NMA Condemns Administration’s False Assumptions Behind Coal Royalty Change

Washington, D.C. – While claiming action in the name of the American taxpayer, this latest assault on the coal industry is nothing more than another covert operation in the administration’s “keep it in the ground” campaign. The casualties will be an industry that has worked diligently to provide Americans with low cost, reliable energy, and the low-income families who rely on that energy.

Royalty rates are already above market. Current royalties, bonus bids and fees amount to an effective 40 percent tax rate on federal coal, undermining the specious claim that somehow taxpayers are being cheated. And all this at a time when the industry is being arbitrarily punished by this administration for providing low-cost energy while at the same time hemorrhaging high-wage jobs – more than 67,400 since 2011–in some of the nation’s most economically depressed areas.

Freezing all pending and future coal leases, altering the valuation of royalties and raising royalty rates on federal coal leases will discourage production from federal lands that account for a significant share of total electricity generation, scare away investment, lead to further job losses, increase the price of energy on middle and low-income families and eliminate billions of dollars in state and federal revenue.

This valuation policy is election-year politics that does a disservice to American consumers and taxpayers and to the hundreds of thousands of Americans whose livelihoods rely on coal production.

See the release here.