OFFICE OF SURFACE MINING RECLAMATION AND ENFORCEMENT

U.S. Department of the Interior

Research conducted by: Todd Leatherman

Page 1 of 3

COALEX STATE INQUIRY REPORT - 74

July 28, 1986

Charles W. Kurtz. Esq.

Office Of General Counsel

Fifth Floor. Capital Plaza Tower

Frankfort, Kentucky 40601

TOPIC: CIVIL PENALTY/RECLAMATION REQUIREMENTS

INQUIRY: May a state regulatory agency impose both civil penalty and reclamation 

requirements upon an operator mining without a valid permit.?

SEARCH RESULTS: A search of COALEX was conducted focusing on decisions of the 

Interior Board of Surface Mining Appeals (the Board) interpreting the Act's application to 

operators conducting surface mining operations without a permit. Also included is a discussion 

of OSM's changes in the regulatory definition of "Permittee" (30 CFR 700.5, 30 CFR 701.5) in 

attempting to clarify the Secretary's interpretation of Congressional intent.

_____________________________________________________________________________

INTERIOR BOARD DECISIONS

The first Board decision dealing with the issue of whether the Secretary could issue notices of 

violation and cessation orders or impose civil penalties upon a surface coal mine operator 

operating without a permit was DELIGHT COAL CORP., 1 IBSMA 186, 86 I.D. 321 (1979).

Delight operated an underground mining operation in Wise County, Virginia. OSM issued 

Delight a notice of violation and three orders of cessation. One of the cessation orders alleged a 

violation of 6502(d) of the Act in Delight's failure to obtain a surface mine permit. Delight filed 

a petition for review, contesting certain elements of the notice of violation and the amounts of 

the proposed civil penalties. The ALJ issued a ruling from the bench concerning Delight's 

petition for review and assessed a penalty. However, before the ALJ issued a written order he 

vacated the order from the bench "in order to prevent a possible= miscarriage of justice by a 

misinterpretation of the law and regulations." The ALJ requested briefings from the parties on 

whether a person who does not have a permit to mine coal was subject to (a) 30 U.S.C. 61201 et 

seq. (1977) and (b) the penalty provisions of 30 CPR 700 et seq. (Id. at 192) Both parties having 

failed to submit briefs in accordance with the ALJ's request, the ALJ issued a written opinion in 

which he held that "because Delight was not a permittee' within the meaning of the Act, the civil 

penalty provisions of section 518 of the Act did not apply...." (Id. at 193)

The Interior Board reversed, stating that:

"Acting on Congress' stated intention that certain operational and reclamation standards apply 

during the initial regulatory program, the Secretary defined permittee' in 30 CFR 700.5 in such a 
OFFICE OF SURFACE MINING RECLAMATION AND ENFORCEMENT

U.S. Department of the Interior

Research conducted by: Todd Leatherman

Page 2 of 3

way as to insure that all persons conducting surface coal mining and reclamation operations 

would be covered during the initial program, despite possible differences in the operation of 

existing state regulatory schemes...." (Id. at 198) 

In conclusion, the Board stated that "the definition of permittee' adopted by the Secretary for the 

initial regulatory program includes those persons who, through ignorance or dishonesty, fail to 

get a permit from the proper regulatory authority before engaging in activities regulated by a 

state." (Id. at 199)

The issue was again presented to the Board in CLAYPOOL CONSTRUCTION CO., 1 IBSMA 

259, 86 I.D. 486 (1979). As in DELIGHT, the ALJ in CLAYPOOL held that the Act did not 

apply to Claypool which was engaged in mining activities without a permit. In reversing, the 

Board cited its decision in DELIGHT and reiterated its conclusion that 30 CFR 700.5 was 

written so as to include a mining operator operating without a permit as a "permittee" and 

therefore subject to the performance and enforcement provisions of the Act.

FEDERAL REGULATIONS

30 CFR 700.5 defines permittee as follows:

"[A]ny individual, partnership, association, society, joint stock company, firm, company, 

corporation, or other business organization holding a permit to conduct surface coal mining and 

reclamation operations issued by a State regulatory authority pursuant to a State program or by 

the Secretary pursuant to a Federal program or a Federal lands programs. During the initial 

regulatory program, the term includes persons conducting surface coal mining and reclamation 

operations regulated by a State under State law or conducting such operations under a mining 

plan approved pursuant to Part 211 of this title." 

This definition was promulgated as part of the initial regulatory program December 13, 1977 (42 

FR 62639) without comment as to its application to operators without permits.

OSM reworded the definition of "permittee" when it issued the permanent program regulation, 

on March 13, 1979 (44 FR 15320), in an effort to clarify the applicability of the Act to operators 

of surface coal mining operations operating without a permit.

The old definition was deleted from the initial program. The new definition was promulgated as 

30 CFR 701.5. which reads as follows:

"Permittee means a person holding or required to hold a permit to conduct surface coal mining 

and reclamation operation issued by a State program, by the Director pursuant to a Federal 

program, by the Director pursuant= to a Federal lands program, or, where a cooperative 

agreement pursuant to Section 523 of the Act has been executed, by the Director and the State 

regulatory authority." 

In explaining the rationale of the Secretary in making the change in the definition, OSM stated:
OFFICE OF SURFACE MINING RECLAMATION AND ENFORCEMENT

U.S. Department of the Interior

Research conducted by: Todd Leatherman

Page 3 of 3

"Several general comments were received which expressed concern over the problem of wildcat 

operators, i.e., persons operating without a permit. The definition of permittee was revised to 

include persons required to hold a permit to make it clear that a person cannot exempt himself 

from the requirements of the Act by failing to obtain a permit. This continues the interpretation 

made and implemented by the Office during the initial program." (44 FR 14935 (MARCH 13, 

1979)) 

In addition, OSM stated that the change was made "... to further clarify that its interpretation of 

the Act is that any person who mines without a permit is in violation of the Act and regulations 

and is subject to enforcement action under the Act." (Id. at 14935)

Therefore, this change in OSM's definition of "permittee" in the permanent program, merely 

represented a clarification of the Secretary's interpretation under the initial program and did not 

constitute a change in policy or application of the Act towards operations being conducted 

without permits.

Challenges to the Secretary's authority to regulate operators operating without permits 

subsequent to the promulgation of the new definition of "permittee" have been just as 

unsuccessful.

In WEST VIRGINIA ENERGY INC., 3 IBSMA 301 (1981), the Board, citing DELIGHT and 

CLAYPOOL, concluded that "... one who should have a permit is chargeable with substantive 

violations even in the absence of the required permit." (Id. at 307)

Likewise in MOUNTAIN ENTERPRISES COAL CO. v OSM, Docket Nos. CH 1-88-R, CH 1-

1-09-P (November 2, 1981), the ALJ cited DELIGHT in stating, "[m]ining without a licence 

[sic] does not produce an impediment to enforcement nor to the assessment of a civil penalty." 

(Id. at 12)

ATTACHMENTS

A. 42 FR 62640 (DECEMBER 13, 1977). 

B. 44 FR 15320 (MARCH 13, 1979). 

C. 44 FR 14935 (MARCH 13, 1979).