COALEX STATE INQUIRY REPORT - 138
January 18, 1990
Michael Lepchitz
Assistant Attorney General
P. O. Drawer U
Big Stone Gap, Virginia 24219
TOPIC: HISTORY OF THE TWO-ACRE EXEMPTION
INQUIRY: A civil suit has been filed against the State by the parents of a boy who drowned in a
water-filled, unreclaimed pit on two-acre mine site. The accident occurred before the two-acre
exemption was repealed. We would like to provide the judge, who has little familiarity with
SMCRA, with a history of the development of the regulations and an overview of existing caselaw.
SEARCH RESULTS: Research was conducted using the COALEX Library and the other materials
available in LEXIS. A synopsis of the legislative history of the SMCRA section and the changes in
the regulation is followed by descriptions of relevant decisions. The chronology of the SMCRA
section and the regulation in table form is included as an attachment. Unless otherwise indicated,
copies of the materials listed below are attached.
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SECTION I: LEGISLATIVE HISTORY
ORIGINAL LEGISLATION
Surface Mining Control and Reclamation Act of 1977 (SMCRA), Pub L No 95-87, 91 STAT 445
(1977), codified at 30 USC 1201.
Purposes of the Act include: cooperation between the Department of the Interior and the
States with respect to the regulation of surface coal mining operations; striking a balance
between the production of coal and protection of the environment and agricultural productivity;
and reclamation of abandoned mines.
Sec. 528 (30 USC 1278). SURFACE MINING OPERATIONS NOT SUBJECT TO THIS ACT:
"The provisions of this Act shall not apply to any of the following activities:
...
(2) the extraction of coal for commercial purposes where the surface mining operation affects two
acres or less".
ORIGINAL LEGISLATIVE HISTORY
A succinct legislative history of SMCRA appears in the preamble to the proposed rule published
in the Federal Register on JANAURY 4, 1982, 47 FR 41:
Congress provided the two acre exemption "because it perceived the exempted operations as
causing minimal environmental damage and regarded the benefit to the environment of
regulation as very small in relation to the burden on both the miner and the regulatory authority."
47 FR 41 [See also, S Rep No 128, 95th Cong, 1st Sess 97-98 (1977) included as an attachment.]
An early, more restrictive, version of the surface mining bill would have allowed the exemption
only for "the extraction of minerals or the removal of overburden for commercial purposes in
amounts of less than one thousand tons in any one location (of not more than two acres) in any
one calendar year." These "pick and shovel operations", Sen. Jackson felt, should be excluded
from SMCRA requirements because "the scope of their impact is so minor" and they " do not
present the environmental or social costs which regulation under the Act would internalize." 119
Cong Rec 1357, 1368 (January 18, 1973). Congress later dropped the 1000 ton limitation.
"In hearings on the final bill, Senator Metcalf gave further indication of the type of operation
intended to be exempted under the language finally adopted. He stated that the Act would not
'prevent this mine operator who handles a truckload of coal once a week, or something like that,
from having complete opportunity to mine without any permit whatsoever....You don't have to do
it under this proposed regulation exemption of two-acres.' Senator Metcalf concluded with the
statement, 'We are trying to exempt the one-man operation.' Surface Mining Control and
Reclamation Act of 1977, Hearings on S. 7 before the Subcommittee on Public Lands and
Resources of the [Senate] Committee on Energy and Natural Resources, 95th Cong, 1st Sess 436
(1977)." 47 FR 41.
SUBSEQUENT LEGISLATION
Public Law 100-34 (HR 1963), 101 STAT 300, 301 (May 7, 1987).
Sec. 201 REPEAL OF EXEMPTION:
Sec. 528 paragraph (2) was repealed; paragraph (3) was redesignated paragraph (2).
SUBSEQUENT LEGISLATIVE HISTORY
Explanation for the repeal of the two-acre exemption appears in the Congressional Record for
April 21, 1987, 133 Cong Rec H 2053.
Unethical operators, "not mom and pop operators," used the provision to circumvent SMCRA's
land reclamation requirements and payment of abandoned mine reclamation fees. "This gave the
unethical operator a significant economic advantage."
Methods used to qualify for the exemption included the following:
1. The "string of pearls": an operator would mine a few sites along a coal seam, skip 50 to
100 feet between pits, then claim each site as a separate mine under the exemption.
2. Deeding "coal haul roads to local governments to decrease the surface area disturbed to 2
acres or less."
3. Creating shell corporations "under which separate companies were formed and operated
under the 2-acre exemption using common equipment, employees, offices and
stockholder."
