FEDERAL MINE SAFETY

AND HEALTH

REVIEW COMMISSION

PERFORMANCE AND 

ACCOUNTABILITY REPORT

FISCAL YEAR 2016

NOVEMBER 15, 2016
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Table of Contents

Message from the Chairman ............................................................................... 1

Management Discussion and Analysis .............................................................. 3

Overview .................................................................................................... 3

Key Challenges ........................................................................................... 6

Analysis of Financial Statements ............................................................... 6

Management Assurances ............................................................................ 9

Performance Section ...........................................................................................10

Administrative Law Judges Function ...........................................................10

Commission Review Function .....................................................................12

Office of Executive Director Function ..........................................................14

Financial Section .................................................................................................15

Letter from Executive Director .....................................................................15

Independent Auditors’ Report ......................................................................18

Financial Statements and Notes .................................................................22
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Message from the Chairman

November 15, 2016

As Chairman of the Federal Mine Safety and Health Review Commission (Commission), 

I am pleased to submit the Performance and Accountability Report for Fiscal Year 2016. 

This report provides performance information in keeping with the requirements of the 

Government Performance and Results Modernization Act of 2010 and includes audited 

financial statements and accompanying documentation as mandated by the 

Accountability of Tax Dollars Act of 2002.

The Commission is an independent adjudicatory agency that provides administrative trial 

and appellate review of legal disputes arising under the Federal Mine Safety and Health 

Act of 1977 (Mine Act), as amended. 

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

administrative law judges and appellate review of judges’ 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 the Department of Labor and 

address whether or not the alleged safety and health violations occurred and if so, the 

degree of gravity and negligence involved, so that appropriate sanctions may be 

imposed. 

The Commission has set forth the following strategic goals: 

Strategic Goal 1: Ensure expeditious, fair, and legally sound adjudication of cases

Strategic Goal 2: Manage the Commission’s human resources, operations, facilities, and 

information technology systems to ensure a continually improving, 

effective, and efficient organization

In Fiscal Year 2016, the Commission met or substantially met the performance targets 

for three of four trial level goals in the Office of the Administrative Law Judges. It is 

significant that the goal for pendency of penalty cases again was met. The number of 

cases on hand has been reduced significantly from the high point in FY 2010. In 

addition, this was the sixth year that the number of pending trial level cases was reduced 

from the previous year. At the appellate level, four out of five targets were met. The 

number of cases on hand at year end was reduced from a high in FY 2013 of 69 to 18 

this year.
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We are pleased to report the independent auditor’s opinion that the financial statements 

present fairly, in all material aspects, the financial position of the Commission, and that 

no matters involving internal control were noted and that no material internal control 

weaknesses were identified. It is my assessment that the financial and performance data 

in this report is reliable and complete. 

The Commission’s mission is to provide the just, speedy, and legally sound 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. We remain 

committed to that mission. 

Mary Lu Jordan

Chairman
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Management Discussion and Analysis

OVERVIEW

Mission

The Federal Mine Safety and Health Review Commission is an independent adjudicatory 

agency charged with resolving disputes arising from the enforcement of 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). The Commission’s mission is to provide just, speedy, and legally 

sound 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 scope of the Commission’s mission was expanded by the passage of the Mine 

Improvement and New Emergency Response Act of 2006, P.L. 109-236 (MINER Act). 

That statute amended the Mine Act and vested the Commission with the responsibility 

for resolving disputes over the contents of mine emergency plans adopted by 

underground coal mine operators and submitted to MSHA for review and approval. The 

MINER Act imposed tight deadlines on the Commission and its judges with respect to 

these proceedings and the Commission has adopted procedural rules to implement 

those deadlines.

Functions and Procedures

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

and appellate review of judges’ 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 or not the alleged safety and 

health violations occurred and if so, the degree of gravity and negligence involved. 

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.
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Once a case is filed with the Commission, it is referred to the Chief Administrative Law 

Judge (Chief Judge). Thereafter, litigants in the case must submit additional filings 

before the case is assigned to a judge. To expedite the decisional process, the Chief 

Judge 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. If a 

hearing is necessary, the judge schedules and presides over the hearing, and issues a 

decision based upon the record. A judge’s decision becomes a final, non-precedential 

order of the Commission unless it is accepted for review by the five-member 

Commission.

