ELR Citation: ELR 20772
No(s). 90-0150-A (W.D. Va. Dec 30, 1992)

The court holds that a coal company's challenge to reclamation fees it was assessed by the Office of Surface Mining (OSM) under the Surface Mining and Control Reclamation Act (SMCRA), is not required to be brought in the district court for the District of Columbia, and the company qualifies as a surface mine "operator" under SMCRA §701(13) required to pay reclamation fees on a raw coal basis, even if it is merely an agent of the lessor of the mined property. The court holds that it has subject matter jurisdiction under SMCRA §526(a)(1). The action is not required to be brought in the District of Columbia because the company challenged OSM's interpretation of the relevant regulation, and not the regulation itself. The court next holds that the company is an "operator" under SMCRA §701(13). Although the company was the agent of the lessor of the properties from which coal was mined, it had the exclusive right to mine that coal and did so pursuant to its right. The court holds that the company and its lessor could not be treated as one for reclamation fee purposes. The two companies were incorporated separately and had filed separate tax returns. Moreover, ambiguity concerning whether the two companies had a brokerage or commission merchant agreement precludes summary judgement on the issue of whether the transfer of raw coal to the lessor company constitutes a sale. Finally, the court holds that in assessing fees against the company, OSM properly interpreted 30 C.F.R. §870.12(b)(3)(ii) to assess reclamation fees on the basis of gross weight of the material at the time of the initial sale or transfer of ownership. The company, which lacks cleaning facilities, is not entitled to sell raw coal on a clean coal basis and pay reclamation fees for clean coal.

Counsel for Plaintiff
David E. Cecil
Robertson, Cecil & King
P.O. Box 1560, Grundy VA 24614
(703) 935-7571

Counsel for Defendant
Mark Siegel, Special Ass't U.S. Attorney
U.S. Attorney's Office
U.S. Department of Interior, Office of Solicitor
Plaza Tower
800 S. Gay St., Ste. 700, Knoxville TN 37929
(615) 545-4167