The result of the abuse of the exemption was a "flurry of lawsuits, a disproportionate
expenditure of State and Federal funds, and the circumvention of the reclamation provisions of
SMCRA." This amendment "would correct these problems and require proper reclamation at all
mines, regardless of size."
SECTION II: REGULATORY HISTORY
44 FR at 14915 and 15315 (MARCH 13, 1979). ACTION: Final rule.
Promulgation of final rules implementing the permanent regulatory program under SMCRA. The
two-acre exemption is located at 30 CFR Sec. 700.11 Applicability:
"This Chapter applies to all coal exploration and surface coal mining and reclamation operations,
except -
...
(b) The extraction of coal for commercial purposes where the surface coal mining an reclamation
operation affects two acres or less, but not any such operation conducted by a person who affects
or intends to affect more than two acres at physically related sites, or ANY SUCH OPERATION
CONDUCTED BY A PERSON WHO AFFECTS OR INTENDS TO AFFECT MORE THAN TWO ACRES AT
PHYSICALLY UNRELATED SITES WITHIN ONE YEAR".
44 FR 67942 (NOVEMBER 27, 1979). ACTION: Notice of suspension of certain rules.
The language in capital letters above was suspended as the result of litigation over the
permanent regulatory program in which the Commonwealth of Virginia challenged the two-acre
rule as being "overly broad". [In re: Permanent Surface Mining Regulation Litigation, No 79-1144
(D D C 1979)] "The section was modified to reflect more closely congressional intent." NOTE: The
rule, with this modification, continued in effect until September 1, 1982.
45 FR 8241 (FEBRUARY 6, 1980). ACTION: Proposed rulemaking.
OSM proposed to delete the language previously suspended. The original language was
intended to avoid potential abuse of the exemption by "unscrupulous operators"; however, it also
covered legitimate operations of less than two acres conducted by the same operator. The
proposed regulation stated that "all land disturbed by coal extraction", such as haul roads, would
be included in the two-acre calculations and that the exemption did not apply to coal preparation
and processing plants. Although not included as part of the proposed regulation, the Secretary
requested comments on establishing a set of criteria to be used in determining whether sites are
physically related.
46 FR 7902 (JANUARY 23, 1981). ACTION: Final rule.
These regulations were to become effective on February 23, 1981. Comments received by OSM
and OSM's subsequent investigation revealed widespread abuse of the two-acre exemption.
These methods were to be adopted to halt the abuse:
a. Definition of "affect" would include land or water above underground mine workings,
streams and roads, regardless of their ownership, in the two-acre calculations.
b. Mandatory and discretionary criteria for determining whether two or more sites are
related:
Mandatory: Sites are located within the same state AND operations are conducted by the
same operator within a one year period.
Discretionary: Two or more operations are conducted using the same personnel and
equipment; the operations are conducted or controlled by the same person(s); or the coal
removed from various sites is owned by the same person(s).
c. Processing and support facilities are excluded from the exemption.
PRESIDENT'S MEMORANDUM of January 29, 1981.
The effective dates of all final rules which were not yet effective were postponed for 60 days.
[Text of this item is not attached.]
46 FR 10707 (FEBRUARY 4, 1981). ACTION: Extension of effective date.
The effective date of the final rule was postponed until March 30, 1981. [Text of this item is not
attached.]
46 FR 18023 (MARCH 23, 1981). ACTION: Notice of suspension of certain rules.
In error, a notice was published which purported to suspend the two-acre rule pending the
outcome of rulemaking.
46 FR 20211 (APRIL 3, 1981). ACTION: Cancellation of prior notice and deferral of effective dates
for final rules.
The effective dates for the final rules were postponed until May 4, 1981 in order to provide time
to receive comments on the necessity to initiate further rulemaking on these issues. Many states
were just beginning to implement their approved programs. Implementation of new federal final
rules would require the States to begin the process of amending their own programs to meet the
new federal rules. This would have imposed an "unnecessary burden " on the States.
46 FR 23924 (APRIL 29, 1981). ACTION: Deferral of effective dates and reopening of public
comment period.
The effective date of the final rule was further extended until June 14, 1981 and the comment
period was reopened "in response to requests for additional time to allow public comment as to
whether the rules should be modified or suspended indefinitely pending the outcome of
rulemaking."
46 FR 31258 (JUNE 15, 1918). ACTION: Deferral of effective dates.
In order to "fully consider the voluminous comments" received on the proposed suspension of
the two-acre rule, OSM extended the effective date until August 10, 1981.
