# Texas Regulatory Program

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URL: https://www.frixlaw.com/law-library/documents/fr%3A95-30330

## Record

- **Collection:** Federal Register
- **Document type:** Rule
- **Published:** December 13, 1995
- **Citation:** 60 FR 63922

## Text

DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation and Enforcement

30 CFR Part 943

[SPATS No. TX-024-FOR]

Texas Regulatory Program

AGENCY: Office of Surface Mining Reclamation and Enforcement (OSM),
Interior.

ACTION: Final rule; approval of amendment.

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SUMMARY: OSM is approving a proposed amendment to the Texas regulatory
program (hereinafter referred to as the ``Texas program'') under the
Surface Mining Control and Reclamation Act of 1977 (SMCRA). Texas
proposed revisions to its regulations pertaining to self-bonding. The
amendment is intended to revise the Texas program to be consistent with
the corresponding Federal regulations, provide additional safeguards,
and improve operational efficiency.

EFFECTIVE DATE: December 13, 1995.

FOR FURTHER INFORMATION CONTACT:
Jack R. Carson, Acting Director, Tulsa Field Office, Office of Surface
Mining Reclamation and Enforcement, 5100 East Skelly Drive, Suite 470,
Tulsa, Oklahoma 74135-6548, Telephone: (918) 581-6430.

SUPPLEMENTARY INFORMATION:

I. Background on the Texas Program
II. Submission of the Proposed Amendment
III. Director's Findings
IV. Summary and Disposition of Comments
V. Director's Decision
VI. Procedural Determinations

I. Background on the Texas Program

On February 16, 1980, the Secretary of the Interior conditionally
approved the Texas program. Background information on the Texas
program, including the Secretary's findings, the disposition of
comments, and the conditions of approval can be found in the February
27, 1980, Federal Register (45 FR 12998). Subsequent actions concerning
the conditions of approval and program amendments can be found at 30
CFR 943.10, 943.15, 943.16.

II. Submission of the Proposed Amendment

By letter dated August 11, 1995 (Administrative Record No. TX-593),
Texas submitted a proposed amendment to its program pursuant to SMCRA.
Texas submitted the proposed amendment at its own initiative. Texas
proposed to revise 16 Texas Administrative Code 11.221, Texas Coal
Mining Regulations (TCMR) at subsection 806.309(j)(2)(C)(iv) concerning
alternative criteria for acceptance of self-bonds to ensure reclamation
performance.
OSM announced receipt of the proposed amendment in the September
12, 1995, Federal Register (60 FR 47316), and in the same document
opened the public comment period and provided an opportunity for a
public hearing on the adequacy of the proposed amendment. The public
comment period would have closed on October 12, 1995.
During its review of the amendment, OSM identified a concern
relating to TCMR 806.309(j)(2)(C)(iv)(II)(C). Specifically OSM needed
clarification on what effect, if any, Texas' existing 25 percent net
worth limitation provision at TCMR 806.309(j)(5)(A) would have on the
proposed 16\2/3\ percent net worth limitation provision at TCMR
806.309(j)(2)(C)(iv)(II)(C). OSM notified Texas of this concern by
telephone on September 23, 1995 (Administrative Record No. TX-593.03).
By letter dated September 25, 1995 (Administrative Record No. TX-
593.02), Texas responded to OSM's concern by submitting a revision to
its proposed program amendment. Texas proposed an additional revision
to TCMR 806.309(j)(2)(C)(iv) by adding the following clarification
provision.

The limitation contained in subparagraph (II)(C) of this section
applies to applicants or guarantors qualifying pursuant to
subparagraph (II) only and does not affect the limitation set out in
Section 806.309(j)(5)(A) for applicants or guarantors seeking
acceptance of a self-bond pursuant to paragraphs i-iii or
subparagraph (I) of this section.

Based upon the additional explanatory revision to the proposed
program amendment submitted by Texas, OSM reopened the public comment
period in the October 16, 1995, Federal Register (60 FR 53567). The
public comment period closed on October 31, 1995.

