Webster County Judge Executive Steve Henry, Hopkins County Judge Executive Jack Whitfield and other judges from the Kentucky Coal and Mineral County Coalition (KCMCC) testified before the Kentucky legislature's Interim Joint Committee on Appropriations and Revenue last week to discuss the future of coal severance dollars in the state. The testimonies were broadcast live on KET.
"Last month ... we went through coal severance and the coal sheet," said committee co-chairman Representative Steven Rudy. "This would be a perspective from the coal counties and what they would like to see us to do with the coal severance money."
As state legislators prepare for the 2020 budget session, the fate of those coal severance dollars are at the forefront of the minds of elected officials in coal producing counties. Those funds
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help pay for 911 centers, senior citizen services, sheriff's offices, water and sewer projects, jails, fire departments, health departments and ambulance services in those counties.
During the last budget cycle, coal counties took a big hit as law makers chose to spend those funds elsewhere.
Representatives of the KCMCC traveled to Frankfort to make a plea for those funds to remain where they belong, back in the counties where they were collected.
Both Henry and Judge Whitfield spoke with a mining hard hat on the table before them.
"A couple of us have brought out our hard hats," said Henry. "Its not in fear that building was not built well and something is gonna fall from the ceiling. First and foremost we want to let you know that Judge Whitfield and myself are both former coal miners."
Henry told the committee that just as he had a responsibility to his workers when he was a face boss in the mines, today he has a responsibility to the residents of Webster County.
"Harland County, in the south eastern corner of the state, our entire economy is very much dependent on coal," said Harland County Judge Dan Mosley. "Throughout the course of time coal severance has been used on a variety of things, but over the last few years we've had to narrow it down because of the decline in coal severance revenues we've experienced. But just like the state, we have obligations."
Mosley said that while his county has not taken on any new debt during his term in office, the fiscal court faces about $800,000 in debt service every year.
"I thought when I quit mining coal I wouldn't have to worry about my hard hat anymore, but these last ten months have taught me that there are days when I really need a hard hat in the office," said Whitfield.
He told the committee that the Hopkins County Fiscal Court has given around half a million dollar to local volunteer fire departments in the last decade.
"They can't make it and operate efficiently and effectively without some of that coal severance money coming back to them," he stated.
He said Hopkins County has also given over a million dollars into water and sewer projects and almost four million dollars into roads.
"As judge executive, that is what we hear the most about," he said. "If there is a pot hole, people are going to call us. That is also part of our economic development. If you don't have good roads for people to drive to work on or for trucks to haul material on, you can't move forward."
"I'm in a position now where I've put together a budget for fiscal year 2020, worked on my LGEA based on what was forecasted from the state on what we should be getting and less than two months into that budget the only coal mine in my county closed down," said Henry. "January 1 we will transition from a producing county to an impact county. My responsibility to my citizens have not changed. The things I am having to try and pay for to provide them what they deserve...I'm not sure."
Henry thanked the committee for adding language to state law allowing roughly $15 million in excess coal severance monies to be returned to coal counties earlier this year.
"If that language wasn't in there, I don't know what we would have done," he said. "Over the last three years, I've trimmed everything that I can. We are running with 20 percent less work force than where I started out. We are as efficient as can be, I really believe that."
Henry went on to point out that business and industry growth in non-producing counties around the state can be credited to low electric rates because of the coal industry. He told the committee that Kentucky coal miners can be thanked for that.
"This is not about asking for money for counties, its about asking for money for coal miners...who deserve it," he said.
Henry reported the state that in 2012, Kentucky saw a peak coal severance of $298 million paid by coal companies to the state. For 2020, that number is estimated to be around $65 million.
"Counties have state mandates to carry out such as county jails, solid waste, election, animal control and etc," he said. "Our ambulance services, our fire and law enforcement services, our basic things to protect our citizens is what we are talking about. You all have given us three different tools to generate revenue...property tax, insurance premium tax and occupational tax. But not everyone of those taxes fit every community. That is why coal severance is important. We have a crisis in many coal counties in providing those services."
Henry, who acted as the spokesman for the group, closed the judge's statement by putting things on a personal level.
"I didn't go from being a coal miner to being a judge," he said. "After twenty something years, I am a coal miner who happens to be a judge. Coal mining put my son through college... Coal mining is putting my daughter through college... Coal mining has provided a living for my family. It has provided a living for my neighbors. But they expect basic, life saving services. That is what this is about. We aren't here looking for extra revenue to keep campaign promises. We are here to help the people who have called on us. Coal severance is that important. We are looking for means for the day after coal severance, but for right now we just want to survive."
Several members of the committee addressed the judges following their testimony, offering their promise of support for their plight.
"You county judges in coal counties are being asked to do the impossible," said Representative Angie Hunt of Whitsburg. "I don't envy you the job you have taken on. The state representatives and senators from those counties also are charge with making sure the state understands what sort of catastrophic economic situation we are dealing with in our counties."
Hunt represents Letcher County, Kentucky.
"I know Judge Whitfield is doing everything he can to fund not only things in the county that would be under his perview, but also those smaller cities in the county which are dependent on coal severance money," said Representative Myron Dossett of Christian County. "I'm proud to show my support for what you are doing."
Dossett's district includes part of Hopkins and Christian County.
"So much of what you are experiencing right now is things that are coming from Washington," said Dossett. "Individuals who think there is a better source of energy than coal. As you mentioned, one of the reason we have seen industry locate here is due to a low cost of energy because of coal. And I assure you I will do everything possible to see that you get what you deserve from coal severance."
"We face some challenges because we've been coal counties," said Whitfield. "There are some expenses we face that others don't. We think it is well within our right to ask that all coal severance funds that are collected come back to the counties where they are collected."
The judges did seem to get some resistance from committee co-chair Senator Christian McDaniel of Taylor Mill. McDaniel represents Kenton County, the third most populated county in Kentucky and part of the Cincinnati-metro area. Kenton County is practically as far from a coal mine as one can be and still be in the state of Kentucky.
According to Kentucky Coal Mine Maps on the Kentucky Energy and Environmental Cabinet's website, the nearest coal mine to Kenton County is Bowie Refind Coal LLC in Estill County, Kentucky, over 125 miles away.
"Judge Whitfield proposed that 100 percent of the money should go back to where it was collected from," McDaniel said. "Judge Henry, the question to you would be that you get nothing next year under that proposal. Is this a uniform agreement that we want the money to go back exactly where it is collected?"
Henry pointed out that under the current regulations, Webster County will be an "impact county." Under state law, impact counties are those counties where coal is not currently being mined, but land in the county is being used for the transport and/or refining of coal.
"I think we're talking about repealing existing statute, from what I heard," said McDaniel. "What about off the top and off the middle distributions. We've got debt service and all kinds of things that are in there. Are you proposing we do away with those distributions?"
"We are open to discussing how we can do it, whether it be discussing with former producing or impact counties," said Whitfield. "We don't know what the debt services is. That would be important for us to know. Or when it will be paid for. To have that discussion I think we need more information about what that is. We can't answer that question intelligently without knowing what is the hurdle."
McDaniel said that the proposal would do away with scholarships the state gives out and debt services that it pays from coal money.
"This is a town where I tell people to be very careful what you come asking for," he said.
"We appreciate the opportunity to go up and speak," Henry said via a phone interview. "Certainly no county in western Kentucky is more concerned about coal severance than Webster County. This was our chance to go to Frankfort and get to speak in front of legislators who don't normally hear from officials in coal county."
Only time will tell if those legislators were paying attention.
Reach MATT HUGHES at 270-667-2068 or firstname.lastname@example.org.