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February 11, 2014

Can Coal Get Any Dirtier? Try Leasing It

CoalJust when you thought coal couldn't get any dirtier, not one but TWO federal watchdog agencies released outrageous findings last week, proving (again) that the federal government's coal leasing program has it own toxic problems.  

Friday, the office of Senator Ron Wyden (D-OR) released a letter it received from the U.S. Department of Interior in response to a probe the Senator's office launched in early 2013. The Interior Department's investigation discovered that Bureau of Land Management (BLM) staff were "illegally conferring" with coal companies during the bidding process for coal leases despite federal regulations designed to limit interactions between the BLM and coal companies in order to prevent unfair influence from the industry.  

BLM's excuse? It claims that it wanted to help the leasing process "move faster." With only a handful of coal companies to ever place a lease-bid in the history of the federal coal leasing program, and even fewer to have ever received a competing bid or have a bid rejected, one is left to wonder: what’s BLM’s hurry?

Here's a fun fact from the same letter: since 1991 one solitary employee has been responsible for setting the value of eight billion tons of federal coal -- $4.9 billion worth of coal leases. None of this employee's valuations have been independently audited. Incredible? No, it's business as usual in a program that is essentially captured by the coal industry it leases to.

Earlier in the week, the U.S. Government Accountability Office (GAO) released the result of its highly anticipated report called for by the office of Senator Ed Markey (D-MA) to investigate whether, as earlier reports had claimed, BLM's lax bidding process on public lands let coal companies hose U.S. taxpayers out of $30 billion.

The GAO results were damning enough that Senator Markey echoed the call from the Sierra Club and several other environmental and community organizations to immediately suspend the federal coal leasing program until the BLM gets its act together. The report found specific flaws in the information BLM considers during the leasing process, the lack of public transparency, and the lack of independent oversight. Specifically, the GAO found that BLM's current leasing practices fail to do more than supply "generic boilerplate statements" about the coal industry's plans to rake in cash by exporting federal coal, do not provide the public with accessible, transparent information on coal leases, and lack independent reviews that are "critical for ensuring the integrity" of the appraisal process. According to the GAO, "BLM is unable to ensure that its results are sound" when leasing billions of tons of federal coal.  

Senator Ed Markey and Representative Peter DeFazio produced a joint summary of the report, saying:

The Interior lacks rigor and oversight in determining the fair market value of federal coal leases. Given the lack of market competition in coal leases, if the fair market value set by Interior is low, it can lead to significant losses for taxpayers. For instance, for every cent per ton that coal companies decrease their bids for the largest coal leases, it could mean the loss of nearly $7 million for the American people.

Following on the heels of the Inspector General's report, released in June 2013, the GAO report is the second federal report in just over six months to criticize BLM’s coal leasing program.  

The GAO findings provide a definitive answer for people across the country who have eyed the mounting evidence against the BLM's coal leasing practices on public lands.

Two government reports and now news of illegal actions by federal representatives all confirm that this program has lost its public integrity. Interior Secretary Sally Jewell, who oversees the BLM, should get ahead of this growing scandal by suspending the leasing program. Continuing ahead with leases for billions of tons of coal would neglect the public interest. The federal coal leasing program needs a timeout and a substantive commitment to transparency to ensure the public interest is protected.

We cannot afford to continue the current coal leasing policies that take advantage of the U.S. taxpayer, damage our economy and public lands, and worsen climate disruption. It's time for America to move beyond an 'all of the above' energy policy and use available clean energy like wind and solar that don't come at such a high cost to American families.

-- Bill Corcoran, Director of the Beyond Coal Campaign Western Region


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