PERFORMANCE AND 

ACCOUNTABILITY REPORT

FISCAL YEAR 2009
FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION 

PERFORMANCE AND ACCOUNTABILITY REPORT 

FISCAL YEAR 2009 

TABLE OF CONTENTS 

MESSAGE FROM THE CHAIRMAN ............................................................................................ 3 

MANAGEMENT DISCUSSION AND ANALYSIS ...................................................................... 5 

FINANCIAL SECTION ..................................................................................................................... 

 MANAGEMENT REPRESENTATION LETTER .......................................................... 16 

 INDEPENDENT AUDITOR'S REPORT ON THE FINANCIAL STATEMENTS ........ 20 

 INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL .......................... 21 

 INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH LAWS AND 

 REGULATIONS .............................................................................................................. 22

 BALANCE SHEET ........................................................................................................... 23 

 STATEMENT OF NET COST ......................................................................................... 24 

 STATEMENT OF CHANGES IN NET POSITION ........................................................ 25 

 STATEMENT OF BUDGETARY RESOURCES ........................................................... 26 

 NOTES TO THE FINANCIAL STATEMENTS .............................................................. 27 
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Federal Mine Safety and Health Review Commission 

FY 2009 Performance Accountability Report 

Management Discussion and Analysis 

Overview

The Federal Mine Safety and Health Review Commission (“Commission”) is an 

independent adjudicatory agency charged with resolving disputes arising from the 

enforcement of occupational safety and health standards in the nation’s mines. Under 

its enabling statute, the Federal Mine Safety and Health Act of 1977 (“Mine Act”), as 

amended, the Commission does not regulate the mining industry, nor does it enforce 

the Mine Act; those functions are delegated to the Secretary of Labor acting through the 

Mine Safety and Health Administration (MSHA). 

Mission and Organization Structure 

The Commission’s mission is to provide just, speedy, and articulate adjudication of 

proceedings authorized under the Mine Act, thereby enhancing compliance with the Act 

and contributing to the improved health and safety of the nation’s miners. 

The Commission carries out its responsibilities through trial-level adjudication by the 

Commission’s Office of Administrative Law Judges (ALJs) and appellate review of ALJ 

decisions by a five-member Commission appointed by the President and confirmed by 

the Senate. Most cases involve civil penalties assessed against mine operators by 

MSHA and address whether the alleged safety and health violations occurred, and, if 

so, the appropriate sanctions to be imposed. Other types of cases involve mine 

operators’ contests of mine closure orders, miners’ complaints of safety or health 

related discrimination, miners’ applications for compensation after a mine is idled by a 

closure order, and review of disputes between MSHA and underground coal mine 

operators relating to those operators’ mine emergency plans. 

Once a case is filed with the Commission, it is given a docket number and referred to 

the Chief Administrative Law Judge (Chief ALJ). Thereafter, litigants in the case must 

submit additional filings before the case is assigned to an ALJ. To expedite the 

decisional process, the Chief ALJ may rule on certain motions and, where appropriate, 

issue orders of settlement, dismissal, or default. Otherwise, once a case is assigned to 

an individual judge, that judge is responsible for the case and rules upon motions and 

settlement proposals, schedules the case for hearing, holds the hearing, and issues a 

decision based upon the record. An ALJ’s decision that is not reviewed becomes a 

final, non-precedential order of the Commission. 
6

The 5-member Commission provides administrative appellate review based on the 

record. It may, in its discretion, review decisions issued by ALJ’s when requested by a 

litigant, or it may, on its own initiative, direct cases for review. The Commission’s 

decisions are precedential and appeals from the Commission’s decisions are to the 

federal circuit courts of appeals. 

Key Challenges 

Since FY 2006, the number of new cases filed with the Commission has steadily 

increased. From FY 2000 through FY 2005, the average number of cases filed was 192 

per month, or 2,307 per year. However, in FY 2008 and FY 2009, 8,961 and 9,230 new 

cases were filed, respectively. As of September 30, 2009, the Commission had a 

backlog of 14,090 – over 6 times the normal caseload from FY 1995 through FY 2005. 

The Commission currently has a backlog of over 14,000 cases. In contrast, the average 

backlog from FY 2000 through FY 2004 was only 1,379. 

Only a small fraction of cases decided by the Commission’s OALJ is appealed in any 

given year. Consequently, at the appellate level, the workload is expected to remain 

relatively consistent over the next several years. 200 new cases are anticipated for FY 

2010. 

In addition to conducting its appellate responsibilities, the Commission published an 

advanced notice of proposed rule making regarding requests to reopen cases in which 

a mine operator is in default for failure to respond to the Secretary’s proposed penalty or 

to a Judge’s order. The number of these cases has increased sharply, primarily due to 

a significant number of operators (usually small operators) who, due to increased 

enforcement, are contesting citations, orders, and civil penalties for the first time, and 

who are unfamiliar with Commission procedures. 

The Commission has been taking a number of steps to dispose of cases more efficiently 

and reduce the backlog. In an attempt to expedite the processing of settlement 

decisions, the Commission is in the process of considering alternative filing 

requirements, such as the submission of proposed orders by the parties. For FY 2009, 

the Commission increased its full-time law clerks to 5 to assist the OALJ, which has 

substantially increased the productivity of the Judges. Currently, each clerk is assigned 

to 2 Judges. During FY 2009, the Commission employed the use of 6 additional 

contract employees and secured 5 unpaid law student summer interns to assist in 

reducing the backlog. The Commission continues to develop an electronic casetracking system and electronic filing system, which will reduce processing time and 

improve staff productivity. 
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Performance Goals and Results 

In view of the recent and continuing upsurge in its caseload, the Commission must 

continually reassess its strategic goals in light of changing circumstances. Therefore, 

the Commission has established benchmarks as part of its overall strategic plan, but it 

will also revisit and evaluate those benchmarks as part of its annual performance and 

budget planning activity. 

