Rejection of Benham and Lynch Lands Unsuitable for Mining Petition Appealed
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COMMONWEALTH OF KENTUCKY
ENERGY AND ENVIRONMENT CABINET
FILE NO. ________________
LANDS UNSUITABLE FOR MINING PETITION 10-1
CITY OF LYNCH, KENTUCKY, ROY SILVER,
CARL SHOUPE, STANLEY STURGILL and
BENNIE MASSEY,
PETITIONERS,
VS. PETITION FOR REVIEW
ENERGY AND ENVIRONMENT CABINET
RESPONDENT.
Come now the Petitioners, the City of Lynch, Roy Silver, Carl Shoupe, Stanley Sturgill and Bennie Massey, (the ?Petitioners), and pursuant to 405 KAR 7:092 Section 9, file this Petition seeking review of the September 7, 2010 determination declining to process A Petition To Designate The Historic Districts Within The Cities Of Benham and Lynch And The Viewshed From Those Districts, And The Watersheds That Provide The Water Supply For The Towns Of Benham and Lynch, As Areas Unsuitable For Mining which was filed by the Petitioners with the Respondent Cabinet. In support of this Petition for Review, Petitioners state as follows:
1. This Petition for Review is timely filed, within the meaning of 405 KAR 7:092 Section 9, since it is being filed on October 5, 2010, within thirty (30) days of the September 7, 2010 Determination of the Cabinet that is the subject of this Petition For Review.
2. 405 KAR 7:092 Section 9(2) requires that the petition for review be filed within thirty (30) days of when the petitioner had notice or could reasonably have had such notice. The response letter was dated April 14, 2010, and the earliest the Petitioners could have had such notice was on receipt of the letter. Thus, the petition is timely filed, since it is filed within thirty (30) days of the date on the letter informing Petitioners that the Lands Unsuitable Petition 10-1 (hereinafter LUM 10-1) would not be processed.
3. Petitioners are persons aggrieved by the Cabinets determination to reject the LUM 10-1 Petition as frivolous, and are injured within the meaning of KRS 350.0301 and 405 KAR 5:092 Section 9.
4. The City of Lynch, Kentucky, an incorporated entity located in Harlan County, Kentucky. The City of Lynch operates a water treatment and distribution system which is supplied from Gap Branch and Looney Creek watersheds, and which could be directly and adversely affected by increases in sedimentation and mineralization of runoff into those watersheds associated with surface coal mining operations. Additionally, the City of Lynch has invested significant time and effort in developing an educational and tourism economy grounded in the rich cultural and historical traditions associated with underground coal mining during the first half of the 20th century, and those investments will be jeopardized by allowing surface coal mining operations to be conducted within the viewshed of the historic districts of Benham and Lynch.
5. The Cabinets determination of September 7, 2010 not to UM 10-1 Petition adversely affects the ability of the City of Lynch to protect its water supply and its historic district from the adverse effects of surface coal mining operations, and thus the City is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
6. Roy Silver, who resides at 170 Main Street in Benham, Kentucky with a mailing address at P.O. Box G, Benham, Kentucky 40807, ph. 606-848-1812. Mr. Silver is a resident of Benham, and uses water for beneficial purposes, including drinking water, from both Benham and Lynch. Mr. Silver enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the water supplies and of the historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Benham and Lynch reservoirs.
7. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Silver to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
8. Carl Shoupe, a former City Councilman for the City of Benham, is a resident of Benham, with a street address of 434 Main Street and a mailing address of P.O. Box 185, Benham, Kentucky 40807, ph. 606-848-0555. Mr. Shoupe lives on the bank of Looney Creek, and uses water for beneficial purposes, including drinking water, from the Benham water system. Mr. Shoupe enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the Benham water supply and of the historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Benham reservoir.
9. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Shoupe to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
10. Stanley Sturgill is a resident of Lynch, residing at 353 East Main Street with a mailing address of P.O. Box 776 Lynch, Kentucky 40855, ph. 606-848-0997. Mr. Sturgill uses the water supply of the community of Lynch for beneficial purposes, including drinking water. Mr. Sturgill enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the Lynch water supply and of the historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Lynch reservoir.
11. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Sturgill to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
12. Bennie Massey, a member of the City Council of Lynch for 16 terms, has been a resident of Lynch for 60 years. He currently resides at 432 First Street, Lynch Kentucky, with a mailing address at P.O. Box 117, Lynch, Kentucky 40855 ph. 606-848-5624. Mr. Massey uses water for beneficial purposes, including drinking water, supplied by the Lynch water system. Mr. Massey enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the Lynch water supply and of the Benham and Lynch historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Lynch reservoir.
13. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Massey to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
14. The Cabinets determination of September 7, 2010 is a final and appealable determination within the meaning of 405 KAR 7:092 Section 9, and the September 7, 2010 letter acknowledged as much wherein it states that
"Under 405 KAR 7:092 Section 9, if you feel aggrieved by the determination contained in this letter, you may file a petition for review."
15. The facts entitling the Petitioners to the requested relief, which is the reversal of the Cabinets determination rejecting the LUM 10-1 Petition as lacking merit and being frivolous, are as follows:
a. On August 6, 2010, a Petition to Designate an Area as Unsuitable for Surface Coal Mining was filed with the Department for Natural Resources within the Energy and Environment Cabinet. Acknowledgment of that filing is contained in the September 7 letter from Director of Mine Permits Allen Luttrell to each of the Petitioners.
b. The Petition to Designate an Area as Unsuitable For Surface Coal Mining was assigned the identification number of LUM 10-1.
c. LUM 10-1 was filed using the Cabinets form, with supplemental attachments providing the bases on which the designation of the identified areas were sought.
