U.S. agency halts coal-roy­alty changes

Northwest Arkansas Democrat-Gazette - - NATIONAL -

BILLINGS, Mont. — The In­te­rior De­part­ment has put on hold changes to how the fed­eral govern­ment val­ues masses of coal ex­tracted from pub­lic lands, pri­mar­ily in the western United States, af­ter min­ing com­pa­nies chal­lenged the agency in fed­eral court.

The move by Pres­i­dent Don­ald Trump’s ad­min­is­tra­tion means cur­rent rules gov­ern­ing the in­dus­try will re­main in place pend­ing de­ci­sions in the courts, ac­cord­ing to an agency no­ti­fi­ca­tion due to be pub­lished to­day in the Fed­eral Reg­is­ter.

The changes, crafted un­der Pres­i­dent Barack Obama’s ad­min­is­tra­tion, were aimed at en­sur­ing that com­pa­nies don’t short­change tax­pay­ers on coal sales to Asia and other mar­kets. Coal ex­ports surged over the past decade even as do­mes­tic sales de­clined.

Fed­eral law­mak­ers and oth­ers have long com­plained that tax­pay­ers were los­ing hun­dreds of mil­lions of dol­lars an­nu­ally be­cause roy­al­ties on coal from pub­lic lands were not be­ing cal­cu­lated at the mar­ket rate.

Rules in place since the 1980s have al­lowed com­pa­nies to sell their fuel to af­fil­i­ates and pay roy­al­ties to the govern­ment on that price, then turn around and sell the coal at higher prices, of­ten over­seas. In the rule changes crafted by Obama’s In­te­rior De­part­ment, the roy­alty rate would be de­ter­mined at the time the coal is leased, and rev­enue would be based on the price paid by an out­side en­tity, rather than an in­terim sale to an af­fil­i­ated com­pany.

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