The annual performance plan will clearly explain the role of each Commission activity as 

set forth in the Commission’s budget. The plan’s specific objectives, adjusted to reflect 

policy determinations and resource allocations in the annual budget process, will serve 

as intermediate steps in the Commission’s overall efforts to successfully accomplish the 

goals of this strategic plan. 

Accordingly, in order to achieve its mission, the Commission has set forth the following 

strategic goals: 1) to ensure expeditious, fair and legally sound adjudication of cases at 

the trial and appellate levels, and 2) to manage the Commission’s human resources, 

operations, facilities, and systems to ensure a continually improving, effective and 

efficient organization. 

Commission Review Function 

The responsibility for the review of ALJ decisions is set forth in section 113(d)(1) of the 

Mine Act. The Act states that an ALJ’s decision shall become final 40 days after its 

issuance, unless within that period any two Commissioners direct that the decision be 

reviewed. 

Most cases come before the Commission when two or more Commissioners vote to 

grant a petition for discretionary review filed by a party adversely affected or aggrieved 

by the ALJ’s decision. Petitioners may include miners, miners’ representatives, mine 

operators or the Secretary of Labor. The Commission is also charged with the 

responsibility of reviewing disputes arising over the emergency response plans of 

underground coal operators pursuant to the Mine Improvement and New Emergency 

Response Act of 2006 (MINER Act), P.L. 109-236. 

Two or more Commissioners may also direct any case for review sua sponte (on the 

Commission’s own motion, without the parties filing a petition). Sua sponte review is 

limited to ALJ decisions that are contrary to law or Commission policy, or that present a 

novel question of policy. By law, a quorum of three Commissioners is required to 

consider and decide cases appealed from the Commission’s ALJs. Many of the 

Commission’s cases present issues of first impression under the Mine Act. That is, the 

cases raise issues that have not been resolved by prior decisions of the Commission or 

the courts or the cases involve the interpretation of safety and health standards and 

regulations newly promulgated by MSHA. 
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The Commission began FY 2009 with an inventory of 103 undecided cases and 

received 184 new cases during the year. One hundred ninety two dispositions were 

made during FY 2009, resulting in 95 undecided cases remaining at the end of the fiscal 

year. In FY 2010, the Commission began the year with an inventory of 95 undecided 

cases, and 200 new cases are anticipated for the year. 

Of the 192 cases decided in FY 2009, 4 were substantive decisions, 184 were 

procedural orders in default cases, and 4 were denials of petitions for review. The 

average age of the 95 default cases pending on the Commission’s docket as of 

September 1, 2009 was 4.1 months, and the average age of the 4 substantive decisions 

issued in FY 2009 was 9.6 months. 

During FY 2009, the number of default cases handled by the Commission continued to 

be a major challenge, particularly for the Commission’s Office of the General Counsel 

(OGC). Default cases typically involve situations where a mine operator has allegedly 

failed to challenge civil penalties proposed by the MSHA within the prescribed 30-day 

period for contesting such proposed penalties. Under the Mine Act, proposed penalties 

that are not contested in a timely manner automatically become final Commission 

orders. Operators may file written requests with the Commission seeking to establish 

“good cause” to re-open the final orders. The Commission has determined that 

operators may file requests seeking to establish good cause to re-open final orders 

utilizing principles adopted by the Federal Courts. 

The number of default cases received by the Commission increased dramatically from 

68 in FY 2007 to 177 in FY 2008 - a 250 percent increase. This higher rate continued in 

FY 2009 as 170 default cases were received. The increase in default orders has greatly 

increased the demands on OGC’s attorneys, who must analyze each case and prepare 

a draft order for the Commissioners. 

The following table provides the performance goals and results for this function for FYs 

2006 - 2009. 

COMMISSION REVIEW APPELLATE CASES 

ISSUE OPINION IN A TIMELY MANNER GOAL 

PERFORMANCE GOALS FY 

2006 

FY 

2007 

FY 

2008 

FY 

2009 MET NOT 

MET 

Decide all cases within 18 months of 

receipt. (undecided cases over 18 

months of age) 

0 0 0 0 √ 

Assign all cases before briefing is 

completed. (cases briefed but 

unassigned) 

0 0 0 0 √ 

Maintain average age of substantive 

decisions at 12 months of less. 

(average age of substantive decisions) 

15.5 5.1 8.9 9.6 √ 
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Administrative Law Judge Function 

The Commission employs Administrative Law Judges to hear and decide contested 

cases at the trial level, as initiated by the Secretary of Labor, mine operators, and 

miners or their representatives. The judges are also responsible for evaluating and 

approving or denying settlement agreements under the Mine Act. 

Administrative Law Judges travel to hearing sites located at or near the mine involved in 

order to afford mine operators, miners and their representatives full opportunity to 

participate in the hearing process. 

The Commission believes that the number of new case filings will not decrease in the 

coming years as operators continue to elect to contest higher civil penalties proposed 

by MSHA and as MSHA increases its utilization of its “pattern of significant and 

substantial violations” sanctions. 

The Commission’s Office of Administrative Law Judges began FY 2009 with an 

inventory of 9,737 cases and 9,239 new cases were filed during the year. Case 

dispositions for the year were 4,766, resulting in an end-of-year inventory of 14,213 

undecided trial cases. The number of new trial cases received in FY 2009 was 280 

percent higher than FY 2005. The Commission Judges’ disposition rate remained 

constant in FY 2009 with 91% of these dispositions occurring within 12 months of 

assignment. In FY 2010, the Commission is beginning the year with an inventory of 

14,213 undecided trial cases, and 9,200 cases are anticipated for the year. 

