Trump administration proposes to give coal company retroactive tax cut, rip off American taxpayers

Colorado Governor John Hickenlooper has opportunity to object

Coal operations on public lands in Colorado | Bureau of Land Management

It’s no secret that the Trump administration has bent over backwards for the oil, gas and coal industries, rolling back clean air and water regulations at a breakneck pace. Now, Trump’s Interior Department, led by Secretary Ryan Zinke, is about to allow the country’s second largest coal company to rip off taxpayers in Colorado and across the country for years to come.

But there’s a twist: Colorado Governor John Hickenlooper has the opportunity to speak up for taxpayers, stand up to this administration, and reject the proposal.

West Elk Mine | Google Earth

At issue is the West Elk Mine, located on public lands in Colorado’s Gunnison National Forest, owned by St. Louis-based Arch Coal. Arch has long whined that mining coal at West Elk is tough, because a split in one coal seam requires reinforced mine shaft ceilings and specialized equipment. Now, Arch Coal is asking the Trump administration to reduce the royalties they pay American taxpayers for coal mined at West Elk. Given their track record, when a coal company asks President Trump and Secretary Zinke for something, the question isn’t if it will happen, it’s just how fast.

On August 3, the Bureau of Land Management, which oversees energy development on public lands, wrote Colorado Governor John Hickenlooper, proposing to approve a request from Arch Coal to reduce the federal royalty rate from 8 percent to 5 percent for certain coal produced at the West Elk Mine from 2015 through 2020. You read that right, the Trump administration is going to give the company a tax cut for coal it already mined, sold and profited from up to two years ago.

Governor Hickenlooper can, and should, object to this proposal that would divert an estimated $12 million from state and federal programs back to Arch Coal. For context, Arch Coal paid its CEO John Eaves nearly $13 million in 2016 alone. More importantly, Arch is speaking out of both sides of its mouth when begging for charity. In quarterly filings for investors, the company repeatedly touts West Elk as a “low cost” mine, one that routinely returns about $10 per ton in profits, far more than the company’s flagship mines in Wyoming.

President Trump and Secretary Zinke have a dismal record when it comes to protecting taxpayers and ensuring Americans get a fair return from coal, oil, and natural gas. The administration has moved to allow companies to continue wasting natural gas from oil and gas operations on public lands, and even lowered royalty rates on companies drilling in the Gulf of Mexico. Egregiously, the administration recently reopened a massive tax loophole that allows coal companies to sell coal to self-owned subsidiaries at depressed prices, effectively avoiding paying taxes.

Taxpayers deserve a fair share for coal mined on public lands owned by all Americans. Unfortunately, the proposal to reduce federal royalties for Arch Coal shows that President Trump and Interior Secretary Zinke would rather see that money line the pockets of coal CEOs. Thankfully there’s still time for Colorado Governor John Hickenlooper to weigh in against this corporate giveaway. Hopefully he’ll take that chance and stand up for taxpayers in Colorado and around the country.