d. More specifically, LUM 10-1, which is captioned as A Petition To Designate The Historic Districts Within The Cities Of Benham and Lynch And The Viewshed From Those Districts, And The Watersheds That Provide The Water Supply For The Towns Of Benham and Lynch, As Areas Unsuitable For Mining, sought designation of the following areas as unsuitable for surface coal mining operations:
the lands comprising the historic districts of the cities of Benham and Lynch, in Harlan County, Kentucky, and the viewshed from the historic districts of those cities, as well as the watersheds that supply the water sources for those cities, as areas unsuitable for surface coal mining operations, pursuant to KRS 350.465(2)(b), KRS 350.610 and 405 KAR Chapter 24.
e. On September 7, 2010, by letter signed by Mine Permit Division Director Luttrell, the Cabinet provided a final determination declining to process the petition. Each Petitioner received a letter identical in substantive text (other than the name and address of the Petitioner). The Cabinet justification, in its entirety, is as follows:
"After a review of all submitted materials, it has been found that the petition lacks merit, and, by regulation, has been deemed frivolous. The Department declines to process the petition based on the following rationale:
Regulations that articulate the procedures and procedures and criteria for reviewing lands unsuitable petitions are found at 405 KAR 24:030. A listing of those lands exempt from designation is found in Section 2 of that regulation. Pertaining to LUM 190-1, subsection (b) of Section 2 is Lands covered by a permit issued under KRS 350 or a permit application for which the public comment period has closed. Similar language is also found in KRS 350.610(5). The Department carefully reviewed the submitted petition area map and inventoried all existing and pending permits in the petition area. Surface acreage overlying underground mining operations
is permitted according to Kentucky surface mining law (KRS 350.060(12).
Given this fact, the Department has concluded that over 90% of the petition area is under permit, and therefore exempt, from the lands unsuitable process. With this determination, the Department is returning the original LUM Petition application to the petitioners."
A copy of the determination is attached hereto as Appendix A.
f. The Cabinets determination is arbitrary, capricious, and otherwise inconsistent with both state law and with the federal Surface Mining Control and Reclamation Act and regulations promulgated pursuant thereto, to which the Respondent Cabinet is obligated to conform the implementation, administration and interpretation of the approved state regulatory program.
16. Pursuant to 405 KAR 5:092 Section 9, a Petitioner is required to provide an explanation of the specific alleged errors in the Cabinets decision. The Cabinets determination is erroneous as a matter of law and is contrary to law, as that phrase is used in KRS 350.0301, for these independent and sufficient reasons:
a. The areas overlying underground workings, whether those workings are permitted or not, are not currently considered to be subject to the designation process under Section 522(e) of the 1977 Surface Mining Control and Reclamation Act. Rejection of a LUM Petition on the basis of the presence of permitted underground workings or underground workings for which a permit is pending at the time of filing of a designation petition, is erroneous as a matter of state and federal law.
In 2003, OSM adopted an interpretive rule reversing the historic position of the agency that surface effects of underground mining (i.e. subsidence) were included within the definition of surface coal mining operations for purposes of the application of Section 522(e). The 2003 Rule provided that:
"761.200 Interpretive rule related to subsidence due to underground coal mining in areas designated by Act of Congress. OSM has adopted the following interpretation of rules promulgated in part 761. (a) Interpretation of § 761.11Areas where mining is prohibited or limited. Subsidence due to underground coal mining is not included in the definition of surface coal mining operations under section 701 28) of the Act and § 700.5 of this chapter and therefore is not prohibited in areas protected under section 522(e) of the Act."
The Secretarys interpretation was challenged, and was ultimately upheld by the U.S. Court of Appeals for the District of Columbia Circuit in the case of Citizens Coal Council v. Norton, 330 F.3d 478 (D.C. Cir. 2003).
The Court of Appeals upheld the Secretarys 2003 Interpretive Rule acknowledging that the Secretarys interpretation, albeit perhaps not the most natural reading, is a reasonable one, and therefore we defer to that interpretation in accordance with the requirements of Chevron. Id.
After the issuance of that interpretive rule, areas overlying underground workings were no longer considered surface coal mining operations for the purpose of application of Section 522(e); rather, the only aspects of underground mines that remained subject to Section 522(e), according to the Secretarys rule, is surface effects associated with surface areas (i.e. face-ups, fills, above-ground explosive storage areas) associated with underground mining operations.
The Cabinet is obligated to conform its interpretation and application of the state lands unsuitable for mining process to the federal regulation, including the Secretarys 2003 rulemaking on 30 CFR 761.200. See: KRS 350.465; and KRS 350.028 (empowering the Cabinet to adopt administrative regulations to allow the state to administer and enforce the initial and permanent regulatory programs of Public Law 95-87, "Surface Mining Control and Reclamation Act of 1977" and providing that Administrative regulations shall be no more stringent than required by that law.
Thus, rejection of the LUM 10-1 Petition on the basis of the existence of permitted underground mine shadow areas (i.e. areas overlying underground workings) was inconsistent with state and federal law, and justifies reversal of the decision and remand to the Department for Natural Resources for a determination of the completeness of the LUM 10-1 Petition.
b. The September 7, 2010 determination is erroneous as a matter of law for a second reason, which is that the presence of permitted areas and/or areas with pending permits does not justify rejection of a petition as frivolous or without merit. Instead, 405 KAR 24:030 Section 2 provides a mechanism for excluding those areas from consideration for designation, while continuing to process the petition as to those lands which are neither under permit or pending permitted status, as well as considering the lands under permit for designation as unsuitable for future mining.
As noted above, a Petition is required to petition an area, which is defined in 405 KAR 24:001 Section 1(5) as a geographic unit in which the criteria alleged in the petition . . . occur throughout and form a significant feature. This petition for designating lands unsuitable for mining seeks the designation of unsuitability for mining for several defined geographic units identified on the map included as Appendix A and described as follows:
Area A is intended to include the boundary of the historic district listed on the National Register of Historic Places, within the cities of Benham and Lynch and the viewshed from those historic districts, in order to provide a visual buffer to prevent adverse effects on the use and enjoyment of the historic districts and historical and cultural values of the cities, and to prevent physical damage to such resources. Area A is outlined in black on the map that accompanies this petition.