The Commission monitors its workload by Dockets. Each Docket contains one or more 

citations, and each citation is, in essence, a separate case for which a Judge must 

render a decision. Prior to February 2009, Dockets were limited to 20 citations due to 

MSHA’s practices. Therefore, each Docket would be comprised of no more than 20 

citations, or cases. However, since MSHA has removed that limit, Dockets may now 

include all citations related to a particular inspection. Therefore, the number of citations 

in one Docket could range from 1 to a few hundred. Approximately 10% of our Dockets 

were affected by the removal of the 20 citation limit. 
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The following table provides the performance goals and results for this function for FYs 

2006 – 2009. 

OFFICE OF ADMINISTRATIVE LAW JUDGES

Ensure Timely Issuance of Decisions GOAL 

PERFORMANCE GOALS FY 

2006

FY 

2007

FY 

2008 

FY 

2009 

MET NOT 

MET 

Issue 90 percent of decisions within 180 

days of receipt of the post-hearing briefs. 88% 69% 60% 86% 

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Issue 95 percent of settlement decisions 

within 60 days of receipt of settlement 

motions. 

96% 80% 73% 61% 9

Decide 90 percent of cases within 12 

months of assignment. 98% 97% 79% 91% 9

Undecided cases over 365 days of age. N/A N/A 2,989 3,738 9

Office of the Executive Director Function 

The Office of the Executive Director (OED) provides administrative services to support 

the Commission in fulfilling its mission. 

OED provides strategic planning and operational management for the organization. 

OED also includes administrative services, financial, human resources, procurement, 

technology management, and computer and information security. The day-to-day tasks 

performed under the direction of the Executive Director include: 

• Supporting the development and implementation of the Agency’s strategic goal; 

• Supporting the implementation and development of effective and efficient case 

management and administrative systems through information technology 

hardware and software; 

• Maintaining and enhancing a website to provide the public with user friendly 

access to Commission information; 

• Enhancing telecommunications and improving technology efficiency and 

effectiveness; 

• Providing support agency-wide in the areas of human resources, procurement, 

budget, finance, equal opportunity, and general administrative services; 

• Providing personnel, payroll, benefits, hearing coordination, and travel 

coordination to agency employees; and 

• Procuring goods and services, maintenance and needed repairs of equipment, 

training, reference materials, and supplies and office space. 
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Analysis of Financial Statements 

The Accountability of Tax Dollars Act of 2002 requires that the Commission’s financial 

statements be audited annually. In accordance with the Accountability of Tax Dollars 

Act of 2002, the Commission began annual audits in FY 2003. The Commission has 

received an “unqualified” opinion for each annual review conducted by an independent 

auditor. 

The Commission has contracted with the Bureau of Public Debt, Administrative 

Resource Center, for accounting services since 1998. The Administrative Resource 

Center prepared the Commission’s FY 2009 financial statements, which include 

comparative data for FY 2008. The principal financial statements include the Balance 

Sheet, Statement of Net Cost, Statement of Changes in Net Position, and Statement of 

Budgetary Resources. 

Analysis of the Balance Sheet 

The Commission’s assets in fiscal year 2009 were $3,130,660 as of September 30, 

2009. This represents a decrease of $748,956 from fiscal year 2008. The Fund 

Balance with Treasury of $3,019,141 represents the Commission’s largest asset as of 

September 30, 2009. This is a decrease of approximately 21 percent from fiscal year 

2008 and represents approximately 96 percent of the agency’s total assets. General 

Property, Plant and Equipment accounts for approximately 4 percent of the Commission 

total assets as of September 30, 2009. The net fixed asset value of $111,179 equals 

the cost less accumulated depreciation and represents the current book value of those 

assets. 

The Commission’s liabilities in fiscal year 2009 totaled $649,438 as of September 30, 

2009. This is a decrease of $56,395 from the fiscal year 2008 balance of $705,833. 

Accounts payable balance at September 30, 2009, was $81,201, a decrease of $71,648 

from September 30, 2008. Accrued payroll liabilities and payroll taxes payable 

increased slightly in 2009. Unfunded annual leave decreased $24,380 in 2009 from 

2008. Unfunded annual leave represents approximately 42 percent of total agency 

liabilities. 

Net position is the difference between total assets and total liabilities. The total net 

position for fiscal year 2009 decreased by $692,561 from fiscal year 2008. 
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Analysis of Statement of Net Cost 

The statement of Net Cost shows the net cost of operations for the agency, and it is 

broken out between the Commissions two major programs, Administrative Law Judge 

and Commission. The total net cost of operations in 2009 was $8,893,048, an increase 

of $539,832, or 6 percent, over the 2008 net cost of operations of $8,353,216. 

Analysis of the Statement of Changes in Net Position 

The Statement of Changes in Net Position reports the change in the agency’s net 

position during the reporting period. The net position consists of two components, the 

unexpended appropriations and the cumulative results of operations. The Net Position 

decreased $692,561 in 2009 from 2008, a change of approximately 22 percent. 

Analysis of the Statement of Budgetary Resources 

The Statement of Budgetary Resources presents how the budgetary resources were 

made available and the status of the budgetary resources at the end of the reporting 

period. The total budgetary resources must always equal the total status of budgetary 

resources. For fiscal year 2009, the Commission had total budgetary resources of 

$10,694,210, which is $14,458 less than in 2008. 

Management Assurances 

Systems, Controls, and Legal Compliance 

The Commission is responsible for establishing and maintaining effective internal 

control over financial reporting which includes safeguarding assets and complying with 

applicable laws and regulations. As a micro independent agency, the Commission must 

rely heavily on the systems and controls provided by servicing agencies to meet the 

OMB’s guidelines and the requirements of law with respect to financial management, 

accounting systems, and financial reporting. These services are supplemented by 

internal control procedures within the Commission sufficient to assure that the 

performance and financial data included in this audit report are complete and reliable. 