46 FR 40650 (AUGUST 10, 1981). ACTION: Withdrawal of final rule.
The two-acre exemption regulations published January 23, 1981 was withdrawn for the
following reasons: the "rule may unnecessarily restrict the availability of the exemption to
underground mines by including all land above underground mine workings in determining the
size of a mine"; the "related sites" issue and the "complex issues involved in counting haul roads
and access roads as part of a mine" were inadequately addressed in these rules.
47 FR 41 (JANUARY 4, 1982). ACTION: Notice of proposed rulemaking.
A number of changes to the existing rule were proposed. The principal changes are outlined
below. In some cases, comments were requested on several alternative rules being considered by
OSM.
a. The exemption would apply where the operation "has or will have" an affected area of two
acres or less. This language would clarify Congressional intent to exempt small operations
not "the first two acres of any operation."
b. Criteria for "determining how to treat haul or access roads used by two or more
operations" would be added. Five alternatives were described.
c. Two or more operations would be deemed related if the operations occurred within 12
months of each other and met both a physical relatedness test (three alternatives were
provided to establish this criteria) and a common ownership or control test.
47 FR 33424 (AUGUST 2, 1982). ACTION: Final rule.
The new rule, which became effective on September 1, 1982, was considered by OSM to be
"interpretative in the sense that it clarifies, but does not change the ambit of, an exemption that
currently exists." [See the attachments for the full text of the new 700.11(b). Principal changes
are discussed below.]
a. The wording "has or will have an affected area of two acres or less" was adopted from the
proposed rule. "This is a change in wording, not a change in substance, from the previous
regulation. OSM believes that this is the proper interpretation of the Act and its legislative
history...."
b. "[T]he entire area of any segment of a road used by more than one operation will be
included in the 'affected area' of each of those operations." However, "if two or more
'related' operations use the same segment of a haulage or access road, the entire area of
that segment will be included only once in their combined acreage to avoid counting the
same segment of road more than once in the acreage of the same operation." The
regulatory authority must "first determine the affected area of the surface coal mining
operation and any related operations. If a road used by a surface coal mining operation is
part of its 'affected area,' it is counted for purposes of determining whether that operation
affects two acres or less."
c. The relatedness regulation adopted will help prevent abuse by operators who seek to
"evade the permitting and environmental protection performance standards of the Act" by
dividing "what is essentially one mine site into numerous sites of two acres or less." The
three components of the test are:
(1) Temporal limitation: Operations are related if they occur within twelve months of each
other.
(2) Physical relatedness: "Drainage from both operations flows into the same watershed
at or before a point within five aerial miles of either operation." A "geographical
relationship is the most appropriate measure of physical relatedness....The five-mile
watershed test is broad enough to encompass those operations that use common
equipment, personnel and facilities." The alternative adopted "will provide uniform and
understandable rules" and is consistent with the "intent of Congress to exempt only
operations which have minimal effects on the environment."
(3) Related by direct or indirect ownership or control, where "control" means ownership of
at least 50 percent of the voting shares in a company or enough shares to give the 'ability
in fact or law to direct" what the company does: Two or more operations owned or
controlled by the same person, two or more persons, members of the same family.
d. After considering all of the history and circumstances of two or more operations, the
regulatory authority may exempt these operations, despite being "related". The written
determination must be "consistent with the purposes of the Act."
e. Support facilities "incidental to the extraction of coal on a less than two-acre operation" as
well as the extraction of coal itself are exempt.
f. An operator may request a written determination of exemption in advance. The regulatory
authority may "make such a determination on its own initiative." If a determination of
exemption is later reversed, an operator who has acted in good faith will not be cited for
"violations which occurred prior to the date of the reversal."
52 FR 21228 (JUNE 4, 1987). ACTION: Notice of suspension.
Effective June 6, 1987, the rules governing the two-acre exemption were suspended. This
action, an "interpretive statement", was taken to conform the regulatory program to the "enacted
legislation repealing the exemption previously provided in section 528(2)....The suspension is not
intended to affect any pending or future enforcement action against persons who incorrectly
asserted that exemption when it was in effect." All surface mining operations, regardless of size,
were made subject to the requirements of SMCRA, e.g., obtain an approved permit, pay a
reclamation fee and fulfill reclamation requirements, unless entitled to an exemption under some
other provision of SMCRA.
"Pub. L. 100-34 preempts any State law or regulation which permits surface coal mining
operations affecting two acres or less without satisfying the requirements of SMCRA. The
legislation invalidates applicable State laws or regulations as of June 6, 1987...." Operations
which began prior to June 6, were allowed to continue until Nov. 8, 1987. On that date, all
surface coal mining operations "not otherwise exempt under SMCRA" could not be conducted
without "an approved permit under the applicable regulatory program."
