Black Lung Trust Fund Likely Burdened by Murray Bankruptcy Wednesday, Nov 20 2019 

The recent bankruptcy of Murray Energy is likely to significantly increase the debt of a struggling federal trust fund that supports disabled miners’ health care expenses. 

According to court filings, Murray Energy could be responsible for as much as $155 million under the Black Lung Act and general workers’ compensation, but testimony from the Government Accountability Office shows that the company only offered $1.1 million in collateral to the Black Lung Disability Trust Fund. That means the struggling fund will likely have to take on at least some of that liability. 

The federal fund was established in 1978 to provide monthly stipends and health care coverage for miners disabled by black lung, a preventable and progressive workplace disease. The fund, which is supported by a per-ton tax on coal companies, currently covers expenses for some 25,000 miners and their dependents, and is expected to be $15 billion in debt by 2050. Last year, Congress failed to extend a higher per-ton tax rate, increasing the strain on the fund. 

A spokesperson for Senate Majority Leader Mitch McConnell of Kentucky said in an email to the ReSource, “While the temporary, higher tax expired last year, current benefits for our impacted miners and their families have been maintained. Senator McConnell will continue to ensure these important benefits are maintained. Additionally he will continue working on the many ways to help coal miners and the clinics that serve them across Kentucky.”

If the fund becomes insolvent, it may be bailed out by the Treasury’s general fund, effectively transferring the burden of caring for disabled miners from the industry that caused the illnesses to American taxpayers. 

“History shows that miners and their families will be forced to pay the price in the form of reduced eligibility for benefits if Congress allows the Black Lung Disability Trust Fund to sink deeper into debt,” Rep. Bobby Scott, chairman of the House Ed and Labor committee, said in a hearing this summer. Given the recent rise in the most severe form of black lung disease, Congress must take action to secure future benefits and health care for disabled miners.” 

A spokesperson for Murray Energy did not respond to a request for comment for this article, but in court filings, newly appointed Chief Executive Officer of Holdings Robert Moore said, “Although Murray has been able to outlast many of its competitors, mounting debt and legacy liability expenses have become too heavy of a burden to sustain under current industry conditions.”

According to recent testimony from the Government Accountability Office, there were 22 self-insured active coal operators as of June 2019. Only 10 of those had provided estimates for their total unfunded liability to the trust fund — that is, the potential debt that could be transferred to the federal government if the company filed for bankruptcy.

“An estimated black lung liability of over $310 million has been transferred to the trust fund from insolvent coal operators,” said GAO Director of Education, Workforce and Income Security Cindy Brown Barnes. “In addition to those liabilities being transferred, there’s also the beneficiaries that have come along with that. There’s been over 1500 beneficiaries that have been transferred to the trust fund as a result of the companies that we looked at from 2014 to 2016.” 

Brown Barnes could not confirm how much, if any, liability from Murray Energy would be transferred to the fund.  

“Just because a company is bankrupt, it doesn’t necessarily mean that the liabilities are going to be transferred to the trust fund,” Brown Barnes cautioned. “There’s one liability at the time of bankruptcy and then another liability that gets transferred to the fund. It’s not a one-to-one.”

A report further detailing that unfunded liability, and its implications for the solvency of the trust fund, is expected early next year. 

A Larger Pattern

As of October 29, Murray reported approximately $2.7 billion in funded debt and over $8 billion in actual or potential legacy liability obligations under pension and benefit plans, including the black lung trust fund. As Murray’s numerous secured creditors vie to recoup as much of their debts as they can, it is likely that there won’t be money left over to pay back environmental, retiree and health care debts. 

“When you have this pattern of a large company spinning off its least productive assets and loading those assets with obligations that it obviously doesn’t want to pay, it seems to look like it’s a strategy,” said Josh Macey, an assistant visiting professor at Cornell University. 

Macey is a co-author of a recent article in the Stanford Law Review titled, “Bankruptcy as Bailout: Coal Company Insolvency and the Erosion of Federal Law.” In that paper, Macey and his co-author found that since 2012, four of the nation’s largest coal producers used bankruptcy to discharge roughly $3.2 billion in retiree benefits and $1.9 billion in environmental debts, as well as $5.2 billion in other regulatory obligations. Those numbers were current as of April 2019, before the high-profile bankruptcies of Blackjewel, Blackhawk, and Murray Energy. 

Macey said Murray took a slightly different tack than other companies in similar positions. Rather than spinning off unprofitable assets into new companies that were designed to fail, Macey said, “Murray went about snatching [assets] up at a pretty frenzied pace, because it was able to in that way pledge more assets as collateral and give its own creditors tons and tons of collateral that ensured they, too, would be paid before miners and the environment.”

Homelessness And Health Costs: This Kentucky Mom Faced Cancer While Living In Her Car Monday, Nov 18 2019 

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Cancer was what finally pushed Kristi Reyes into living in her car.

The mother of four had worked all her life, starting at age 7 when she helped out at her family’s furniture store. Most of her work was in retail. It was paycheck-to-paycheck but she kept her kids together and a roof over their heads.

But then in 2012 she was diagnosed with breast cancer. She started cycling through jobs because of the time she needed to take off for recovery from treatment. Soon, she was too sick to work at all and things continued to slide. She had Medicaid, what she calls a medical card, but it wasn’t enough.

“Even though I had a medical card, there were out of pocket things that medical didn’t cover,” Reyes said. “I don’t care how much money you make. Money is never enough when you’re sick like that.”

Mary Meehan | Ohio Valley ReSource

Kristi Reyes now spends time with her grandson in her new home.

She and three of her children, who were ages 11, 13, and 15, all stayed in the car for awhile. But soon she was forced to let her children live with other people.

She remembers recovering from surgery to remove cancerous lymph nodes, homeless and alone. Eventually, she was too sick for treatment to even continue.