III. Director's Findings

Set forth below, pursuant to SMCRA and the Federal regulations at
30 CFR 732.15 and 732.17, are the Director's findings concerning the
proposed amendment.

TCMR 806.309(j)(2)(C)(iv) Self-Bonding: Requirements for a Business and
Governmental Entities, Alternative Financial Eligibility Criteria

1. Existing State Regulation Requirements
Like the Federal self-bonding regulations at 30 CFR 800.23(b)(3)
(i), (ii), and (iii), Texas has standard financial criteria for self-
bonding at Sec. 806.309(j)(2)(C) (i), (ii), and (iii) that are
substantively identical to the corresponding Federal regulations. Under
the State's standard criteria, an applicant can qualify for self-
bonding by meeting one of three criteria that pertain to having either
a bond rating of A or higher; or $10 million net worth and certain
financial ratio values; or having fixed assets of $20 million and
certain financial ratio values.
To provide additional flexibility to financially strong firms,
Texas proposed an alternative four-part test at
Sec. 806.309(j)(2)(C)(iv) that was approved by OSM on February 19,
1992, as an alternative test under the Texas self-bonding program (57
FR 5983). Texas' alternative test allows an applicant to qualify if it
meets four criteria in combination. Specifically, an applicant applying
for self-bonding under Sec. 806.309(j)(2)(C)(iv) must have an
investment-grade bond rating (Sec. 806.309(j)(2)(C)(iv)(I)); tangible
net worth of at least $10 million and fixed assets in the United States
of $20 million (Sec. 806.309(j)(2)(C)(iv)(II)); a ratio of total
liabilities to net worth that is equal to or less than the industry
median (Sec. 806.309(j)(2)(C)(iv)(III)); and a ratio of current assets
to current liabilities that is equal to or greater than the industry
median or a current credit