SECTION III: ADMINISTRATIVE DECISIONS
LLOYD D. LIVESAY, D.B.A. NU-WAY COAL CO. v OSM, Docket No. NX 7-46-R (1989).
In 1981, the Administrative Law Judge (ALJ) determined that Livesay's mining operations had
"disturbed a surface area in excess of 2 acres". The Interior Board of Surface Mining Appeals
(IBSMA) dismissed Livesay's appeal because "the parties had filed a joint motion for consent
decision" which detailed a compromise settlement involving the consolidated cases. In 1986,
members of the Virginia Two-Acre Task Force (VTATF), conducting an oversight inspection,
determined that the required reclamation activities had not been performed and issued a Ten-Day
Notice (TDN) to the Virginia Division of Mined Land Reclamation (DMLR). DMLR took no
enforcement action, relying that the site was covered by the two-acre exemption. VTATF issued a
Notice of Violation (NOV) and later a Cessation Order (CO), when the violations were not abated.
The ALJ ruled that the 1986 actions were not res judicata because no final judgment on the
merits of the 1981 actions had been issued by the appellate board. In addition, OSM had grounds
to issue the 1986 CO because: "the question of whether DMLR had properly granted to Livesay a
less-than-2-acre exemption in 1979 concerning the mining activities at Nu-Way...could not have
been raised in the earlier proceedings which were concluded on November 6, 1981, since the
triggering circumstances which resulted in the VTATF inspections ...had not been entered until
June 7, 1985."
LLOYD D. LIVESAY, D.B.A. NU WAY COAL CO. v OSM, 112 IBLA 137, IBLA 90-28 (1989).
The appeal was dismissed. Livesay's brief, filed late, contained insufficient grounds to support
an appeal.
CHERRY HILL DEVELOPMENT v OSM, 110 IBLA 185, IBLA 86-387 and 88-655 (1989).
OSM cited Cherry Hill for "failure to backfill to eliminate all highwalls" after the Kentucky
Department of Surface Mining Reclamation and Enforcement (DSMRE) took no action on the TDN.
DSMRE stated that the Cherry Hill operation had a state permit "issued for two acres or less with
a variance to leave the highwall." The ALJ sustained the issuance of the NOV and CO by OSM and
ruled that a portion of the country road used by Cherry Hill as a haul road should be included in
calculating the operation's "affected area", thus, at the time the NOV and CO were issued, the
area affected by the Cherry Hill operation was greater than two acres. However, the ALJ
concluded that no civil penalty should be assessed since Cherry Hill was following its state permit
requirements in leaving the highwall. On appeal, the Interior Board of Land Appeals (IBLA) ruled
as follows: (1) it upheld the OSM's issuance of the NOV and CO, stating that the state's earlier
enforcement actions "did not arise from the same operative facts" as the federal actions; (2)
affirmed that the area affected by the operations was greater than two acres; (3) determined
that the exemption "will not be deemed finally reversed...until the applicable administrative or
judicial review process had been exhausted"; and (4) reversed the ALJ's decision regarding
removal of the highwall, ruling that once coal was removed from the Cherry Hill development, and
"those operations affected more than two acres, they became subject" to regulation under
SMCRA and its state equivalent, where the requirement to eliminate highwalls "is an absolute
requirement."
CUMBERLAND RECLAMATION CO., 102 IBLA 100, IBLA 85-583 (1988).
The IBLA affirmed the decision of the Lexington Field Office of OSM which held that
Cumberland's dredging operation was a surface coal mining operation and that the area the
operation affected was greater than two acres when all factors were considered: disturbance on
the riverbank, area of the riverbed dredged and area of downstream pollution.
THOMPSON BROTHERS COAL CO. v OSM, 105 IBLA 69, IBLA 86-1394 (1988).
In reversing the ALJ decision and vacating the CO, the IBLA determined that: "No violation of
[SMCRA] occurred where, during the interim program for the regulation of surface coal mining in
Pennsylvania, surface drainage was passed from one permit area to an adjacent permit and then
passed through a sedimentation pond before leaving the second permit area, where both permit
areas were embraced within the same mine drainage permit issued by the state regulatory
authority."
OSM v C-ANN COAL CO., 94 IBLA 14, IBLA 85-75 (1986).
This appeal involved the interim regulatory program. C-Ann mined an area of just under two
acres. The IBLA ruled that the [preexisting] refuse storage pile
C-Ann used should be included in the calculation, thus the total area disturbed by their operation
was greater than two acres. In addition, the Board noted that C-Ann's permit application called
for the disturbance of a total of three acres and stated that: "where an entity that is extracting
coal intends to affect more than 2 acres, that entity is not exempted from coverage under
[SMCRA] regardless of whether or not it has actually affected 2 acres."