“I couldn’t even walk up a flight of stairs without being out of breath, almost needing oxygen,” she said. Her diabetes was out of control. She was also having trouble with her kidneys.

But Reyes said she knew other people who had it worse.

“At the same time, I think that was kind of something that kept me going. Right? Like knowing that somebody had it worse than I did.”

At least, she said, she had a car.

Housing And Health

In fact, Reyes’ case is not unique. The National Alliance to End Homelessness estimates there are 15,000 people experiencing homelessness in Kentucky, West Virginia and Ohio. Many more are living on thin financial margins. The Robert Wood Johnson Foundation reported earlier this year that half of rural Americans say they could not afford to pay an unexpected bill of $1,000, and nearly a third say that they have had trouble paying medical bills.

Jessica N. Sucik directs homeless services for HealthFirst Bluegrass, a federally qualified health center in Fayette County, Kentucky. HealthFirst serves 25,000 patients, many of them poor. It also runs two health clinics for the homeless.

HealthFirst Bluegrass

Jessica Sucik of HealthFirst Bluegrass.

She said there is a saying in public health that “housing is healthcare.”

Just the nature of chronic illnesses such as diabetes or COPD can limit how much people can work. 

“So they know they can’t work permanently, 40 hours a week,” she said. “They’re working as they can, but they also can’t afford housing or whatever treatment they need to overcome their condition.” 

Circumstances can change quickly. 

“With chronic medical conditions, something temporary can very, very quickly turn into a permanent homelessness status,” she said.

That leads to challenges paying the bills. It can be an unrelenting cycle.

“Without that, it’s like, you know, building a house on sand,” Sucik said. ”You have to have that safety and that security blanket of safe, stable and affordable housing before you can take care of yourself and be able to meet your needs.”

In recent years, HealthFirst has adopted a team approach with all patients. There is a medical provider, a social worker, a case manager and psychiatrist to provide medical, psychological and social support instead of leaving patients to fend for themselves.

“The magic that happens when you address not just the physical health issues, but also the things that are preventing them from getting those physical health issues addressed, is really, that’s where it’s at,” she said.

Alexandra Kanik | Ohio Valley ReSource

Policy Solutions

But others say homelessness or personal bankruptcy due to medical costs point to a need for more systemic change.  

One policy solution gaining traction among Democratic presidential candidates is Medicare for All, a proposal that would eliminate private health insurance and replace it with a government-run system. Leading contenders Sen. Elizabeth Warren and Sen. Bernie Sanders support such a proposal. 

rural-homeless-rent-burden-map-v3Alexandra Kanik | Ohio Valley ReSource

Warren estimates her proposed plan would cost $20.5 trillion above expected health care costs over ten years. She says that could be paid for largely with an increase in taxes on the top income brackets and through savings in medical costs, but that claim has met some skepticism from policy experts. Sanders has been less specific about the costs and has said his proposal would find savings through cutting administrative costs. 

The Urban Institute has estimated that a switch to a single-payer system would require $59 trillion over 10 years, about $7 trillion more than the costs under the current system.

Dr. Steffie Woolhandler is co-founder of the advocacy group Physicians For A National Health Program, which argues for a single-payer system. Her group says research shows more than 60 percent of personal bankruptcies are tied to medical bills. She says a single-payer system can reduce costs and relieve families from going into debt, which is why many other countries have such a system.

“Virtually every other developed country guarantees health care to everyone living there,” she said. “This is true in Europe, it’s true in Canada, and it’s true in Australia. The United States is an outlier.”

She said the idea is gaining appeal in the U.S.

“What I’m seeing, really since 2016, is that the idea of Medicare for all has become an issue with non physicians and a lot of people who don’t work in health systems but are users of that healthcare system are actually talking about Medicare for All,” she said.

rural-homeless-care-categoryAlexandra Kanik | Ohio Valley ReSource

A Kitchen Table

Reyes doesn’t spend a lot of time considering such policy decisions. Taking care of herself and her family is about all she can handle. 

For about four years from the time she was first diagnosed with cancer, she was struggling to keep her employment, living mostly in her car, and separated from her children. 

She tried from time to time to get into a shelter but whenever she’d reach out, they were full.  One day, she said, she couldn’t take it anymore.

“I was at my wit’s end. Like I didn’t know what else to do. I was tired, worn out. My body felt like I couldn’t handle it anymore,” she said. “Honestly, I just started praying.”

Finally, she found help and a new home. 

She called the Salvation Army and was referred to the Housing and Homeless Coalition of Kentucky. Within two months, she was off the street.

Last year, she moved into a house in Frankfort, Kentucky, where she lives with her children, two grandchildren and her boyfriend. Because of her ongoing medical problems she has been approved for lifetime housing assistance and resumed her cancer treatment. 

“That made it even better. Because I know no matter the struggles of my health, or the battles that I got to fight with it. I’m always going to have that support.”

About a month ago, she was well enough to start working at a Subway sandwich shop.

A simple, second-hand dining room table is her favorite place to be.

“That’s the thing, that’s my thing,” she said with a laugh. “Because I can come in, I can cook for my children. And we can sit at the table and have a meal together.”

Looking back, Reyes said, she realizes now that she was in denial about just how bad her health was. And she hopes other people will take some comfort in knowing things can change for the better. 

“You just have to tell yourself, ‘OK, I’m not going to give in today,” she said. “You know, people just need to know that just because you’re going through things, it doesn’t necessarily mean that you’re going to be stuck there for a lifetime.”

Murray Energy’s Bankruptcy Could Bring Collapse Of Coal Miners’ Pensions Monday, Nov 4 2019 

The recent bankruptcy of Ohio Valley coal giant Murray Energy has renewed fears about the already shaky financial foundations of the pension plan that tens of thousands of miners and their families depend upon.

