For decades, companies exporting coal mined on public lands have exploited a loophole that allowed them to pay lower royalty fees, shorting the government millions of dollars and denying states and taxpayers a fair return.

When exporting coal mined from public lands, companies are required to pay a fee based on the value of the coal when it is first sold to another company. Instead of paying their fair share, many companies have sold coal to a company affiliated with them, artificially lowering the price and boosting profits for coal exporters, all while leaving federal and state governments millions in the hole.

In 2011, Senator Lisa Murkowski (R-AK) joined her colleague Senator Ron Wyden (D-OR) in asking the Obama administration to investigate this practice. Last week the Department of the Interior issued regulations that would close this loophole and require coal companies to pay royalties based on the actual value of the coal sold.

You would expect Senator Murkowski to be happy that taxpayers will soon receive a fair return for exports of coal mined on public lands, a change she had asked for. Wrong. Instead, the Senator issued a blistering statement decrying the proposal. It is unclear why Senator Murkowski made a 180-degree turn on closing a long-abused loophole for coal mined on public lands. Perhaps the Senator should take a look at the letter she wrote in 2011 to be reminded why it’s a good thing for taxpayers to receive their fair share.

Senator Murkowski Then (2011)

“Energy exports can create jobs, generate revenue, and improve our balance of trade. As we seek to maximize these benefits, we must be certain that coal exporters are following the rules for royalty payments so that taxpayers receive a fair return.”

Senator Murkowski Now (2016)

“This administration’s attitude toward resource development is incoherent. On the one hand, we are told we must maximize value to the taxpayer, but on the other, we see decision after decision to keep valuable resources in the ground – whether on the North Slope of Alaska, the Arctic and Atlantic offshore, or a multi-year moratorium on coal leasing. This approach will not benefit taxpayers, but instead leave them with higher energy costs and fewer economic opportunities.”

 

Photo credit: Kimon Berlin, Flickr

Written by on Wednesday, July 6th, 2016