All financial data reported was obtained from the FY 2009 accounting reports prepared 

by the Bureau of Public Debt, the Commission’s accounting servicing provider, and the 

performance data on case intake and dispositions has been verified by Commission 

managers. There are no material inadequacies or non-conformance in either the 

completeness or reliability of the data reported. 

Commission managers are pleased to certify, with reasonable assurance, that the 

Commission’s systems of internal controls and the systems of accounting used by the 

Bureau of Public Debt are in compliance with the Federal Managers Financial Integrity 

Act. 
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The EEO Office of the Commission directs and manages a comprehensive EEO 

program assuring compliance with all Federal anti-discrimination laws and regulations. 

It provides policy and legal guidance to the Chairman and other senior level managers, 

ensuring that the agency is kept abreast of all critical developments in the law. The 

EEO office oversees the EEO counseling, alternative dispute resolution (“ADR”) and 

complaint procedures. It develops, manages and implements the agency’s EEO 

policies and procedures. The office coordinates and conducts the required EEO 

agency-wide trainings for all personnel. The EEO office prepares and submits agency 

reports in compliance with the statutory and Equal Employment Opportunity 

Commission (“EEOC”) reporting requirements (e.g., the Congressional submission 

under the No FEAR Act, EEOC Management Directive 715, and the Annual Federal 

EEO Statistical Report of Discrimination Complaints). It works with senior managers to 

promote equal opportunity in recruitment, training, benefits, and promotion. 

Last year, the EEO Office incurred a number of expenses as part of its mission. It 

purchased on-line training for all personnel to review the requirements of the No FEAR 

Act. This is a requirement for all new personnel and agency-wide every two years. The 

office also hired two contract counselors to meet with agency employees and one 

mediator to resolve a formal complaint. The agency also prepared a Final Agency 

Decision (FAD) in one case. In order to keep current with the ever-changing EEO law 

and requirements, the EEO Director attends training courses and EEO Director 

meetings. The office plans to continue its annual trainings in the EEO field so as to 

proactively prevent discrimination and to raise the awareness of employees and 

managers as to their rights and remedies. 

The Commission has implemented a new system of providing annual ethics training to 

its employees. Previously, the Commission typically presented one hour of ethics 

training through a general overview to employees who were required to receive annual 

ethics training under 5 C.F.R. §§ 2638.704 and 2638.705. During FY 2009, 

Commission employees have been receiving ethics training on-line at a website 

managed by the Bureau of Public Debt. In creating the training, the Commission 

identified various subjects relating to ethics that are relevant to Commission employees. 

For each subject, the Commission’s ethics officials drafted background material and 

questions and answers that specifically relate to issues likely to be faced by 

Commission employees. Employees read the material, answer the questions, and read 

further information provided in the answers. An automatic certificate of completion is 

then generated for record-keeping purposes. 

The new ethics training method has led to a number of positive changes. First, the 

Commission now provides training more often and as the specific need arises. In FY 

2009, the Commission provided two training sessions for employees. In addition, the 

Commission has been able to involve a greater spectrum of employees in training, 

rather than only those employees required to receive annual training. The Commission 

also has been able to tailor training to current matters at issue. Finally, the 
14

Commission’s ethics officials have noticed a heightened awareness in employees 

regarding their ethical obligations. 

During the 2009 fiscal year, the agency received 46 FOIA requests. The majority of 

these requests were for case-related materials. When the agency was in possession of 

documents and information that were responsive to the FOIA request, the request was 

granted and the information provided within the 20-day statutory time period. For five 

requests, the agency did not possess records responsive to the request made. No 

requests were denied in part or in whole. The agency collected $64.30 in fees. 

The agency has a Chief FOIA Officer and a FOIA Liaison who administer its FOIA 

program. During FY 2009, both employees expended on average 5% of their work time 

administering the agency’s FOIA program. Other agency employees participated in 

responding to certain FOIA requests, on an as-needed basis. Overall, in FY 2009, the 

agency’s FOIA program involved approximately 1 - 2% of the agency’s overall work load 

and cost approximately $12,000 in expenses, including personnel time. 

The Commission continues to devote a major portion of its information technology 

efforts to network security. In FY 2009, the Commission implemented proactive 

measures in order to protect the networks core infrastructure as well as end user 

computer and their privacy. Symantec End Point Protection Suite and deployment of 

the Symantec Mail Security module for exchange have added additional security from 

internal and external threats against the core infrastructure and end users. 

Performance Data Verification 

The adjudicative and managerial goals and objectives set forth above can be achieved 

through an integrated set of strategies that build on current Commission programs and 

initiatives. The Commission now provides same day electronic recordings of oral 

arguments and decisional meetings on its web site. The Commission’s Performance 

Data and Verification web site access is provided in real time. The Commission is 

implementing a new case management system so that all case files will be stored 

electronically. The system will ultimately allow parties to file all documents electronically 

as well. 

Working from the premise that fair and expeditious decision-making and efficient 

agency management go hand in hand, the Commission adopts the following strategies 

to implement the strategic goals and objectives: 1) prioritize the decisional process; 2) 

maintain and enhance an information technology program; 3) improve human resources 

management; and 4) promote employee accountability. 

The Commission will evaluate its progress towards accomplishing its strategic goals, 

through analysis of the results of its performance measures and through a continual 

reassessment of its workload and the needs of the parties that it serves. Program 

strengths and weakness will be assessed to determine alternative courses of action. 
15

The Commission will use the results of these evaluations to develop the annual 

performance goals and objectives which will focus the Commission's activities for the 

year. 

Limitations of the Financial Statements 

The principal financial statements have been prepared to report the financial position 

and results of operations of the Federal Mine Safety and Health Review Commission, 

pursuant to the requirements of 31 U.S.C. 3515 (b). 

The statements have been prepared from the books and records of the Commission in 

accordance with GAAP for Federal entities and the formats prescribed by OMB. The 

statements are in addition to the financial reports used to monitor and control budgetary 

resources, which are prepared from the same books and records. 
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17
18
19
20
21
22
The accompanying notes are an integral part of these financial statements. 