SECTION IV: FEDERAL CASE LAW
SAVE OUR CUMBERLAND MOUNTAINS, INC. v HODEL, Civil Action No. 81-2238 (D D C,
settlement agreement filed June 7, 1985). (The text of this settlement agreement is not attached.
The following description of the agreement is quoted from LIVESAY v OSM, Docket No. NX 7-46-R, pp 7-9.)
"The central issue in that lawsuit was whether some 3,000 surface coal mining operations, as well
as underground coal mining operations with attendant surface impacts, located in Kentucky and
Virginia had properly been granted less-than-2-acre type exemptions by the appropriate State
regulatory authorities. The granting of those exemptions relieved those permittees from the
provisions of the Act and the implementing regulations...."
According to the terms of the settlement agreement, Kentucky and Virginia agreed to develop
inventories of all mining sites which have claimed exemption from the Act under the two-acre
provision at any time since May 3, 1978. Under the specific inspection and enforcement
procedures developed, each state created a "Two-Acre Task Force (TATF)" responsible for
conducting initial inspections, plus any required followup inspections, of sites listed in the
inventory. Review of all mine sites was to be completed within a 7-year period.
W.D. MARTIN, D/B/A MARTIN COAL CO. v HODEL, 692 F Supp 637 (W D VA 1988).
In 1981, the ALJ vacated OSM's NOV, holding that Martin's operation disturbed less than two
acres and was exempt from provisions of the Act. In 1988, the TATF, citing numerous violations,
issued another NOV for the site Martin mined in 1981. Martin filed suit in district court to "enjoin
the federal defendants from prosecuting the 1988 NOV on the legal ground of res judicata." The
court concluded the case was res judicata, that it was not premature for the court to hear the
case and that OSM had failed to prove that Martin deliberately tried to conceal mining activities at
another nearby small minesite which occurred shortly before the mining operation in question
began.
HARMAN MINING CORP. v HODEL, 662 F Supp 629 (W D VA 1987).
This case involves the surface effects of underground mines. When Virginia DMLR determined
the affected area of Harman's mine, it did not include in the calculations the acreage of several
access roads which DMLR considered public roads. DMLR took no action in response to OSM's
TDN since it concluded it had no jurisdiction over the matter. Harman's request for temporary
relief from the OSM-issued NOV was denied by the ALJ and Harman appealed the district court.
The court also denied the request for temporary relief for the following reasons: (1) the unsafe
conditions [improperly sealed portal entries] would "adversely affect the public health or safety" -
they were a hazard to "unwary children and hunters"; (2) the Virginia Code section Harman sites
with respect to the deeding of the haul road to the county was invalidated by the Secretary of the
Interior at the time Virginia's proposed permanent program was approved because that section
was inconsistent with SMCRA; and (3) "Harman did not act in good faith"; their attempt to
categorize the roads as "public" was a "sham and a stratagem" used to avoid "strictures of the
Act" - there was not evidence that the county maintained the roads with public funds and the
road was chained to bar traffic.
PATRICK COAL CORP. v OSM, 661 F Supp 380, 27 ERC 1338 (W D VA 1987).
Patrick appealed to the district court to temporarily enjoin OSM from enforcing the CO and NOV
OSM's TATF had issued after the Interior ALJ denied Patrick's temporary relief request. The court
held that: (1) the CO and NOV were valid even though OSM had failed to provide Virginia DMLR
with the TDN, finding that "the state can waive a provision [the ten-day notice] intended solely
for its benefit"; (2) additional areas, including an access road, were properly included by OSM in
"determining the affected area's total acreage"; (3) "estoppel [against the United States] is not
an assertable defense" - Patrick relied "on DMLR's advice, not on the United States' advice", and
"has not changed its position in reliance of advice"; and (4) the scope of 30 CFR 700.11(c) does
not "prevent OSM from reversing DMLR's earlier decision that [Patrick's] mine affected area is less
than two acres", however, the regulation does preclude OSM's application of civil penalties "prior
to reversal".
HARMAN MINING CORP. v OSM, 659 F Supp 806, 25 ERC 2092 (W D VA 1987).
Harman was granted temporary relief from OSM's enforcement of two NOV's which resulted
from an "oversight inspection". The NOV's were issued for failure to permit a haulage road.