Area B is intended to include the watershed and drainage area that comprise the water supply source for the city of Benham. The city of Benham draws its water supply from the Kellioka coal seam to the south of Looney Creek, where it is collected, piped to, and treated by the city of Benham for use by the residents of that community.
Area C is intended to encompass the Gap Branch watershed, which provides some 30% of the recharge for the Darby seam reservoir that supplies raw water to the city of Lynch. The recharge occurs through an intake borehole in the streambed of Gap Branch, which is connected with the underground reservoir in the Darby coal seam.
Area D is intended to encompass that area within the Looney Creek watershed, including the watersheds of Barnett Branch and Trace Branch that flow into Looney Creek, which is located above the borehole in the streambed of Looney Creek that is the primary water source for the Lynch Reservoir. The total area covered under this petition is believed to be approximately 10,442 acres.
The process for designation of lands as unsuitable for mining is authorized by KRS 350.610, which provides in part that:
"The requirements of this section shall not apply to lands on which coal mining operations were being conducted on August 3, 1977, or under a permit issued pursuant to this chapter or where substantial legal and financial commitments in such operation were in existence prior to January 4, 1977."
KRS 350.610(5).
KRS 350.610 was adopted by the General Assembly in furtherance of primary regulatory authority under the 1977 Surface Mining Control and Reclamation Act, which precludes approval of a state regulatory program unless that program had laws and regulations in accordance with the federal mining law and consistent with the Secretarys regulations. 30 USC 1253(a)(1), (7). The Kentucky General Assembly indicated an intent to conform state law to federal law, directing that the agency adopt rules and regulations to allow the state to administer and enforce the initial and permanent regulatory programs of Public Law 95-87[.] KRS 350.028(5). In enacting KRS 350.465, the General Assembly again indicated an intent that the Cabinets regulatory program shall be consistent with federal law and regulations, and specifically prohibited the Cabinet from adopting a program in conflict with the policy and purposes of the federal mining law. With respect to the construction of state law, the General Assembly clearly indicated an intent to conform the administration of KRS Chapter 350 to the federal mining law, providing in KRS 350.025 that any state law set forth by the Secretary of Interior as inconsistent with the federal act would be deemed superseded by federal law and become unenforceable. KRS 350.025. The Respondent Cabinet, in construing, implementing and enforcing the requirements and provisions of 405 KAR Chapter 24, is obligated by federal regulation to conform the administration and implementation of the state regulations to federal law and regulations. 30 C.F.R. 733.11.
Thus, federal law and legislative history, and the interpretation of the scope of the exemption for permitted operations by state and federal agencies controls the interpretation of the lands unsuitable process and specifically, when a petition can be deemed frivolous.
The state unsuitability statute is patterned after 30 U.S.C. 1272, which provides in relevant part that:
"(a)(6) The requirements of this section shall not apply to lands on which surface coal mining operations are being conducted on the date of enactment of this Act [August 3, 1977] or under a permit issued pursuant to this Act, or where substantial legal and financial commitments in such operation were in existence prior to January 4, 1977."
The language is in substance identical, and thus the interpretation accorded the provision by Congress and the Secretary of Interior which illuminates the intent behind the language binds the state interpretation.
The intent of the exemption was plainly addressed by the House Committee on Interior and Insular Affairs, which stated that:
"The designation process is not intended to be used as a process to close existing mine operations, although the area in which such operations are located may be designated with respect to future
mines. The committee recognized that an existing mine might not be one actually producing coal, because it was in a substantial stage of development prior to coal production. Thus the meaning of existing operations is extended to include operations for which there are substantial legal and financial commitments.'
(Emphasis added). House Rept. No. 95-218, 95th Cong., 1st Sess. 94-5 (1977).
That same report continued, reflecting that the petition area was not to be tailored to individual mine permits:
"It should be noted that the designation process is structured to be applied on an area basis, rather than a site by site determination which presents issues more appropriately addressed in the permit application process."
Id. at 95.
While it is true that an area which is under permit is exempt from designation as to that permitted operation, the controlling legislative history indicates that such an area can be subject to a petition with respect to future mining that is not authorized by the current permit. For example, in this instance, while it may be true that 90% of the petition area is under permit, the permitting of an area for underground coal removal, for example, does not automatically exempt all property and all coal seams above that permitted seam from evaluation for designation as to other coal seams not authorized to be removed under that permit, or as to other forms of mining not authorized under the permit. To assume that permitting one coal seam for underground mining precludes consideration of an unsuitability petition for all overlying areas, for mining methods and coal seams not contemplated nor approved in that permit, goes far beyond the goal of Congress of avoiding the application of the unsuitability process to existing operations, since the holder of the underground mine permit could not unilaterally decide to change mining method or mine seams not identified and approved in the permit.
Even assuming for the sake of argument that the shadow areas overlying permitted underground mines are included under lands unsuitable petitions as to those underground operations, the suggestion that permitting a particular coal seam exempts all land and all coal seams above the permitted seam from consideration under an unsuitability petition is an insupportable interpretation of the law.
Even if it were the case that the existence of a permitted underground mine disallows consideration of designation as unsuitable all lands and all coal seams above the mine, that would not render the petition frivolous, since frivolity speaks to the merit of the petition allegations rather than the acreage or percentage of the petitioned area that is under permit.
The petition process is intended to identify areas based on the existence of the features for which the designation is sought. Thus, the state regulation at 405 KAR 24:001(5) defines an area as a geographic unit in which the criteria alleged in the petition . . . occur throughout and form a significant feature[.] The applicant is obligated only to identify an area based on the occurrence of the values or features for which designation is sought; and is not required to define the petition area by permit or property boundaries. Since the regulation compels that the petitioned area include a geographic unit throughout which the petitioned features are found, the regulation necessitates that the Petitioner include those areas that share the same feature(s) despite the exempt status of certain coal seams as being under permit or a pending permit application for which the public comment period has closed, and the inclusion of those areas does not render the application without merit or frivolous.
