State to feds: ‘Mine’ your own business

SUTTON — The state of Alaska has responded to federal concerns about the validity of permits to mine coal in Sutton with a strongly worded letter reiterating its stance that the permits are valid.

“(The federal Office of Surface Mining) indicated in its letter to (the state’s Department of Natural Resources) dated July 19, 2012 that despite all evidence

to the contrary, the Wishbone Hill permits likely expired in 1996,” the state’s letter released Friday morning says. “In doing so, OSM ignores 16 years of DNR permit renewal decisions, inspections and recent operations conducted under the permit. OSM also ignores that OSM itself has previously reviewed this permit and knew that operations did not begin until 2010.”

A press release from Usibelli Coal Mine, the company whose permit is at stake in the matter, applauds the state.

“Usibelli appreciates the fortitude of the Parnell administration to continue to fight for state’s rights and for pointing out all of OSM’s involvement in Wishbone Hill over the years, from inspections to annual reports praising the state’s process,” Lorali Simon, spokeswoman for Usibelli Coal Mine, says in the press release.

The letter did little to alleviate concerns from opponents to mining at the Wishbone Hill site who called the permits into question at the federal level in December 2011.

“The fact that Usibelli Coal Mine Inc. has not adequately maintained necessary permits and that DNR has allowed unpermitted mining activities next to a residential area creates a sense of distrust in both the company and the DNR’s permitting process,” said Tim Leach, conservation director of Friends of Mat-Su.

In an interview, DNR’s deputy commissioner said that the move at the federal level to step in on permits the state and Usibelli thought were valid for more than a decade is unprecedented.

“It’s definitely out of keeping with our relationship with the feds,” deputy commissioner Ed Fogels said. “I don’t think any state has seen it anywhere in a significant manner.”

What’s new, he said, aren’t the rules, but how they’re being used. The federal agency stepped in using what is called a Ten Day Notice, or TDN. He said TDNs are commonly used in mining operations, but not like this.

“TDNs are generally used for violations or known violations” when the feds observe or get wind of some kind of violation occurring in an active mining operation, Fogels said. “They’re generally not applied to state permitting processes.”

So what’s the permitting decision at issue now?

Opponents to coal mining in the area — a group including the Chickaloon Village Traditional Council, Cook Inletkeeper, Alaska Center for the Environment, Friends of Mat-Su, Castle Mountain Coalition and Trustees for Alaska — asked the federal government to step in, arguing that the permits were invalidated in 1996 when one of the previous permit holders failed to begin mining operations within the time period required by law.

In a nutshell, state law says two things relevant to the case. First, is that a permit holder can renew its permit every five years. Second, that the permit is invalid if mining doesn’t commence in three years without the permit holder getting an extension.

The state contends that when it renewed the permit multiple times during the past 16 years it “implicitly granted” extension on that three-year deadline to start mining and didn’t need to make that extension explicit.

But the federal agency that reviewed the Wishbone Hill permits disagrees.

In its letter to the state, OSM said it has good reason to believe violations of federal law were occurring, and demanded the state either take action or give a good reason why no action has been take. The state responded, but a letter from the same federal agency two weeks ago asked for more documentation supporting the state’s claim that the permits are valid. This week’s response also included hundreds of pages of documents, some from OSM’s own files.

“We are hoping that they will look at our information and realize that we have been issuing these permits for the last 15 years and they have been watching us and approving our renewals for 15 years,” Fogels said.

But if that doesn’t happen, a few things could result.

In one scenario the federal government will likely run an inspection and after which declare the permit invalid and maybe level some fines against the state and probably Usibelli.

That’s the most extreme scenario.

Also on the list of possibilities — a trio of ongoing lawsuits could settle the matter either in state or federal court.

Fogels and DNR’s director of Division of Mining, Land and Water, Brent Goodrum, said there is a more serious issue at play here — that the federal government is stepping in on a program it has previously praised.

“We seem to think that it’s our program and we know how our program should be run,” Goodrum said.

And, Fogel added, if a federal agency’s review can invalidate a 16-year-old state decision, essentially opponents of development have a perpetual right to appeal. Meanwhile, industry is left staring into an uncertainty permitting future.

“We’ve been telling this company for 20 years that they have a valid permit. They’ve been basing investment decisions on that assumption because we and OSM have told them we have a valid permit for 20 years and now we’re going to flip-flop and rule it invalid after all of these years?” Fogels said.

Contact reporter Andrew Wellner at andrew.wellner@frontiersman.com or 352-2270.