The Commission provides administrative appellate review. It may, in its discretion, 

review decisions issued by judges 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 heard in the federal courts of appeals.

The Office of the Executive Director supports the above functions by providing budget 

and financial management, and administrative and technical services, including human 

resources and information technology, procurement and contracting, and facilities 

management.

Strategic Goals

The Commission has two strategic goals:

Strategic Goal 1: Ensure expeditious, fair, and legally sound adjudication of cases

Strategic Goal 2: Manage the Commission’s human resources, operations, facilities, and 

information technology systems to ensure a continually improving, 

effective, and efficient organization
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Organizational Chart
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KEY CHALLENGES

The Commission faced significant challenges when the new cases received increased 

significantly in recent years: the trial level cases increased by 170% from FY 2007 to FY 

2010. This backlog was the result of the increased contest rate since 2006. Then the 

appellate level cases increased by 380% from FY 2009 to FY 2011. This increase in new 

cases led to substantial backlogs in cases on hand.

Through a combination of reengineered business processes, increased staffing, and a 

reduction in new cases received, the Commission has been able to reduce the cases on 

hand to meet its performance goals. 

The Commission has recently added focus on reducing the pendency of case 

dispositions. Pendency is defined as the time from receipt to disposition of cases. 

Aggressive goals for pendency were established for FY 2016, and the Commission met 

the goals for trial level penalty cases and for appellate substantive decisions.

The Commission will continue to focus on meeting the pendency and cases on hand 

goals, and emphasize reducing the age of appellate default cases on hand. 

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 “unmodified” opinion for each annual review conducted by an independent 

auditor. 

The Commission has contracted with the Department of the Treasury, Bureau of the 

Fiscal Service, Administrative Resource Center, for accounting services since 1998. 

The Administrative Resource Center prepared the Commission’s FY 2016 financial 

statements, which include comparative data for FY 2015. 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 2016 were $7,767,796 as of September 30, 

2016. The Fund Balance with Treasury of $7,194,686 represents the Commission’s 

largest asset as of September 30, 2016. This is an increase of approximately 14 percent 

from fiscal year 2015 and represents approximately 93 percent of the agency’s total 

assets. Property, Equipment, and Software accounts for approximately 6 percent of the 
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Commission's total assets as of September 30, 2016. The net fixed asset value of 

$501,261 equals the cost less accumulated depreciation and represents the current 

book value of those assets. 

The Commission’s liabilities in fiscal year 2016 totaled $2,211,186 as of September 30, 

2016. This is a decrease of $656,885 from the fiscal year 2015 balance of $2,868,071. 

Accounts payable balance at September 30, 2016, was $463,817, a decrease of 

$612,466 from September 30, 2015. Accrued payroll liabilities, payroll taxes payable, 

and unemployment insurance increased $79,596 in 2016. Unfunded annual leave 

increased $10,553 in 2016 from 2015. Unfunded annual leave represents approximately 

26 percent of total agency liabilities. 

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

position for fiscal year 2016 increased by $1,397,411 from fiscal year 2015. 

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 Commission’s two major functions, Administrative Law Judges 

and Review Commission. The total net cost of operations in 2016 was $16,126,112

which is an increase of $250,343 more than 2 percent, over the 2015 net cost of 

operations of $15,875,769. 

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 

increased $1,397,411 in 2016 from 2015, a change of approximately 34 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 2016, the Commission had total budgetary resources of 

$21,608,054, which is $1,236,053 more than in 2015.

 
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Dollars in Thousands Increase / (Decrease)

FY 2016 FY 2015 $ %

Total Financing Sources $ 16,104 $ 15,794 $ 310 2%

Less: Net Cost of Operations $ 16,126 $ 15,876 $ 250 2%

Net Change $ (22) $ (82) $ 60 73%

Assets:

Fund Balance With Treasury $ 7,195 $ 6,302 $ 893 14%

Accounts Receivable $ 72 $ 16 $ 56 350%

Property, Equipment, and Software $ 501 $ 709 $ (208) -29%

Total Assets $ 7,768 $ 7,027 $ 741 11%

Liabilities

Accounts Payable - Intergovernmental $ 54 $ 569 $ (515) -91%

Other $ 1,747 $ 1,792 $ (45) -3%

Accounts Payable $ 410 $ 507 $ (97) -19%

Total Liabilities $ 2,211 $ 2,868 $ (657) -23%

Net Position (Assets minus Liabilities) $ 5,557 $ 4,159 $ 1,398 34%

1

 Source: Statement of Net Cost and Statement of Changes in Net Position

2

 Source: Balance Sheet

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

Table of Key Measures

COSTS1

NET POSITION2
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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 were obtained from the FY 2016 accounting reports prepared 

by the Bureau of Fiscal Service, 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. 