The seismic collapse of yet another coal employer has lawmakers from the region renewing their push to fix the United Mine Workers pension fund, and has even raised broader concerns about pensions for a range of other trades.

Murray Energy has a substantial footprint across the region. It is also the last major employer contributing to the UMWA pension plan. In its bankruptcy filing, the company reports $2.7 billion in debt and more than $8 billion in obligations under various pension and benefit plans. More information will likely come out as the bankruptcy court takes up the matter.

IMG_0129 2Sydney Boles | Ohio Valley ReSource

Bob Murray speaking at an event in October, 2019.

Bankruptcy proceedings often take months, and it’s not yet clear if the company will be relieved of its pension obligations. UMWA spokesperson Phil Smith said if recent history is any guide, that is a likely outcome.

“We don’t think any company should be able to be relieved of its responsibility to any retirees, whether they’re in the coal industry or not,” Smith said. “But it has happened in the coal industry time after time after time.”

Smith said if the bankruptcy court relieves Murray’s pension obligations, that could be another $6 billion loss for the UMWA retirement fund.

The UMWA health and retirement fund covers the benefits of retirees whose employers went out of business before 2007. The plan was already facing insolvency by 2022, largely due to the industry’s decline in production and a wave of bankruptcies. Smith said now that Murray Energy has filed for Chapter 11 protection, the fund could become insolvent by next year.

UMWA President Cecil Roberts said much of the problem lies in how bankruptcy courts treat workers’ concerns.

“Why should workers stand in line last? Why should it be beneficial to a CEO or CFO to file bankruptcy?” he said. “They ran the company into the ground, they get rich, the workers lose their health care. Sometimes they lose their job. Sometimes they lose their pensions. That needs to be dealt with.”

Murray Energy is among nearly a dozen coal companies to go bankrupt during the Trump administration, despite the repeated claims of a “coal comeback.” Some lawmakers worry that the combined impact could cause a domino effect for other multi-employer pensions across the country.

Virgil2Becca Schimmel | Ohio Valley ReSource

Retired Kentucky miner Virgil Stanley at a UMWA rally for pension protections.

‘Economic contagion’

Insolvent plans fall to the Pension Benefit Guaranty Corporation, or PBGC, which is a federal backstop for pension plans. Lawmakers from around the Ohio Valley warn that the fund is also already at risk, and it would be in far more financial trouble if it became responsible for the UMWA plan.

Last year a bipartisan group of lawmakers served on the Joint Select Committee on Solvency of Multi-employer Pensions. The group was tasked with finding a solution to pension problems affecting a range of workers including teamsters, coal miners, iron workers, and bakers and confectioners.

Sen. Rob Portman, an Ohio Republican on the joint committee, warned at a field hearing last year that if even one of the larger plans becomes insolvent that could put the PBGC at risk as well.

“That wave of bankruptcy has the potential to create an economic contagion effect,” Portman said. “In other words, it would spread around our economy.”

IMG_1076Aaron Payne | Ohio Valley ReSource

A union miner at the rally for pension protection.

But despite the shared concern, the committee missed a self-imposed deadline to come up with a solution and disbanded at the end of the year.

The UMWA’s Smith said more than $1 billion goes into local economies every year from health care benefits and pensions that are paid directly to retirees. More than $130 million flows into Kentucky alone.

Simon Haeder is an assistant professor of public policy at Penn State University. He said shoring up the UMWA pension plan would have been a lot less expensive and more manageable if Congress had started to address the “inevitable” issue much earlier.

“Coal miners are one of those probably worst-case scenarios here,” he said, “because the balance between people paying into the system and people taking out of the system is so out of whack.”

Haeder said the miners’ pension problems also raise questions about whether people can rely on these pension systems in the future. He said the decline in union membership and the complex actions of bankruptcy courts have given employers an edge over the interests of workers when a business goes under.

“Bankruptcy law and bankruptcy court will certainly side with employers much more than they will side with employees,” he said.

A Legislative Fix?

Sen. Joe Manchin and other coal-area lawmakers introduced the American Miners Act to try to shore up the shaky UMWA pension. The West Virginia Democrat’s bill would transfer some money from interest accrued on the federal Abandoned Mine Land fund – which is used to clean up old mining sites – into the mine workers’ pension plan. It would not take money directly from the fund.

Manchin is attaching the American Miners Act to a spending bill that keeps the federal government running. He said most of the pension checks are for $600 a month or less and many of those are going to widows who depend on that money for basic living expenses.

“When coal companies go bankrupt coal miners benefits are at the bottom of the priority list,” Manchin said.

The bill would also restore a tax on coal used to fund the federal Black Lung Disability Trust Fund, which Congress had allowed to be reduced by half last year. Pennsylvania Democratic Sen. Bob Casey is a co-sponsor on the bill.

“I won’t stop fighting until we’ve secured the promised pensions and an extension of the Black Lung Disability Trust Fund for coal miners and their families,” Casey said. “I hope Congressional Republicans will join our mission.”

The Senate bill does not yet have a Republican co-sponsor but there is general bipartisan support for action on the miners’ pensions. In the House two pending bills propose a similar funding method to shore up the UMWA fund. Republican Rep. David McKinley of West Virginia is the lead sponsor on one of those.

Democratic Rep. Bobby Scott of Virginia proposes a version that also addresses the health care benefits of retirees whose companies went bankrupt last year and have been or will be relieved of those obligations by a bankruptcy court. Both bills have passed out of committee.

But of course one Republican’s voice will matter most, and that is Senate Majority Leader Mitch McConnell of Kentucky.

McConnell’s Call

McConnell had previously postponed action on miners’ pensions by splitting an earlier proposal to address both retirement funds and health benefits. McConnell introduced his own version in 2017, which provided for miners’ health benefits but avoided dealing with pensions.

