Opinion ID: 501787
Heading Depth: 3
Heading Rank: 5

Heading: Substantial Legal and Financial Commitment

Text: 284 Under Sec. 522 of the Act, state regulatory authorities may designate an area of land as unsuitable for surface coal mining either because reclamation is not feasible or because mining operations might have one of the serious consequences listed in Sec. 522(a)(3). But Sec. 522 contains a grandfather clause that exempts, inter alia, lands where substantial legal and financial commitments in mining operations were in existence prior to January 4, 1977. 82 At issue here is the Secretary's definition of substantial legal and financial commitments (SLFC): 285 Substantial legal and financial commitments in a surface coal mining operation means significant investments that have been made on the basis of a long-term coal contract in power plants, railroads, coal-handling, preparation, extraction or storage facilities and other capital-intensive activities. An example would be an existing mine, not actually producing coal, but in a substantial stage of development prior to production. Costs of acquiring the coal in place or the right to mine it without an existing mine, as described in the above example, alone are not sufficient to constitute substantial legal and financial commitments. 286 30 C.F.R. Sec. 762.5 (1984). 287 We are asked by Industry to overrule the district court, but we do not. We affirm the district court's upholding of the Secretary's power to promulgate Sec. 762.5. Relying heavily on the legislative history of similar sections of the Act, Industry contends that the above definition is too narrow and rigid to be consistent with congressional intent. The district court rejected Industry's challenge, finding that the Secretary's interpretation is amply supported by the one expression of legislative intent specifically on point. 83 A portion of the House Report explains: 288 The phrase substantial legal and financial commitments in the designation section and other provisions of the act is intended to apply to situations where, on the basis of a long-term coal contract, investments have been made in power plants, railroads, coal handling and storage facilities and other capital-intensive activities. The committee does not intend that mere ownership or acquisition costs of the coal itself or the right to mine it should constitute substantial legal and financial commitments. 289 H.R.REP. NO. 218, 95th Cong., 1st Sess. 95 (1977), reprinted in 1977 U.S.CODE CONG. & ADMIN.NEWS 593, 631. The Secretary's definition closely tracks this language; however, Industry objects to the Secretary's decision to limit SLFC to situations involving long-term contracts, claiming that the House Report used long-term contracts merely as an example of the sort of commitment required. 290 It may well be possible to read the House Report as Industry suggests, but it is also certainly possible, and indeed more natural, to interpret it as the Secretary has. Nevertheless, Industry would have us believe that the legislative history of the valid existing rights clauses in Sec. 522(e) and Sec. 601, as well as selected discussions of a similar phrase in Sec. 510(b)(5), mandates its reading of the House Report and accordingly its broad interpretation of SLFC. We disagree and conclude with the district court that, at best, the legislative history of the other provisions of the bill creates some ambiguity--perhaps enough to support Industry's position had it been adopted by the Secretary. But it is far from sufficient to constitute a specific legislative intent contradicting the Secretary's interpretation. Congress has evidently delegated to the Secretary the authority to flesh out the meaning of substantial legal and financial commitments, see Chevron, 467 U.S. at 842-43, 104 S.Ct. at 2781-82, and the Secretary has done so in an entirely reasonable fashion, balancing the financial interests of the mine operators against the public's interests in prohibiting mining where it is environmentally unsuitable. Accordingly, we affirm the judgment below on this issue.