The inclusion of such permitted areas within the petition boundary does not make the petition frivolous since that is defined in 405 KAR 24:030 Section 3(4) as one in which the allegations of harm lack serious merit. No such claim has been made, and none credibly could, since the allegations of harm and the justification for designation are well-supported, and because the Cabinet itself has shown considerably concern regarding protection of the Lynch and Benham water supplies, and at hearing, Petitioners anticipate calling upon a number of Cabinet employees who are familiar with the sensitivity of those water supplies to degradation to explore the merits of the petition that the Cabinet erroneously rejected as frivolous and without merit.
It is no small irony that the Cabinet would reject the LUM 10-1 Petition as frivolous on the basis of the existence of permitted underground workings, since the Cabinet argued against such a position before the Office of Administrative Hearings in the case of Apogee Coal et al. v. Natural Resources and Environmental Protection Cabinet, et al., File No. LUP-24370-043. In that case, the coal companies argued that the underground mine permit shadow areas, in addition to the permitted mines themselves, were exempt from the unsuitability process, and because 77.7% of the LUM petition area for Black Mountain was under permit, that made the petition "frivolous.
In the Cabinets Memorandum in Support of Respondents Cross-Motion For Summary Disposition And In Opposition To Petitioners Motion For Summary Judgment, the Cabinet argued as follows:
"The coal companies argue that most of the area covered by the LUP is exempt from being designated as unsuitable for mining, pursuant to 405 KAR 24:030 Section 2(1)(b). The coal companies have submitted the affidavit of Larry D. Adams in support of their argument, Adams affidavit states that 77.7% of the LUP area is currently under permit. What the coal companies fail to point out is that most of the permitted areas in the LUP area are areas overlying underground workings,known as shadow area. Less than 10% of the land on Black Mountain above the 3000 feet elevation (the LUP area) is permitted for surface [disturbance]
* * *
Both federal and state laws require Kentuckys surface coal mining regulatory program to be consistent with the regulation program established by Public Law 95-87 When the purpose of a state law is to carry out a comparable federal law, the state must consider the way the federal law has been interpreted in applying the state law. (Citations omitted).
* * *
The argument that shadow areas are exempt from designation leads to an absurd result. A permittee has no legal rights under its permit to conduct surface coal mining operations on shadow areas. In an area with multiple coal seams, the permittees right to mine may be limited to a single seam, and it may not have the right to mine the seams above it. There is no logical reason to exempt an area from designation simply because it is permitted as a shadow area. Such a result would go way beyond the intent of Congress to protect ongoing operations and existing permit rights.
* * *
The coal companies position that shadow areas are exempt from designation as unsuitable for mining is simply untenable. The purpose of the exemption is to protect the rights of ongoing mining operations. Even if a shadow area is designated unsuitable for surface coal mining operations, the permittee is allowed to continue with its underground mining operation, and does not lose any rights under its permit. Consequently, there is no reasonable basis to exempt shadow areas from being designated unsuitable for mining.
Even if the coal companies position that shadow areas are exempt from designation is correct, it still does not render the LUP frivolous. If a LUP covers both permitted areas and unpermitted areas, a state regulatory authority must process the petition for the unpermitted areas.
44. Fed. Reg. 15002 (March 13, 1979).
A frivolous petition is one in which the allegations of harm lack serious merit. 405 KAR 24:030, Section 3(4). The question of whether a petition is frivolous relates to the merits of the allegations that mining would harm people, land, air, water, or other resources. See 52 Fed. Reg. 49323 (Dec. 30, 1987). In evaluating a petition to determine if it is frivolous, a regulatory authority must ðetermine if the allegations have a serious basis for the area being petitioned. 48 Fed. Reg. 41332 (Sept. 14, 1983).
(Emphasis added).
In rejecting the coal companies argument that the petition is frivolous because about 77% of the proposed designation area is already under permit[,] the Hearing Officer rejected the argument that a permit for underground mining includes both the minerals and the surface shadow areas where no mining is proposed but which are included in the permit area because they overly a permitted underground coal mine. The Hearing Officer noted that:
ENERGY AND ENVIRONMENT CABINET
FILE NO. ________________
LANDS UNSUITABLE FOR MINING PETITION 10-1
CITY OF LYNCH, KENTUCKY, ROY SILVER,
CARL SHOUPE, STANLEY STURGILL and
BENNIE MASSEY,
PETITIONERS,
VS. PETITION FOR REVIEW
ENERGY AND ENVIRONMENT CABINET
RESPONDENT.
Come now the Petitioners, the City of Lynch, Roy Silver, Carl Shoupe, Stanley Sturgill and Bennie Massey, (the ?Petitioners), and pursuant to 405 KAR 7:092 Section 9, file this Petition seeking review of the September 7, 2010 determination declining to process A Petition To Designate The Historic Districts Within The Cities Of Benham and Lynch And The Viewshed From Those Districts, And The Watersheds That Provide The Water Supply For The Towns Of Benham and Lynch, As Areas Unsuitable For Mining which was filed by the Petitioners with the Respondent Cabinet. In support of this Petition for Review, Petitioners state as follows:
1. This Petition for Review is timely filed, within the meaning of 405 KAR 7:092 Section 9, since it is being filed on October 5, 2010, within thirty (30) days of the September 7, 2010 Determination of the Cabinet that is the subject of this Petition For Review.
2. 405 KAR 7:092 Section 9(2) requires that the petition for review be filed within thirty (30) days of when the petitioner had notice or could reasonably have had such notice. The response letter was dated April 14, 2010, and the earliest the Petitioners could have had such notice was on receipt of the letter. Thus, the petition is timely filed, since it is filed within thirty (30) days of the date on the letter informing Petitioners that the Lands Unsuitable Petition 10-1 (hereinafter LUM 10-1) would not be processed.
