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What does the Infrastructure Investment and Jobs Act mean for OSMRE's AML Program?

The Infrastructure Investment and Jobs Act

Public Law 117-58: The Infrastructure Investment and Jobs Act, also known as “The Bipartisan Infrastructure Law (the Law),” was enacted on November 15, 2021. This enacted legislation included language that directly, or in some cases indirectly, impacts OSMRE. In addition to the extension of abandoned mine land (AML) fee collections and mandatory AML Grant distributions, $11.293 billion in new funding was authorized to be appropriated for deposit into the Abandoned Mine Reclamation Fund.

President Biden signs the Infrastructure Investment and Jobs Act as he is surrounded by lawmakers and members of his Cabinet during a ceremony on the South Lawn at the White House

President Biden signs the Infrastructure Investment and Jobs Act as he is surrounded by lawmakers and members of his Cabinet during a ceremony on the South Lawn at the White House (November 2021)
 

How to Apply for AML Grants under the Law

Biden-Harris Administration Releases Final Guidance for Bipartisan Infrastructure Law Abandoned Mine Land Grant Program

Provisions under the Law that impact the AML Program

With the passage of the Law, OSMRE takes on a new opportunity to invest in our infrastructure and benefit the American public for the next generation. 

This key investment will improve federal stewardship of our critical infrastructure and significantly increase OSMRE efforts to support our partners, stakeholders, Tribal nations, and communities. Most notably, this federal law expands investment in the Abandoned Mine Land (AML) program. Implementing this law and delivering meaningful results is a top priority for OSMRE.
 

 

AML Program changes include extending AML Fee Collection through Fiscal Year 2034, reducing the AML Fee Rate by twenty percent (New rates will be: Surface Mining 22.4¢ per ton, Underground - 9.6¢ per ton, and Lignite - 6.4¢ per ton), and extending AML Mandatory Distribution through 2035.

 

In addition to the changes to the existing AML Program, the law authorizes $11.293 billion to be deposited into the Abandoned Mine Land Fund to be distributed as follows:

  • Infrastructure Law AML Reclamation Grants to Eligible states and Tribes
    • OSMRE will distribute amounts made available in the appropriation to eligible states and Tribes on an equal annual basis over a 15-year period in accordance with the provisions of the the infrastructure law.
  • Up to 3% for OSMRE Operations
    • Up to 3 percent of the amount appropriated in the law may be used for OSMRE's administration of the program.
  • 0.5% for Office of Inspector General Operations
    • One-half of one percent of amounts made available in the law must be transferred to the Office of the Inspector General of the Department of the Interior for oversight of funding
  • $25 million for Financial and Technical Assistance
    • States and Tribes will be provided with the financial and technical assistance necessary for the purpose of making amendments to the Abandoned Mine Land Inventory System (e-AMLIS).

The distribution announced on February 7, 2022, is the first of 15 annual installments under the BIL that will provide approximately $10.87 billion (after BIL directed reductions) for AML reclamation projects, in addition to funds available under AML-fee based grants.

As directed by the BIL, the distribution amounts were based on the number of tons of coal historically produced in each State or from the applicable Indian lands before August 3, 1977. OSMRE relied on the March 1980 Final Environmental Impact Statement (OSM-EIS-2) to ascertain these amounts and then calculated each State’s or Tribe’s percentage of total historic coal production.

For More Information

To support the implementation of these historic investments and new programs for reclamation and environmental stewardship under the Law, see the additional resources on federal funding.

NOFO Application

From the Department of the Interior

From the Biden-Harris White House

Frequently Asked Questions

Following passage of the Law, the Office of Surface Mining and Reclamation Enforcement received several questions as to whether the Law’s provisions for reclamation encompass funding for certain acid mine drainage (AMD) projects.

Below, OSMRE provides guidance on some of these questions.

  • States and tribes have been getting AML money every year for decades – is this just the same? 

No – the annual AML fee-based grants that states and tribes receive are separate from the Bipartisan Infrastructure Law AML grants. The AML fee-based grants are funded primarily by reclamation fees and distributed as required by section 402 of SMCRA, while the Law AML grants are funded by moneys from the United States Treasury and will be distributed as required by section 40701 of the Law. 

The distribution announced on February 7, 2022, is the first of 15 annual installments under the Law that will provide approximately $10.87 billion (after Law-directed reductions) for AML reclamation projects, in addition to funds available under AML-fee based grants. The Bipartisan Infrastructure Law AML guidance document published on July 21, 2022, provides additional details on the Law AML grants and expectations for the program.

  • The Bipartisan Infrastructure Law AML Grant Distribution was announced on February 7, 2022. Does this announcement represent a one-time distribution amount to states and Tribes?  

No. As directed by the Law, OSMRE will be distributing approximately $725 million annually for 15 years, beginning in FY2022. Eligible states and Tribes will receive these annual Law AML grant distributions for the remaining years, subject to any required adjustments.

  • What formula was used to determine how much Bipartisan Infrastructure Law AML funding each State and Tribe gets in FY 2022? 