[[Page 63923]]
rating of 4A2 or higher from Dun and Bradstreet Corporation
(Sec. 806.309)(j)(2)(C)(iv)(IV)).
There is no direct Federal counterpart regulation to Texas'
alternative test for self-bonding. However, as explained in the
February 19, 1992, Federal Register (57 FR 5983), the Director found
that when an applicant for self-bonding in Texas meets the combined
requirements of the alternative test at Sec. 806.309(j)(2)(C)(iv), the
applicant is complying with financial strength and solvency
requirements that are no less effective than the standard financial
safeguards of the Federal regulations at 30 CFR 800.23(b)(3).
2. Proposed State Regulation Requirements
On its own initiative, Texas proposes to recodify and expand the
existing alternative financial criteria at Sec. 806.309(j)(2)(C)(iv) to
provide applicants a choice between two, four-part financial tests. The
State's intention is to maintain consistency with the Federal
regulations while providing flexibility to financially strong
applicants who apply for self-bonding under its alternative eligibility
criteria.
Texas proposes to recodify its existing regulations at
Sec. 806.309(j)(2)(C)(iv) (I)-(IV) as Sec. 806.309(j)(2)(C)(iv)(I) (A),
(B), and (C). This remodified section serves as the first optional
financial test under the State's proposed alternative tests for self-
bonding. Texas proposes to add Sec. 806.309(j)(2)(C)(iv)(II) (A), (B),
and (C). This new section constitutes the second optional financial
test under the State's proposed alternative tests for self-bonding.
The State's proposal allows applicants the option of qualifying for
self-bonding by meeting the combined requirements of either
subparagraph (I) or subparagraph (II) of Sec. 806.309(j)(2)(C)(iv).
These proposed requirements are further discussed below:
a. Investment-Grade Bond Rating (Applicable to both Alternative
Test I and Test II). TCMR Sec. 806.309(j)(2)(C)(iv). First, an
applicant applying for self-bonding under either of the two proposed
alternative financial tests at Sec. 806.309(j)(2)(C)(iv) (I) or (II)
must have an investment-grade rating for its most recent bond issuance
(Baa3 or higher from Moody's Investor Service and BBB- or higher from
Standard and Poor's Corporation). This requirement is identical to the
existing criteria at Sec. 806.309(j)(2)(C)(iv)(I).
In the preamble to the final Federal self-bonding regulations (48
FR 36418, August 10, 1983), OSM stated that ``The services [bond rating
services] are relied upon heavily by creditors and maintain a high rate
of predictive success [about a bond issuer's ability to re-pay bond
issues].'' OSM's allowance of a bond rating of ``A or higher'' in the
Federal regulations as a stand-alone test for self-bonding is based on
reliance on the expertise of the rating service to evaluate the
financial position of a firm. In determining the rating of a bond
issue, rating services conduct an in-depth financial analysis of the
issuer. Using Standard and Poor's rating of bonds issued by public
utilities as an example, some factors that it considers include: (1)
Legal considerations such as the rate covenant (which defines the size
and source of the utility's financial reserve); the flow of funds (or
the priority of claims on the revenue stream); and the legal
implications of energy sales contracts (the company's potential
liabilities); (2) economic considerations such as income trends;
diversification of the employment base (analysis of key local
industries); and growth trends; and (3) systems considerations such as
projected energy growth; generating capacity and fuel sources; and
whether customer profiles indicate that end-users are balanced in terms
of including residential, commercial and industrial customers. Also
considered are the company's capital improvement and financing plans;
the stability and predictability of the revenue stream pledged to pay
debt service; the liquidity position and equity position of the
company; and the financial implications of the regulatory environment.
In the preamble to OSM's final self-bonding regulations, OSM also
explained that since it was allowing a self-bonding applicant to
qualify by meeting one financial test (unlike EPA that requires more
than one test, and thus allows a lower, investment-grade bond rating),
an applicant that selected the bond rating test would have to have
bonds rated ``A or higher.'' This is because the bond rating of ``A or
higher'' is a stand-alone test in the Federal regulations. While not
specifically addressed by OSM in its final regulations on self-bonding,
it follows that a State's self-bonding program that requires an
applicant to meet multiple financial criteria in addition to having an
investment-grade bond rating is no less effective than the Federal
regulations that allow a bond rating of ``A or higher'' as a stand-
alone financial test.
As an additional safeguard, Texas is requiring applicants to notify
the Commission of any rating change to a lower bond rating than the
applicant had at the time the self-bond was approved. If an applicant's
rating is down-graded, then the Commission will immediately hold a
hearing to decide whether the applicant may remain in the self-bonding
program. This requirement is in addition to the existing requirement at
Sec. 806.309(j)(8) for applicants to notify the Commission if it no
longer meets the criteria at (2)(C) and (2)(D) of the self-bonding
regulations.
b. Alternative Test I. TCMR 806.309(j)(2)(C)(iv)(I)(A). Under
subparagraph (I)(A), Texas proposes to recodify the exiting
requirements at Sec. 806.309(j)(2)(C)(iv)(II) [wherein an applicant
must demonstrate that it has a tangible net worth of at least $10
million and fixed assets in the United States totaling at least $20
million]. Other than recodifying this section, no changes are proposed;
therefore, the requirements at Sec. 806.308(j)(2)(C)(iv)(I)(A) are no
less effective than the Federal self-bonding requirements at 30 CFR
800.23(b)(3).
TCMR 806.309(j)(2)(C)(iv)(I)(B). Texas is revising requirements at
Sec. 806.309(j)(2)(C)(iv)(III) to provide flexibility under the
recodified subparagraph at Sec. 806.309(j)(2)(C)(iv)(I)(B). The State
is revising this sub-part to provide an optional test whereby an
applicant must demonstrate that it has either a ratio of total
liabilities to net worth of 2.5 or less or a ratio of total liabilities
to net worth that is equal to or less than the industry median reported
by Dun and Bradstreet Corporation for the applicant's primary SIC code.
A ratio value of 2.5 or less is the current standard test in the
State's self-bonding program at Sec. 806.309(j)(2)(C) (ii) and (iii),
and in the Federal regulations at 30 CFR 800.23(b)(3) (ii) and (iii).
Therefore, allowing applicants the option of meeting either the
standard ratio value of 2.5 or less, or having a ratio value that is
equal to or less than the industry median is no less effective than the
Federal regulations for reasons further explained below.
The rationale for comparing an applicant's ratio of total
liabilities to net worth to the industry median was discussed in detail
in the preamble to the final Texas rule (57 FR 5983, February 19,
1992). Industry medians reflect the relative financial status of firms
within an industry classified by net worth. Comparing a firm with
current industry medians is more meaningful than comparing it with
static values for financial ratios that represent the conditions of an
industry at an historical point in time. OSM determined that ratio
values that are keyed to an applicant's industry