3. Petitioners are persons aggrieved by the Cabinets determination to reject the LUM 10-1 Petition as frivolous, and are injured within the meaning of KRS 350.0301 and 405 KAR 5:092 Section 9.
4. The City of Lynch, Kentucky, an incorporated entity located in Harlan County, Kentucky. The City of Lynch operates a water treatment and distribution system which is supplied from Gap Branch and Looney Creek watersheds, and which could be directly and adversely affected by increases in sedimentation and mineralization of runoff into those watersheds associated with surface coal mining operations. Additionally, the City of Lynch has invested significant time and effort in developing an educational and tourism economy grounded in the rich cultural and historical traditions associated with underground coal mining during the first half of the 20th century, and those investments will be jeopardized by allowing surface coal mining operations to be conducted within the viewshed of the historic districts of Benham and Lynch.
5. The Cabinets determination of September 7, 2010 not to UM 10-1 Petition adversely affects the ability of the City of Lynch to protect its water supply and its historic district from the adverse effects of surface coal mining operations, and thus the City is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
6. Roy Silver, who resides at 170 Main Street in Benham, Kentucky with a mailing address at P.O. Box G, Benham, Kentucky 40807, ph. 606-848-1812. Mr. Silver is a resident of Benham, and uses water for beneficial purposes, including drinking water, from both Benham and Lynch. Mr. Silver enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the water supplies and of the historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Benham and Lynch reservoirs.
7. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Silver to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
8. Carl Shoupe, a former City Councilman for the City of Benham, is a resident of Benham, with a street address of 434 Main Street and a mailing address of P.O. Box 185, Benham, Kentucky 40807, ph. 606-848-0555. Mr. Shoupe lives on the bank of Looney Creek, and uses water for beneficial purposes, including drinking water, from the Benham water system. Mr. Shoupe enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the Benham water supply and of the historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Benham reservoir.
9. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Shoupe to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
10. Stanley Sturgill is a resident of Lynch, residing at 353 East Main Street with a mailing address of P.O. Box 776 Lynch, Kentucky 40855, ph. 606-848-0997. Mr. Sturgill uses the water supply of the community of Lynch for beneficial purposes, including drinking water. Mr. Sturgill enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the Lynch water supply and of the historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Lynch reservoir.
11. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Sturgill to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
12. Bennie Massey, a member of the City Council of Lynch for 16 terms, has been a resident of Lynch for 60 years. He currently resides at 432 First Street, Lynch Kentucky, with a mailing address at P.O. Box 117, Lynch, Kentucky 40855 ph. 606-848-5624. Mr. Massey uses water for beneficial purposes, including drinking water, supplied by the Lynch water system. Mr. Massey enjoys both the historic districts of Benham and Lynch, and the viewshed from those districts. His use and enjoyment of the Lynch water supply and of the Benham and Lynch historic districts and the viewshed from those districts would be adversely affected by surface coal mining operations occurring in the viewshed, and within the watersheds that recharge the Lynch reservoir.
13. The Cabinets determination of September 7, 2010 not to process the LUM 10-1 Petition adversely affects the ability of Mr. Massey to protect his water supply and his use and enjoyment of the historic and scenic values of the Lynch and Benham historic districts from the adverse effects of surface coal mining operations, and thus he is a person aggrieved by and with an interest that has been adversely affected by the Cabinets action.
14. The Cabinets determination of September 7, 2010 is a final and appealable determination within the meaning of 405 KAR 7:092 Section 9, and the September 7, 2010 letter acknowledged as much wherein it states that
"Under 405 KAR 7:092 Section 9, if you feel aggrieved by the determination contained in this letter, you may file a petition for review."
15. The facts entitling the Petitioners to the requested relief, which is the reversal of the Cabinets determination rejecting the LUM 10-1 Petition as lacking merit and being frivolous, are as follows:
a. On August 6, 2010, a Petition to Designate an Area as Unsuitable for Surface Coal Mining was filed with the Department for Natural Resources within the Energy and Environment Cabinet. Acknowledgment of that filing is contained in the September 7 letter from Director of Mine Permits Allen Luttrell to each of the Petitioners.
b. The Petition to Designate an Area as Unsuitable For Surface Coal Mining was assigned the identification number of LUM 10-1.
c. LUM 10-1 was filed using the Cabinets form, with supplemental attachments providing the bases on which the designation of the identified areas were sought.
d. More specifically, LUM 10-1, which is captioned as A Petition To Designate The Historic Districts Within The Cities Of Benham and Lynch And The Viewshed From Those Districts, And The Watersheds That Provide The Water Supply For The Towns Of Benham and Lynch, As Areas Unsuitable For Mining, sought designation of the following areas as unsuitable for surface coal mining operations:
the lands comprising the historic districts of the cities of Benham and Lynch, in Harlan County, Kentucky, and the viewshed from the historic districts of those cities, as well as the watersheds that supply the water sources for those cities, as areas unsuitable for surface coal mining operations, pursuant to KRS 350.465(2)(b), KRS 350.610 and 405 KAR Chapter 24.
e. On September 7, 2010, by letter signed by Mine Permit Division Director Luttrell, the Cabinet provided a final determination declining to process the petition. Each Petitioner received a letter identical in substantive text (other than the name and address of the Petitioner). The Cabinet justification, in its entirety, is as follows:
"After a review of all submitted materials, it has been found that the petition lacks merit, and, by regulation, has been deemed frivolous. The Department declines to process the petition based on the following rationale:
Regulations that articulate the procedures and procedures and criteria for reviewing lands unsuitable petitions are found at 405 KAR 24:030. A listing of those lands exempt from designation is found in Section 2 of that regulation. Pertaining to LUM 190-1, subsection (b) of Section 2 is Lands covered by a permit issued under KRS 350 or a permit application for which the public comment period has closed. Similar language is also found in KRS 350.610(5). The Department carefully reviewed the submitted petition area map and inventoried all existing and pending permits in the petition area. Surface acreage overlying underground mining operations
is permitted according to Kentucky surface mining law (KRS 350.060(12).
