I 

116TH CONGRESS 

1ST SESSION H. R. 4435 

To amend the Surface Mining Control and Reclamation Act of 1977 to 

protect taxpayers from liability associated with the reclamation of surface 

coal mining operations, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 20, 2019 

Mr. CARTWRIGHT (for himself, Mr. GRIJALVA, Mrs. DINGELL, Mrs. NAPOLITANO, Mr. RASKIN, Mr. LOWENTHAL, and Ms. LEE of California) introduced the following bill; which was referred to the Committee on Natural 

Resources 

A BILL 

To amend the Surface Mining Control and Reclamation Act 

of 1977 to protect taxpayers from liability associated 

with the reclamation of surface coal mining operations, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Coal Cleanup Taxpayer 

5 Protection Act of 2019’’. 


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1 SEC. 2. SURFACE COAL MINING BONDING. 

2 Section 509 of the Surface Mining Control and Rec3 lamation Act of 1977 (30 U.S.C. 1259) is amended— 

4 (1) by striking subsection (c) and inserting the 

5 following: 

6 ‘‘(c) ALTERNATIVE BONDING SYSTEM.— 

7 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

8 the Secretary may approve as part of a State or 

9 Federal program an alternative system that will— 

10 ‘‘(A) achieve the objectives and purposes of 

11 the bonding program pursuant to this section; 

12 and 

13 ‘‘(B) result in no greater risk of financial 

14 liability to the Federal Government or a State 

15 government than the bonding program under 

16 this section. 

17 ‘‘(2) REPORT REQUIRED.—The Secretary may 

18 only approve an alternative bonding system for a 

19 State under paragraph (1) if such State submits a 

20 report to the Secretary that provides the following 

21 information: 

22 ‘‘(A) A history of bond forfeitures and rec23 lamation costs in such State in the seven-year 

24 period ending on the date on which the report 

25 is submitted, including— 


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1 ‘‘(i) in the case of any bond forfeiture, 

2 whether the money collected to make up 

3 the difference between the bond and rec4 lamation cost was sufficient to complete 

5 the reclamation as specified in the permit; 

6 and 

7 ‘‘(ii) an engineer’s estimate of the cost 

8 to complete reclamation of mines for which 

9 such State has not yet determined the cost 

10 of reclamation. 

11 ‘‘(B) A five-year forecast proving the pro12 posed bond pool will be financially sound based 

13 on— 

14 ‘‘(i) the proposed annual or per ton 

15 fees paid by mining operators; 

16 ‘‘(ii) the past and anticipated financial 

17 performance of participating mining opera18 tors; 

19 ‘‘(iii) market projections for the five20 year period beginning on the date of the 

21 submission of such report; 

22 ‘‘(iv) the anticipated number of min23 ing operators participating in each year; 

24 and 


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1 ‘‘(v) anticipated reclamation costs, in2 cluding known reclamation costs and an 

3 engineer’s estimate of costs not yet 

4 known.’’; and 

5 (2) by adding at the end the following: 

6 ‘‘(f) SELF-BONDING.— 

7 ‘‘(1) FEDERAL PROGRAMS.— 

8 ‘‘(A) IN GENERAL.—Effective on the date 

9 of enactment of this subsection, the Secretary— 

10 ‘‘(i) may not accept the bond of the 

11 applicant itself (referred to in this sub12 section as a ‘self-bond’); and 

13 ‘‘(ii) may accept a separate surety or 

14 collateral bond, consistent with subsection 

15 (b). 

16 ‘‘(B) EXISTING SELF-BONDS.—For coal 

17 mining operations covered by a self-bond ac18 cepted by the Secretary prior to the date of en19 actment of this subsection, the permittee shall 

20 replace the self-bond with another form of bond 

21 acceptable to the Secretary under this section 

22 by not later than the earlier of— 

23 ‘‘(i) the date of renewal of the permit 

24 under section 506(d); and 


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1 ‘‘(ii) the date of any major permit 

2 modification under section 506. 

