“If the Administration really wants to get a greater return on federal coal, it should reverse course immediately. It should scrap its new regulations on the production and consumption of coal. It should stop artificially suppressing demand for coal.”
GILLETTE, WYOMING— Today, U.S. Senator John Barrasso (R-WY) participated in the Bureau of Land Management’s (BLM) listening session in Gillette, Wyoming on raising the royalty rates on the Federal Coal Leasing Program. The text of Senator Barrasso’s prepared statement for the record is below.
Senator Barrasso’s Statement for the Record:
“Welcome to Gillette, Wyoming. And thank you for taking the time to travel here today. Thank you also for your willingness to listen to the concerns of the people of Wyoming.
“I wish the Administration had been willing to visit Gillette prior to issuing other regulations.
“Had it done so, I think it would have seen the importance that coal production plays in the lives of so many people in this state.
“Coal production has enabled thousands of people to achieve the American dream. It provides good jobs for Americans regardless of their educational background.
“In 2013, the average annual wages for coal workers in Wyoming was $82,654. That is almost twice the average annual wages for all workers in Wyoming.
“In Wyoming, a coal worker’s salary provides financial security and allows parents to save for their children’s education.
“Simply put—coal production provides a level of social mobility that is unavailable in most of America.
“Coal production also brings significant revenues to Wyoming’s state and local governments.
“In the last decade, ninety percent of revenues used to fund the construction of public schools in Wyoming came from coal bonus bid payments. Coal royalties are used to fund salaries for school teachers, state highways, and budgets for cities and towns.
“And coal companies have injected billions of dollars into rural communities across Wyoming and the West. This money has been a life blood for rural America. Taking the money that would otherwise be invested in these communities and sending it to Washington, is simply a bad idea.
“As important as coal revenues are, now is not the time for BLM to consider raising bonus bids, rents or royalties on federal coal.
“I find the fact that the Administration is even asking whether it is getting a fair return on federal coal to be disingenuous at best.
“Since day one, the Obama Administration has done all it can to discourage the use of coal in the United States and around the world.
“The Department of the Interior, Environmental Protection Agency, and other federal agencies have issued dozens of new regulations which have made it more expensive to produce and consume coal.
“Through these regulations, the Administration has actively suppressed the demand for federal coal.
“As Economics 101 tells us: if the demand for a product falls while the supply of that product is constant, prices for that product will decline.
“That’s largely why BLM has failed to hold a successful coal lease sale in Wyoming for the last three years. It’s also why BLM held only one successful coal lease sale in the entire country in 2014.
“With all due respect, I find it extraordinarily hypocritical for the Administration to ask whether it’s getting a fair return on federal coal when it has gone to such lengths to suppress demand for coal.
“And I find it absurd for BLM to ask whether it’s getting a fair return on federal coal when it is unable to find buyers for federal coal now.
“If the Administration really wants to get a greater return on federal coal, it should reverse course immediately.
“It should scrap its new regulations on the production and consumption of coal. It should stop artificially suppressing demand for coal.
“If the Administration took these steps, the demand for federal coal would rebound and BLM would see a greater return.
“The Administration should also help coal producers access international markets.
“Currently, three proposed coal export terminals in Oregon and Washington await federal permits. If the Administration wants a greater return on federal coal, it should accelerate the permitting process for these facilities.
“These facilities would allow producers to export federal coal to Asia and partially offset declining sales here in the United States. This too would boost BLM’s return on federal coal.
“Like many in this room, I don’t expect the Administration to reverse course. And I don’t expect the Administration to help federal coal producers access Asian markets.
“President Obama, while still a candidate in 2008, promised to ‘bankrupt’ utilities that use coal. That’s why I view the Administration’s interest in getting a greater return on federal coal with deep skepticism. It appears to be at best, a charade, and, at worst, an effort to bankrupt coal producers.
“In January 2010, the combined value of Wyoming’s four largest coal producers was nearly $23 billion. Today, the combined value of Wyoming’s four largest coal producers is under $1 billion.
“And one of these producers just filed for bankruptcy last week.
“Given these numbers and the fact that BLM is having trouble selling federal coal now, it’s inconceivable to me that BLM is considering raising the price on federal coal. If anything, BLM should consider lowering prices on federal coal.
“BLM has called today’s event a ‘listening session.’ I would encourage BLM to do exactly that, listen.
“Listen to the concerns of those who will be directly and immediately impacted by your decisions. Listen to the concerns of those who fear losing their jobs. Listen to local leaders who fear their communities will be financially ruined. Listen to the concerns of those whose health and marriages will suffer and who will no longer be able to provide for their children if they are unemployed.
“We in Congress are listening and will not allow their voices to go unheard.
“Last week, EPA issued a rule that a University of Wyoming professor estimated will cost Wyoming up to 11,000 jobs. Eleven thousand jobs lost in one state from one EPA regulation.
“Before proceeding, BLM should not just consider in isolation the impact of raising prices on federal coal. It should consider the impact of raising prices on federal coal in light of all the Obama Administration’s regulations affecting coal, including the rule EPA issued last week.
“If you do this, you will find that raising prices on federal coal would devastate communities throughout this state, and, for that reason, your proposal to do so should be rejected.
“Thank you.”
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