[[Page 63924]]
medians are an appropriate measure of how the applicant performs
financially in comparison to the rest of its industry. On this basis,
OSM approved the use of industry median values in lieu of the standard
value of 2.5 or less. However, since OSM's approval of Texas'
alternative self-bonding test on February 19, 1992, changes have
occurred in general financial accounting requirements resulting in
industry median values that do not consistently reflect the true
comparative financial strength of applicants for self-bonding.
For example, the Financial Accounting Standards Board (FASB) has
issued new accounting standards that firms must follow in order to be
in compliance with Generally Accepted Accounting Principles (GAAP). One
such standard is the ``Statement of Financial Accounting Standards No.
109, `Accounting for Income Taxes' '' (SFAS 109) issued in 1991. The
effects of SFAS 109 and another accounting standard, ``Employer's
Accounting for Postretirement Benefits Other than Pensions'' (SFAS
106), are complex and affect both sides of a firm's balance sheet in a
variety of ways.
Upon review, ratio values for a firm that has adopted SFAS 106
(post-retiree health benefits) may not compare well with ratio values
for a firm that has not yet adopted the standard or a firm that is on
different implementation schedule. On the other hand, a firm that has
adopted SFAS 109 (accounting for deferred income taxes) may appear
financially stronger than it actually is. Accounting for deferred tax
assets is an example. In an article entitled ``Evaluating Deferred-Tax
Assets: Some Guidance for Lenders'' (Commercial Lending Review, July
1994, pp. 12-25), Eugene Comiskey and Charles Mulford state that
``deferred tax assets result in increases to earnings, assets, and
shareholders' equity which in essence do not increase the financial
strength of the firm from that before adoption of FASB 109 [SFAS
109].'' The authors advise that deferred tax assets ``especially those
recorded for various tax carryforwards, share features with intangible
assets--assets that are often deducted from equity in the measurement
of tangible net worth in debt covenants.'' These examples illustrate
the many complexities involved in analyzing the interdependent effects
that recent FASB standards have had on the financial status of self-
bonding applicants. Therefore, Texas proposes to revise its alternative
test to allow financially strong applicants the flexibility of
qualifying by either having a ratio of total liabilities to net worth
that meets the standard criteria (2.5 or less) or a ratio value that
meets the industry median test.
Changes to accounting standards notwithstanding, ratio analysis
based on industry medians, (industry norms) has merit when comparing
firms with similar conditions (net worth and asset size) in the same
industry. However, not all firms are adopting the FASB financial
accounting standards during the same accounting year and/or in the same
manner; so the industry medians do not always reflect a level financial
playing field for the purpose of comparing a firm to its industry.
Under the State's proposal, an applicant that meets the standard
criterion, 2.5 or less for the ratio of total liabilities to net worth,
satisfies the Federal ceiling for this ratio under the Federal
regulations at 30 CFR 800.23(b)(3) (ii) and (iii). In addition, the
ratio criterion based on comparison with the industry median is an
approved financial test in the State's existing alternative criteria
for self-bonding. Therefore, Texas' proposed revision at
Sec. 806.309(j)(2)(C)(iv)(I)(B) that allows an applicant the option of
qualifying under either of these two ratio criteria is no less
effective than the Federal regulations.
TCMR 806.309(j)(2)(C)(iv)(I)(C). Under subparagraph (I)(C), Texas
proposes to recodify the existing State requirement at