3 ‘‘(2) STATE PROGRAMS.—Not later than 90 

4 days after the date of enactment of this subsection, 

5 the Secretary shall notify all State regulatory au6 thorities that allow applicants to self-bond that the 

7 approved regulatory programs of the State regu8 latory authority must be amended— 

9 ‘‘(A) to remove the authority for applicants 

10 to self-bond; and 

11 ‘‘(B) to require coal mining operations cov12 ered by a self-bond accepted by the State regu13 latory authority prior to the date of enactment 

14 of this subsection to replace the self-bond with 

15 another form of bond acceptable under this sec16 tion by not later than the earlier of— 

17 ‘‘(i) the date of renewal of the permit 

18 under section 506(d); and 

19 ‘‘(ii) the date of any major permit 

20 modification under section 506. 

21 ‘‘(g) BONDS ISSUED BY SURETY.— 

22 ‘‘(1) IN GENERAL.—Not later than 1 year after 

23 the date of enactment of this subsection, the Sec24 retary shall issue rules establishing limitations on 

25 surety bonds accepted under this section to minimize 


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1 the risk of financial liability to the Federal Govern2 ment or a State government, including rules regard3 ing— 

4 ‘‘(A) the maximum quantity of corporate 

5 surety bonds issued by any 1 corporate surety 

6 as a percentage of the total quantity of coal 

7 mine reclamation bonds in any 1 State; 

8 ‘‘(B) the minimum percentage of surety 

9 bonds unrelated to activities regulated pursuant 

10 to this Act required to reinsure corporate surety 

11 bonds; 

12 ‘‘(C) the minimum collateralization re13 quired for corporate surety bonds; and 

14 ‘‘(D) the minimum amount of cash assets 

15 required to be held by a corporate surety as a 

16 percentage of coal mine reclamation bonds 

17 issued by the corporate surety. 

18 ‘‘(2) EXISTING CORPORATE BONDS.—Corporate 

19 surety bonds in existence on the date of enactment 

20 of this subsection must be modified or replaced as 

21 necessary by not later than 1 year after the date on 

22 which the rule is issued under paragraph (1). 

23 ‘‘(h) COLLATERAL REQUIREMENTS.— 

24 ‘‘(1) REAL PROPERTY.—Real property posted 

25 as collateral for a bond may not include— 


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1 ‘‘(A) coal; 

2 ‘‘(B) a coal mine; 

3 ‘‘(C) land that includes a coal mine; 

4 ‘‘(D) land that is located above a coal 

5 mine; 

6 ‘‘(E) a coal processing facility; 

7 ‘‘(F) a coal waste disposal site; 

8 ‘‘(G) coal mining equipment unlikely to re9 tain salvage or resale value; or 

10 ‘‘(H) any other property determined by the 

11 Secretary. 

12 ‘‘(2) RE-EVALUATION.— 

13 ‘‘(A) The Secretary shall re-evaluate the 

14 value of any nonliquid collateral, as that term 

15 is defined in subparagraph (B), 3 years after 

16 such collateral is posted for a bond and every 

17 three years thereafter. 

18 ‘‘(B) In this paragraph, ‘nonliquid collat19 eral’ has the meaning given to it by the Sec20 retary, except that such term— 

21 ‘‘(i) includes the first lien interests in 

22 real estate and equipment; and 

23 ‘‘(ii) does not include— 

24 ‘‘(I) cash; 

25 ‘‘(II) letters of credit; 


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1 ‘‘(III) certificates of deposit; 

2 ‘‘(IV) Federal, State, or munic3 ipal bonds; and 

4 ‘‘(V) investment grade securities. 

5 ‘‘(i) EXECUTIVE COMPENSATION.—The Secretary 

6 may require the inclusion of executive compensation, in7 cluding salaries and bonuses of officers and executives, of 

8 an applicant under this section, and any affiliated com9 pany, as collateral for a bond under this section.’’. 

Æ 


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