Stimulus loans meant to help small businesses hurt by the coronavirus pandemic are being doled out to coal companies, stoking criticism from environmentalists that the Trump administration is using the aid to help a preferred industry that was already in financial trouble.
“The question is, is this a good use of taxpayer dollars when we have other businesses closing their doors? What is the long term viability of this industry?” said Jayson O’Neill, director of the Western Values Project, a Montana-based conservation group. “I would argue we should focus first on the small businesses that are in the most need.”
Among the recipients are
The stimulus program has drawn criticism for other awards, including loans to
The coal company funding came after the industry successfully lobbied the
The industry, which also asked
In fact, the mining industry, which includes coal and other minerals as well as oil and gas extraction companies, tapped the first, $349 billion installment of the Paycheck Protection Program at a higher rate than other industries, a Bloomberg News analysis of payroll data found. Approved PPP loans covered more than 78% of the industry’s eligible payroll compared to an average for all industries of 52%.
One possible explanation is that SBA classifies many mining and extraction companies as small even if they have more than 500 employees, the standard for most other industries. Bituminous coal underground mining businesses, for example, can have as many as 1,500 employees and still qualify for PPP loans. Overall, the mining sector got 1.14% of Paycheck Protection Program loans, according to SBA data through April 16.
“The industry is experiencing many of the same challenges confronting so many other industries and deserves the same support,” said
Jennifer F. Kelly, a SBA spokeswoman, said it “is following the law as it executes the PPP program as defined by the Cares Act passed by Congress.”
Lexington, Kentucky-based Ramaco Resources received an $8.44 million loan on April 17. The company, which has 395 employees and didn’t respond to a request for comment, said in a
In some cases, companies with ties to the Trump administration have received aid.
Rhino Resource Partners, which has 605 employees and is also based in Lexington, Kentucky, received a $10 million stimulus loan, the maximum allowed under the PPP program, according to a company
American Resources, an Indiana-based mining company, received a $2.7 million loan on April 22, according to a
“During these unique and trying times, we are taking the opportunity to keep people working and are actively taking this opportunity to advance our environmental efforts as well as maintenance of our existing operations to put us in a position to grow our infrastructure platform once we get past Covid-19,”
Coal miner and seller Hallador Energy, which hired former
“The Paycheck Protection Program was set up to help working families keep the lights on and put food on the table, not enrich corporate shareholders,” said Ryan Schleeter, a spokesman for environmental group
At least one opponent of the coal industry says its receipt of Paycheck Protection Program funding defies the purpose of a program established to help businesses survive the economic downturn brought on by the pandemic.
“The coal industry stands out as the member of the fossil fuel herd that was uniquely sick before Covid ever hit and is even worse off after. So this isn’t a bailout -- that would require strong economic fundamentals in the first place,” said Justin Guay, director of global climate strategy for the Sunrise Project, an environmental group. “This is a bonfire -- we’re just literally lighting our taxpayer dollars on fire because they will go bankrupt regardless. It’s just a matter of time.”
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