23 

2009 2008

Assets:

Intragovernmental:

Fund Balance With Treasury (Note 2) 3,019,141 $ 3,798,259 $ 

Total Intragovernmental 3,019,141 3,798,259 

Accounts Receivable (Note 3) 340 - 

General Property, Plant and Equipment, Net (Note 4) 111,179 81,357 

Total Assets 3,130,660 $ 3,879,616 $ 

Liabilities:

Intragovernmental:

Accounts Payable - $ 2,094 $ 

Other (Note 6) 47,193 39,607 

Total Intragovernmental 47,193 41,701 

Accounts Payable 81,201 150,755 

Other (Note 6) 521,044 513,377 

Total Liabilities 649,438 $ 705,833 $ 

Net Position:

Unexpended Appropriations - Other Funds 2,645,321 $ 3,392,425 $ 

Cumulative Results of Operations - Other Funds (164,099) (218,642) 

Total Net Position 2,481,222 $ 3,173,783 $ 

Total Liabilities and Net Position 3,130,660 $ 3,879,616 $ 

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

BALANCE SHEET

AS OF SEPTEMBER 30, 2009 AND 2008

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

24 

2009 2008

Program Costs:

Commission Review

Gross Costs (Note 8) 4,733,967 $ 4,313,028 $ 

Net Program Costs 4,733,967 $ 4,313,028 $ 

Other Programs:

Administrative Law Judge Determinations

Gross Costs (Note 8) 4,159,081 $ 4,040,188 $ 

Net Program Costs 4,159,081 $ 4,040,188 $ 

Net Cost of Operations 8,893,048 $ 8,353,216 $ 

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

STATEMENT OF NET COST

FOR THE YEARS ENDED SEPTEMBER 30, 2009 AND 2008

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

25 

2009 2008

Cumulative Results of Operations:

Beginning Balances (218,642) $ (207,051) $ 

Budgetary Financing Sources:

Appropriations Used 8,495,515 7,936,929 

Other Financing Sources (Non-Exchange):

Imputed Financing Sources 452,076 404,696 

Total Financing Sources 8,947,591 8,341,625 

Net Cost of Operations 8,893,048 8,353,216 

Net Change 54,543 (11,591) 

Cumulative Results of Operations (164,099) $ (218,642) $ 

Unexpended Appropriations:

Beginning Balances 3,392,425 $ 4,427,549 $ 

Budgetary Financing Sources:

Appropriations Received 8,653,000 8,096,000 

Other Adjustments (904,589) (1,194,195) 

Appropriations Used (8,495,515) (7,936,929) 

Total Budgetary Financing Sources (747,104) (1,035,124) 

Total Unexpended Appropriations 2,645,321 $ 3,392,425 $ 

Net Position 2,481,222 $ 3,173,783 $ 

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

STATEMENT OF CHANGES IN NET POSITION

FOR THE YEARS ENDED SEPTEMBER 30, 2009 AND 2008

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

26 

2009 2008

Budgetary Resources:

Unobligated Balance:

Unobligated Balance Brought Forward, October 1 2,921,486 $ 3,386,498 $ 

Recoveries of Prior Year Unpaid Obligations 24,313 420,365 

Budget Authority

Appropriation 8,653,000 8,096,000 

Less: Permanently Not Available 904,589 1,194,195 

Total Budgetary Resources 10, $ 10,708,668 694,210 $ 

Status of Budgetary Resources:

Obligations Incurred

Direct 8,759,964 $ 7,787,182 $ 

Unobligated Balance

Apportioned 25,615 358,031 

Unobligated Balance Not Available 1,908,631 2,563,455 

Total Status of Budgetary Resources 10, $ 10,708,668 694,210 $ 

Change in Obligated Balance:

Obligated Balance, Net

Unpaid Obligations, Brought Forward, October 1 876,773 $ 1,313,227 $ 

Obligations Incurred Net 8,759,964 7,787,182 

Less: Gross Outlays 8,527,529 7,803,270 

Less: Recoveries of Prior Year Unpaid

Obligations, Actual 24,313 420,365 

Obligated Balance, Net, End of Period

Unpaid obligations 1,084,895 876,773 

Total, Unpaid Obligated Balance, Net, End of Period 1,084,895 $ 876,773 $ 

Net Outlays:

Net Outlays:

Gross Outlays 8,527,529 $ 7,803,270 $ 

Net Outlays 8,527,529 $ 7,803,270 $ 

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

STATEMENT OF BUDGETARY RESOURCES

FOR THE YEARS ENDED SEPTEMBER 30, 2009 AND 2008

(In Dollars)
FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION 

NOTES TO THE FINANCIAL STATEMENTS 

27 

NOTE 1. SUMMARY OF SIGNIFICANT 

ACCOUNTING POLICIES 

A. Reporting Entity 

The Federal Mine Safety and Health Review 

Commission (MSC) is an independent Federal 

agency with the mission of providing 

administrative trial and appellate review of 

legal disputes arising under the Federal Mine 

Safety and Health Amendments Act of 1977, 

Public Law 91-173, amended by Public Law 

95-164. The MSC reporting entity is 

comprised of General Funds and General 

Miscellaneous Receipts. 

General Funds are accounts used to record 

financial transactions arising under 

congressional appropriations or other 

authorizations to spend general revenues. 

General Fund Miscellaneous Receipts are 

accounts established for receipts of nonrecurring activity, such as fines, penalties, fees 

and other miscellaneous receipts for services 

and benefits. 

MSC has rights and ownership of all assets 

reported in these financial statements. We do 

not possess any non-entity assets. 