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 Generally Accepted Accounting Principles (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.

The statements should be read with the realization that they are for a component of the 

U.S. Government, a sovereign entity. 
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Performance Section

PERFORMANCE GOALS AND RESULTS

The Commission has set forth the following strategic goals: 

Strategic Goal 1: Ensure expeditious, fair, and legally sound adjudication of cases

Strategic Goal 2: Manage the Commission’s human resources, operations, facilities, and 

information technology systems to ensure a continually improving, 

effective, and efficient organization

The first strategic goal is accomplished through the Administrative Law Judges function

at the trial level, and the Commission Review function at the appellate level. The second 

strategic goal is accomplished through the Office of the Executive Director function.

ADMINISTRATIVE LAW JUDGES FUNCTION

The Commission employs administrative law judges to hear and decide contested cases 

at the trial level. The judges travel to hearing sites located at or near the mine involved 

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

participate in the hearing process. Commission judges are also responsible for 

evaluating and approving or denying settlement agreements proposed by the parties 

under the Mine Act.

The Commission received 4,051 new case filings in FY 2016. The number of new cases 

was a 22 percent decrease from FY 2015. 

There were 4,682 cases pending at the start of FY 2016. In FY 2016 there were 5,675

dispositions.

The FY 2016 end-of-year inventory was 3,058 undecided cases. This was the sixth

consecutive year that the number of pending cases was reduced by the end of the year.

The Commission met or substantially met three of the four performance targets for the 

Administrative Law Judges function, as shown in the Performance Measurement Matrix. 

Although the target for average time from receipt to disposition of all cases was not met, 

it is significant that the average age of cases on hand at year end was 237 days, a 

decrease from the 278 days at FY 2015 year end.
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ADMINISTRATIVE LAW JUDGES FUNCTION

CASE WORKLOAD

ADMINISTRATIVE LAW JUDGES FUNCTION

PERFORMANCE MEASUREMENT MATRIX

Performance Goal FY 2012 FY 2013 FY 2014 FY 2015 Target Actual Status

Average time from receipt to 

disposition of all cases 541 days 463 days 459 days 425 days 300 days 348 days Not met

Average time from receipt to 

disposition of penalty cases 525 days 433 days 429 days 387 days 330 days 309 days Met

Percent of all cases on hand over 

365 days in age 38% 43% 28% 25% 20% 21%

Substantially 

met*

Number of cases pending at 

year end 12,982 7,612 6,278 4,452 4,200 3,058 Met 

Substantially met: Within 10% of target

Performance Metrics - Office of the Administrative Law Judges Function

FY 2016
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COMMISSION REVIEW FUNCTION

The Commission decides two principal types of cases: (1) substantive cases, which are 

cases in which a judge has issued a final or interlocutory decision on the merits and the 

Commission has granted a petition for review filed by either party, or at least two 

Commissioners have decided to grant review on their own initiative; and (2) default 

cases, which are cases where an operator has failed to timely contest a proposed 

penalty or to timely respond to a judge’s order and the operator has filed a motion to 

reopen the final order.

In recent years, the Commission’s appellate review function has seen a significant 

increase in the number of filings of both substantive and default cases. The trend of this 

higher number of petitions being filed for substantive review is likely to continue for the 

foreseeable future. In FY 2008, 8 petitions for review of judges’ decisions were filed, and 

4 petitions were granted. In FY 2016, 33 petitions were filed, and 22 were granted.

The increase in petitions filed by parties and granted by the Commission has had a 

significant impact on the Office of General Counsel, which is responsible for conducting 

the initial research in substantive cases and preparing draft opinions for the 

Commissioners. 

