Coal Companies Under the Microscope For Taxpayer Ripoff

Human nature is a funny thing: we can ignore long-term, catastrophic problems like climate change, but heaven help the person who tries to rip us off. Sometimes, the two mesh, and we get a situation like the one that came down last week, when a bipartisan pair of Senators decided to take action on one of the biggest conservation issues facing the country: coal exports.

The coal industry has been ripping off taxpayers for decades, but the tides may be turning. (Photo: Philip Taylor)
In a letter to the U.S. Department of the Interior, Senators Lisa Murkowski (R-Alaska) and Ron Wyden (D-Oregon) asked them to explain some serious accounting problems that may have cost taxpayers millions. At issue is whether coal companies are avoiding royalty payments by ducking under weak federal rules, in order to pad their profit margins by selling federally owned coal at jacked-up prices overseas — the answer appears to be a resounding “YES,” and the senators want to find out just how much the government was bilked, and whether that money can be recouped after the fact. The DOI’s Inspector General is already conducting an investigation, as is the Government Accountability Office, and Murkowski and Wyden’s interest lends support to a growing public outcry against the coal industry’s shady business practices.

It’s hard not to feel a little giddy about this development (at least for those of us who track this stuff for a living). When your entire business model is pegged to degrading the environment, you had better be sure that you’re keeping your financial ledgers clean, but companies like Peabody, Arch Coal, and others have been scamming the public for so long that it’s second nature. The U.S. has shifted away from burning coal for power, but other countries—particularly in Asia—are still paying top dollar for it, and the industry is trying to take advantage of record prices by mining cheap American coal and selling it at tremendous profits overseas. Their mistake was in trying to avoid paying the federal government the royalties it was due, by setting up corporate middlemen and various other dodges that skirted the boundaries of legality and undermined the public trust. As Wyden said in a press release:

This is so obvious it shouldn’t need to be said: Coal companies need to be paying taxpayers all of the money they are owed. If regulators, or decades-old laws, are not doing enough to protect the public interest, our committee intends to find out, and to fix it.

Pod of orcas near Mayne Island, just miles away from a major proposed coal export terminal. (Photo: Miles Ritter)
Now, I’m all for ethical business practices, but I’m more excited to see what this could mean for the environment. As part of the Power Past Coal coalition, National Wildlife Federation has been working for over a year to draw attention to the industry’s plans to send hundreds of millions of tons of coal through the Pacific Northwest each year, a game-changing development for the global climate and for the communities and wildlife along the rail and shipping routes. More coal would also mean more mining in the Powder River Basin of Wyoming and Montana, which is one of America’s last and most precious big-game hunting areas, and is already under serious pressure from mining (the PRB is the country’s coal hub) and other industrial activity.

But regardless of what motivates our elected officials, if the Senate starts taking the profit question seriously, they’ll have to dig into the question of who is really benefiting from all this mining — is it the American people, or is it a few industry executives? The truth ain’t rocket science, and it could go a long way toward protecting iconic species and the health of our planet.

Take ActionTake Action! Protect threatened wildlife like salmon and orcas by speaking out against coal exports in the Pacific Northwest.

You can learn more about the danger of coal exports at NWF’s website, or check out Power Past Coal for more ways to get involved.