Given this fact, the Department has concluded that over 90% of the petition area is under permit, and therefore exempt, from the lands unsuitable process. With this determination, the Department is returning the original LUM Petition application to the petitioners."
A copy of the determination is attached hereto as Appendix A.
f. The Cabinets determination is arbitrary, capricious, and otherwise inconsistent with both state law and with the federal Surface Mining Control and Reclamation Act and regulations promulgated pursuant thereto, to which the Respondent Cabinet is obligated to conform the implementation, administration and interpretation of the approved state regulatory program.
16. Pursuant to 405 KAR 5:092 Section 9, a Petitioner is required to provide an explanation of the specific alleged errors in the Cabinets decision. The Cabinets determination is erroneous as a matter of law and is contrary to law, as that phrase is used in KRS 350.0301, for these independent and sufficient reasons:
a. The areas overlying underground workings, whether those workings are permitted or not, are not currently considered to be subject to the designation process under Section 522(e) of the 1977 Surface Mining Control and Reclamation Act. Rejection of a LUM Petition on the basis of the presence of permitted underground workings or underground workings for which a permit is pending at the time of filing of a designation petition, is erroneous as a matter of state and federal law.
In 2003, OSM adopted an interpretive rule reversing the historic position of the agency that surface effects of underground mining (i.e. subsidence) were included within the definition of surface coal mining operations for purposes of the application of Section 522(e). The 2003 Rule provided that:
"761.200 Interpretive rule related to subsidence due to underground coal mining in areas designated by Act of Congress. OSM has adopted the following interpretation of rules promulgated in part 761. (a) Interpretation of § 761.11Areas where mining is prohibited or limited. Subsidence due to underground coal mining is not included in the definition of surface coal mining operations under section 701 28) of the Act and § 700.5 of this chapter and therefore is not prohibited in areas protected under section 522(e) of the Act."
The Secretarys interpretation was challenged, and was ultimately upheld by the U.S. Court of Appeals for the District of Columbia Circuit in the case of Citizens Coal Council v. Norton, 330 F.3d 478 (D.C. Cir. 2003).
The Court of Appeals upheld the Secretarys 2003 Interpretive Rule acknowledging that the Secretarys interpretation, albeit perhaps not the most natural reading, is a reasonable one, and therefore we defer to that interpretation in accordance with the requirements of Chevron. Id.
After the issuance of that interpretive rule, areas overlying underground workings were no longer considered surface coal mining operations for the purpose of application of Section 522(e); rather, the only aspects of underground mines that remained subject to Section 522(e), according to the Secretarys rule, is surface effects associated with surface areas (i.e. face-ups, fills, above-ground explosive storage areas) associated with underground mining operations.
The Cabinet is obligated to conform its interpretation and application of the state lands unsuitable for mining process to the federal regulation, including the Secretarys 2003 rulemaking on 30 CFR 761.200. See: KRS 350.465; and KRS 350.028 (empowering the Cabinet to adopt administrative regulations to allow the state to administer and enforce the initial and permanent regulatory programs of Public Law 95-87, "Surface Mining Control and Reclamation Act of 1977" and providing that Administrative regulations shall be no more stringent than required by that law.
Thus, rejection of the LUM 10-1 Petition on the basis of the existence of permitted underground mine shadow areas (i.e. areas overlying underground workings) was inconsistent with state and federal law, and justifies reversal of the decision and remand to the Department for Natural Resources for a determination of the completeness of the LUM 10-1 Petition.
b. The September 7, 2010 determination is erroneous as a matter of law for a second reason, which is that the presence of permitted areas and/or areas with pending permits does not justify rejection of a petition as frivolous or without merit. Instead, 405 KAR 24:030 Section 2 provides a mechanism for excluding those areas from consideration for designation, while continuing to process the petition as to those lands which are neither under permit or pending permitted status, as well as considering the lands under permit for designation as unsuitable for future mining.
As noted above, a Petition is required to petition an area, which is defined in 405 KAR 24:001 Section 1(5) as a geographic unit in which the criteria alleged in the petition . . . occur throughout and form a significant feature. This petition for designating lands unsuitable for mining seeks the designation of unsuitability for mining for several defined geographic units identified on the map included as Appendix A and described as follows:
Area A is intended to include the boundary of the historic district listed on the National Register of Historic Places, within the cities of Benham and Lynch and the viewshed from those historic districts, in order to provide a visual buffer to prevent adverse effects on the use and enjoyment of the historic districts and historical and cultural values of the cities, and to prevent physical damage to such resources. Area A is outlined in black on the map that accompanies this petition.
Area B is intended to include the watershed and drainage area that comprise the water supply source for the city of Benham. The city of Benham draws its water supply from the Kellioka coal seam to the south of Looney Creek, where it is collected, piped to, and treated by the city of Benham for use by the residents of that community.
Area C is intended to encompass the Gap Branch watershed, which provides some 30% of the recharge for the Darby seam reservoir that supplies raw water to the city of Lynch. The recharge occurs through an intake borehole in the streambed of Gap Branch, which is connected with the underground reservoir in the Darby coal seam.
Area D is intended to encompass that area within the Looney Creek watershed, including the watersheds of Barnett Branch and Trace Branch that flow into Looney Creek, which is located above the borehole in the streambed of Looney Creek that is the primary water source for the Lynch Reservoir. The total area covered under this petition is believed to be approximately 10,442 acres.
The process for designation of lands as unsuitable for mining is authorized by KRS 350.610, which provides in part that:
"The requirements of this section shall not apply to lands on which coal mining operations were being conducted on August 3, 1977, or under a permit issued pursuant to this chapter or where substantial legal and financial commitments in such operation were in existence prior to January 4, 1977."
