Study neglects $2 billion miner payroll – Anonymous post

Beckley Register Herald – June 24, 2010
An environmental group’s claim that West Virginia’s coal business is a $97.5 million loser when government services are figured in the mix of revenues yielded in taxes was disputed Wednesday by an industry leader.

Bill Raney, head of the West Virginia Coal Association, said he was struck by some key items Downstream Studies omitted from its 83-page report.

“Apparently, payroll is not included in any sense of the word,” he said.

“It’s very difficult for me to see how they can start drawing comparisons and not include the payroll, as well as the supporting industries and businesses, account for.”

Raney figures the payroll from all sources combined is roughly $2 billion.

“Other things not included are the property taxes,” he said.

Generally, Raney took the critical report in stride, seeing it as just another attack on a crucial industry, saying, “There’s always somebody wanting to throw negative darts, it seems like.”

While the study alluded to taxes companies pay to the general revenue fund, those realistically are “a very small portion of the property taxes,” the coal leader said.

“It didn’t mention the fact that property taxes for coal properties, as well as the industrial personal property tax, the equipment we have, is paid to counties that typically go to support the education system,” he said.

Raney said the report acknowledges on the front end the significance of the industry to West Virginia in terms of employment and taxes generated.

“One of the reasons it’s significant is because it’s been able to compete, not only in the domestic market, but in the worldwide market,” he said.

“Their answer is, ‘Let’s tax it more so we can make it uncompetitive.’ It would seem everyone’s thoughts, efforts and devotions ought to be pointed to how we can mine more coal, put more people to work and market more coal from West Virginia so that we have increased revenues and increased activity as it regards West Virginians working, as opposed to just simply saying, ‘Well, we need to tax it more so that somebody can get more money to do what someone envisions need to be done someplace.”

Much is said in Downstream Strategies’ report about the damage inflicted on roads by coal trucks.

“There’s been an absolute reduction over the last eight years since the coal truck bill was passed,” Raney said.

“First of all, you’re dealing with trucks that haul much less weight than they did historically over the years. You’re dealing with a system that has some reliability and certainty with it, routes are identified, and maintenance is done in accordance with that.”

Raney said the environmental study seems to imply that only coal trucks are using roads in certain locales at a time when the industry is trying to retire as many of its vehicles as possible.

“We’ve got belt lines running all over the country that are taking coal to rail sidings, to river loading facilities, that 10 years ago likely would have been coal hauled in trucks,” he said.

Nor does the report illuminate the investment of coal concerns in roads under public-private partnerships, he said.

Historically, the roads have been improved by coal operators before they are entered into the coal resource transportation system, he said.

“Usually that’s done with the agreement that not only are we going to fix it in the front end but we’re going to make sure when we finish hauling coal, it’s put back in the condition before it was designated,” Raney said.

Raney said he could “pretty easily conclude” that Downstream Strategies has an anti-coal agenda, saying some on its board of directors share that negative attitude.

“When you look at the 26 counties where we produce coal, it’s likely to be the largest private capital investment activity in those counties,” he said.

The association won’t produce a follow-up paper to answer Downstream Strategies, he said, since a coal study unveiled to lawmakers last Feb. 18 in joint research by West Virginia and Marshall universities pointed to $25.1 billion economic impact by coal in this state.

“Let’s all get together and figure out how we go forward and make it all better as opposed to just thinking, ‘Well, let’s assess more taxes so we can get more money,’” he said.

“There are an awful lot of studies done these days to point out problems, but they’re a little short on solutions. We’re under absolute assault from the federal government right now. When you remove the extraction industry from this state, then you are removing a huge, huge part of the economy.”

Raney appealed to all stakeholders in the coal industry to bond for a common goal. “I’m just hopeful for that great day when everybody wants to pull together here and move forward here and try to make us the best we can possibly be and be proud of being the powerhouse for a big chunk of this nation,” he added.
Related Article:
Chamber calls report on state’s coal industry a ‘mockery’
Charleston Daily Mail – June 23, 2010
CHARLESTON, W.Va. — The West Virginia Chamber of Commerce called a recent report on the state’s coal industry a “mockery of real academic research.”

The report released Tuesday by Downstream Strategies of Morgantown and the West Virginia Center on Budget & Policy concluded that while coal creates valuable jobs, personal income and tax revenue, it also carries hidden expenses the state never recovers, including multimillion-dollar damage to roads and bridges.

The report said the industry cost the state an estimated $97.5 million in fiscal 2009. It also recommended new policies, taxes, fees and fines to ensure coal companies are paying their way.

The chamber released a statement noting the Sierra Club and the Natural Resources Defense Council paid for part of the report.

“This report was created by people who are staunchly anti-coal, oppose job growth in the production sector, and who seek to drive away the coal and manufacturing industries, which pay the highest wages, offer the best benefits, and fuel much of West Virginia’s economy,” said chamber president Steve Roberts said in a statement.

He said the state unemployment rate should be a rallying cry.

“It is time to get serious about the need for energy, the importance of manufacturing, and the urgency of repairing our economy so that families have a good place for wage earners to work,” Roberts said. “Fiction from a so-called policy and research organization will not create jobs or help West Virginia families.”

The authors of the report acknowledged their figures were estimates and say their results carry “an inherent degree of uncertainty,” but they stand by their larger point: that West Virginia must begin to diversify its economy and plan for the decline of coal or it will suffer later.

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