Rural America voted for the loser; does it lose out?

Most rural voters chose John McCain in this month's election, so "That has some wondering whether President-elect Barack Obama will pay much attention to rural issues," Howard Berkes reports for National Public Radio, leading with these sound bites from James Gimpel, professor of government at the University of Maryland and a native of rural South Dakota and Nebraska:

"I think most rural Americans would be fearful of the possibility [Obama's] not really interested in them. He comes out of Chicago and is a big-city politician. Rural Americans probably aren't looking for a lot out of this administration. ... They can see for themselves who won. And it didn't seem to be rural America in this last election."

However, Berkes notes that Obama "pledged to hold a 'rural summit' and deliver a package of rural initiatives to Congress in his first 100 days as president," and made himself the Democratic front-runner "by campaigning for fundamental change in farm and rural policy in the state of Iowa," as described by Chuck Hassebrook, executive director of the Nebraska-based Center for Rural Affairs. (Photo of Obama in Iowa by David Lienemann, The Associated Press)

While urban and suburban Americans may think of rural Americans as farmers, fewer than 2 percent actually make their living mainly from agriculture, and there is conflict between some of them and those who want the federal government to do more for rural development, which Berkes explores in a second story. "Many rural Americans are challenged by a rural economy that tanked sooner and deeper than the nation's economy," he says in his first report. "High energy prices have made food and long commutes more expensive. And most rural places are losing population."

Obama often spoke about making high-speed Internet access more available in rural areas. That should be at the top of his rural agenda, said Debby Kozikowski of RuralVotes, a partisan group that ran ads criticizing McCain. "Internet access is not just for watching YouTube," she told Berkes. "It's an instrument of commerce and education." Gimpel says cutting the capital-gains tax on small businesses would help rural economies, and Dee Davis of the Kentucky-based Center for Rural Strategies, below, has bigger ideas.

"He believes rural places should become part of the national economic recovery plan," Berkes reports. "Davis foresees rural areas focused on the renewable energy and alternative fuels the nation seeks. He envisions new markets tying local farmers to towns and cities close by. He also proposes a system for rewarding rural areas financially if the market in "pollution credits" results in the construction of power plants that pollute rural skies." (Read more) To listen to the story, click here.

Tom Gish, inspirational rural editor-publisher, dies

Thomas E. Gish, who set an inspirational standard for courage in rural journalism, died today amid the Appalachian Mountains he struggled to protect as publisher of The Mountain Eagle in Whitesburg, Ky. He was 82. His wife, Pat, survives, and his son, Ben, is editor of the paper.

Tom Gish died of heart failure, but his journalistic heart beats on in the Eagle, which began crusading in the public interest soon after the Gishes took ownership on Jan. 1, 1957. First they took on local officials who tried to close meetings, and that fight helped pass Kentucky's first open-meetings law. (A much stronger law was passed in 1974.) Then they took on the environmental and safety practices of the powerful coal industry, and became the target of advertiser boycotts, personal shunning and eventually a firebombing of their office.

"The Mountain Eagle became the first newspaper in Eastern Kentucky to seriously challenge the environmental damage caused by strip mining," writes Andy Mead of the Lexington Herald-Leader. (Read more) Tom Gish was "the conscience of the mountains, and also the conscience of the press," Pineville lawyer Steve Cawood told R.G. Dunlop of The Courier-Journal. "When the statewide press, the regional and national press, weren't paying attention to the principal issues of the region, it was his coverage that brought that press in." (Read more)

With the help of friends and supporters around Kentucky and the nation, the Gishes brought the paper through hard times and continued reporting on state, regional and national issues that affected Letcher County. In 2004, the Institute for Rural Journalism and Community Issues created the Tom and Pat Gish Award for courage, integrity and tenacity in rural journalism. From the start, there was no question whose name the award would bear, and the Gishes were the first recipients. For more on them, click here. For an essay they wrote in 2000 on their work, click here.

Visitation will begin at 5 p.m. Sunday at Letcher Funeral Home. Services will be held at 1 p.m. Monday at the Presbyterian Church in downtown Whitesburg.

Tobacco-settlement spending for agriculture in Ky. to get more oversight; N.C. expands investments

The Kentucky Agricultural Development Board pledged yesterday to do a better job of overseeing the spending of grants it awards from the state's share of the national tobacco settlement. But board members "also said they cannot micromanage or guarantee the success of every project," and should continue to take some risks, reports Greg Hall of The Courier-Journal.