As directed by the Law, the distribution amounts were based on the number of tons of coal historically produced in each State or from the applicable Indian lands before August 3, 1977. OSMRE relied on the March 1980 Final Environmental Impact Statement (OSM-EIS-2) to ascertain these amounts and then calculated each State’s or Tribe’s percentage of total historic coal production. Once calculated, that percentage was simply multiplied by $10.87 billion and divided by 15 – with the exception of Alaska. 

  • Why is Alaska an exception?  

The Law provides that each eligible state or tribe will get a minimum total of $20 million over the life of the program unless the state or tribe has less than $20 million in unfunded AML reclamation costs.  

Alaska had an unfunded inventory of roughly $25.8 million, so its 15-year allocation was increased from $3.3 million (under the formula) to raise its total to $20 million.  The roughly $16.7 million in extra funds to Alaska resulted from a recalculation among the states and tribes in proportion to their historic coal percentage. 

  • How will the Law AML distribution amounts be calculated in FY2023 and beyond? 

OSMRE is still drafting guidance related to the distribution calculations after FY2022, but the historic coal production numbers in the March 1980 Final Environmental Impact Statement will not change (OSM-EIS-2). However, as eligible states and Tribes update their inventories, OSMRE will adjust distributions to ensure that each eligible state and tribe receives at least $20 million over the course of the 15-year distribution, unless the amount needed for reclamation on state and tribal lands is less than $20 million.  

  • How do states and tribes reconcile recommended labor provisions in the Bipartisan Infrastructure Law AML guidance document that conflict with state or tribal bid laws and regulations?

The Law AML guidance document encourages states and tribes to meet the recommendations set forth in the guidance document for Law AML program implementation to the extent those steps are possible and consistent with applicable state or tribal law.

  • Do states and tribes need to use the Council on Environmental Quality (CEQ) Climate and Economic Justice Screening Tool (CEJST) map to identify a “disadvantaged community” to calculate benefits in relation to the Justice40 Initiative?

No, not at this time. Given that the CEJST tool is currently in beta mode and is still being developed to appropriately represent impacted legacy coal mining communities, the Law AML guidance document offers a broader definition of a “disadvantaged community” based on the OMB and CEQ Interim Implementation Guidance for the Justice40 Initiative. If this changes, OSMRE will work with states and Tribes to incorporate the changes into their programs. In the interim, states and tribes should identify opportunities through public engagement at the local level with affected communities to prioritize projects that deliver benefits to disadvantaged communities that reduce environmental burdens in alignment with the overall objectives of Justice40 Initiative.

  • When will states and tribes actually get this money? 

We expect eligible states and tribes will start applying for the FY 2022 funds in August 2022. OSMRE published the final Law Guidance on July 21, 2022, with pertinent information for the eligible states and tribe on how to apply for the first $725 million.

  • Will states and tribes be able to apply for these Law funds each year?  

Yes. Eligible states and tribes will be able to apply annually for the amount specified in each Fiscal Year Law grant distribution.   

  • Will states and tribes be required to submit separate grant applications for the Bipartisan Infrastructure Law AML grants and the AML-fee-based grants. 

Yes. OSMRE is requiring a separate grant application for Law AML funding to ensure, consistent with federal financial assistance requirements, its ability to track the expenditure of Law funds, ensure proper oversight of taxpayer dollars, facilitate audit reviews, be responsive to reporting requirements, and enhance transparency of the use of funds. OSMRE will continue to work with the states and Tribes to develop procedures that minimize burdens on applicants from having separate Law and fee-based AML applications.

  • When does OSMRE plan to provide funding to assist states and tribes with making amendments to the coal AML inventory system, e-AMLIS?

OSMRE expects to announce the availability of funding to assist states and tribes in updating their e-AMLIS inventories before September 30, 2022.

  • For AML projects where OSMRE has completed its NEPA review and issued an Authorization to Proceed (ATP) to states or tribes, will OSMRE require the states or tribes to resubmit all that paperwork for an additional ATP approval using Bipartisan Infrastructure Law funds or allow those projects to proceed with previous approvals? 

 Assuming there has been no change in the scope of work and all applicable provisions (e.g., compliance with the Davis Bacon Act, and Build America Buy America Act) have been or will be met, projects with a completed NEPA analysis and an ATP, will not need to be resubmitted to use Law funding. 

  • Will former and current employees of coal-fired power plants be considered “former and current employees of the coal industry” for purposes of the Law implementation?

Yes.

  • What information must be included in FY22 grant applications? Only the information that is typically included in grant applications, or something more? For example, the FY22 Notice of Funding Opportunity lists four things from the Guidance that are supposed to be prioritized: Justice 40/disadvantaged communities, public review of projects, methane reductions, and coal industry worker employment. Does information on those things need to be included in the FY22 grant application? If so, what kind of information is required?

In order to receive the FY2022 Bipartisan Infrastructure Law funds, grant applications must include a budget justification breakdown of how the funds will be allocated in the Law AML subaccounts (see Appendix I: Subaccounts for BIL AML Financial Assistance), and a Program Narrative summarizing how project selection practices will achieve reclamation, remediation, and socio-economic benefits.  

