By Richard Valdmanis
(Reuters) – U.S. coal companies lobbied Congress to allow a drop in their payments to help miners with black lung disease by arguing the incurable ailment was in decline and a victims’ trust fund was financially healthy, assertions contradicted by government findings, according to documents seen by Reuters.
Coal companies are currently required to pay a tax of $1.10 per ton on underground production to finance the federal Black Lung Disability Trust Fund, which pays medical and living expenses for some 25,000 eligible miners and their families.
That excise tax is scheduled to revert to the 1977 level of 50 cents per ton at the start of 2019. A bipartisan effort earlier this year to extend the higher rate failed, though lawmakers may raise the issue again in the coming months.
“Changing the schedule now would effectively impose a tax increase on an industry struggling to recover from the regulatory excesses of the past administration,” National Mining Association President Hal Quinn wrote in a June 14 letter to U.S. Representatives Kevin Brady of Texas and Virginia Foxx of North Carolina, both Republicans.
Brady is the chairman of the powerful Ways and Means Committee and Foxx heads the Education and the Workforce Committee.
An accompanying “one-pager” on the issue, which was also seen by Reuters, included the assertion that black lung was in decline and that the trust fund would be in good stead without an extension of the excise tax.
“Despite a decline in medical black lung disease, claim approvals have skyrocketed,” the NMA said in the pamphlet.
It also stated: “The tax, even at the reduced rate that will go into effect on January 1, 2019, is more than sufficient to provide monthly disability benefits” for the trust fund.
At the time the NMA sent the documents, government research showed incidents of black lung disease, which was nearly eradicated in the 1990s, rising rather than falling.
In February, for example, the National Institute for Occupational Safety and Health confirmed 416 cases of advanced black lung disease in three clinics in rural Virginia from 2013 to 2017 – the highest concentration ever seen. It also confirmed many hundreds of other cases in southwestern Virginia, southern West Virginia and eastern Kentucky.
The Labor Department also found that nearly half the 4,679 benefits claims from miners with the worst form of black lung disease had been made since 2000, according to Kirsten Almberg, an assistant professor of environmental and occupational health at the University of Illinois at Chicago who analyzed the data in a study earlier this year.
Last month, the NIOSH issued a more comprehensive report showing more than 10 percent of America’s coal miners with 25 or more years of experience have black lung disease, the highest rate recorded in roughly two decades.
NMA spokeswoman Ashley Burke said the letter and one-page pamphlet accompanying it were sent to lawmakers before the latest NIOSH report, and that previous studies had been unconvincing.
“Prior data showed the heightened incidence of disease was localized to a small geographic region, not national,” she wrote to Reuters in an email.
She said the NMA was “concerned” by the latest NIOSH report but did not say whether the group had updated its lobbying materials.
U.S. President Donald Trump has vowed to revive the ailing U.S. coal industry, which has been shrinking for years under pressure from cheaper natural gas and advances in solar and wind energy.
TRUST FUND FINANCES
The assertion that the black lung trust fund would have more than enough money if the excise tax reverted to the lower level also clashes with government research.
The U.S. Government Accountability Office said in a June report that the fund would need a multi-billion dollar taxpayer bailout if the coal production tax was not extended.
“With the scheduled 2019 tax rate decrease, our moderate case simulation suggests that expected revenue will likely be insufficient to cover combined black lung benefit payments and administrative costs, as well as debt repayment expenditures,” according to the report from the non-partisan GAO.
NMA’s Burke said the group had relied on its own calculations to conclude otherwise in the materials sent to lawmakers: “Our calculations were based on current actuals/production vs. GAO future modeling.”
The fund, which was established in the 1970s, is already roughly $6 billion in debt because revenues have failed to keep up with outflows.
The NMA has repeatedly argued the fund is mismanaged, and covers victims of lung disease caused by smoking not mining – though medical experts have countered that it is easy to identify lung damage caused by coal dust in an x-ray.
The National Coalition of Black Lung and Respiratory Disease Clinics and the Appalachian Citizens’ Law Center called the NMA’s lobbying materials misleading.
“While NMA, or any trade association, has the right to defend the interests of the industry it represents, it is unacceptable to attempt to mislead Members of Congress and their staff,” they said in a joint statement.
(Reporting by Richard Valdmanis; Editing by Paul Simao)