Feds Partially Greenlight Ohio's Mining Bond Overhaul and Fixes
Published Date: 8/7/2026
Rule
Summary
The Office of Surface Mining Reclamation and Enforcement (OSM), is approving, in part, two amendments to the Ohio regulatory program (the Ohio program) under the Surface Mining Control and Reclamation Act of 1977 (SMCRA or the Act). As proposed by Ohio, the amendment involves statutory and regulatory changes to its bonding program (i.e., revising Ohio's alternative bonding system and providing the option for an applicant to post full-cost performance securities) and also includes statutory and regulatory changes pertaining to other subjects, such as abandoned mine land program funding, permitting standards, valid existing rights, remining, blasting, and topsoil handling. Ohio submitted this amendment, in part, to satisfy a program condition related to bonding inadequacies. We are removing this program condition.
Analyzed Economic Effects
8 provisions identified: 2 benefits, 3 costs, 3 mixed.
Choice: Full‑Cost Bonding or $2,500/Acre Pool
If you operate a coal mine in Ohio, you can now choose to post a site‑specific, full‑cost performance security or elect Ohio's alternative bonding system (bond pool). If you join the bond pool you must post a flat‑rate performance security of $2,500 per acre and pay an additional severance tax on each ton of coal produced; any shortfall between the $2,500/acre and DMRM's estimated reclamation cost can be paid from the Reclamation Forfeiture Fund. The State kept a $10,000 minimum total bond requirement that applies to either method.
Bond Pool Eligibility: 5‑Year Requirement and Transfers
To be eligible to join Ohio's bond pool, the applicant (or an owner/controller/affiliate) must have held a permit issued under Ohio law for at least five years. If a permit is transferred, assigned, or sold, a transferee who does not meet the five‑year requirement is not eligible for the bond pool even if the permit name stays the same.
Flat‑Rate Increase Triggered to $5,000/Acre
Ohio law allows DMRM to require a higher flat‑rate performance security for bond‑pool participants: if a cessation order is issued for failure to abate a contemporaneous reclamation violation, the State may increase the flat‑rate performance security from $2,500 per permitted acre to $5,000 per permitted acre. The State notifies permittees and interested parties before adjustments.
Permit Fee Removed; Severance Tax Funding Increased
Ohio removed the prior $75 per acre permit application and renewal fee and instead increased the severance tax on coal production to fund program administration and the Reclamation Forfeiture Fund. Civil penalties are also directed into the Reclamation Forfeiture Fund.
Trust Funds Accepted as Performance Security
Ohio added 'trust funds' to the list of acceptable forms of performance security. A trust fund must name the State as the primary beneficiary and be in an amount sufficient to complete reclamation for any areas that may default at any time.
State Determines Reclamation Cost; Applicants Provide Detail
Ohio removed the requirement that applicants submit their own per‑acre estimated reclamation cost and instead requires applicants to include detailed information in the reclamation plan so DMRM can determine the estimated cost used to set full‑cost performance security.
Permittee Bond Reductions and Adjustment Process
A permittee may request a reduction in full‑cost performance security by submitting documentation showing the posted amount exceeds the estimated reclamation cost; the State will review and notify the permittee of any allowed reduction. Bond adjustments (increases or decreases) follow a notice process and applicants may request an informal conference.
Cash/Certificate Providers Must Be Ohio‑Licensed
If your performance security is a cash deposit or a certificate of deposit, the bank or savings & loan must be licensed and operating in Ohio, and DMRM will review the performance security documents.
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Related Federal Register Documents
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