B. Basis of Presentation 

The financial statements have been prepared to 

report the financial position, net cost of 

operations, changes in net position, and the 

status and availability of budgetary resources 

of MSC. The statements are a requirement of 

the Chief Financial Officers Act of 1990, the 

Government Management Reform Act of 1994 

and the Accountability of Tax Dollars Act of 

2002. They have been prepared from, and are 

fully supported by, the books and records of 

MSC in accordance with the hierarchy of 

accounting principles generally accepted in the 

United States of America, standards approved 

by the principals of the Federal Accounting 

Standards Advisory Board (FASAB), OMB 

Circular A-136, Financial Reporting 

Requirements and MSC accounting policies 

which are summarized in this note. These 

statements, with the exception of the Statement 

of Budgetary Resources, are different from 

financial management reports, which are also 

prepared pursuant to OMB directives that are 

used to monitor and control MSC’s use of 

budgetary resources. 

C. Budgets and Budgetary Accounting 

Congress usually enacts appropriations to 

permit MSC to incur obligations for specified 

purposes. In fiscal years 2009 and 2008, we 

were accountable for General Fund 

appropriations. We recognize budgetary 

resources as assets when cash (funds held by 

the U.S. Treasury) is made available through 

the Department of Treasury General Fund 

warrants. 

D. Basis of Accounting 

Transactions are recorded on both an accrual 

accounting basis and a budgetary basis. Under 

the accrual method, revenues are recognized 

when earned, and expenses are recognized 

when a liability is incurred, without regard to 

receipt or payment of cash. Budgetary 

accounting facilitates compliance with legal 

requirements on the use of federal funds. 

E. Revenues & Other Financing Sources 

Congress enacts annual appropriations to be 

used, within statutory limits, for operating and 

capital expenditures. Appropriations are 

recognized as a financing source when 

expended. 
28 

We recognize as an imputed financing source 

the amount of accrued pension and postretirement benefit expenses for current 

employees paid on our behalf by the Office of 

Personnel Management (OPM). 

F. Taxes 

MSC, as a Federal entity, is not subject to 

Federal, State, or local income taxes, and, 

accordingly, no provision for income taxes has 

been recorded in the accompanying financial 

statements. 

G. Fund Balance with Treasury 

The U.S. Treasury processes cash receipts and 

disbursements. Funds held at the Treasury are 

available to pay agency liabilities. MSC does 

not maintain cash in commercial bank 

accounts or foreign currency balances. 

Foreign currency payments are made either by 

Treasury or the Department of State and are 

reported by MSC in the U.S. dollar 

equivalents. 

H. Accounts Receivable 

Accounts receivable consists of amounts owed 

to MSC by other Federal agencies and the 

public. Amounts due from Federal agencies 

are considered fully collectible. Accounts 

receivable from the public include 

reimbursements from employees. An 

allowance for uncollectible accounts 

receivable from the public is established when, 

based upon a review of outstanding accounts 

and the failure of all collection efforts, 

management determines that collection is 

unlikely to occur considering the debtor’s 

ability to pay. 

I. Property, Equipment, and Software 

Property, equipment and software represent 

furniture, fixtures, equipment, and information 

technology hardware and software which are 

recorded at original acquisition cost and are 

depreciated or amortized using the straight-line 

method over their estimated useful lives. 

Major alterations and renovations are 

capitalized, while maintenance and repair costs 

are charged to expense as incurred. MSC's 

capitalization threshold is $50,000 for 

individual purchases and $500,000 for bulk 

purchases. Applicable standard governmental 

guidelines regulate the disposal and 

convertibility of agency property, equipment, 

and software. The useful life classifications 

for capitalized assets are as follows: 

Leasehold Improvements is the period of the 

lease, and Office Equipment is 5 years. 

 

J. Advances and Prepaid Charges 

Advance payments are generally prohibited by 

law. There are some exceptions, such as 

reimbursable agreements, subscriptions and 

payments to contractors and employees. 

Payments made in advance of the receipt of 

goods and services are recorded as advances or 

prepaid charges at the time of prepayment and 

recognized as expenses when the related goods 

and services are received. 

K. Liabilities

Liabilities represent the amount of monies or 

other resources likely to be paid by the MSC as 

a result of transactions or events that have 

already occurred. No liability can be paid, 

however, absent an appropriation or other 

funding. Liabilities for which an appropriation 

has not been enacted or other funds received 

are, therefore, classified as not covered by 

budgetary resources. There is no certainty that 

the appropriation will be enacted. 

Additionally, the Government, acting in its 

sovereign capacity, can abrogate liabilities. 

Liabilities not covered by budgetary resources 

on the Balance Sheet are equivalent to amounts 

reported as components requiring or generating 

resources on the Reconciliation of Net Cost to 

Budget. 

 

L. Accounts Payable 

Accounts payable consists primarily of 

amounts owed to other Federal agencies and 

the public for contracts for goods or services, 

such as leases, utilities, telecommunications 

and consulting and support services. 
29 

M. Annual, Sick, and Other Leave 

Annual leave is accrued as it is earned, and the 

accrual is reduced as leave is taken. The 

balance in the accrued leave account is 

adjusted to reflect current pay rates. Liabilities 

associated with other types of vested leave, 

including compensatory, restored leave, and 

sick leave in certain circumstances, are accrued 

at year-end, based on latest pay rates and 

unused hours of leave. Funding will be 

obtained from future financing sources to the 

extent that current or prior year appropriations 

are not available to fund annual and other 

types of vested leave earned but not taken. 

Nonvested leave is expensed when used. Any 

liability for sick leave that is accrued but not 

taken by a Civil Service Retirement System 

(CSRS)-covered employee is transferred to the 

Office of Personnel Management upon the 

retirement of that individual. No credit is 

given for sick leave balances upon the 

retirement of Federal Employees Retirement 

System (FERS)-covered employees. 

