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GAO Study Recommends Elimination of Self-Bonding for Mining Reclamation

Thursday, April 12, 2018  
In response to a request to the Government Accountability Office (GAO) from Members of Congress, the GAO conducted a study of the oversight of financial assurances for coal mine reclamation.

The study noted several challenges associated with self-bonding due to the difficulty of assessing the operator’s aggregate exposure in other states. The study recommended that Congress amend the Surface Mining and Coal Reclamation Act to eliminate the use of self-bonding.

The study also included data from the Office of Surface Mining Reclamation and Enforcement and state regulatory agencies. The study stated that regulatory agencies held $10.2 billion in financial assurance, with surety bonds accounting for 76% of that total ($7.8 billion). Almost half of that total surety bond amount comes from three states (Wyoming ($1.641 billion), Kentucky ($886 million) and Pennsylvania ($976.7 million)). “Self-Bonding” accounts for $1.2 billion of financial assurance.

The Members of Congress requesting this study were: Representatives (Sen. Maria Cantwell (DWA), Rep. Raul Grijalva (D-AZ), Rep. Alan Lowenthal (D-CA), Sen. Richard Durbin (D-IL), Rep. Matt Cartwright (D-PA), and Rep. Debbie Dingell (D-MI)).

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