Articals of interest to the coal industry.

Monday, March 26, 2007

Safety Fines To Double

Mine Safety Fines to Double Under New Regulation
Mar 24, 2007

Total fines for mine safety violations would more than double, to almost $32 million a year nationwide, under a new rule finalized Thursday by the U.S. Mine Safety and Health Administration.
But fines charged to the industry's largest operators could actually decline, compared to the original proposal MSHA published last year, according to estimates made public with the release of the final rule.
While MSHA refused an industry request and generally raised fees across the board, agency officials also backed off several parts of the original proposal issued in the wake of last year's deadly year in the coalfields.
United Mine Workers President Cecil Roberts generally praised the final rule, but said he remains worried about how MSHA will implement it.
"It remains to be seen if MSHA will actually shift its general attitude from 'compliance assistance' to being strict enforcers of the law," Roberts said in a prepared statement.
Carol Raulston, a spokeswoman for the National Mining Association, said her group had hoped MSHA would scale back the rule to include only fine increases required by Congress in a reform bill passed last year.
That law established a new maximum fine of $220,000 for "flagrant" health and safety violations and a penalty of $5,000 to $60,000 for operators who fail to promptly report serious accidents, but under pressure after the Sago Mine disaster and a string of other deaths, MSHA did a much broader rewrite of its penalty regulations.
The rule rewrites a set of tables that set penalty "points" for violations, based on various factors, including the company size, compliance history and violation seriousness.
Under the final rule, total fines for all mining sectors would increase, if officials assume no additional compliance, from $24.9 million a year to $69.3 million, slightly more than under the original MSHA proposal.
MSHA projected its overall increase in penalties would force more coal operators to comply with the law more frequently. Overall, the agency said, total violations are expected to drop by nearly one- fourth.
When this change is accounted for, MSHA projects total fines assessed per year would increase from $14.7 million to $31.8 million.
Total fines for the very largest operators - those with more than 500 workers - would drop compared to the original proposal, from $7.4 million to $5.7 million.
For the next largest category - operators with between 20 and 500 workers - total penalties would increase slightly over the proposed rule, from $46.7 million to $49.4 million.
In its Federal Register notice, MSHA analyzed several industry examples that indicate the final rule is not as severe as last year's proposal:
* At one Jim Walter Resources mine in Alabama, the proposed rule would have increased total 2005 penalties form $66,000 to $379,000. The final rule increases them to $334,000, about 12 percent less.
* At another Jim Walter mine, last year's proposal would have increased total fines from $129,000 to $421,000. This week's final rule would increase them to $344,000, about 18 percent less.
* At a Peabody Energy mine, the original MSHA proposal would have increased the average fine for a serious violation from $576 to $3,996. The final rule would increase the fine to $2,902, about 27 percent less.
Among other changes, MSHA backed off its original proposal for increasing penalty points based on mine size. Instead of a maximum of 20 points for mines with more than 2 million tons a year of coal produced for example, the final proposal gives similar-sized operators 15 points. That is still an increase over the 10 points allocated to those size operators under current rules.
MSHA eliminated the single shift penalty, which assigned automatic fines of $60 to the most common and less serious violations.
Under the change, these violations will instead be processed through the normal assessment procedure.
MSHA also reduced from 24 months to 15 months to period of time that will be examined in determining whether operators have a history of violations.
Also, in its new addition to the penalty formula meant to take into account repeat violations of the same safety standards, MSHA decided to base its analysis on the number of citations per inspection day rather than just the raw number of citations.
MSHA did not agree to industry requests that this new part of the formula only consider violations inspectors deem to be "significant and substantial."
To contact staff writer Ken Ward Jr., use e-mail or call 348- 1702

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