In an emailed statement, McConnell said he’s concerned about the insolvency issues facing a number of multi-employer pension plans, and that he supports finding a bipartisan solution for pension reform.

It’s not clear when or if the majority leader will take up the issue of coal miners’ pensions or healthcare benefits.

manchin mcconnellU.S. Senate

Sen. Joe Manchin (D-WV) and Majority Leader Sen. Mitch McConnell (R-KY).

The Miners Act and other similar bills have attracted criticism from fiscal conservatives such as the Heritage Foundation. Heritage calls the proposal a “bail out” that would do nothing to “fix the root of the problem” with the large pension plans.

Manchin said he will attach the American Miners Act to every vehicle possible in Congress in the hope that McConnell will agree to take action.

“And Senator McConnell I know he’s concerned about other pensions, we’re all concerned about other pensions, but this is on the front burner now,” Manchin said, adding that if the miners’ pension plan falls it will likely not fall alone. “When this happens, everything else will tumble and snowball with it.”

ReSource reporter Brittany Patterson contributed to this story.

Ohio-Based Coal Giant Murray Energy Declares Bankruptcy   Tuesday, Oct 29 2019 

IMG_0129 2Murray Energy Corp., the largest underground coal mining company in America with a substantial footprint across the Ohio Valley, has filed for bankruptcy protection. 

“Although a bankruptcy filing is not an easy decision, it became necessary to access liquidity and best position Murray Energy and its affiliates for the future of our employees and customers and our long term success,” company founder Robert Murray said in a release.

According to the release, the company filed first day motions with the bankruptcy court Tuesday and expects to be able to continue day-to-day operations uninterrupted. The company says it will finance its operations throughout Chapter 11 with cash on hand and access to a $350 million new money debtor-in-possession financing facility, subject to court approval.

CEO Robert Murray, who founded the business in 1988, is stepping down. According to the release, a new entity, called Murray NewCo, will serve as a “stalking horse bidder” to acquire most of the company’s assets. If approved by the court, the company expects all of its debt to be eliminated and Murray to be named Chairman of the Board of Murray NewCo.

Sydney Boles | Ohio Valley ReSource

Bob Murray speaking at an event in October, 2019.

Murray Energy is the ninth coal producer to seek bankruptcy during the Trump administration. Murray’s declaration follows the chaotic and high-profile bankruptcy of West Virginia-based Blackjewel LLC and Kentucky-based metallurgical coal mining company Blackhawk Mining.

The company turned to bankruptcy after it failed to make payments to lenders. Murray Energy prided itself on producing low-cost bituminous coal at mines located close to its customers — largely coal-fired power plants. But as coal generators close, that has posed challenges for the company’s bottom line. 

Despite promises by President Donald Trump to revive the U.S. coal industry, demand for coal has fallen to its lowest level in 40 years, according to the EIA. 

Federal mining data show the Ohio-based company operates 15 active mining facilities across seven states, including 10 in West Virginia and two in Ohio. A Murray subsidiary operates seven mining facilities in Kentucky

According to data by the U.S. Energy Information Administration, in 2018, Murray Energy was the fourth-largest coal producer in the U.S., producing more than 46,000 short tons of coal. 

According to its website, the company employs nearly 7,000 people at its U.S. operations and at mines in Colombia. 

Trump Connection 

The company’s chief executive, Bob Murray, has enjoyed a close relationship with the Trump administration. Murray has often appeared with the president during his appearances in West Virginia. In July, he hosted a private fundraiser for Trump in Wheeling, West Virginia. 

In February, Trump took to Twitter to urge the Tennessee Valley Authority to not shutter the Paradise Fossil Plant in Kentucky, which is largely supplied by Murray mines. 

A vocal Trump supporter, Murray donated $300,000 to the president’s inauguration. Weeks later, the coal executive shared a detailed “action plan” with administration officials that outlined a series of environmental rollbacks and policy changes that would benefit the U.S. coal industry. 

The majority of Murray’s wish list — which included the repeal and replacement of the Obama-era Clean Power Plan, withdrawal from the Paris climate agreement, and staff cuts at the U.S. Environmental Protection Agency — have been carried out by the Trump administration. 

However, the White House has been unable to fulfill one of Murrary’s chief requests — to bailout struggling coal-fired power plants. 

In 2017, FERC unanimously rejected a proposal by the Energy Department to subsidize coal and nuclear plants. Additional efforts — largely driven by the Department of Energy — have stalled

Speaking last week at the EnVision Forum at the University of Kentucky Center, Murray told the crowd continued inaction by federal regulators, including the Federal Energy Regulatory Commission, or FERC, has resulted “in the destruction of America’s coal industry, the reliability and resilience of the electric power grid, and the cost of electricity itself.”

The country’s largest regional grid operator, PJM Interconnection, which operates across a 13-state region including the Ohio Valley, has argued there is no need for federal intervention. 

Alexandra Kanik | Ohio Valley ReSource

Murray also repeated his oft-cited nickname for the independent agency calling it “feckless FERC.” 

“Nothing has been done by FERC or anyone to save the American coal industry from extinction, and we are virtually extinct,” he said. 

Major Impact

Murray Energy’s bankruptcy could have far-reaching impacts on the company’s workers. According to United Mine Workers of American Spokesperson Phil Smith, Murray Energy is the last major company contributing to the UMWA’s pension plan, and is likely to accelerate the plan’s fast decline into insolvency. 

In August 2007, nine miners and rescuers died after the Murray-owned Crandall Canyon mine in Utah collapsed. The Labor Department fined the company $1.85 million for violating federal mine safety law. In 2012, the agency settled with Murray for a reduced amount. The settlement included acknowledgement by Murray Energy for its “responsibility for the failures that led to the tragedy.”