Virginia DMLR had determined previously that the road in question was "a public road under the
Virginia State Program" and did not have to be permitted. Ruling in Harman's favor, the district
court described the standards used to review the decision of an ALJ: in reviewing an ALJ's
decision "on merits," the court "must affirm if the findings are 'supported by substantial evidence
on the record considered as a whole'"; when considering a request for "temporary relief pending
final determination", the court must conduct "its own examination of the criteria in [30 USC] sec.
1276(c) to determine if temporary relief is proper." The court had to look "to the Act itself" to
make its decision because the federal regulation concerning the determination of public road had
been remanded to the Secretary of Interior and no new federal regulations had been
promulgated; once the federal regulations were ruled invalid, "Virginia's identical regulation" was
also considered invalid. "To hold otherwise would allow Virginia's regulation to be inconsistent
with the Act."
SAVE OUR CUMBERLAND MOUNTAINS, INC. (SOCM) v CLARK, 725 F2d 1422, 14 ELR 20205 (D D
C 1983). SAVE OUR CUMBERLAND MOUNTAINS, INC. v WATT, 558 F Supp 22 (D D C 1982).
SOCM charged that the Secretary "failed to enforce the Act" by "unlawfully" withdrawing the
two-acre exemption regulation. [See 46 FR 40651 (August 10, 1981) in the Regulatory History
section above.] The court affirmed the district court ruling that the "withdrawal of the regulation
was mooted by the agency's subsequent promulgation of a regulation covering the same subject
matter." [See 47 FR 33424 (August 2, 1982) above.]
JAWARD CORP. v WATT, 564 F Supp 797, 13 ELR 20874 (W D VA 1983).
OSM stated that Jaward's operation affected more than two acres "because of an access road
and certain underground disturbance or shadow area". The court determined that it had
jurisdiction "to hear procedural due process violations as a result of the Secretary' application of
the Act", since it was the district court in which the surface mining operation was located. It ruled
that Jaward satisfied the criteria for granting an injunction: there were no violations of the
regulations, only a question of the inclusion of the haul road; therefore, there was no adverse
effect on the public health and safety. OSM was enjoined from issuing cessation orders, to Jaward
and all other similar "two-acre mines", based "upon the charge that an operation with a Chapter
23 permit [operations of two acres or less] must obtain a Chapter 19 permit [larger operations
subject to 'extensive regulation']. However, OSM is not enjoined from issuing cessation orders
against operations which are causing serious harm to the environment." [See Virginia, below.]
VIRGINIA, ex rel. VIRGINIA DEPT. OF CONSERVATION AND ECONOMIC DEVELOPMENT v WATT,
741 F2d 37, 14 ELR 20492 (4th Cir 1984), cert granted 469 US 979, cert dismissed 469 US 1198
(1985).
Subsequent to the approval of its regulatory program, Virginia passed regulations governing
two-acre exemptions (Chapter 23). The Secretary alleged that these regulations were inconsistent
with federal regulations because Chapter 23 does not include haulage roads and the land above
underground mine workings in their two-acre calculations. The Secretary began enforcement
actions, including the issuance of CO's, against Virginia and certain coal operators to force
compliance with the federal laws. The coal miners and the Commonwealth of Virginia challenged
the OSM issued CO's, claiming compliance with Chapter 23. The Secretary contended that the
district court in Jaward "lacked subject-matter jurisdiction." The circuit court ruled that the proper
forum for the "review of the Secretary's rulemaking actions" was the US District Court for the
District of Columbia", reasoning that "[c]onflicts among various district courts concerning validity
of the federal regulations would impair or prevent the establishment of nationally uniform
minimum standards."
US v E & C COAL CO., INC., 846 F2d 247, 18 ELR 21079, 27 ERC 2031 (4th Cir 1988). US v E & C
COAL CO., INC., 647 F Supp 268, 25 ERC 1734 ( W D VA 1986).
These cases involve the definition of "affected area", the inclusion of the "area above
underground mine workings" in the calculations for eligibility under the two-acre exemptions and
the payment of reclamation fees. Both E & C and the US appealed the district court's judgment
which held E & C not liable for reclamation fees for coal mined prior to August, 1982 (see the
regulatory section above) and liable for fees for coal mined after August, 1982. The circuit court
determined the March 13, 1979 definition of "affected area" included the shadow area and that
Virginia's definition "would have to conform" with the federal definition. E & C was "required to
pay fees for coal mined both prior and subsequent to August, 1982."