The comments came in the board's discussion of a University of Kentucky study of $209 million in spending from the 1998 settlement, from 2001 through 2006. In 2000, the state legislature allocated half the state's share of the settlement to improvement of the state's agricultural economy. It placed priority on helping tobacco farmers find other sources of income, anticipating the end of the federal tobacco program of quotas and price supports, which was repealed in 2004.

The study concluded that the money has helped about 50,000 current and former tobacco growers. "It is clear that these investments have led to broad market improvements," the researchers wrote. Markets for 148 products were created or expanded, "primarily through investments in livestock and horticulture projects plus marketing promotion." The most common investment was in beef-cattle farming; Kentucky is the leading Eastern cattle state. But entrepreneurs have created more than 500 new products, from salsa to industrial glue, with the program's help.

The study wasn't all good news. Researchers found that the transition from tobacco to something else was far easier in the large and medium-scale farms in Western and Central Kentucky than in the smaller farms in hilly Eastern Kentucky, one of the nation's poorest areas.

Some major investments, such as a Western Kentucky fish-farming cooperative, failed. But the researchers said the board "should continue to fund ‘risky’ new ventures which stimulate new markets, expand the value chain, and encourage value-added processing." They said some failures "still resulted in advancements in new enterprises, new on-farm technology, production of new crops, and contract marketing." Hall reports, "Board member Sam Lawson said he hoped the report wouldn't result in the panel being so conservative that it never funded an ultimately unsuccessful program." (Read more)

The researchers said the Governor's Office of Agricultural Policy, which acts as staff to the board, "appears to lack the staff necessary to fully utilize information" from reports filed by grant recipients or to oversee all projects. "Relatively too much staff time was involved in feasibility analysis versus project monitoring." For a 4.8mb PDF of the study, click here.

The other state to earmark half its tobacco-settlement money for rural-related purposes was North Carolina, the state that produces the most tobacco and had the second largest number of tobacco farmers, after Kentucky. The Tar Heel State created a foundation to invest the money and spend the earnings on grants to help the economies of tobacco-growing counties. The Golden LEAF foundation "has increasingly dangled big bait for corporate prizes," reports Emery Dalesio of The Associated Press. "This year, it opened its vault by committing $100 million to build an aircraft parts plant." The acronym stands for Long-term Economic Advancement Foundation. "We'll continue to do more high-quality manufacturing," foundation President Dan Gerlach told AP. "We're going to do more on health care." (Read more)

The other state that is using tobacco-settlement money to help the economies of tobacco-growing areas is Virginia. The state uses 40 percent of its share for health programs; the remainder "is overseen by a commission that awards grants for education and economic development projects in tobacco-dependent communities. The commission also makes payments to farmers to compensate for a decline in tobacco quotas," reports The Associated Press and Michael Sluss of The Roanoke Times. In 2005, the Commonwealth "sold nearly $450 million in bonds backed by a 25 percent share of the state's overall settlement payments. Proceeds from the bond sale fund an endowment that is used primarily for technology and economic development projects." The major expenditure has been $80 million to bring broadband service to Southwest and Southside Virginia and other rural areas of the state. (Read more)

New program to improve oral health in economically distressed counties in West Virginia

Marshall University is starting a program to improve the dental health of children in rural West Virginia. "The program hopes to award 15-20 grants and is expected to serve about 7,500 children the first year, with a priority for sealants that prevent cavities," writes Bill Rosenberger of the Herald-Dispatch in Huntington. "Parents and community members at large also will have the opportunity to avail themselves of the preventive services."

The program is focused on counties designated as economically distressed by the Appalachian Regional Commission. Richard Crespo, professor of community health at the Rural Health Center, told Rosenberger that selected communities and schools will get money to buy portable dental equipment and pay for support, planning and coordination of the program. (Read more) By some measures, West Virginia has the worst oral health in the nation. In Kentucky, which is worst by other measures, dental decay is the No.1 source of infectious disease in children and dental pain is the most common reason cited for children missing school. As reported here, dental health is a major health concern for many rural children in other states.

New standard for organic fish is quickly criticized

"For the first time, a federal advisory board has approved criteria that clear the way for farmed fish to be labeled 'organic,' a move that pleased aquaculture producers even as it angered environmentalists and consumer advocates," write Julie Eilperin and Jane Black of The Washington Post. Opponents of the move argue that it will cheapen the organic label because it would allow farmed fish to be fed 25 percent non-organic material while other industries must use 100 percent organic material.