Murray later told NPR “this settlement is not an admission of any contribution to the August 2007 accidents.”

Murray was also sued by the Department of Labor, after miners complained the CEO personally told workers in a 2014 meeting to stop making complaints to federal regulators. Under federal law, miners have the right to speak anonymously to government inspectors. Earlier this year, Murray lost an appeal in the case. The court upheld a decision that Murray must personally apologize. 

ReSource reporters Sydney Boles and Becca Schimmel contributed to this story.

Blackjewel Miners Get More Of Their Pay As Labor Dept. Acts Against Bankrupt Company Thursday, Oct 24 2019 

Coal miners who went without pay when mining company Blackjewel declared bankruptcy this June are one step closer to receiving lost wages. The checks come weeks after some of the miners ended a long-running protest, and months after the federal Department of Labor first intervened to allege the company violated labor laws in the month before it folded.

Rumors of a deal circulated early this month, and in consent orders filed in U.S. district courts in Kentucky and Virginia, Blackjewel committed to pay more than $5 million to miners. 

The bankruptcy drew widespread attention this summer when a group of Blackjewel miners blocked a train full of coal to protest unpaid wages. The protest lasted 59 days and ended after the last remaining miners found work or had to return to other obligations 

According to a press release from Kentucky Gov. Matt Bevin, more than 600 coal miners from Kentucky’s Black Mountain and Lone Mountain mines will receive pay following agreements between the coal company and the Department of Labor.

“This means a whole lot.” said Stacy Rowe, wife of former Blackjewel miner Chris Rowe. “Getting this check, it’s going to pay off some of the bills we owe, and it’s going to get us started when we start driving.” 

Chris Rowe has taken a job as a truck driver since the bankruptcy. Blackjewel owes Chris about $6,000, Stacy said. 

“Today is a great day and one we’ve longed to see come,” said Harlan County Judge Executive Dan Mosley in the release. “My heart is overjoyed for these hardworking folks who took a stand in a professional way to say workers shouldn’t be treated this way.”

“Although we’re certainly relieved that these miners are finally getting paid, it took three and a half months, and that’s far too long,” said Ned Pillersdorf, an attorney who is representing Blackjewel miners in ongoing litigation. 

Pillersdorf says the miners will continue to pursue additional claims against Blackjewel as well as its former CEO. The Kentucky Labor Cabinet said it will continue to pursue litigation against the company for failure to pay a performance bond. 

It is unclear whether the checks scheduled to be delivered to Blackjewel miners will include compensation for lost health care benefits, child support payments, or paid time off.

Former Blackjewel Miners End Railroad Blockade In Kentucky Thursday, Sep 26 2019 

The nearly two-month blockade of a Kentucky railroad track is coming to an end as unpaid coal miners end their protest in order to take new jobs, start classes, or move away from their coal-dependent communities. 

When coal company Blackjewel abruptly declared bankruptcy in July, it left some 1100 Appalachian coal miners in Kentucky, Virginia, and West Virginia without pay. On July 29, five miners blockaded a train full of coal preparing to leave a Blackjewel facility in Harlan County, Kentucky. The miners’ rallying cry was “No Pay, No Coal.” 

But after 59 days on the tracks, the protest is coming to an end. 

Felicia Cress is married to a former Blackjewel miner, and has been at the protest since the first day. 

miners signsSydney Boles | Ohio Valley ReSource

Felicia Cress on the first day of the miners’ protest.

“This happened because we got shafted, which happens all the time,” Cress said. “You got these rich people that s*** on these poor people, and people just overlook it.”

She said even though her family has to move on, the relationships forged through the protest will stay with her. 

It was a bad situation that made us come together, stay there day and night, through the rain, through the blazing sun,” she said. “We have now friendships, you know, we have a bond.” 

Cress’ husband is currently looking for work. She said her bank has threatened to foreclose on her home unless she finds money for her mortgage payment by Saturday. 

more miners on traxSydney Boles | Ohio Valley ReSource

Miners assemble on railroad tracks to block a shipment of coal from a Blackjewel mine.

Hundreds of Blackjewel miners in Kentucky and Virginia have still not been paid. But the protesters can claim some important victories.

West Virginia miners received owed wages earlier this monthThe protest drew international attention, helped win miners a portion of their back pay, and highlighted the state’s failure to collect bond payments from companies like Blackjewel, as the law requires. 

The train load of coal the miners blocked will remain where it is until a ruling from a West Virginia bankruptcy judge. That ruling is expected in October. 

 

Paychecks Cut For W.Va. Blackjewel Miners; Ky. And Va. Miners Still Waiting Thursday, Sep 19 2019 

West Virginia employees of coal operator Blackjewel LLC have received their final paychecks more than two months after the company declared bankruptcy on July 1.

In an agreement reached last week between the Department of Labor and the company, Blackjewel cut paper checks for all owed wages to a few dozen employees working at the company’s Pax Mine in Fayette County, West Virginia.

While good news for former West Virginia employees, about 1,000 miners in Kentucky and Virginia are still owed millions of dollars in back wages.

Christina Burgess’ husband, Greg, ran heavy equipment at the Pax Mine. The 20-year coal mining veteran had been laid off before, but the family had never before experienced the fallout from a paycheck bouncing, as Greg’s did in early July.

“It’s been unreal,” Christina Burgess said.

The Burgess family received Greg’s owed wages late last week, but is still waiting for the check to clear a bank hold.

Blackjewel’s bad check created a series of challenges. The first few unemployment checks the family received went straight to the bank to get the account out of the red. In total, Burgess said Blackjewel’s bankruptcy has cost her family about $3,000 in penalties and fees.

Greg quickly found new work after the Pax Mine closed and the family had some money saved in preparation for a downturn in the local industry. Burgess said she empathizes with younger miners who were hit hard by Blackjewel’s sudden bankruptcy.

