A report from the Government Accounting Office (GAO) indicates that the Black Lung Trust Fund might be headed for financial trouble if a new tax cut goes into effect. Mining advocates say that the taxes that coal companies already pay into the fund are enough and that any increases would burden the coal industry. Meanwhile, cases of black lung are increasing and lawmakers are worried about the fund’s longevity.

https://www.gao.gov/assets/700/692103.pdf

The GAO released their examination of the fund and found they could face a deficit by 2050 due to a decline in coal production and a reduction in a tax that companies pay into the fund. The fund was created in 1969 for coal miners who suffer debilitating pneumoconiosis as a result of their work in mines. Pneumoconiosis is a disease caused by inhaling coal dust. Workers who are totally disabled from the disease receive payments for monthly wages and medical treatments. Surviving dependents receive monthly wages from the fund. Wages currently range from $650 to $1,300 a month, and medical care can average $6,980 per miner.

Currently coal companies pay a $1.10 per ton tax on underground coal production. If the tax cut goes into effect in 2019 they will pay $.50.

In 2017 the fund paid out $184 million in benefits and made $450 million in revenue but borrowed $1.3 billion from the Department of the Treasury to cover debt repayment. Revenue from the tax is decreasing because of declining production and competition due to other energy sources. The fund could be $15 billion in debt by 2050 based on their projections. The report suggested several ways to reduce this debt, but the only way to eliminate the debt would be to stop borrowing money and increase the tax by 25%.

Bruce Watzman, an executive at the National Mining Association, says that increasing the tax would burden an already strapped coal industry. He supports congressional action that would forgive the debt. Even with debt forgiveness the GAO projects a deficit of $2.3 billion by 2050, and that also shifts the burden from coal companies to taxpayers.

“Coal operators caused this problem, and they are the ones who should be responsible for funding the compensation these workers receive,” says Cecil Roberts, international president of the United Mine Workers of America.

Read the report from the GAO and more on the story here and here.