Sec. 806.309(j)(2)(iv)(IV). Other than recodifying this section, no
changes are proposed. Therefore, the State's proposed requirements at
Sec. 806.309(j)(2)(iv)(I)(C) are no less effective than the Federal
regulations.
c. Alternative Test II. TCMR 806.309(j)(2)(C)(iv)(II). Applicants
applying for self-bonding under the Federal regulations at 30 CFR
800.23(b)(3) (ii) and (iii) and under the State's standard self-bonding
test at Sec. 806.309(j)(2)(C) (ii) and (iii) are required to have
certain financial ratio values that indicate solvency and a reasonable
liquidity position. Rather than measuring an applicant's liquidity
position by requiring certain values for the ratio of current assets to
current liabilities and the ratio of total liabilities to net worth,
Texas is proposing alternative criteria to demonstrate financial
strength.
In OSM's final self-bonding rules (48 FR 36418, August 10, 1983),
OSM indicated that the self-bonding program was established at 30 CFR
800.23 for firms that could demonstrate a low likelihood of bankruptcy,
debts that are not disproportionate to assets, and reasonable
liquidity. OSM also stated that the ``New Sec. 800.23 allows a State to
develop a comprehensive self-bonding program to balance the risk of
forfeiture versus the benefits to financially sound operators of a
self-bonding program,'' and that . . . ``These final rules [Federal
regulations] contain standards general enough to take into account
state-specific conditions.'' To recognize variability among financially
strong industries mining coal in Texas, the State proposes to add a
second set of alternative criteria to provide financially strong
applicants an additional option for demonstrating liquidity and
financial strength. This proposed alternative test will provide
flexibility and increase the availability of the self-bonding program
without jeopardizing the level of reclamation assurance.
Texas' new proposed alternative test at
Sec. 806.309(j)(2)(C)(iv)(II), consists of three subparagraphs. All
financial criteria (including the investment-grade bond rating
discussed above) must be met in combination in order for an applicant
to qualify for self bonding under this proposed alternative test.
TCMR 806.309(j)(2)(C)(iv)(II)(A). Texas is proposing that an
applicant applying for self-bonding have a net worth of at least $100
million and fixed assets in the United States totaling at least $200
million. These proposed levels of net worth and fixed assets are ten
times greater than the $10 and $20 million respective levels required
by the standard self-bonding criteria at Sec. 806.309(j)(2)(C) (i),
(ii), and (iii), and the counterpart Federal regulations at 30 CFR
800.23(b)(3) (i), (ii), and (iii). Intangible assets such as goodwill,
patents, royalties, and trademarks (if any) are included in the
calculation of net worth in this proposal; whereas in the existing
approved alternative test and standard criteria, intangible assets are
not counted in the calculation of net worth. However, the Director
finds that a tenfold increase in the required level of net worth from
$10 million to $100 million provides assurance, no less effective than
the Federal regulations, that sufficient assets should be available to
conduct reclamation and avoid bankruptcy. Since the levels of net worth
and fixed assets under this proposal require financial strength levels
that are higher than the existing levels in the Federal counterpart
regulations at 30 CFR 800.23(b)(3) (i), (ii), and (iii), the State's
requirements at Sec. 806.309(j)(2)(C)(IV)(II)(A) are no less effective
than the Federal regulations.
TCMR 806.309(j)(2)(C)(IV)(II)(B). Under subparagraph (II)(B), the
Texas proposal requires the applicant to have issued securities in
accordance with the requirements of the Securities Act of 1933, and
that the applicant is subject to the periodic financial reporting