The targets for substantive cases were met with regard to four of the five goals, as 

shown on the following performance measurement matrix. Not met was the percentage 

of default cases on hand over six months in age. Because one Commissioner’s 

appointment expired in August 2016, disposition of substantive cases was given priority. 

This resulted in resources being diverted from default cases to substantive case 

decisions in FY 2016, resulting in an increased number of default cases over six months 

in age in FY 2016.

The percent of appellate cases on hand over 18 months in age at year end decreased 

from 49% in FY 2015 to 11% in FY 2016. The increase in appellate case backlog 

starting in FY 2009 resulted in the accumulation of significantly older cases on hand. As 

that backlog was reduced by the end of FY 2016, the cases on hand became more 

current, and therefore the average case age was reduced.

The Commission disposed of 54 substantive cases in FY 2016, ending the year with 18 

cases on hand.
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COMMISSION REVIEW FUNCTION

CASE WORKLOAD - SUBSTANTIVE CASES

COMMISSION REVIEW FUNCTION

PERFORMANCE MEASUREMENT MATRIX

Performance Goal FY 2012 FY 2013 FY 2014 FY 2015 Target Actual Status

Average time from date granted to 

issuance of decision for appellate 

cases

19 

months

24 

months

27 

months

26 

months

31 

months

22

months Met

Average time from briefing 

completion to issuance of decision 

for appellate cases

15 

months

21 

months

24 

months

24 

months

27 

months

19

months Met

Percent of appellate cases on hand 

over 18 months in age 26% 43% 49% 49% 40% 11% Met

Number of appellate cases pending 

at year end 57 69 57 39 19 18 Met

Percent of default cases on hand 

over 6 months in age 40% 13% 54% 59% 12% 57% Not met

Performance Metrics - Commission Review Function

FY 2016
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OFFICE OF THE EXECUTIVE DIRECTOR FUNCTION

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

the Commission in fulfilling its mission and strategic goals. The primary functions are 

financial management, human resources, procurement and contracting, information 

technology, facilities management, and general administrative service support. 

The financial management services function includes the areas of budget and 

accounting, such as budget formulation, budget execution, funds control, financial 

reporting, and vendor payments.

Human resources services cover the areas of recruitment and placement, classification 

and pay administration, performance management and incentive awards, employee 

benefits and retirement, personnel security, coordination of employee training programs, 

and wellness and employee assistance programs. 

Procurement and contracting services cover maintaining a simplified acquisition program 

for supplies and services, contract implementation and oversight, and coordination of 

services and supplies.

Information technology entails help-desk functions, network administration, policy 

formulation, and telecommunication.

Facilities management services cover property and space management, organization 

management, and physical security.

Other general administrative services provided by OED include the administration of 

employee travel authorizations and reimbursements and the Metro subsidy program. 
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FINANCIAL SECTION

LETTER FROM THE EXECUTIVE DIRECTOR

I am pleased to join the Chairman in presenting the Performance Accountability Report 

(PAR) for Fiscal Year 2016.

The PAR is the primary mechanism for the Commission to report on our financial 

operations and provide transparency and accountability to the American people. The 

financial statements included in the PAR demonstrate the Commission's sound 

stewardship for the taxpayers' dollars entrusted to us.

As the Executive Director of the Federal Mine Safety and Health Review Commission, I 

am responsible for the overall financial management of the Agency. I am pleased to 

report that we received an unmodified opinion on our fiscal year 2016 financial 

statements for the 14th consecutive year. Such an opinion is the highest level of 

assurance that can be expressed by independent auditors.

The Commission remains committed to continuous vigilance and improvement in 

financial management and internal controls, even with the receipt of an unmodified 

audit opinion. During FY 2016, we continued to monitor and evaluate the 

implementation and effectiveness of the financial management practices developed in 

the past years. All transactions have been recorded in the accounting records and 

reflect in the financial statements accordingly.

We have acknowledged and fulfilled our responsibility for maintaining effective 

internal control over financial reporting. We have worked closely with our servicing 

agency, the Bureau of Fiscal Services, to ensure that we remain compliant with all 

applicable laws and regulations regarding the Commission's financial reporting.

We also remain committed to improving and strengthening the Office of the Executive 

Director to continue to support the mission and various functions of the Commission.

Lisa M. Boyd 

Executive Director 

November 10, 2016
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