The organic fish standard is the result of a long process and confusing process. Many fish species are carnivorous and live in nets in the ocean where they feed on small fish, which makes a 100 percent standard difficult to meet.

Many fear that the standard, created by the National Organic Standards Board, will damage the existing organic standard for some consumers. Critics point out that consumers of organic meat products expect the animals to be fed with 100 percent organic feed, as indicated by a recent Consumers Union poll, "in which 93 percent of respondents said fish labeled organic should be produced with 100 percent organic feed; 90 percent said organic fish farms should be required to recover waste and not pollute the environment," Eliperin and Black write.

The standard also looks to protect certain fish species that have dwindled as the fish farming industry has boomed. Environmentalists are concerned because the standard does not attempt to prevent fish waste and disease from polluting the ocean. (Read more)

Newly discovered memo sheds light on historic mining accident 40 years ago today

A newly discovered memo helps explain how 78 men died in a landmark mine accident 40 years ago. "That memo — and sworn testimony taken after the disaster — suggest that no one had to die on Nov. 20, 1968," write Bonnie Stewart of West Virginia University and Scott Finn of West Virginia Public Broadcasting for National Public Radio. Why that memo was ignored for years remains unclear.

The memo and miners' testimony shows how poorly the underground coal-mining industry was regulated at the time of the accident. The mine fire at Farmington, W.Va., was the first big mine disaster to get national television coverage and focused a spotlight on the horrid conditions in the mines. The events and the coverage spurred new federal and state laws. In 1968, annual deaths from mine accidents was roughly 250, today that number averages about 32. (Read more)

Ethanol industry, facing more bankruptcies, wants automakers to produce more flexible-fuel vehicles

"Ethanol producers want to use a bailout of the auto industry to boost production of cars that can run on higher blends of the corn-based fuel," writes Philip Brasher of The Des Moines Register. The corn ethanol industry has been struggling due to fluctuations in corn prices following last summer's flooding in the Midwest.

Many in the industry see the best way to ensure continued growth is by increasing the number of flexible-fuel vehicles automakers produce. FFVs "are equipped to run on a wide range of blends of ethanol and gasoline," Brasher explains. "Under federal law, conventional vehicles can legally run on no more than 10 percent ethanol." Many advocates of the corn-ethanol industry insist that if automakers receive a bailout, it must include stipulations requiring automakers to make a firmer commitment to FFV production and alternative fuel use.

"General Motors, Ford and Chrysler are increasing their production of cars and trucks that can run on as much as 85 percent ethanol, or E85," writes Brasher. "But ethanol producers fear there won't be enough of those vehicles on the road to consume all of the biofuel that is going to be produced in coming years under the government's usage mandates."

Many in the ethanol industry say federal incentives are crucial if the industry is "to stay economically viable and to develop new forms of biofuels from nongrain feedstocks such as crop residue, wood and other sources of plant cellulose," adds Brasher. (Read more)

VeraSun, one of the country's largest ethanol producers, was forced to declare bankruptcy in October, a sign of looming trouble for the industry. "VeraSun's bankruptcy comes amid predictions of more bankruptcies and consolidations as the ethanol industry struggles with falling prices, lower demand and volatile markets," reports Dan Pillar of the Register. "Omaha investment banker Mark Lakers predicted Monday at an agricultural bankers convention in Des Moines that as many as 40 ethanol plants might be in bankruptcy by early next year." (Read more)

EPA moves to relax rules on air pollution in parks

The Environmental Protection Agency is moving forward with plans to alter air quality standards near national parks, despite formal opposition from half its regional administrators.

Currently, measurements near national parks detect pollution spikes that violate EPA limits. Power plants, oil refineries and other sources of air pollution are facing fines for such incidental violations. EPA wants to scrap the method in favor of a yearly average standard, under which emissions over the course of a year must average below the pollution limit. Critics say this move will result in an increase in pollution from power plants.

"The approach that's being proposed is going to underestimate the emissions, both for power plants that are out there now and for the ones that are proposed," Don Shepherd, an environmental engineer at the National Park Service's air resources division in Denver, told Juliet Eilperin of The Washington Post. "It's going in the wrong direction for our efforts to try to improve air quality in the parks." Shepherd notes that according to a study from the 1980s, all of the national parks faced poor visibility due to air pollution, and nothing has really changed since that study. (Read more)

If these and other eleventh-hour changes go through before the end of the Bush administration on Jan. 20, can the new president reverse them? Yes, but it would take some time, reports Joaquin Sapien of ProPublica: "Rescinding a rule would require the new administration to re-start the rule-making process, which can take years and prompt legal challenges. Another strategy that has been talked about lately – getting Congress to disapprove the rules through the Congressional Review Act — carries political risks and has been used only once before. (Read more)

Groundwater shows less pesticide than expected

Samples of groundwater show significantly lower levels of pesticide contamination than expected, according to a study by the U.S. Geological Survey. USGS tested for 80 pesticides in 362 wells, first from 1993 to 1995, then in 2001-2003. Only six pesticides were found in more than 10 wells during both time periods, at concentrations at less than one-tenth of federal limits.