[[Page 63925]]
requirements established by the Securities and Exchange Act of 1934. To
protect investors, the Securities and Exchange Commission (SEC) has
stringent financial disclosure and reporting requirements for issuers
of securities.
Annual reports filed with the SEC are readily available public
filings that require disclosure of detailed financial and business
information that exceeds the level of detail usually found in a firm's
annual report to its stockholders. Like the Federal self-bonding
program, whether or not Texas accepts a qualified applicant's self-bond
is discretionary with the State. In making this decision, the State is
not limited to the materials filed by an applicant. In its analysis of
an applicant's qualifications, Texas can calculate financial ratios
from the applicant's balance sheet data, compare an applicant's ratios
to industry norms, and conduct any number of other financial tests to
determine whether an applicant is a good candidate for self-bonding.
Having an applicant's SEC financial information at its disposal places
the State in a position to make an informed decision about a self-
bonding applicant's qualifications. For example, in addition to
requiring that financial statements be prepared in conformance with
GAAP, Section 78m.(b)(2)(B) of the Securities and Exchange Act requires
firms to assure that safeguards are present to protect assets.
Protecting assets helps assure reasonable liquidity which is one of the
requirements for qualifying under the Federal and Texas self-bonding
programs.
In lieu of using financial ratios to measure liquidity, Texas is
proposing that under this alternative test applicants meet a
combination of requirements including: stringent SEC financial
reporting, an investment-grade bond rating, and net worth that is six
times the total amount of the applicant's outstanding and proposed
self-bonds. Meeting the combined financial requirements of Texas'
proposed alternative test will assure that an applicant has reasonable
liquidity and a low risk of bankruptcy. The requirement for net worth
that is six times the total self-bonded amount is further discussed
under subparagraph (C) below.
TCMR 806.309(j)(2)(C)(iv)(II)(C). Like the Federal self-bonding
regulations at 30 CFR 800.23, an applicant applying for self-bonding
under Texas' standard test at Sec. 806.309(j)(2)(C) (i), (ii), and
(iii) and an applicant applying for self-bonding under the first of
Texas' alternative tests at Sec. 806.309(j)(2)(C)(iv)(I) may not have
outstanding and proposed self-bonds that are greater than 25 percent of
the applicant's tangible net worth in the United States. In other
words, tangible net worth must be four times the outstanding and
proposed self-bonded amount. Tangible net worth is used as the basis
for comparison with the amount of proposed and outstanding self-bonds
because intangible assets such as goodwill, patents, royalties, and
trademarks are difficult to evaluate and liquidate. Under the new
alternative at Sec. 806.309(j)(2)(C)(iv)(II)(C), Texas is proposing
that an applicant's total outstanding and proposed self-bond amount not
exceed 16\2/3\ percent of the applicant's net worth in the United
States. In other words, net worth [including intangible assets] must be
six times the amount of outstanding and proposed self-bonds. Under this
proposal, Texas is allowing the basis of comparison to be total net
worth including the calculation for intangible assets. However, the
Director finds that the inclusion of intangible assets in this
calculation is offset by the State's proposal to increase the ratio of
net worth to self-bond amount to six times rather than four times. This
proposed increase to the required level of net worth should provide
assurance that a self-bonded permittee has sufficient assets to perform
reclamation and stave off bankruptcy. Therefore, under this proposed
second alternative test at Sec. 806.309(j)(2)(C)(iv)(II), Texas is
requiring that an applicant have a greater financial cushion to protect
the State should it be required to attempt to recover self-bonded
amounts from the applicant's assets in the event the applicant files
for bankruptcy.
In the preamble to the final Federal self-bonding regulations (48
FR 36418, August 10, 1983), OSM responded to a commenter who
recommended a 6 to 1 ratio of net worth to self-bonded amount in the
Federal regulations ``to be more in keeping with the rates used by the
surety industry.'' OSM responded by saying that ``Although the
requirements of these rules are such that only well-established,
financially solvent business entities will qualify for self-bonding,
there is always an element of risk involved in underwriting the
obligations for such companies. The 25 percent restriction provides a
financial cushion, in the event that a self-bonded entity should fail,
to allow the regulatory authority to attempt to recoup self-bonded
amounts from the assets of the bankrupt entity. A 6 to 1 ratio is
considered overly restrictive, especially in light of other required
financial tests [at 30 CFR 800.23(b)(3)].'' The State's proposal for a
6 to 1 ratio of net worth to self-bonded amount plus meeting a
combination of three additional financial tests (investment-grade bond
rating, $100 million net worth plus $200 million domestic fixed assets,
and SEC financial reporting) is no less effective than the Federal
regulations that require a 4 to 1 ratio of tangible net worth to self-
bonded amount plus meeting one of three stand-alone financial tests
(bond rating of A or higher; or $10 million tangible net worth plus 1.2
or greater current ratio of assets to liabilities plus 2.5 or less
ratio of total liabilities to net worth; or $20 million domestic fixed
assets plus the same ratio values as stated above).
d. Based on the above discussions, the Director finds that Texas'
proposed financial criteria at TCMR 806.309(j)(2)(C)(iv) (I) and (II)
are either already contained in Texas' existing approved alternative
test for self-bonding or provide financial options for the new proposed
alternative test that are no less effective at measuring financial
strength and reasonable liquidity than the Federal self-bonding
regulations at 30 CFR 800.23(b)(3).

