U.S. agency halts coal-royalty changes
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.