feature that caused the land to come

under the protection of § 761.11(a); and

(ii) Publish notice of the decision in

a newspaper of general circulation in

the county in which the land is located.

If the request includes Federal lands

within an area listed in paragraph (a)(1)

or (a)(2) of § 761.11, OSM will publish

notice of the decision in the Federal

Register.

(e) Administrative and judicial

review. A determination under this

section that a person has or does not

have valid existing rights is subject to

administrative and judicial review

under §§ 775.11 and 775.13 of this

chapter.

PART 772—REQUIREMENTS FOR

COAL EXPLORATION

14. The authority citation for Part 772

is revised to read as follows:

Authority: 30 U.S.C. 1201 et seq. and 16

U.S.C. 470 et seq.

15. Section 772.10 is revised to read

as follows:

§ 772.10 Information collection.

(a) In accordance with 44 U.S.C. 3501

et seq., the Office of Management and

Budget (OMB) has approved the

information collection and

recordkeeping requirements of this part.

The OMB clearance number is 1029–

0033. OSM and State regulatory

authorities use the information collected

under this part to maintain knowledge

of coal exploration activities, evaluate

the need for an exploration permit, and

ensure that exploration activities

comply with the environmental

protection, public participation, and

reclamation requirements of parts 772

and 815 of this chapter and section 512

of SMCRA (30 U.S.C. 1262). Persons

seeking to conduct coal exploration

must respond to obtain a benefit.

(b) OSM estimates that the combined

public reporting and recordkeeping

burden for all respondents under this

part will average 11 hours per notice or

application submitted, including time

spent reviewing instructions, searching

existing data sources, gathering and

maintaining the data needed, and

completing and reviewing the collection

of information. Specifically, OSM

estimates that preparation of a notice of

intent to explore under § 772.11 will

require an average of 10 hours,

preparation and processing of an

application for coal exploration under

§ 772.12 will require an average of 103

hours, compliance with § 772.14 will

require an average of 18 hours, and

recordkeeping and information

collection under § 772.15 will require an

average of approximately 1 hour per

response. Send comments regarding this

burden estimate or any other aspect of

these information collection

requirements, including suggestions for

reducing the burden, to the Office of

Surface Mining Reclamation and

Enforcement, Information Collection

Clearance Officer, 1951 Constitution

Avenue, N.W., Washington, DC 20240;

and the Office of Management and

Budget, Office of Information and

Regulatory Affairs, Attention: Interior

Desk Officer, 725 17th Street, NW,

Washington, DC 20503. Please refer to

OMB Control Number 1029–0033 in any

correspondence.

16. Section 772.12 is amended by

revising the section title and paragraphs

(d)(2)(ii) and (d)(2)(iii) and adding

paragraphs (b)(14) and (d)(2)(iv) to read

as follows:

§ 772.12 Permit requirements for

exploration that will remove more than 250

tons of coal or that will occur on lands

designated as unsuitable for surface coal

mining operations.

* * * * *

(b) * * *

(14) For the lands described in

§ 761.11(a) of this chapter, a

demonstration that one of the following

conditions exists:

(i) The exploration activities will not

substantially disturb these lands.

(ii) The owner of the coal possesses

valid existing rights as that term is

defined in § 761.5 of this chapter. The

demonstration of valid existing rights

must be made in accordance with the

requirements and procedures of § 761.13

of this chapter. The demonstration and

request for a determination of valid

existing rights may be submitted in

advance of the remainder of the coal

exploration permit application. When

the agency makes a determination in the

absence of a permit application, the

determination is subject to

administrative and judicial review

under § 761.13(e) of this chapter.

(iii) The exploration is needed for

mineral valuation purposes or

authorized by judicial order.

(iv) The applicant has obtained a

waiver or exception in accordance with

paragraphs (c) through (f) of § 761.12 of

this chapter.

* * * * *

(d) * * *

(2) * * *

(ii) Not jeopardize the continued

existence of an endangered or

threatened species listed pursuant to

section 4 of the Endangered Species Act

of 1973 (16 U.S.C. 1533) or result in the

destruction or adverse modification of

critical habitat of those species;

(iii) Not adversely affect any cultural

or historical resources listed on the

National Register of Historic Places

pursuant to the National Historic

Preservation Act, as amended (16 U.S.C.

470 et seq. and Pub. L. 102–575), unless

the proposed exploration has been

approved by both the regulatory

authority and the agency with

jurisdiction over the resources to be

affected; and

(iv) Not substantially disturb any

lands listed in § 761.11(a) of this chapter

unless the applicant has:

(A) Obtained a waiver or exception in

accordance with paragraphs (c) through

(f) of § 761.12 of this chapter;

(B) Demonstrated the existence of

valid existing rights in accordance with

§ 761.13 of this chapter; or

(C) Demonstrated that the disturbance

is needed for mineral valuation

purposes or is authorized by judicial

order.

* * * * *

[FR Doc. 97–2184 Filed 1–30–97; 8:45 am]

BILLING CODE 4310–05–M