IV. Summary and Disposition of Comments

Public Comments

The Director solicited public comments and provided an opportunity
for a public hearing on the proposed amendment. No one requested an
opportunity to speak at a public hearing; therefore, no hearing was
held.
Texas Utilities Services Inc. provided written support for the
proposed amendment (Administrative Record No. TX-593.07).

Federal Agency Comments

Pursuant to 30 CFR 732.17(h)(11((i), the Director solicited
comments on the proposed amendment from various Federal agencies with
an actual or potential interest in the Texas program (Administrative
Record No. 593.01).
On September 15, 1995 (Administrative Record No. TX-593.06), the
U.S. Bureau of Land Management commented that the revised regulations
addressed by the documents appear to exceed Federal coal standards. On
September 18, 1995 (Administrative Record No. TX-593.04), the U.S. Army
Corps of Engineers acknowledged that the revisions were satisfactory.
On October 2, 1995 (Administrative Record No. TX-593.08), the Natural
Resources Conservation Services responded without comment.

Environmental Protection Agency (EPA)

Pursuant to 30 CFR 732.17(h)(11)(ii), OSM is required to obtain the
written

[[Page 63926]]
concurrence of the EPA with respect to those provisions of the proposed
program amendment that relate to air or water quality standards
promulgated under the authority of the Clean Water Act (33 U.S.C. 1251
et seq.) or the Clean Air Act (42 U.S.C. 7401 et seq,). However, none
of the revisions that Texas proposed to make in this amendment pertain
to air or water quality standards. Therefore, OSM did not request EPA's
concurrence.
Pursuant to 732.17(h)(11)(i), OSM solicited comment on the proposed
amendment from EPA (Administrative Record No. TX-593.01). EPA did not
respond to OSM's request.

State Historical Preservation Officer (SHPO) and the Advisory Council
on Historic Preservation (ACHP)

Pursuant to 30 CFR 732.17(h)(4), OSM is required to solicit
comments on proposed amendments which may have an effect on historic
properties from the SHPO and ACHP. OSM solicited comments on the
proposed amendment from the SHPO and ACHP (Administrative Record No.
TX-593.01). Neither SHPO nor ACHP responded to OSM's request.