ATTACHMENTS
A. CHRONOLOGY OF THE TWO-ACRE EXEMPTION.
B. Surface Mining Control and Reclamation Act of 1977 (SMCRA), Pub L No 95-87, 91 STAT
445 (1977), codified at 30 USC 1201. Sec. 528 (30 USC 1278). SURFACE MINING
OPERATIONS NOT SUBJECT TO THIS ACT, amended by Public Law 100-34 (HR 1963),
101 STAT 300, 301 (May 7, 1987). Sec. 201. REPEAL OF EXEMPTION.
C. S REP No 128, 95th Cong, 1st Sess 97-98 (1977).
D. 119 Cong Rec 1357, 1368 (JANUARY 18, 1973).
E. Surface Mining Control and Reclamation Act of 1977, Hearings on S. 7 before the
Subcommittee on Public Lands and Resources of the [Senate] Committee on Energy and
Natural Resources, 95th Cong, 1st Sess 436 (1977).
F. 133 CONG REC H 2053 (April 21, 1987).
G. 44 FR 14902, 14915 and 15315 (MARCH 13, 1979).
H. 44 FR 67942 (NOVEMBER 27, 1979).
I. 45 FR 8241 (FEBRUARY 6, 1980).
J. 46 FR 7902 (JANUARY 23, 1981).
K. 46 FR 18023 (MARCH 23, 1981).
L. 46 FR 20211 (APRIL 3, 1981).
M. 46 FR 23924 (APRIL 29, 1981).
N. 46 FR 31258 (JUNE 15, 1981).
O. 46 FR 40650 (AUGUST 10, 1981).
P. 47 FR 41 (JANUARY 4, 1982).
Q. 47 FR 33424 (AUGUST 2, 1982).
R. 52 FR 21228 (JUNE 4, 1987).
S. LLOYD D. LIVESAY, D.B.A. NU-WAY COAL CO. v OSM, Docket No. NX 7-46-R (1989).
T. LLOYD D. LIVESAY, D.B.A. NU WAY COAL CO. v OSM, 112 IBLA 137, IBLA 90-28 (1989).
U. CHERRY HILL DEVELOPMENT v OSM, 110 IBLA 185, IBLA 86-387 and 88-655 (1989).
V. CUMBERLAND RECLAMATION CO., 102 IBLA 100, IBLA 85-583 (1988).
W. THOMPSON BROTHERS COAL CO. v OSM, 105 IBLA 69, IBLA 86-1394 (1988).
X. OSM v C-ANN COAL CO., 94 IBLA 14, IBLA 85-75 (1986).
Y. W.D. MARTIN, D/B/A MARTIN COAL CO. v HODEL, 692 F Supp 637 (W D VA 1988).
Z. HARMAN MINING CORP. v HODEL, 662 F Supp 629 (W D VA 1987).
AA. PATRICK COAL CORP. v OSM, 661 F Supp 380, 27 ERC 1338 (W D VA 1987).
BB. HARMAN MINING CORP. v OSM, 659 F Supp 806, 25 ERC 2092 (W D VA 1987).
CC. SAVE OUR CUMBERLAND MOUNTAINS, INC. (SOCM) v CLARK, 725 F2d 1422, 14 ELR
20205 (D DC 1983).
DD. SAVE OUR CUMBERLAND MOUNTAINS, INC. v WATT, 558 F Supp 22 (D D C 1982).
EE. JAWARD CORP. v WATT, 564 F Supp 797, 13 ELR 20874 (W D VA 1983).
FF. VIRGINIA, ex rel. VIRGINIA DEPT. OF CONSERVATION AND ECONOMIC DEVELOPMENT v
WATT, 741 F2d 37, 14 ELR 20492 (4th Cir 1984), cert granted 469 US 979, cert
dismissed 469 US 1198 (1985).
GG. US v E & C COAL CO., INC., 846 F2d 247, 18 ELR 21079, 27 ERC 2031 (4th Cir 1988).
HH. US v E & C COAL CO., INC., 647 F Supp 268, 25 ERC 1734 ( W D VA 1986).
Research conducted by: Joyce Zweben Scall
CHRONOLOGY OF THE TWO-ACRE EXEMPTION
SMCRA Sec. 528(2), 30 USC 1278, and 30 CFR 700.11(b)
(Reformatted from original)
ACTION
DATE; CITE
SUMMARY
SMCRA PASSED
Aug. 3, 1977; P L 95-87, 91 STAT 445, 30 USC 1201
Exempted: "the extraction of coal for commercial purposes where the surface mining operation
affects two acres or less."
FINAL RULE
Mar. 13, 1979; 44 FR 15311
Exempted: "The extraction of coal for commercial purposes where the surface coal mining and
reclamation operation affects two acres or less, but not any such operation conducted by a
person who affects or intends to affect more than two acres at physically related sites, or any
such operation conducted by a person who affects or intends to affect more than two acres at
physically unrelated sites within one year."
