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COAL MINE RECLAMATION: Federal and State Agencies Face Challenges in Managing Billions in Financial Assurances

After mining, a coal company is required to restore the land it disturbed, e.g., by regrading or replanting. The federal government requires coal companies to get bonds to assure their payment for these activities.

Federal law permits coal mine operators in some cases to guarantee these costs on the basis of their own finances, a practice known as self-bonding, rather than by securing a bond through another company or providing collateral.

Some stakeholders told us that self-bonds are riskier now than before, citing industry bankruptcies and lower coal demand.

We recommended that Congress consider amending the law to eliminate self-bonding.

https://www.gao.gov/products/GAO-18-305