Ron Smith of Southwest Farm Press attributes the findings to a number of factors: the high cost of pesticides, technological advances in seed development and land management, and careful attention to water movement patterns. He says a culture of respect for land among farmers influences pesticide usage: "They don’t knowingly overuse pesticides. It’s too expensive, too wasteful, and too potentially damaging to the resources farmers rely on for their livings." (Read more)

Stevens loses rural Alaska, and his Senate seat

Rural Alaska's lack of support for embattled Republican Ted Stevens, left, may have been the difference in the loss of his U.S. Senate seat, confirmed yesterday as all but a few ballots remained uncounted.

"Bush Alaska has benefited handsomely from Sen. Ted Stevens’ money-producing magic, but it broke with other parts of the state on Nov. 4," Alex DeMarban of Alaska Newspapers noted last week. "Registered voters in the six districts extending from Kodiak to the North Slope sided with Democrat Mark Begich, some of them quite heavily." (Read more)

"Begich trounced Stevens throughout rural Alaska, long a Stevens stronghold, as well as in Southeast Alaska," notes Sean Cockerham of the Anchorage Daily News. (Read more) For background on Stevens' careet, from Tom Kizzia of the ADN, click here. (ADN photo)

Idea: Simpler Web sites, pages for dialup readers

The "digital divide" in America is not just between those who use computers and the Internet and those who don't. It's also between people who have high-speed or broadband service and those who don't, especially as video, Flash and other bandwidth-suckers become more prevalent. And most of the people who want or need broadband but can't get it are in rural areas.

Should newspapers with circulation areas that straddle the digital divide create simpler Web sites or pages that take less time to download? We know at least two newspapers have been thinking about doing just that for their rural readers who are still on dialup, so we're checking to see if anyone else has already done it. If you've done it, or know someone who has, post a comment to this item or send an e-mail to Al.Cross@UKy.edu. Thanks!

EPA raises minimum share of ethanol in gasoline

Gasoline marketers will have to put a bit more ethanol in their product after the first of the year, to keep up with the Renewable Fuels Standard set by Congress. The Environmental Protection Agency said in a press release yesterday that gasoline must contain 10.21 percent ethanol "to ensure that at least 11.1 billion gallons of renewable fuels be blended into transportation gasoline." Under the 2007 energy bill, that target will gradually increase to 36 billion gallons in 2022. The current minimum is 7.76 percent, but marketers typically sell a blend with 10 percent ethanol.

Madeline Pickens offers to foster wild horses and burros that are too numerous for federal land

Animal lovers are celebrating an unexpected offer to save some of the 30,000 or so wild horses and burros that live on federal land from euthanasia and potential slaughter. Madeleine Pickens, wife of Texas billionaire T. Boone Pickens, made the offer at a public hearing in Reno yesterday. She is working with several private groups and intends to foster the animals.

The proposal comes just in time for the Bureau of Land Management, which "expects to spend 75 percent of its wild-horse budget this year just to feed and maintain the animals living in government holding pens and pastures. That leaves little money to oversee the estimated 30,000 that remain in the wild across the West," writes David Danelski for The Press-Enterprise in Riverside, Calif. Last year, BLM spent $21 million on care of the horses and burros. (Read more)

Despite the sigh of relief, activists warn that the fix is temporary. "I'm thrilled, obviously, that these horses are getting a reprieve. At the same time, we need to address the basic issue of how these animals got in this position in the first place," Shelley Sawhook, president of the American Horse Defense Fund, told Lyndsey Layton of The Washington Post. Horse advocates say the rising cost of hay and faulty assumptions about how many animals the land can handle are to blame. "What we seek is the management of the population," Jeff Eisenberg, director of federal lands for the National Cattlemen's Beef Association, told Layton. (Read more)

Nine states are home to wild horses and burros on federal land, primarily in Nevada, where 18,800 roam free. Based on the ability of the land to sustain them, the ideal number for the state is estimated to be 12,600. All told, about 33,000 horses and burros are free on the range that officials say can only humanely accommodate 27,000. The Government Accountability Office called the current situation a "crisis" and cited the lack of a coherent management policy as part of the problem.

