OFFICE OF SURFACE MINING RECLAMATION AND ENFORCEMENT

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COALEX STATE INQUIRY REPORT - 268

September 1993

Ted Biggs, Esquire

Indiana Department of Natural Resources

Division of Reclamation

402 West Washington Street

Indianapolis, Indiana 46204

TOPIC: IMPROVIDENTLY ISSUED PERMIT

INQUIRY: Indiana is promulgating regulations that mirror the federal rules on 

improvidently issued permits. Industry is claiming that the state has the authority to 

revoke permits only after showing cause, not through rescission. Are there any cases 

addressing this issue? 

SEARCH RESULTS: Research was conducted using the COALEX Library and the 

other materials available in LEXIS. No cases on this issue were identified. A preamble 

to 1989 final rules and an OSM directive were retrieved that discuss the 

revocation/rescission issue and detail the procedures to be followed for determining 

whether a permit was improvidently issued and the suspension/ rescission of these 

permits. Several additional items are included for background. Copies of the items listed 

below are attached. 

54 FR 18438 (APRIL 28, 1989). Final rule. Improvidently issued permits.

1. Definitions of terms (18438).

"Rescission -- equivalent to revocation, but used to differentiate between the rescission 

of an improvidently issued permit under Sec. 773.21 of this rule and the revocation of a 

permit for a pattern of violations under existing 30 CFR 843.21.

...

Revocation -- see rescission."

2. Permit Rescission vs. Revocation (18460).

"Several commenters said that the Act did not authorize rescission of a permit, only 

revocation. 

. . .

"OSMRE disagrees. Although section 201(c)(1) of the Act used the term revocation and 
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not rescission, these two terms are equivalent.

. . .

"To differentiate between the revocation of a permit for reasons that existed at the time 

of permit issuance, and revocation for reasons that subsequently arose, OSMRE 

applies the term rescind to the former and revoke to the latter. In either case the 

ultimate effect of rescission or revocation is identical -- the loss of the permit -- and the 

choice of different terms for each is simple a matter of administrative convenience."

OSM DIRECTIVE, Subject No. INE-34, Transmittal No. 659, "Improvidently Issued 

Permits" (Issued 2/22/91).

This directive established procedures for determining whether a permit was 

improvidently issued and details the rescission process if the permit is determined to be 

improvidently issued where OSM is the regulatory authority. Particularly relevant 

sections are reproduced below. The entire document is attached.

"4. Policy/Procedures.

"a. Background. Sections 201(c) and 510(c) of the Act require a regulatory authority to 

withhold a surface coal mining and reclamation permit from any applicant who is either 

directly or indirectly responsible for an outstanding violation of the Act or certain other 

environmental laws and regulations or is linked to such a violation through a relationship 

of ownership or control. OSM has implemented these provisions by regulations at 30 

CFR 773.5 and 773.15. Each State regulatory program is required to contain 

counterparts consistent with those regulations.

. . .

"b. Policy. Whenever OSM has reason to believe that a Federal permit has been 

improvidently issued, it shall be agency policy to immediately conduct a review to 

determine whether the permit was, in fact, improvidently issued and to take steps to 

bring the permit into compliance in accordance with the procedures specified in section 

4.d.(1) below. Where OSM has reason to believe that a permit approved pursuant to a 

State program has been improvidently issued, it shall be agency policy to immediately 

notify the State regulatory authority of the matter, and to follow-up with the State to 

ensure that the permit is brought into compliance by implementing the procedures 

specified in section 4.d.(2) below."

"d. Procedures. These include:

"1. Notifying the permittee promptly by certified letter, indicating the basis for the 

determination that the permit was improvidently issued. There is a 15 day response 

period.

"2. If the permittee does not contact the Field Permitting Unit or cooperate to develop an 

abatement plan or payment schedule, the Field Permitting Unit prepares a transmittal, 

accompanied by a Notice of Proposed Suspension and Rescission, for approval of the 

Assistant Director for Field Operations. The transmittal explains actions already taken 

and the reasons why they were unsuccessful. The Notice specifies a time, not to 
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exceed 90 days, for the permittee to submit certain information or the permit will 

automatically be rescinded. It also includes information on how to file an appeal for 

administrative review.

"3. Where the permittee fails to satisfy the requirements necessary to avoid automatic 

suspension or rescission, the Field Permitting Unit prepares a Notice of Permit 

Suspension or a Notice of Permit Rescission for the approval of the Assistant Director 

for Field Operations. These Notices also carry the right of appeal."

See the DIRECTIVE for procedures for State Program Permits and cases where the 

permittee has filed a petition for protection under bankruptcy laws.

HEARINGS on H.R. 2 Before the Subcomm. on Energy and the Environment of the 

House Comm. on Interior and Insular Affairs, 95th Cong., 1st Sess. 71 (February 

24, 1977). Panel discussion.

"The Supreme Court has held that notice and an opportunity to be heard prior to 

suspension or termination of an important benefit is a constitutional imperative.

. . .

"The right to prerevocation hearing is also denied by sections 504(d) and (f). These 

sections allow either the Secretary or the State regulatory authority to determine that a 

permit has been improvidently granted and, in effect, to revoke it in part or in toto. While 

there may be no right to hearing where only questions of law are involved, the 

determinations under 504(d) and (f) must necessarily involve mixed questions of law 

and fact and the due process clause of the Constitution mandates that these questions 

be resolved only after procedurally proper notice and an opportunity to be heard."

Also included with this Report are:

Excerpts from 56 FR 45780 (SEPTEMBER 6, 1991). Proposed rule. Ownership and 

control information.

HEARINGS on H.R. 2 Before Subcomm. the Subcomm. on Energy and the 

Environment of the House Comm. on Interior and Insular Affairs, 95th Cong., 1st Sess. 

344 (February 28, 1977).

ATTACHMENTS

A. 54 FR 18438 (APRIL 28, 1989). Final rule. Improvidently issued permits. 

B. OSM DIRECTIVE, Subject No. INE-34, Transmittal No. 659, "Improvidently 

Issued Permits" (Issued 2/22/91). 

C. HEARINGS on H.R. 2 Before the Subcomm. on Energy and the Environment of 

the House Comm. on Interior and Insular Affairs, 95th Cong., 1st Sess. 71 

(February 24, 1977). Panel discussion. 
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D. Excerpts from 56 FR 45780 (SEPTEMBER 6, 1991). Proposed rule. Ownership

and control information. 

E. HEARINGS on H.R. 2 Before Subcomm. the Subcomm. on Energy and the 

Environment of the House Comm. on Interior and Insular Affairs, 95th Cong., 1st 

Sess. 344 (February 28, 1977).