Title: Coal Cleanup Taxpayer Protection Act
Policy area: Public Lands and Natural Resources

Summary:
Coal Cleanup Taxpayer Protection Act of 2021
This bill prohibits self-bonding practices for coal reclamation, establishes limits on bonding practices associated with surface coal mining operations, and establishes requirements for coal mining operations to provide sufficient financial resources to complete mine reclamation.
Currently, self-bonding practices allow coal mining operations to demonstrate that they have sufficient corporate assets to complete reclamation, without requiring cash or collateral up-front as in the case of surety or collateral bonds. The bill prohibits the Office of Surface Mining and Reclamation Enforcement (OSMRE) and state regulatory authorities from accepting new self-bonds for coal reclamation.
In addition, the bill requires any existing self-bonds or corporate bonds utilized for coal reclamation to be converted to surety or collateral bonds. The OSMRE must issue rules establishing limitations on surety bonds to minimize the financial liability to the federal or state government. The OSMRE may approve state or federal alternative coal mining bond programs that result in no greater risk of financial liability to the federal government than a surety or collateral bond program.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2505 Introduced in House (IH)]

<DOC>






117th CONGRESS
  1st Session
                                H. R. 2505

  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

                             April 14, 2021

Mr. Cartwright (for himself, Mrs. Dingell, Mr. Nadler, Mr. Blumenauer, 
   Ms. Velazquez, Mr. Lowenthal, Mr. Grijalva, Mrs. Napolitano, Ms. 
 Norton, Mr. Cleaver, and Ms. Jayapal) 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.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Coal Cleanup Taxpayer Protection Act 
of 2021''.

SEC. 2. SURFACE COAL MINING BONDING.

    Section 509 of the Surface Mining Control and Reclamation Act of 
1977 (30 U.S.C. 1259) is amended--
            (1) by striking subsection (c) and inserting the following:
    ``(c) Alternative Bonding System.--
            ``(1) In general.--Subject to paragraph (2), the Secretary 
        may approve as part of a State or Federal program an 
        alternative system that will--
                    ``(A) achieve the objectives and purposes of the 
                bonding program pursuant to this section; and
                    ``(B) result in no greater risk of financial 
                liability to the Federal Government or a State 
                government than the bonding program under this section.
            ``(2) Report required.--The Secretary may only approve an 
        alternative bonding system for a State under paragraph (1) if 
        such State submits a report to the Secretary that provides the 
        following information:
                    ``(A) A history of bond forfeitures and reclamation 
                costs in such State in the seven-year period ending on 
                the date on which the report is submitted, including--
                            ``(i) in the case of any bond forfeiture, 
                        whether the money collected to make up the 
                        difference between the bond and reclamation 
                        cost was sufficient to complete the reclamation 
                        as specified in the permit; and
                            ``(ii) an engineer's estimate of the cost 
                        to complete reclamation of mines for which such 
                        State has not yet determined the cost of 
                        reclamation.
                    ``(B) A five-year forecast proving the proposed 
                bond pool will be financially sound based on--
                            ``(i) the proposed annual or per ton fees 
                        paid by mining operators;
                            ``(ii) the past and anticipated financial 
                        performance of participating mining operators;
                            ``(iii) market projections for the five 
                        year period beginning on the date of the 
                        submission of such report;
                            ``(iv) the anticipated number of mining 
                        operators participating in each year; and
                            ``(v) anticipated reclamation costs, 
                        including known reclamation costs and an 
                        engineer's estimate of costs not yet known.''; 
                        and
            (2) by adding at the end the following:
    ``(f) Self-Bonding.--
            ``(1) Federal programs.--
                    ``(A) In general.--Effective on the date of 
                enactment of this subsection, the Secretary--
                            ``(i) may not accept the bond of the 
                        applicant itself (referred to in this 
                        subsection as a `self-bond'); and
                            ``(ii) may accept a separate surety or 
                        collateral bond, consistent with subsection 
                        (b).
                    ``(B) Existing self-bonds.--For coal mining 
                operations covered by a self-bond accepted by the 
                Secretary prior to the date of enactment of this 
                subsection, the permittee shall replace the self-bond 
                with another form of bond acceptable to the Secretary 
                under this section by not later than the earlier of--
                            ``(i) the date of renewal of the permit 
                        under section 506(d); and
                            ``(ii) the date of any major permit 
                        modification under section 506.
            ``(2) State programs.--Not later than 90 days after the 
        date of enactment of this subsection, the Secretary shall 
        notify all State regulatory authorities that allow applicants 
        to self-bond that the approved regulatory programs of the State 
        regulatory authority must be amended--
                    ``(A) to remove the authority for applicants to 
                self-bond; and
                    ``(B) to require coal mining operations covered by 
                a self-bond accepted by the State regulatory authority 
                prior to the date of enactment of this subsection to 
                replace the self-bond with another form of bond 
                acceptable under this section by not later than the 
                earlier of--
                            ``(i) the date of renewal of the permit 
                        under section 506(d); and
                            ``(ii) the date of any major permit 
                        modification under section 506.
    ``(g) Bonds Issued by Surety.--
            ``(1) In general.--Not later than 1 year after the date of 
        enactment of this subsection, the Secretary shall issue rules 
        establishing limitations on surety bonds accepted under this 
        section to minimize the risk of financial liability to the 
        Federal Government or a State government, including rules 
        regarding--
                    ``(A) the maximum quantity of corporate surety 
                bonds issued by any 1 corporate surety as a percentage 
                of the total quantity of coal mine reclamation bonds in 
                any 1 State;
                    ``(B) the minimum percentage of surety bonds 
                unrelated to activities regulated pursuant to this Act 
                required to reinsure corporate surety bonds;
                    ``(C) the minimum collateralization required for 
                corporate surety bonds; and
                    ``(D) the minimum amount of cash assets required to 
                be held by a corporate surety as a percentage of coal 
                mine reclamation bonds issued by the corporate surety.
            ``(2) Existing corporate bonds.--Corporate surety bonds in 
        existence on the date of enactment of this subsection must be 
        modified or replaced as necessary by not later than 1 year 
        after the date on which the rule is issued under paragraph (1).
    ``(h) Collateral Requirements.--
            ``(1) Real property.--Real property posted as collateral 
        for a bond may not include--
                    ``(A) coal;
                    ``(B) a coal mine;
                    ``(C) land that includes a coal mine;
                    ``(D) land that is located above a coal mine;
                    ``(E) a coal processing facility;
                    ``(F) a coal waste disposal site;
                    ``(G) coal mining equipment unlikely to retain 
                salvage or resale value; or
                    ``(H) any other property determined by the 
                Secretary.
            ``(2) Re-evaluation.--
                    ``(A) The Secretary shall re-evaluate the value of 
                any nonliquid collateral, as that term is defined in 
                subparagraph (B), 3 years after such collateral is 
                posted for a bond and every three years thereafter.
                    ``(B) In this paragraph, `nonliquid collateral' has 
                the meaning given to it by the Secretary, except that 
                such term--
                            ``(i) includes the first lien interests in 
                        real estate and equipment; and
                            ``(ii) does not include--
                                    ``(I) cash;
                                    ``(II) letters of credit;
                                    ``(III) certificates of deposit;
                                    ``(IV) Federal, State, or municipal 
                                bonds; and
                                    ``(V) investment grade securities.
    ``(i) Executive Compensation.--The Secretary may require the 
inclusion of executive compensation, including salaries and bonuses of 
officers and executives, of an applicant under this section, and any 
affiliated company, as collateral for a bond under this section.''.
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