Ethanol projects, especially smaller ones, stalled by credit freeze and market changes

Folks in San Pierre, a town of 156 people in one of Indiana's poorest counties, hoped that a planned ethanol plant would save the town, only to find the project canceled as the result of the credit freeze.

"Those people on Wall Street? They don't have the sense to know how they're hurting us," said Freda Risner, owner of a town bar, tells P.J. Huffstutter of the Los Angeles Times. "That plant could have helped the county. It could have helped save San Pierre." Residents were looking forward to the jobs created by the plant, the tax income it would have generated, and the boost it would have provided other local businesses.

Ethanol has had a rough year, thanks to rising corn prices, falling gas prices, and lawsuits from environmentalists and town residents, combined with a generally poor economy. Nationwide, 27 ethanol plants have either closed their doors or seen plans for their production stopped as a result of the current market. "There's been no credit for months," said Todd Neeley, who covers biofuels for DTN, an agricultural news service. "Even the top ethanol producers are having a difficult time getting financing. For these smaller projects, like San Pierre, they had no chance of surviving in this kind of environment."(Read more)

Kentucky governor objects to proposed rule that would make mountaintop-removal mining easier

UPDATE, Nov. 25: Gov. Phil Bredesen, D-Tenn., also objected to the rule, Anne Paine of The Tennesseean reported, quoting from his Nov. 14 letter to EPA: "Ironically, OSM is now shining a light on its practice of routinely granting variances in order to justify doing away with the variance process altogether. . . . The argument ignores the policy reason for having the buffer in the first place." (Read more)

In his first official move against the mountaintop-removal strip mining of coal, Kentucky Gov. Steve Beshear has objected to a proposed federal rule change that would make it easier for companies to engage in the controversial practice. "The modification has been a top priority of coal operators who want to see it implemented before the Bush administration ends," reports Roger Alford, correspondent for The Associated Press in the state capital of Frankfort.

Beshear announced today that he and three fellow Democrats, Attorney General Jack Conway of Louiwsville and U.S. Reps. Ben Chandler of Versailles and John Yarmuth of Louisville, had sent letters to the Environmental Protection Agency objecting to the Interior Department's proposal to all but repeal the regulation that prohibits mining activities within 100 feet of a stream. That would remove a legal obstacle to the valley fills made up of rock and dirt mined from the mountaintops. The rule requires EPA approval.

The department's Office of Surface Mining would allow dumping of rock and dirt from mines into perennial or intermittent streams. Fills can already cover ephemeral streams, which flow only after precipitation. OSM would still require mines to avoid streams "to the extent possible," but that provision has been criticized as too vague to effectively enforce. Beshear said likewise.

"Kentucky's vast water resources are key to our health and economic development, and I do not believe the newly proposed waivers can be effectively and uniformly applied to protect these water resources," Beshear wrote, adding that the rule would be "very difficult to apply consistently and fairly, and leaves open increased opportunities for abuse." He noted that Kentucky is the nation's third largest producer (behind Wyoming and West Virginia) of coal, "a crucial energy resource," but said, "I am strongly committed to environmentally responsible coal mining and cannot support rules that may be subject to arbitrary administration and enforcement." For the full letter, click here. For our initial report last month on the proposed rule change, with links to other information, click here.

AP to help fill growing gap in Washington coverage by regionalizing reporters, serving 28 more states

We've reported a good bit this year on the declining number of reporters covering Washington for regional newspapers. Now The Associated Press says it will beef up its coverage of congressional delegations and issues of regional and state interest. "The restructuring will provide AP regional Washington coverage for 28 states that now are not represented," the wire service said in a press release.

AP says it will reorganize its regional reporting staff in Washington into four regional teams, along the lines of the four regional editing desks it is creating around the country, "and answer to news managers in each of them," the release said. "The first desk, in Atlanta, was established earlier this year, followed by the East Desk, in Philadelphia. Locations of the two other regional desks have not been announced yet. Until they are, the Washington regional teams for the West and Midwest will report to regional managers to be named."