As one of the administrators for the Blackjewel Employees Stand Together Facebook group, she has heard many stories of families unable to pay their bills as a result of not being paid by Blackjewel. She expects the fallout from Blackjewel’s bad checks to have long-term consequences as well.

“Everybody that’s involved in this right now their credit score has been damaged because of this,” Burgess said. “And that’s hard to come back from when you when your credit starts going down.”

She said she reached out to more than three dozen West Virginia state senators and Attorney General Patrick Morrisey, but heard nothing back. She said she feels abandoned by West Virginia lawmakers who were slow to advocate on behalf of stiffed workers in the bankruptcy court and haven’t pushed utility companies or others to offer leniency to struggling Blackjewel families.

“They could have at least came in and said, you know, ‘don’t send turn off notices for the power bills, give them a little leeway,’” she said. “Nothing. We didn’t receive anything.”

Truck into Revelation mineBrittany Patterson | Ohio Valley ReSource

A truck enters a mine belonging to the now-bankrupt Revelation coal company.

The Pax mine is now owned by Tennessee-based Contura Energy. About 1,000 Blackjewel employees in Virginia and Kentucky are still awaiting millions of dollars in owed wages. A protest on the railroad tracks in Harlan County is in its eighth week.

Millions of dollars worth of coal mined by former Blackjewel employees is sitting in railcars. The Department of Labor says the coal is “hot goods” and can’t be moved or sold until the workers who mined it are paid for their work.

Last week, the bankruptcy court in West Virginia overseeing the case gave the Labor Department, Blackjewel, and Blackjewel Marketing and Sales (BJMS) — buyer of the disputed coal — until Sept. 23 to submit a series of briefs to the court. A final set of briefs is due Oct. 1.

The judge said he expects to review the documents “swiftly” and rule soon after whether the coal should remain sitting until the Blackjewel workers who mined it are fully paid, or if it can be sold.

BJMS has proposed paying $1.4 million for the coal. The Labor Department says back wages owed to workers directly involved in producing the “hot goods” coal in Kentucky and Virginia totals more than $3 million.

‘Bloody Harlan’ Revisited: Blackjewel Miners Draw On Labor History While Facing Uncertain Future Monday, Aug 12 2019 

Curtis Cress sat in the gravel beside a railroad track in Harlan County, Kentucky. Tall and thin with a long, black beard, Cress is every bit a coal miner, or, he was until a month ago.

“It’s part of my heritage, you know? My dad and papaws had always done it,” he said. “And I’m proud of that heritage.”

Cress had been at these railroad tracks for days, with little sleep. Not far down the rails sat a row of hopper cars filled with coal from his former employer, Blackjewel Coal.

In the last month, Cress and his fellow miners have gone from moving coal out of the ground to stopping coal in its tracks. Blackjewel’s chaotic bankruptcy filing on July 1 left about a thousand miners like Cress with bounced checks and unpaid bills, and largely in the dark about their future.

Aerials_Miners_On_Tracks-2Curren Sheldon

An aerial shot of the encampment that has grown up around the protest site.

Days turned into weeks, and miners had no way to know if they still had jobs, or health insurance, or access to their retirement savings.

On July 29, five miners saw an opportunity. A train full of coal was leaving a Harlan County loading facility. The five men clambered onto the railroad tracks to block the train. More than a week later, they hadn’t left.

“If they can move this train, they can give us our money!” miner Shane Smith said.

That rag-tag group quickly grew to a full-fledged protest camp, complete with solar showers, a chore list, and a rotating schedule of miners to hold the place down. Community members brought food. Politicians stopped by to make speeches.  Kids played cornhole on the tracks.

“We’re suffering, our kids are suffering, water’s getting cut off,” Austin Watts said. “As long as I gotta stay here, I’ll stay.”

Miners_On_Tracks-37Curren Sheldon

Protesting Blackjewel miners in Harlan Co., KY.

Arnold Shepherd, a miner from Leslie County, Kentucky, was among those who said the protest recalled an earlier period in Harlan County history.

“This thing here, it puts you in mind of ‘Bloody Harlan,’ back years ago,” Shepherd said.

Bloody Harlan. The name comes from the nearly century-long and sometimes violent struggle between coal companies and workers seeking to unionize.

“Harlan is one of the locations used to undercut wage stability for the rest of the country,” Northern Illinois Univ. labor historian Rosemary Feurer said. Harlan miners started to organize in the 1920s, a struggle that culminated in a long and violent strike in 1931. Miners picketed again in the early 1970s, again sparking violence. “What the miners were saying is, we can’t be basically just extraction engines and robots and tools left to die of black lung,” Feurer said.

Today, the protest is peaceful. The union is largely gone from Kentucky mines. And the entire coal industry is a fraction of what it was decades ago. Blackjewel’s bankruptcy, though more chaotic than most, is just one of many recent shocks to a declining coal industry. Dozens of companies went under in the past decade, and despite a coal-friendly president rolling back regulations more have followed. In 2019 alone, BlackHawk Group LLC, Cambrian Coal LLC, and Cloud Peak Energy Inc. all went bankrupt.

With lower union representation and an expectation of more bankruptcies to come, miners’ advocates and industry watchers worry that coal miners and mining communities will suffer the brunt of the industry’s decline. The Blackjewel miners who took to the tracks are following in a long history of worker protest in Harlan County. They are also stepping into an uncertain future for themselves and their community.

Scene Of Labor Struggles 

“You have to look at ‘Bloody Harlan’ in a long history of a bloody coal industry,” said labor historian Feurer, who has written about the region and legendary labor organizer Mother Jones.

Feurer said the coal industry pushes the full cost of coal onto workers’ health, on workers’ wages, and on the environment. The United Mine Workers of America, Feurer said, arose from workers’ demands for better treatment.

