I 116th CONGRESS 1st Session H. R. 4435 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. Short title This Act may be cited as the Coal Cleanup Taxpayer Protection Act of 2019 . 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. .