"One wonders if this isn't in part a reaction to Politico's recent partnering up with numerous papers nationwide in order to share content and ad sales," Glynnis writes on MediaBistro. (Read more)

Whitebark pine is dwindling in Northern Rockies

The future of the whitebark pine, one of the most distinctive trees of the northern Rocky Mountains, is in doubt. Brett French of the Billings Gazette writes, "Fungus, beetles, climate change and a lack of fire have all contributed to the species' decline across high-altitude landscapes in the Northwest."
(State of Montana photo)

The tree has been listed as a species at risk in Canada and a species of concern in western Washington. A recent survey of the Greater Yellowstone Ecosystem fount that the of the whitebark pines being monitored since 2002, 56 percent have died.

Protecting the trees has proved difficult. "Part of the problem in studying ways to restore whitebark pine is that much of its habitat is in high mountain terrain, much of which is in roadless or wilderness areas where aggressive restoration such as planting, treating trees with chemicals to fight off fungus or beetles and setting fires to clear land for seedlings is not allowed," French reports.

The loss of the whitebark pine will have several consequences. Not only do the seeds of the tree provide an important food source for grizzly bears, keeping them at higher elevations and reducing their chances of run-ins with humans, but "The trees stall mountain snowmelt, providing streams with water longer into the summer," French notes. "They stabilize the soils on steep ground, exposed high ridge tops where they grow, reducing erosion." (Read more)

Where is federal help for small, rural businesses?

News of a potential bailout of the U.S. auto industry, following bailout of some of Wall Street's biggest banks and insurance companies, leaves some wondering why no attention is being paid to small rural businesses. "In rural America, small businesses are the backbone of our economy and communities," writes Brian Depew in the Daily Yonder. "They create new jobs, develop new industries and create opportunity and vibrant rural communities."

There have been some efforts to help small rural businesses. The new Farm Bill created the Microentrepreneur Assistance Program, which gives grants to organizations for loans, training and technical assistance to rural businesses. But it is "woefully underfunded at just $4 million for the entire nation," writes Depew, the organizing and outreach director for the Center for Rural Affairs in Lyons, Neb. "That’s just 1/200,000 of the $700 billion being injected into big banks to solve the nation’s financial crisis."

Small-business development helped the economy recover from the 2002 recession and could give a boost to the current economy, Depew argues: "There is much potential in rural small business development, and there can be no wiser investment to provide opportunity and economic growth at a time of economic slowdown than assistance to businesses that create new jobs and innovation in our rural communities." (Read more)

Massey Energy settles in wrongful death lawsuit

Massey Energy Co. and its president, Don Blankenship, settled a wrongful death lawsuit brought by the widows of two coal miners killed in a mine fire. The settlement was reached after four days of a trial in which many of the big coal company's mine managers invoked their Fifth Amendment rights not to answer questions. Details of the settlement were not released.

"Federal investigators cited Massey for mining ventilation walls that inspectors said were a major cause of the deaths," writes Ken Ward Jr. of The Charleston Gazette. "The missing ventilation walls, called stoppings, allow smoke from the conveyor belt fire to enter the mine's primary escape tunnel. During the fire, a crew of workers ran into smoke in their escape tunnel and had to find another way out." Two got lost and died. In addition to the lawsuit, "Massey was already facing proposed fines of $1.5 million for 25 major violations cited by the U.S. Mine Safety and Health Administration."(Read more)

In the days leading up to the settlement of this case Massey Energy pushed its insurer to pay out $20 million for the settlement. Its Aracome subsidary alleged that the families of the dead miners "had offered to settle their case for an amount 'within the applicable limits of coverage' under the company's $20 million stopgap policy," Ward writes. "Aracoma lawyers said that Aracoma had agreed to pay its $5 million deductible portion of the settlement."(Read more)

Economy, shareholder lawsuit kill coal-iron merger

North America's largest iron-ore company and Virginia's largest coal company have called off what might have been the largest-ever acquisition of a U.S. coal company. "Alpha Natural Resources and Cliffs Natural Resources, formerly Cleveland-Cliffs Inc., announced yesterday that they have agreed to terminate the merger agreement that was announced this summer and originally valued at $10 billion," reports The Coalfield Progress of Norton, Va.

When the sale was announced in July, supplies of coal and iron ore were tight. But the economy "has changed dramatically," the twice-weekly newspaper notes, and one of Cliffs' major shareholders, Harbinger Capital Partners, challenged the deal. The firm owns 18 percent of Cliffs. The companies agreed to settle a lawsuit filed by Harbinger and other stockholders.

Alpha, based in Abingdon, Va., has 3,640 employees and mines in Kentucky, Virginia, West Virginia and Pennsylvania. For more of the story, by Keith Strange and Jenay Tate, click here.