Robert Gumpert, from the Appalshop Archive

Women of the Brookside women’s support group talk with tow truck operator at a roadblock in 1974.

“It’s not only bloody for the labor violence, but for the death toll,” she said, from mining accidents and black lung disease. “It’s more than most wars.”

The UMWA negotiated its first successful wage increase in 1898, and went on to fight for eight-hour workdays and standard measurement for coal. The union helped miners weather the mining industry’s boom and bust cycles, and many of the union’s hard-won health and safety standards are still in place today.

Mine operators viciously opposed miners’ efforts to unionize, particularly in Harlan County. In the bloody 1930s coal wars, miners known to be union members were fired and evicted from company-owned homes. Soon enough, most miners had gone on strike out of solidarity.

Conflict broke out again the 1970s in what was known as the Brookside strike. Two miners were shot, and one died in a strike that lasted over a year and resulted in a new contract.

Robert Gumpert, from the Appalshop Archive

Victory photo after the Highsplint mine voted to join the UMWA in 1974.

Labor Losses

But union membership is in decline across the country, and the miners’ union has declined faster than most. Between 1997 and 2017, overall mine employment in the Ohio Valley dropped by 50 percent. Union participation has declined much faster. Between 1997 and 2017, Ohio Valley miner participation in unions has dropped by 76 percent.

“The reason that unions have really been imperiled in the southern parts of the country,” said Feurer, “is because they’ve been told the only way the South can rise again is by being a non-union, anti-union reserve for companies that were moving from the unionized areas of the north.”

Alexandra Kanik | Ohio Valley ReSource

Feurer said that even though the Blackjewel miners are acting without a union, their protest follows the tradition of labor action in the area.

“Putting their bodies on the lines is what I see is historically connected,” she said. “People who risk themselves, that is what has resonance to a long body of history.”

The Blackjewel miners still feel a strong sense of solidarity with their fellow workers. “If you work in the coal field, you spend more time underneath that mountain than you do with your own family,” said miner Shane Smith. “These men are like a brother to me.”

Some UMWA retirees and other union workers have joined the Blackjewel miners on the tracks in a show of solidarity.

UMWA spokesperson Phil Smith said he thinks Appalachian coal miners lost their sense for the power of unions in the coal slump in the 1970s. Mine employment was low for nearly a full generation of workers entering the labor force, Smith said, effectively breaking the chain of stories passed from father to son, stories of how unions improved working conditions and fought for better wages.

By 2017 there were no union miners left working in Harlan County, and only a handful in all of Kentucky.

Phil Smith worries that a weak union puts miners at risk of losing protections that previous generations of miners fought for. “The minute that a government who is intent on doing away with many of these worker protections feels like they can without there being any political blow-back from doing it, they’re going to do it,” he said.

Policies like so-called “Right to Work” laws, which have been passed in 28 states, including Kentucky and West Virginia, threaten the economic viability of unions. Still, Smith finds hope in teachers’ strikes around the country, and efforts to unionize other workplaces. “I think we’re seeing a resurgence in people making sure they have a voice at work.”

Curren Sheldon

A quiet moment for miners and their supporters.

Chris Lewis was one of the first five Blackjewel miners who blocked that train on July 29. The bankruptcy has been a struggle, he said, but he and his wife have it better than do workers with young children.

Lewis has complicated views on unions. “I was raised union, and I believe in the union. But I also believe in a man’s right to feed his family, you know what I’m saying?”

He resents miners who call strikebreakers “scabs.” Still, Lewis thinks he and his coworkers wouldn’t be in this predicament if they had been in a union.

After his experience with Blackjewel, Lewis isn’t ready to give up on the industry. But he is giving up on Kentucky. Lewis leaves Kentucky later this month for a job in a coal mine in Alabama. In that new job, he’ll be a part of a union.

‘The end game’

The uncertainty many Blackjewel miners feel about their future is true for the coal industry as a whole. Declining demand and competition from cheap natural gas from fracking has led to the closure of eight coal-fired power plants in the Ohio Valley since 2010, with more planned to shut down in the future.

“No matter what policies are developed and put forward in D.C.,” said the UMWA’s Phil Smith, “the fact of the matter is, coal-fired power plants are closing.”

Additionally, renewable energy makes up an increasing share of the nation’s energy portfolio. For the first time this year, renewable energy exceeded coal in percentage of energy generated in the United States.

In 1997, there were about 18,000 coal jobs in Kentucky. In 2017, there were about 6,200. According to the Appalachian Regional Commission, coal production has fallen most sharply in Central Appalachia compared to other coal-producing regions.

Kentucky Coal Association spokesperson Tyler White said his group is committed to fighting for the longevity of the industry.

“The coal industry is still struggling with a lot of over-burdensome regulations that were put in place under the previous administration,” he said. Most energy analysts contest that view, and point instead to the market forces driving coal’s decline.

Similarly, the UMWA’s Smith said that he’s not ready to give up on coal. He fears significant regulation to prevent further climate climate could put the coal industry out of business, and he views the union’s role as advocating for policies that would promote clean, safe coal mining and keep miners employed for generations.

Blackjewel’s bankruptcy has been messier than most. But Clark Williams-Derry, the director of energy finance for Sightline Institute, a research organization based in Seattle, says we should expect more chaotic bankruptcies like it.

“We’re sort of in the early stages of the end game, I would say, of the coal economy,” he said.

Williams-Derry worries that in the chaos of Blackjewel’s bankruptcy, some mine lands may end up without money to pay for reclamation, and he thinks future bankruptcies may have the same result as fewer companies want to take on risky mines. The costs of worker pensions, land reclamation, and other debts may well be passed on to taxpayers, or left unpaid altogether.

“We’re in uncharted territory,” he said. “We don’t really know what happens when the industry is shrinking so rapidly that we see mines just simply abandoned.”

