Taxpayers for Common Sense released the following statement from TCS President Ms. Ryan Alexander:
|“Peabody Energy’s bankruptcy filing leaves no doubt that allowing coal companies to ‘self-bond’ for future mine clean-up costs is a flawed system that puts taxpayers at huge financial risk. As millions of dollars in self-bonding liabilities disappear in the bankruptcy proceedings of one coal company after another, taxpayers are left holding the bag. |
If what we saw in other recent bankruptcies like Arch Coal and Alpha Natural Resources are any indication of what’s to come, Peabody will likely only be required to pay a small fraction of its $1.4 billion in possible clean-up costs.
Like Arch and Alpha before it, Peabody’s decline into bankruptcy was all but a foregone conclusion. Yet regulators continued to allow the companies to promise that they would cover their clean-up costs themselves, increasing the chances that taxpayers stuck with the tab. If Peabody hadn’t been allowed to qualify for self-bonding through its subsidiaries, the firm would have been forced to post collateral or obtain surety bonds to cover these costs, instead of saddling taxpayers with them.
It’s clear that bonding practices need serious reform in order to protect taxpayers from covering these costs.”
To learn more about self-bonding, read our fact sheet: “Coal Bonding: Time to Revisit Self-Bonding Requirements”