Some members of Congress in Washington, D.C., have begun suggesting that coal companies are not paying the full amount of taxes they owe to the federal government; all in the name of helping shore up revenues for the struggling federal budget, of course. Wyoming Gov. Matt Mead and former Gov. Brian Schweitzer have disputed the accusations, and this appears to be more a part of the concerted campaign aimed at harming the coal industry than anything else.
Congress has one simple solution if they are serious about increasing the amount of federal revenue that we realize from the coal industry: simply allow production to increase.
Right now the biggest impediment to increased coal production in America is the fact that our West Coast shipping ports are at capacity. With domestic demand for coal relatively flat, the best opportunity to expand American coal production is to sell to the rapidly growing export market.
New export terminals, and expansions to new ones, have been proposed, but are subject to approval by federal agencies. The feds can show they’re serious about improving our economy, creating jobs and deriving more tax revenue from coal by expediting the approval process for these terminal proposals and not allowing them to be bogged down by the typical stall tactics employed by the environmental litigation industry.
Proceeding in such a manner would be beneficial for Rocky Mountain states that rely on West Coast shipping capacity to reach world markets. Indeed, it’s not just coal that gets shipped through these ports — they serve a variety of Montana commodities. For instance, over 70 percent of Montana’s grain is exported overseas.
But for Montana there’s probably no greater opportunity that our economy has than the opportunity to increase our coal production. Montana has more coal than any other state — in fact our coal reserves are twice the size of Wyoming’s, the next closest state. Montana has so much coal that our reserves alone could meet the entire electricity demand of the United States for over 100 years. But even with all this coal, Montana ranks just fifth nationally in annual production — and at just one-tenth of Wyoming’s output.
Adding just one new coal mine in Montana, like the proposed Otter Creek mine, would create over 2,000 new jobs, generate hundreds of millions in economic activity each year, and provide billions in new tax revenue to local, state and federal governments over the life of the mine. It would be a transformative economic event that would benefit every part of the state. And we have the capacity for several new mines of this sort.
One reason Montana’s production has lagged behind states like Wyoming is that we are just a little bit further away from domestic markets. The added cost has given producers in other states a small competitive advantage. But for the West Coast export market, Montana holds the competitive advantage over all other coal producing states. That incredible opportunity is lost if new shipping capacity is not constructed.
I’m challenging those members of Congress who say they want more revenue from coal to put their money where their mouth is and join me in encouraging the federal government to swiftly allow new shipping capacity to be built.
Rather than punish companies, let’s help them put people to work by allowing them to produce more.
(Rep. Duane Ankney is the chairman of the Montana House Appropriations Committee. He lives in Colstrip and represents House District 43.)