Details on specific projects are not required to be included in your grant application to receive FY2022 Law AML funds. States and tribes will be afforded a grace period of one year for providing a project list to receive FY2022 Law AML funds.

To receive FY 2022 Bipartisan Infrastructure Law AML funds, a state’s or tribe’s completed grant application must include the OMB-approved forms identified in the Law AML Grant Notice of Funding Opportunity in order to process required assistance agreement (i.e., signed application for Federal Assistance -SF-424 and related forms, budget justification forms, program narrative forms, etc.). 

  • Will states be allowed to consolidate the administrative costs they charge to AML grants to one form of grant, e.g., put all administrative costs for both their AML fee-funded and Bipartisan Infrastructure Law grant-funded AML work on their Law grant?

No. As required under the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, at 2 CFR 200 Subpart D, grant funds must be expended and accounted for in accordance with applicable statutory authorities and through adequate fiscal control procedures so that the expenditure of these funds can be monitored and tracked to ensure compliance with the assistance agreement.  It is imperative to maintain an effective system of controls and accountability for the use of these funds that ensure alignment with the activities supported by the grant agreement.

  • How will the period of performance for the Law grants be determined? How much flexibility will states have to receive funds at different times to better align with their unique financial situation?

The period pf performance for each Bipartisan Infrastructure Law AML grant is five years from the award issue date. OSMRE will, however, work with each state and tribe to address its unique situation where appropriate.  

  • What information will need to be included in FY23 Bipartisan Infrastructure Law grant applications? What information needs to be included in the project lists described on page 7/8 and in Appendix II of the Guidance; only the items in Appendix II, or also some or all of the items listed on page 7/8? Do the project lists need to include a breakdown of estimated costs to be assigned to each subaccount for each project on the list? Will approval of a grant application be contingent on whether the project list has already undergone public review, or can public review be conducted after the grant application has been submitted and approved? Does the entire, collective project list need to be submitted for 60 days of public review as one unit, or can projects be subjected to public review on an individual basis at different times? It is important that further guidance be provided on FY 23 grant applications and project lists soon; the time for applying for FY23 funding is not very far off, and preparation will take time.

OSMRE will provide further details on the project information that will need to be in included in the preparation of grant applications to receive FY 2023 Bipartisan Infrastructure Law AML funds in the FY 2023 Notice of Funding Opportunity.

 

  • Will states and tribes be required to update their existing AML Reclamation Plans?  

Yes. OSMRE will provide additional information about the nature of the needed updates to the AML Reclamation Plans at a later date.

  • Will states and tribes be allowed to receive Law funding if they have not completed updates to their AML Reclamation Plans?   

Yes. states and tribes are not required to complete the AML Reclamation Plan update, review, and approval process as a prerequisite to receiving Law funds.

 

  • Pursuant to section 40701 of the Law, may eligible states and tribes use grant funds to design and build AMD treatment facilities? If so, may grant funds be used to design and build AMD treatment facilities that are “stand alone” Priority 3 projects (i.e., not in conjunction with a Priority 1 or Priority 2 site or within a qualified hydrologic unit)?

Yes. Eligible states and tribes may use Law AML grant funds to design and build AMD treatment facilities and may use those funds to design and build AMD treatment facilities that are not in conjunction with a Priority 1 or Priority 2 site or within a qualified hydrologic unit. The Law specifies that its grant funds may be used only for “activities described in subsections (a) and (b) of section 403 and section 410 of the Surface Mining Control and Reclamation Act of 1977 (SMCRA)” and such activities include all Priority 1 through Priority 3 projects, water supply restoration projects, and emergency projects. Nothing in the Law explicitly or implicitly incorporates other law that might limit these expenditures for such projects to AMD treatment facilities that are in conjunction with a Priority 1 or Priority 2 site or within a qualified hydrologic unit, e.g., section 402(g) of SMCRA.

  • Pursuant to section 40701 of the Law, may eligible states and tribes use grant funds to operate, maintain, and rehabilitate AMD treatment facilities?

Yes. Eligible states and tribes may use Law AML grant funds to operate, maintain, and rehabilitate AMD treatment facilities as part of the activities described in section 40701(c) of the Law. These uses are contemplated by the Law, and nothing in the relevant portions of the Law or SMCRA forecloses these uses.

  • Pursuant to section 40701 of the Law, may eligible states and tribes place a portion of grant funds into their AMD set aside accounts?

No. Eligible states and tribes may not place Law AML grant funds into their AMD set aside accounts. As noted above, the Law does not amend section 402(g) of SMCRA—which specifies the types of funds that can be deposited into AMD set aside accounts—and the Law does not itself provide that contributions to state and tribal AMD set aside accounts are a valid use of Law funds. Placing Law funds into state and tribal AMD set aside accounts may also be contrary to other federal laws, such as the Cash Management Improvement Act of 1990, 31 U.S.C. § 6501.