NOTICE OF SUSPENSION OF CERTAIN RULES
Nov. 27, 1979; 44 FR 67942
As a result of legal challenges to the permanent regulatory program, the portion of the rule
highlighted above was suspended. The rule, in this modified form, remained in effect until Sept.
1, 1982.
PROPOSED RULEMAKING
Feb. 6, 1980; 45 FR 8241
The proposed rule would delete the suspended language. All land disturbed, e.g., haul roads,
would be included in the two-acre calculations. The exemption was not to apply to processing
plants.
FINAL RULE
Jan. 23, 1981; 46 FR 7902
This version of the rule never became effective. The effective date (Feb. 23, 1981) was extended
several times and eventually, due to the large number of comments, was withdrawn. The rule
would have: (1) included land or water above underground mine workings, streams and roads in
the two-acre calculations; (2) sites had to be located within the same state and operations
conducted within 12 months; (3) operations were considered related if they used the same
personnel and equipment or were controlled by the same person(s); and (4) support facilities
were excluded from the exemption.
EXTENSION OF EFFECTIVE DATE
Jan. 29, 1981; Presidential memo
The effective date of all final rules not yet in force was postponed 60 days.
EXTENSION OF EFFECTIVE DATE
Feb. 4, 1981; 46 FR 10707
The effective date of the Jan. 23, 1981 final rule was postponed until Mar. 30, 1981.
NOTICE OF SUSPENSION OF CERTAIN RULES
Mar. 23, 1981; 46 FR 18023
In error, a notice was published which purported to suspend the Jan. 23, 1981 final rule, pending
the outcome of rulemaking.
CANCELLATION OF PRIOR NOTICE AND DEFERRAL OF EFFECTIVE DATES FOR FINAL RULES
April 3, 1981; 46 FR 20211
The effective date for the final rule was postponed until May 4, 1981 in order to provide time to
receive comments on the necessity to initiate further rulemaking.
DEFERRAL OF EFFECTIVE DATES AND REOPENING OF PUBLIC COMMENT PERIOD
April 29, 1981; 46 FR 23924
The effective date was further extended until June 14, 1981. The comment period was reopened
to allow additional time for comments to determine whether the rules should be modified or
suspended pending the outcome of new rulemaking.
DEFERRAL OF EFFECTIVE DATES
June 15, 1981; 46 FR 31258
In order to "fully consider the voluminous comments" received, OSM extended the effective date
to Aug. 10, 1981.
WITHDRAWAL OF FINAL RULE
Aug. 10, 1981; 46 FR 40651
The final rule published Jan. 23, 1981 was withdrawn to reconsider the "related sites" and
"counting haul road" issues.
NOTICE OF PROPOSED RULEMAKING
Jan. 4, 1982; 47 FR 41
A number of changes were proposed. Comments were requested on a number of alternative
rules: (1) Language was changed to "has or will have an affected area"; (2) five alternative
criteria were provided for treating haul roads; (3) relatedness = conducting operations within 12
months + physical relatedness (three alternatives were provided) + common ownership and
control.
FINAL RULE
Aug. 2, 1982; 47 FR 33424
This final rule became effective on Sept. 1, 1982: (1) The wording "has or will have an affected
area of two acres or less" was adopted; (2) a segment of a road used by more than one
operation will be used in the two-acre calculations for each operation; (3) operations will be
considered related if - conducted within 12 months of each other + drainage from operations flow
into the same watershed within five aerial miles of each other + are related by direct or indirect
ownership and control; (4) under certain circumstances, the regulatory authority may exempt
certain operations, despite being "related"; (5) support facilities are included in the exemption;
(6) the regulatory authority may initiate a written determination or provide one in response to an
operator's request and a person operating in "good faith" will not be cited for violations which
occurred while an operation is exempted even if the exemption is later reversed.
AMENDMENT TO SMCRA PASSED
May 7, 1987; P L 100-34, 101 STAT 300, 30 USC 1278
The two-acre exemption was repealed due to excessive abuse by some operators. After Nov. 8,
1972, all surface coal mining operations, not exempted by some other SMCRA provision, will be
subject to all requirements of SMCRA.
NOTICE OF SUSPENSION
June 4, 1987; 52 FR 21228
This "interpretive statement" suspended the two-acre exemption regulations, conforming to
"enacted legislation". Pending or future enforcement actions "against persons who incorrectly
asserted that exemption when it was in effect" were not suspended.
