|Shepherd (Courier-Journal photo)|
"When one company so systematically subverts the requirements of the law, it not only jeopardizes environmental protection on the affected permits, it creates a regulatory climate in which the Cabinet sends the message that cheating pays," Shepherd wrote. He rejected a proposed consent decree between the state and Frasure Creek Mining Co., a subsidiary of International Coal Group, saying its $310,000 civil penalty would be too weak to deter the firm from further violations. The penalties could have been as much as $38 million.
"The effectiveness and integrity of the . . . program depends on the trustworthiness of the regulated entities and vigorous agency oversight and enforcement," Shepherd wrote. But not only did the company falsify its reports, the state doesn't even know how many "outfalls," or sources of discharged water, there are at the 2,200 permitted coal-mine sites in Kentucky, Shepherd wrote. He also cited testimony by the state's environmental protection commissioner that Kentucky ranks 49th in federal funding per permit, and state budget cuts have made it impossible for the agency to effectively regulate systematic violators. "The cabinet has fewer staff today than it did in 1990, and far more responsibilities than it did in 1990," wrote Shepherd, who was the cabinet secretary in 1991-95. He cited one of his own findings as secretary, and a recent federal appeals court decision, to evaluate the proposed consent decree.
In his conclusion, Shepherd said the cabinet's lack of public notice for its proposal showed that its "primary concern" the impact on the impact on the coal company, "and not on the public or the environment." He noted that the violations were discovered by citizens' groups: Kentuckians for the Commonwealth, Kentucky Riverkeeper, Waterkeeper Alliance and Appalachian Voices. Here is more background and reaction as reported by Jim Bruggers of The Courier-Journal and Joe Sonka of Insider Louisville, who adds a downloadable copy of the ruling.