IMG_4328Brittany Patterson | Ohio Valley ReSource

Blackjewel miners and supporters enter the federal courthouse in Charleston, WV.

Down The Line

A marathon bankruptcy hearing in federal court brought mixed news for the Blackjewel miners. The auction of Blackjewel properties attracted enough buyers to generate money to go toward some of the wages owed, and lawyers representing the miners were able to win some concessions from other Blackjewel creditors.

Still, when attorney Ned Pillersdorf addressed the protesting miners on the tracks, he was clearly managing expectations.

“You know I’ve told you that bankruptcy is kind of like a funeral home,” he said. “Nobody leaves happy.”

Kopper Glo, a Knoxville, Tenn.-based mining company that purchased some of Blackjewel’s Kentucky properties, has committed to pay $450,000 to cover miners’ wages. That is expected to cover about 35 percent of the total amount owed to Blackjewel workers. Kopper Glo has also said it hopes to rehire many of Blackjewel’s workers, though it has made no legal commitment to do so. Blackjewel miners worry Kopper Glo will pay less than Blackjewel did.

“I was a roof bolter, I made $25 an hour,” said Shane Smith. “A belt man, they make $22. A different company comes in, what’s to say everybody won’t make $20?”

Kopper Glo said it could not answer specific questions, but said in a press release that the company “has a plan to re-start certain operations and is confident this plan will bring jobs back to many of the former Blackjewel employees. Kopper Glo is also committed to funding to the portion of the back wages due to the employees.”

Miners_On_Tracks-63 (1)Curren Sheldon

Near the scene of the miners’ protest in Harlan Co., KY.

In days spent occupying the train tracks, the Blackjewel miners have plenty of time to consider what their future holds. Do they return to work and hope their new employer doesn’t meet the same fate as the last? Do they try to retrain in a new industry? Or do they look for another job, knowing they may never make as much money as they did in the mines?

“This ain’t a game, we ain’t a bunch of kids,” said miner Caleb Blevins. “We’re grown men with families. Around here in the Appalachian mountains, this is all we got, the coal mines. We’re too far in to try to go to college for 12 years. Our kids need us now, not in 10 years.”

Miner Tim Madden also just wants to get back to business as usual. “I think if they’d roll up here and issue us all a check, I’d be out of here, end of story.”

But Curtis Cress said he’s done with the industry. “You never know from one day to the next if you’re going to have a job,” Cress said. “They’ll get you used to making a whole lot of money and then take it away.”

A father of four, Cress is at risk of losing his home. He says he feels hopeless about what comes next, both for him and for central Appalachia. He thinks his best bet is to find work in manufacturing. He hopes his kids leave the region when they’re old enough.

The miners occupying the Harlan County train tracks say they’ll stand down when they see Kopper Glo’s money in their bank accounts. With mining starting up again in some of Blackjewel’s former mines, some men will likely be headed back underground.

But for many miners, and for the coal industry as a whole, it’s hard to know what’s coming down the tracks.

Benny Becker, Brittany Patterson and Jeff Young contributed to this story.

Protesting Blackjewel Miners To Get Some Overdue Pay From Bankruptcy Sale  Tuesday, Aug 6 2019 

More than a thousand coal miners left unpaid by the abrupt bankruptcy of Blackjewel mining could soon be getting some – but not all – of the money they are owed. 

Dozens of miners have staged a week-long protest on railroad tracks in Kentucky’s Harlan County, blocking delivery of a load of coal from a Blackjewel mine and demanding their pay.  

A federal court overseeing the Blackjewel bankruptcy Tuesday concluded the sales of the mining company’s properties and equipment, and buyers have put money toward paying some of the roughly $11.8 million in pay and benefits due to miners in Kentucky, Virginia, and West Virginia, most of whom have been without pay for a month. 

“That won’t pay off all of the wages that are due,” labor attorney Sam Petsonk said, “but it’ll be a good downpayment.” 

Petsonk, an attorney with West Virginia’s Mountain State Justice, is representing miners from Blackjewel’s eastern division. He said miners will likely get some back wages but full compensation is still far from guaranteed. 

Miners_On_Tracks-12Curren Sheldon

Miners and supporters hold a meeting along the railroad tracks.

“So additional wages and penalties damages that are owed to the workers will have to come through further litigation,” he said. 

Presiding Judge Frank Volk approved the sale of the mines in West Virginia, Kentucky, and Virginia. A proposal by Contura Energy for Blackjewel’s two Wyoming surface mines remains unresolved pending federal government approval. 

Under an agreement by Kopper Glo Mining LLC to purchase Blackjewel’s Lone Mountain and Black Mountain mines in Kentucky, the company committed to set aside $450,000 to pay former employees owed wages. In addition, the company said it would provide up to $550,000 in additional money to the Kentucky miners from the royalties of the operations at Lone and Black Mountain mining complexes.

The company agreed to pay $6,350,000 cash for the properties as well as royalties for six years totaling more than $9 million. Kopper Glo also agreed to assume responsibility for some bonding liabilities. 

IMG_4328Brittany Patterson | Ohio Valley ReSource

Blackjewel miners and supporters enter the federal courthouse in Charleston, WV.

Employees at West Virginia’s Pax mine are likely to get their full back wages. Buyer Contura Energy, based in Tennessee, said it will create a $5 million fund to pay the employees what they’re owed. 

Rhino Energy LLC paid $850,000 cash and agreed to pay $208,000 in royalties over one year for some of Blackjewel’s Virginia mines. 

Requests for comment to both Kopper Glo and Rhino Energy were not immediately answered. 

It appears no mine buyers made legal commitments to rehire the Blackjewel workers. However, an attorney for Kopper Glo Mining, which purchased mines in Kentucky, said the company intends to hire at least some Blackjewel employees.