N. Retirement Plans 

MSC employees participate in either the CSRS 

or the FERS. The employees who participate 

in CSRS are beneficiaries of MSC matching 

contribution, equal to seven percent of pay, 

distributed to their annuity account in the Civil 

Service Retirement and Disability Fund. 

FERS went into effect on January 1, 1987. 

FERS and Social Security automatically cover 

most employees hired after December 31, 

1983. Employees hired prior to January 1, 

1984 elected to join either FERS and Social 

Security, or remain in CSRS. FERS offers a 

savings plan to which MSC automatically 

contributes one percent of pay and matches 

any employee contribution up to an additional 

four percent of pay. For FERS participants, 

MSC also contributes the employer’s matching 

share of Social Security. 

FERS employees and certain CSRS 

reinstatement employees are eligible to 

participate in the Social Security program after 

retirement. In these instances, MSC remits the 

employer’s share of the required contribution. 

MSC recognizes the imputed cost of pension 

and other retirement benefits during the 

employees’ active years of service. OPM 

actuaries determine pension cost factors by 

calculating the value of pension benefits 

expected to be paid in the future and 

communicate these factors to MSC for current 

period expense reporting. OPM also provides 

information regarding the full cost of health 

and life insurance benefits. MSC recognized 

the offsetting revenue as imputed financing 

sources to the extent these expenses will be 

paid by OPM. 

MSC does not report on its financial 

statements information pertaining to the 

retirement plans covering its employees. 

Reporting amounts such as plan assets, 

accumulated plan benefits, and related 

unfunded liabilities, if any, is the responsibility 

of the OPM. 

O. Use of Estimates 

The preparation of the accompanying financial 

statements in accordance with generally 

accepted accounting principles requires 

management to make certain estimates and 

assumptions that affect the reported amounts 

of assets, liabilities, revenues, and expenses. 

Actual results could differ from those 

estimates. 

P. Imputed Costs/Financing Sources 

Federal Government entities often receive 

goods and services from other Federal 

Government entities without reimbursing the 

providing entity for all the related costs. In 

addition, Federal Government entities also 

incur costs that are paid in total or in part by 

other entities. An imputed financing source is 

recognized by the receiving entity for costs 

that are paid by other entities. MSC 

recognized imputed costs and financing 

sources in fiscal years 2009 and 2008 to the 

extent directed by OMB. 
30 

Q. Expired Accounts and Cancelled 

Authority 

Unless otherwise specified by law, annual 

authority expires for incurring new obligations 

at the beginning of the subsequent fiscal year. 

The account in which the annual authority is 

placed is called the expired account. For five 

fiscal years, the expired account is available 

for expenditure to liquidate valid obligations 

incurred during the unexpired period. 

Adjustments are allowed to increase or 

decrease valid obligations incurred during the 

unexpired period but not previously reported. 

At the end of the fifth expired year, the expired 

account is cancelled. 

NOTE 2. FUND BALANCE WITH TREASURY

Fund balance with Treasury account balances as of September 30, 2009 and 2008 were as 

follows: 

Fund Balances:

2009 2008

Appropriated Funds $ 3,019,141 $ 3,798,259 

Total $ 3,019,141 $ 3,798,259 

Status of Fund Balance with Treasury:

2009 2008

Unobligated Balance

 Available $ 25,615 $ 358,031 

 Unavailable 1,908,631 2,563,455 

Obligated Balance Not Yet Disbursed 1,084,895 876,773 

Total $ 3,019,141 $ 3,798,259 

NOTE 3. ACCOUNTS RECEIVABLE 

Accounts receivable balances as of September 30, 2009 and 2008 were as follows: 

2009 2008

With the Public

Accounts Receivable - Employee $ - 340 $ 

Total Accounts Receivable $ - 340 $ 

Historical experience has indicated that the majority of the receivables are collectible. There are 

no material uncollectible accounts as of September 30, 2009 and 2008. 
31 

NOTE 4. PROPERTY, EQUIPMENT, AND SOFTWARE 

Property, equipment, and software account balances as of September 30, 2009 and 2008 were as 

follows: 

Schedule of Property, Equipment, and Software as of September 30, 2009 

Major Class

Acquisition 

Cost

Accumulated 

Amortization/

Depreciation

Net Book 

Value

Leasehold Improvements 120,123 $ 26,829 $ 93,294 $ 

Furniture & Equipment 99,597 81,712 17,885 

Total 219,720 $ 108,541 $ 111,179 $ 

Schedule of Property, Equipment, and Software as of September 30, 2008 

Major Class

Acquisition 

Cost

Accumulated 

Amortization/

Depreciation

Net Book 

Value

Leasehold Improvements 54,441 $ 10,888 $ 43,553 $ 

Furniture & Equipment 99,597 61,793 37,804 

Total 154,038 $ 72,681 $ 81,357 $ 

NOTE 5. LIABILITIES NOT COVERED BY BUDGETARY RESOURCES 

The liabilities on MSC’s Balance Sheet as of September 30, 2009 and 2008, include liabilities not 

covered by budgetary resources. Congressional action is needed before budgetary resources can 

be provided. Although future appropriations to fund these liabilities are likely and anticipated, it 

is not certain that appropriations will be enacted to fund these liabilities. 

2009 2008

Annual Leave 275,618 $ 299,998 $ 

Total Liabilities 275,618 $ 299,998 $ 

 
32 

NOTE 6. OTHER LIABILITIES

All Other Liabilities are considered current liabilities. 

2009 2008

Intragovernmental Liabilities

Payroll Taxes Payable 47,193 $ 39,607 $ 

Total Intragovernmental Liabilities 47,193 $ 39,607 $ 

2009 2008

With the Public

 Payroll Taxes Payable 12,547 $ 6,673 $ 

 Accrued Funded Payroll and Leave 232,879 206,706 

 Unfunded Annual Leave 275,618 299,998 

Total Public Liabilities 521,044 $ 513,377 $ 

NOTE 7. LEASES

Operating Leases

MSC occupies office space under a lease agreement that is accounted for as an operating lease. 