V. Director's Decision

Based on the above findings, the Director approves the proposed
amendment as submitted by Texas on August 11, 1995, and as revised on
September 25, 1995, concerning self-bonding alternative financial
requirements for a business and governmental entities.
The Director approves the rules as proposed by Texas with the
provision that they be fully promulgated in identical form to the rules
submitted to and reviewed by OSM and the public.
The Federal regulations at 30 CFR 943, codifying decisions
concerning the Texas program, are being amended to implement this
decision. This final rule is being made effective immediately to
expedite the State program amendment process and to encourage States to
bring their programs into conformity with the Federal standards without
undue delay. Consistency of State and Federal standards is required by
SMCRA.

VI. Procedural Determinations

Executive Order 12866

This rule is exempted from review by the Office of Management and
Budget (OMB) under Executive Order 12866 (Regulatory Planning and
Review).

Executive Order 12778

The Department of the Interior has conducted the reviews required
by section 2 of Executive Order 12778 (Civil Justice Reform) and has
determined that, to the extent allowed by law, this rule meets the
applicable standards of subsections (a) and (b) of that section.
However, these standards are not applicable to the actual language of
State regulatory programs and program amendments since each such
program is drafted and promulgated by a specific State, not by OSM.
Under sections 503 and 505 of SMCRA (30 U.S.C. 1253 and 1255) and the
Federal regulations at 30 CFR 730.11, 732.15, and 732.17(h)(10),
decisions on proposed State regulatory programs and program amendments
submitted by the States must be based solely on a determination of
whether the submittal is consistent with SMCRA and its implementing
Federal regulations and whether the other requirements of 30 CFR Parts
730, 731, and 732 have been met.

National Environmental Policy Act

No environmental impact statement is required for this rule since
section 702(d) of SMCRA (30 U.S.C. 1292(d)) provides that agency
decisions on proposed State regulatory program provisions do not
constitute major Federal actions within the meaning of section
102(2)(C) of the National Environmental Policy Act (42 U.S.C.
4332(2)(C)).

Paperwork Reduction Act

This rule does not contain information collection requirements that
require approval by OMB under the Paperwork Reduction Act (44 U.S.C.
3507 et seq.).

Regulatory Flexibility Act

The Department of the Interior has determined that this rule will
not have a significant economic impact on a substantial number of small
entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).
The State submittal which is the subject of this rule is based upon
corresponding Federal regulations for which an economic analysis was
prepared and certification made that such regulations would not have a
significant economic effect upon a substantial number of small
entities. Accordingly, this rule will ensure that existing requirements
previously promulgated by OSM will be implemented by the State. In
making the determination as to whether this rule would have a
significant economic impact, the Department relied upon the data and
assumptions for the corresponding Federal regulations.

List of Subjects in 30 CFR Part 943

Intergovernmental relations, Surface mining, Underground mining.

Dated: February 1, 1995.
Brent Wahlquist,
Regional Director, Mid-Continent Regional Coordinating Center.
For the reasons set out in the preamble, Title 30, Chapter VII,
Subchapter T of the Code of Federal Regulations is amended as set forth
below:

PART 943--TEXAS

1. The authority citation for Part 943 continues to read as
follows:

Authority: 30 U.S.C. 1201 et seq.

2. Section 943.15 is amended by adding paragraph (1) to read as
follows:

Sec. 943.15 Approval of regulatory program amendments.

* * * * *
(1) The revisions to the following regulations at 16 Texas
Administrative Code 11.221, the Coal Mining Regulations of the Railroad
Commission of Texas, as submitted to OSM on August 11, 1995, and as
revised on September 25, 1995, are approved effective December 13,
1995.

TCMR 806.309(j)(2)(C)(iv) (I)(A), (B), and Self-bonding: financial
(C). requirements for a
business and governmental
entities, Alternative
Financial Eligibility
Criteria Test I.
TCMR 806.309(j)(2)(C)(iv) (II)(A), (B), and Self-bonding: financial
(C). requirements for a
business and governmental
entities, Alternative
Financial Eligibility
Criteria Test II.

[FR Doc. 95-30330 Filed 12-12-95; 8:45 am]
BILLING CODE 4310-05-M

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A95-30330. Public record. Not legal advice.