KRS 350.610(5).
KRS 350.610 was adopted by the General Assembly in furtherance of primary regulatory authority under the 1977 Surface Mining Control and Reclamation Act, which precludes approval of a state regulatory program unless that program had laws and regulations in accordance with the federal mining law and consistent with the Secretarys regulations. 30 USC 1253(a)(1), (7). The Kentucky General Assembly indicated an intent to conform state law to federal law, directing that the agency adopt rules and regulations to allow the state to administer and enforce the initial and permanent regulatory programs of Public Law 95-87[.] KRS 350.028(5). In enacting KRS 350.465, the General Assembly again indicated an intent that the Cabinets regulatory program shall be consistent with federal law and regulations, and specifically prohibited the Cabinet from adopting a program in conflict with the policy and purposes of the federal mining law. With respect to the construction of state law, the General Assembly clearly indicated an intent to conform the administration of KRS Chapter 350 to the federal mining law, providing in KRS 350.025 that any state law set forth by the Secretary of Interior as inconsistent with the federal act would be deemed superseded by federal law and become unenforceable. KRS 350.025. The Respondent Cabinet, in construing, implementing and enforcing the requirements and provisions of 405 KAR Chapter 24, is obligated by federal regulation to conform the administration and implementation of the state regulations to federal law and regulations. 30 C.F.R. 733.11.
Thus, federal law and legislative history, and the interpretation of the scope of the exemption for permitted operations by state and federal agencies controls the interpretation of the lands unsuitable process and specifically, when a petition can be deemed frivolous.
The state unsuitability statute is patterned after 30 U.S.C. 1272, which provides in relevant part that:
"(a)(6) The requirements of this section shall not apply to lands on which surface coal mining operations are being conducted on the date of enactment of this Act [August 3, 1977] or under a permit issued pursuant to this Act, or where substantial legal and financial commitments in such operation were in existence prior to January 4, 1977."
The language is in substance identical, and thus the interpretation accorded the provision by Congress and the Secretary of Interior which illuminates the intent behind the language binds the state interpretation.
The intent of the exemption was plainly addressed by the House Committee on Interior and Insular Affairs, which stated that:
"The designation process is not intended to be used as a process to close existing mine operations, although the area in which such operations are located may be designated with respect to future
mines. The committee recognized that an existing mine might not be one actually producing coal, because it was in a substantial stage of development prior to coal production. Thus the meaning of existing operations is extended to include operations for which there are substantial legal and financial commitments.'
(Emphasis added). House Rept. No. 95-218, 95th Cong., 1st Sess. 94-5 (1977).
That same report continued, reflecting that the petition area was not to be tailored to individual mine permits:
"It should be noted that the designation process is structured to be applied on an area basis, rather than a site by site determination which presents issues more appropriately addressed in the permit application process."
Id. at 95.
While it is true that an area which is under permit is exempt from designation as to that permitted operation, the controlling legislative history indicates that such an area can be subject to a petition with respect to future mining that is not authorized by the current permit. For example, in this instance, while it may be true that 90% of the petition area is under permit, the permitting of an area for underground coal removal, for example, does not automatically exempt all property and all coal seams above that permitted seam from evaluation for designation as to other coal seams not authorized to be removed under that permit, or as to other forms of mining not authorized under the permit. To assume that permitting one coal seam for underground mining precludes consideration of an unsuitability petition for all overlying areas, for mining methods and coal seams not contemplated nor approved in that permit, goes far beyond the goal of Congress of avoiding the application of the unsuitability process to existing operations, since the holder of the underground mine permit could not unilaterally decide to change mining method or mine seams not identified and approved in the permit.
Even assuming for the sake of argument that the shadow areas overlying permitted underground mines are included under lands unsuitable petitions as to those underground operations, the suggestion that permitting a particular coal seam exempts all land and all coal seams above the permitted seam from consideration under an unsuitability petition is an insupportable interpretation of the law.
Even if it were the case that the existence of a permitted underground mine disallows consideration of designation as unsuitable all lands and all coal seams above the mine, that would not render the petition frivolous, since frivolity speaks to the merit of the petition allegations rather than the acreage or percentage of the petitioned area that is under permit.
The petition process is intended to identify areas based on the existence of the features for which the designation is sought. Thus, the state regulation at 405 KAR 24:001(5) defines an area as a geographic unit in which the criteria alleged in the petition . . . occur throughout and form a significant feature[.] The applicant is obligated only to identify an area based on the occurrence of the values or features for which designation is sought; and is not required to define the petition area by permit or property boundaries. Since the regulation compels that the petitioned area include a geographic unit throughout which the petitioned features are found, the regulation necessitates that the Petitioner include those areas that share the same feature(s) despite the exempt status of certain coal seams as being under permit or a pending permit application for which the public comment period has closed, and the inclusion of those areas does not render the application without merit or frivolous.
The inclusion of such permitted areas within the petition boundary does not make the petition frivolous since that is defined in 405 KAR 24:030 Section 3(4) as one in which the allegations of harm lack serious merit. No such claim has been made, and none credibly could, since the allegations of harm and the justification for designation are well-supported, and because the Cabinet itself has shown considerably concern regarding protection of the Lynch and Benham water supplies, and at hearing, Petitioners anticipate calling upon a number of Cabinet employees who are familiar with the sensitivity of those water supplies to degradation to explore the merits of the petition that the Cabinet erroneously rejected as frivolous and without merit.
It is no small irony that the Cabinet would reject the LUM 10-1 Petition as frivolous on the basis of the existence of permitted underground workings, since the Cabinet argued against such a position before the Office of Administrative Hearings in the case of Apogee Coal et al. v. Natural Resources and Environmental Protection Cabinet, et al., File No. LUP-24370-043. In that case, the coal companies argued that the underground mine permit shadow areas, in addition to the permitted mines themselves, were exempt from the unsuitability process, and because 77.7% of the LUM petition area for Black Mountain was under permit, that made the petition "frivolous.