The lease term began on October 1, 2002 and expires on October 1, 2012. Lease payments are 

increased annually based on the adjustments for operating cost and real estate tax escalations. 

The total operating lease expense for Fiscal Years 2009 and 2008 were $1,262,434 and 

$1,302,602, respectively. Below is a schedule of future payments for the term of the lease. 

Fiscal Year Building

2010 $ 1,311,542 

2011 1,337,542 

2012 1,364,040 

Total Future Payments $ 4,013,124 

The operating lease amount does not include estimated payments for leases with annual renewal 

options. 
33 

NOTE 8. INTRAGOVERNMENTAL COSTS AND EXCHANGE REVENUE 

Intragovernmental costs and intragovernmental exchanges revenue represent goods and services 

exchange transactions made between two reporting entities within the Federal government, and 

are in contrast to those with non-federal entities (the public). Such costs and revenue are 

summarized as follows: 

2009 2008

Commission Review

 Intragovernmental Costs 1,787,463 $ 1,580,222 $ 

 Public Costs 2,946,504 2,732,806 

 Net Program Costs 4,733,967 4,313,028 

Administrative Law Judge Determinations

 Intragovernmental Costs 1,560,562 1,508,721 

 Public Costs 2,598,519 2,531,467 

 Net Program Costs 4,159,081 4,040,188 

Total Intragovernmental costs 3,348,025 3,088,943 

Total Public costs 5,545,023 5,264,273 

 Total Net Cost 8,893,048 $ 8,353,216 $ 

NOTE 9. IMPUTED FINANCING SOURCES 

MSC recognizes as imputed financing the amount of accrued pension and post-retirement benefit 

expenses for current employees. The assets and liabilities associated with such benefits are the 

responsibility of the administering agency, the Office of Personnel Management (OPM). For the 

fiscal years ended September 30, 2009 and 2008, respectively, imputed financing was as follows. 

2009 2008

Office of Personnel Management $ 452,076 $ 404,696 

Total Imputed Financing Sources $ 452,076 $ 404,696 

NOTE 10. BUDGETARY RESOURCE COMPARISONS TO THE BUDGET OF THE 

UNITED STATES GOVERNMENT

The President’s Budget that will include FY09 actual budgetary execution information has not yet 

been published. The President’s Budget is scheduled for publication in February 2010 and can be 

found at the OMB Web site: http://www.whitehouse.gov/omb/. The 2010 Budget of the United 

States Government, with the Actual column completed for 2008, has been reconciled to the 

Statement of Budgetary Resources and there were no material differences. 
34 

NOTE 11. APPORTIONMENT CATEGORIES OF OBLIGATIONS INCURRED 

Obligations incurred and reported in the Statement of Budgetary Resources in 2009 and 2008 

consisted of the following: 

2009 2008

Direct Obligations, Category A 8,759,964 $ 7,787,182 $ 

Total Obligations Incurred 8,759,964 $ 7,787,182 $ 

NOTE 12. UNDELIVERED ORDERS AT THE END OF THE PERIOD

Statement of Federal Financial Accounting Standards No. 7, Accounting for Revenue and Other 

Financing Sources and Concepts for Reconciling Budgetary and Financial Accounting, states that 

the amount of budgetary resources obligated for undelivered orders at the end of the period 

should be disclosed. For the fiscal years ended September 30, 2009 and 2008, undelivered orders 

amounted to $711,074 and $470,938 respectively. 

NOTE 13. CUSTODIAL ACTIVITY 

MSC’s custodial collection primarily consists of Freedom of Information Act requests. While 

these collections are considered custodial, they are neither primary to the mission of MSC nor 

material to the overall financial statements. MSC’s total custodial collections are $115 and $21 

for the fiscal years ended September 30, 2009, and 2008, respectively. 

 
35 

NOTE 14. RECONCILIATION OF NET COST OF OPERATIONS TO BUDGET 

MSC has reconciled its budgetary obligations and non-budgetary resources available to its net 

cost of operations. 

2009 2008

Obligations Incurred 8,759,964 $ 7,787,182 $ 

Less: Spending Authority from Offsetting Collections and 

Recoveries 24,313 420,365 

Obligations Net of Offsetting Collections and Recoveries 8,735,651 7,366,817 

Imputed Financing from Costs Absorbed by Others 452,076 404,696 

Net Other Resources Used to Finance Activities 452,076 404,696 

 7,771,513 9,187,727 

Benefits Ordered But Not Yet Provided 240,136 (570,113) 

 - 24,380 

 54,441 65,683 

 (515,672) 330,199 

 8,287,185 8,857,528 

Increase in Annual Leave Liability - 35,223 

Total Components of Net Cost of Operations That will Require or 

Generate Resources in Future Periods - 35,223 

Depreciation and Amortization 35,860 30,808 

Other (340) -

Total Components of Net Cost of Operations That will not Require 

or Generate Resources 35,520 30,808 

Generate Resources in the Current Period 66,031 35,520 

$ 8,353,216 8,893,048 $ 

Total Resources Used to Finance the Net Cost of Operations

Resources Used to Finance Activities

Budgetary Resources Obligated

Other Resources

Total Resources Used to Finance Activities

Resources Used to Finance Items Not Part of the Net Cost

of Operations

Change in Budgetary Resources Obligated for Goods, Services and

Resources That Fund Expenses Recognized in Prior Periods

Resources That Finance the Acquisition of Assets

Total Resources Used to Finance Items Not Part of the Net Cost of 

Operations

 

Net Cost of Operations

Components of the Net Cost of Operations That Will Not

Require or Generate Resources in the Current Period

Components Requiring or Generating Resources in Future Periods

Components Not Requiring or Generating Resources

Total Components of Net Cost of Operations That will not Require or