In the Cabinets Memorandum in Support of Respondents Cross-Motion For Summary Disposition And In Opposition To Petitioners Motion For Summary Judgment, the Cabinet argued as follows:
"The coal companies argue that most of the area covered by the LUP is exempt from being designated as unsuitable for mining, pursuant to 405 KAR 24:030 Section 2(1)(b). The coal companies have submitted the affidavit of Larry D. Adams in support of their argument, Adams affidavit states that 77.7% of the LUP area is currently under permit. What the coal companies fail to point out is that most of the permitted areas in the LUP area are areas overlying underground workings,known as shadow area. Less than 10% of the land on Black Mountain above the 3000 feet elevation (the LUP area) is permitted for surface [disturbance]
* * *
Both federal and state laws require Kentuckys surface coal mining regulatory program to be consistent with the regulation program established by Public Law 95-87 When the purpose of a state law is to carry out a comparable federal law, the state must consider the way the federal law has been interpreted in applying the state law. (Citations omitted).
* * *
The argument that shadow areas are exempt from designation leads to an absurd result. A permittee has no legal rights under its permit to conduct surface coal mining operations on shadow areas. In an area with multiple coal seams, the permittees right to mine may be limited to a single seam, and it may not have the right to mine the seams above it. There is no logical reason to exempt an area from designation simply because it is permitted as a shadow area. Such a result would go way beyond the intent of Congress to protect ongoing operations and existing permit rights.
* * *
The coal companies position that shadow areas are exempt from designation as unsuitable for mining is simply untenable. The purpose of the exemption is to protect the rights of ongoing mining operations. Even if a shadow area is designated unsuitable for surface coal mining operations, the permittee is allowed to continue with its underground mining operation, and does not lose any rights under its permit. Consequently, there is no reasonable basis to exempt shadow areas from being designated unsuitable for mining.
Even if the coal companies position that shadow areas are exempt from designation is correct, it still does not render the LUP frivolous. If a LUP covers both permitted areas and unpermitted areas, a state regulatory authority must process the petition for the unpermitted areas.
44. Fed. Reg. 15002 (March 13, 1979).
A frivolous petition is one in which the allegations of harm lack serious merit. 405 KAR 24:030, Section 3(4). The question of whether a petition is frivolous relates to the merits of the allegations that mining would harm people, land, air, water, or other resources. See 52 Fed. Reg. 49323 (Dec. 30, 1987). In evaluating a petition to determine if it is frivolous, a regulatory authority must ðetermine if the allegations have a serious basis for the area being petitioned. 48 Fed. Reg. 41332 (Sept. 14, 1983).
(Emphasis added).
In rejecting the coal companies argument that the petition is frivolous because about 77% of the proposed designation area is already under permit[,] the Hearing Officer rejected the argument that a permit for underground mining includes both the minerals and the surface shadow areas where no mining is proposed but which are included in the permit area because they overly a permitted underground coal mine. The Hearing Officer noted that:
"I conclude that the Coal Companies argument is not a basis on which I can deem the LUP frivolous. The regulations define the term frivolous to mean a petition in which the allegations of harm lack serious merit. 405 KAR 24:030 Section 3(4). Frivolity speaks to the merit of the petition allegations of harm, rather than the acreage or percentage of the petitioned area that is under permit. The harms alleged in the LUP include adverse effects on the composition, diversity, extent and health of biologic communities that rely on the habitat as it currently exists. It also alleges harm to water resources by increased sedimentation and placement of spoil in stream headwaters. It further alleges injury to scenic values and adverse impact on historic lands. The Coal Companies do not claim in this challenge to the DSMREs completeness determination that allegations of these harms are frivolous.
34. While the degree of any such harm may vary depending on the amount of acreage that cannot be legally designated as unsuitable, it cannot be said that the LUP does not contain serious allegations that expansion of existing mines or construction of future mines will harm the environment .
35. The petition process is intended to identify areas based on the existence of the features for which the designation is sought. . . .The applicant is obligated only to identify an area based on the occurrence of the values or features for which designation is sought, and is not required to define the petition area by permit or property boundaries. Since the regulation compels that the petitioned area include a geographic unit throughout which the significant features are found, the regulation necessitates inclusion of those areas despite their exemption as permitted and the inclusion of those areas does not render the application frivolous or incomplete. Exempt areas are by law excluded from
evaluation under the petition, and the DSMRE will make the determination of which lands are in fact exempt as a part of its review of the LUP as a whole. The petition applicant is not obligated to delineate permit areas, therefore the existence of such areas does not render the petition frivolous or incomplete as defined by regulation."
Apogee Coal Company et al. v. NREPC et al., File No. LUP 24370-043, Hearing Officers Report and Recommendation (March 4, 1999). (Emphasis added).
17. Petitioners request an evidentiary hearing regarding the September 7, 2010 determination, but reserve the right to move for summary disposition in accordance with the regulations governing these proceedings.
18. Petitioners reserve the right to seek interim relief if the agency renders any permit issuance determination for any area included within the Petitioned Area, during the pendency of this case.
WHEREFORE, based upon the foregoing, the Petitioners pray:
- That the Cabinet determination of September 7, 2010 rejecting LUM 10-1 as being frivolous due to the percentage of area within the Petitioned Area that is under permit or pending permit application, be reversed and remanded to the agency for further processing of the petition in a manner consistent with state and federal law
- That they be awarded their costs and expenses, including reasonable attorney and expert witnesses fees, expended in pursuing this review, and
- For any and all other relief to which they may be entitled.
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By Kentucky Resources Council
on 10/06/2010 5:32 PM
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The Kentucky Resources Council is a non-profit, 501(c)(3) organization dedicated to the conservation and prudent use of Kentucky’s natural resources. Since 1984, we have dedicated ourselves to protecting Kentucky’s land, air, water, and communities.